Not-for-profit Sector Freedom to Advocate Bill 2013

Bills Digest no. 116 2012–13

PDF version  [624KB]

WARNING: This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

Matthew Thomas, Social Policy Section
Kerry Knowler, Law and Bills Digest Section
16 May 2013

Contents

The Bills Digest at a glance
Purpose of the Bill
Structure of the Bill
Background
Committee consideration
Statement of Compatibility with Human Rights
Policy position of non-government parties and major interest groups
Financial implications
Other provisions
Concluding comments
Appendix : Relevant articles of the International Covenant on Civil and Political Rights (ICCPR)

 

The Bills Digest at a glance

What the Bill does

  • This Bill prohibits agencies (defined to include Commonwealth departments and Ministers) from including ‘prohibited content’ in Commonwealth agreements and voids any prohibited content that exists in such agreements before, on or after the commencement of the Act. ‘Prohibited content’ is any requirement that restricts or prevents a not-for-profit (NFP) entity from advocating, commenting on, or opposing Commonwealth actions or policies. In basic terms the Bill seeks to prevent the use of 'gag clauses' in NFP funding agreements entered into by the Commonwealth.

Why the Bill has been introduced

  • To ensure that NFP entities are not prevented from advocating on Commonwealth law, policy and practice.
  • It will enshrine the Government’s policy position in legislation and bind future governments at the federal level (unless and until further legislative change).
  • The Government removed all ‘gag clauses’ in 2008. This position is already reflected in national standards and in the latest edition of the Commonwealth Grant Guidelines, which are to become operative on 1 July 2013.

Key points

  • The key issue concerns the role and responsibilities of NFP entities and whether it is appropriate for them to operate as advocates within the community especially when they are government funded.
  • Prohibiting ‘gag clauses’ under legislation will strengthen the existing measures and serve to safeguard the ability of NFP entities to advocate freely on behalf of the community. It will only affect Commonwealth Government agreements – the Bill will not impact on state or territory agreements.
  • The Bill, once enacted, will invalidate any ‘gag clause’ already included in a Commonwealth agreement—existing rights arising from the ‘gag clause’ will be preserved.

Date introduced: 13 March 2013
House: Senate
Portfolio: Finance and Deregulation
Commencement: The day after Royal Assent.

Links: The links to the Bill, its Explanatory Memorandum and second reading speech can be found on the Bill's home page, or through http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation. When Bills have been passed and have received Royal Assent, they become Acts, which can be found at the ComLaw website at http://www.comlaw.gov.au/.

Purpose of the Bill

The purpose of the Not-for-profit Sector Freedom to Advocate Bill 2013 (the Bill) is to prohibit and invalidate clauses in all Commonwealth agreements that restrict or prevent not-for-profit entities from commenting on, advocating support for, or opposing changes to Commonwealth law, policy or practice.[1]

Structure of the Bill

The Bill:

  • includes the relevant definitions and meaning of prohibited content (clauses 3 and 5 of the Bill)
  • prescribes the main purpose of the Bill under clause 4 and its application under clause 7
  • applies the removal of such ‘gag clauses' so as to preserve any rights, obligations or liabilities acquired or incurred under the prohibited content before the commencement of the Act (clause 7 of the Bill).

Background

The not-for-profit sector

Australia’s NFP sector is very large, being made up of around 600,000 organisations. Of these, some 59 000 are economically significant—that is, they employ staff or access tax concessions. As at
2006–07, these economically significant NFP organisations employed 889,000 staff (around eight per cent of total employment) and contributed approximately $43 billion to the nation’s gross domestic product.[2]

The NFP sector is very diverse. Generally speaking, it is made up of organisations that are formed to further social, environmental or cultural objectives. This includes charities, charitable trusts, churches and religious groups, sporting organisations and clubs, advocacy groups, community organisations, cooperatives, trade unions, trade and professional associations, chambers of commerce, welfare organisations and service providers.

