Charities

Print FriendlyPrint This Article

1 Debates: Charity regulator

The Seanad debated the continuing delays in establishing the post of charity regulator,  on foot of a motion introduced by Mary Ann O’Brien (ind, Taoiseach nominee) (Seanad Eireann, Debates, 1st May 2013, 924-948).    She told the Seanad that a drip-feed of stories on the charities sector had become damaging, citing reports that an ex-CEO had helped himself to ATMs all over the country and that was why she wished to push for the regulator post: ‘we cannot wait until 2015 or 2016, she said.

 Fiach Mac Conghail (ind, Taoiseach nominee) spoke of how Ireland was unique in not having a charity regulator.  The vast majority of charities had nothing to hide.  Publishing the costs of running a not-for-profit company would only benefit the company, create transparency and build trust, he said.  Putting in place a dedicated charities regulator would help to enhance public trust and confidence, allowing charity to flourish and reach its full potential, especially in supporting government policy on fund-raising and philanthropy.  Likewise, Colm Burke (FG, industrial & commercial) said it was important that proper structures be put in place to ensure proper accounting and auditing procedures be adhered to.  Denis O’Donovan (FF, agricultural) added that charities did ‘tremendous work’, but there was ‘a small minority of charities that muddy the waters and do damage to the very foundation of Irish hospitality and generosity toward charities’. 

Speaking for the government, the Minister for Justice & Equality Alan Shatter told the Seanad that when the regulatory system were put in place it would align oversight of the charities sector with the recommendations of the international Financial Action Task Force, which had the remit of promoting effective measures against money laundering and terrorist financing, where the non-profit sector was vulnerable to abuse for funding terrorism.  Very few people would associate charities with terrorism and the possibility of laundering funds.  

The department was now working to develop proposals to bring key provisions of the Act into force on a phased, low-cost basis.  In January, he had published proposals for implementing  key provisions of the Act.  Delays in implementation had understandably led to some frustration on the part of stakeholders and on his part as well, but it had been entirely due to the reduction in the resources available to his department.  160 written submissions had been received and they were currently being reviewed by the department.  He hoped to bring proposals to government, following which the submission would be published where consent had been given, as it had in most cases.  He also hoped then to give a firm indication of the process and timeframe for the establishment of the charities regulatory authority.

It was also important to recognize that the charities sector was at present far from unregulated.  He commended the guiding principles for charitable fund raising developed by Irish Charities Tax Research, for which his department had provided grant support.  Although sign-up to the principles had been growing in recent months, unfortunately so far only a small number of charities had committed to them.  He saw no reason why the overwhelming majority of charities should not make such a commitment.  The minister concluded by mentioning that the national giving campaign, aiming to increase private giving by 10% each year to 2016, would be launched later this year.

‘Those who put their best foot forward are clamouring for the implementation of the Act’, said John Whelan (Lab, labour).  They had been imploring the government to get on with it.  Charities had been embracing the consultation process.  We could no longer say that there was a cost or structural impediment to prevent us getting on with it.  Feargal Quinn (ind, National University) spoke of how, given that the state gave so much money to charities, there must be more impetus on the government department side to audit accounts.  In CEO salaries, there was murkiness.  There was a report last year that four charities that shared millions of euros in state funding every year had refused to reveal how much their chief executives were paid.  While more transparency would hopefully mean more donations in the long term, some charities will simply have to get away from the murkiness that surrounded them.  The press, others and we here could help by spotlighting these charities.  He hoped that ‘we do not do it five or ten years late and then pat ourselves on the back’.

Likewise, Eamonn Coghlan (ind, Taoiseach nominee) spoke of policing the area.  People came to Crumlin hospital offering to sell clothes in its name and they even had a company proposing to sell tyres while using the name of the hospital as a benefit to itself.  Only 10% of the funds raised in parachute jumps went to the charity.  ‘We had to get rid of those and tell them they were not welcome’.  They even had farmers splitting up fields into a grid and running a sweep on where the cows’ calls of nature would land and ‘one can guess where we told them to go’.  It was becoming exceptionally difficult to control well-intentioned individuals and groups who wanted to raise funds – ‘they feel that can just set up shop and go about raising funds without any rules, regulations or guidelines’.   There were also fly-by-night organizations, bogus individuals purportedly collecting for good causes which bring down the name and reputation of genuine charitable organizations, damaging the trust enjoyed by them.  This could only be stopped by establishing the charities regulatory authority.  It had been indicated earlier that lack of funding was the only reason it had not been set up, but ‘we cannot use this as an excuse.  The authority must be up and running soon.’  Time was running out, he concluded.

Labhras O Murchu (FF, cultural & educational) told the Seanad that but for charities, responsibility would fall back on the state.  He recalled the sense of urgency that existed when the Charities Act was enacted in 2009.  People were given the opportunity to feed in their experiences and practical understanding of what was involved. ‘We can imagine how they must feel now that we are told, four years later, that one of the reasons why provisions have not been implemented is their cost’.   It was wrong and unfair that the Act had not been implemented.  In this case, austerity was self-defeating.   

Jillian van Turnhout (ind, Taoiseach nominee) said that when it came to compliance, charities were working in a vacuum.  Martin Conway (FG, administrative) returned to the issue of salaries, because last year the Health Service Executive had requested that charities which it funded declared their bonuses, but they refused to do so because they were paid from charitable contributions.  Chief executives’ salaries, bonuses, expenses, pension contributions and perks should be freely-available information.  That which was expected in public bodies and politics should also be expected in charities.  It was regrettable that vast swathes of the Charities Act had not been implemented.  He did not believe that resources were an issue because this would save money.

 

David Cullinane (SF, labour) told the house that the state had an obligation to make sure that the basic needs of citizens were met and people cared for from the cradle to the grave.  Putting food on the table, making sure that children were properly clothed and had enough income to heat their homes, pay utility and other bills and gain access to education were basic requirements that should be met.  Austerity policies had impacted primarily on the most vulnerable in society, resulting in families and individuals depending on charities to put food on the table, oil in the tanks, send children to school, put clothes on their back and even pay mortgages and utility bills.  That was the reality for any of us dealing with people on a daily basis in our communities.  People coming to clinics were increasingly saying that they were going to the Society of St Vincent de Paul or the Simon Community.  More and more people were depending on charities because the state was failing to meet their requirements.  He had long supported charity regulation, for its urgency was underpinned by the fact that the voluntary Standards Of Recommended Practice (SORP) were adopted by 20% of charities, with 20% planning to adopt it but 60% had no plans to adopt it.

David Norris (ind, Dublin University): ‘Can we please have some law?’ He sometimes saw eight charities with 20 young people out collecting.  He did not begrudge charities the money, but the sector should be regulated properly.  There were other people who paid young people, very often foreign students, to collect money for them.  He wondered how this should be regulated, but it should be regulated.  He had reported to the Garai on people who dropped in little notices asking for old clothes for charity, giving a telephone number one could ring, but when he phoned repeatedly, nobody replied: it was a scam and only the thin end of the wedge.  Enormous trailers of clothes were being loaded up with clothes for central Europe.

Mary Ann O’Brien concluded by saying that ‘we need this regulation now’.  She spoke of crowd funding, which was the way to go in the future of funding, but we could not even being to think of crowd funding unless we had systems, accounting and reporting practices in order.  How could one view the accounts of a charity?  The minister said that one could go to the Companies Registration Office, but a normal person cannot read accountancy reports.  Her motion was agreed nem con.