The NFP sector’s contribution to national life extends beyond immediate economic returns to include helping to enhance its general wellbeing. It is in recognition of this contribution and the key role played by the sector in providing services and meeting community needs that governments provide funding to the sector—both directly for the delivery of programs and services and indirectly through tax exemptions and concessions. In 2006–07 it is estimated that direct government funding of $25.5 billion was provided to the sector.[3] The general public also provides support for the sector, both through donations and by volunteering their time. In 2006–07 over 4.6 million Australians volunteered with NFP organisations (at a wage equivalent value of around $14.6 billion)[4], and total public donations to the sector were around $7.2 billion.[5]

Further information on Australia’s NFP sector and the regulation of this sector at the Commonwealth level is contained in the Bills Digest on the Australian Charities and Not-for-profit Commission Bill 2012.[6]

Development of Commonwealth policies

The Howard Government position

Under the Howard Government, confidentiality clauses were included in many of the purchaser‑provider contracts that were drawn up between the Government and NFP service providers.[7] These clauses carried with them the requirement that the organisation could not make public comment about their service or program without first obtaining the approval of the relevant department or minister. The clauses were widely seen by the NFP sector as a means for the Government to prevent or reduce their advocating on behalf of the groups to whom they provided services.[8] They were also regarded as a mechanism for reducing criticism of the Government and its policies.[9]

Rudd-Gillard Government position

On gaining office in 2007, and as a part of its social inclusion agenda, the Rudd-Gillard Government sought to ‘begin a conversation about a renewed relationship between the Australian Government and the not-for-profit sector.’[10] The Government saw NFP organisations as being ideally placed to ‘foster solutions to exclusion, promote the value of inclusion and empower communities’.[11]

As one means of changing its relationship with the NFP sector and improving the sector’s capacity to enhance social inclusion, then Parliamentary Secretary for Social Inclusion and the Voluntary Sector, Senator Ursula Stephens indicated that the Government would remove ‘gag clauses’ from federal government contracts with the NFP sector. In a 2008 speech to the Australian Council of Social Service (ACOSS), Senator Stephens provided the following rationale for the Government’s doing so:

It is essential that we restore independence and the right to advocate to the not-for-profit sector as you have an important contribution to make to civil society.

Why? There are at least two good reasons.

Because this government believes a strong and independent not-for-profit sector is important. This government wants to hear what independent organisations have to say. It is keen to hear the views of those organisations who know more than it does about the situation on the ground and about what interventions are working and which are not in improving circumstances for disadvantaged Australians.

Not-for-profit organisations play an important role in identifying gaps or policy shortfalls and drawing these to the attention of governments.

Responding to the criticism that organisations funded by government did not feel able to speak their own mind, we promised in the election to remove the so-called ‘gag’ clauses from contracts with not-for-profits and the government has moved quickly to undo the force of these clauses.

Minister Macklin is leading this work and has begun the process by removing ‘early warning’ clauses from contracts to give peak not-for-profit organisations greater independence and a better voice to represent their sector.[12]

The Government has succinctly outlined its position on ‘gag clauses’ in the Explanatory Memorandum to the current Bill:

Since 2008 it has been Commonwealth government policy to not include any ‘gag clauses’ in Commonwealth agreements, in order to remove any restrictions on the NFP sector from engaging in policy and debate.[13]

Commonwealth Grant Guidelines

The soon to become operative second edition of the Commonwealth Grant Guidelines reflect this position, particularly in the context of grants to the NFP sector. The Commonwealth Grant Guidelines ‘include a specific clause that prevents agency staff from including suppression clauses in grant application and selection processes or clauses in grant agreements.’[14] The relevant clause states that:

Agency staff must not use criteria in grant application and selection processes or clauses in grant agreements that seek to limit, prevent or ban not-for-profit organisations from advocating on policy issues.[15]

Federal government election commitment

In fulfilment of a 2010 Federal Election commitment, the Government pledged to introduce a national ‘one-stop-shop’ regulator for the NFP sector.[16] Following the passing of the Australian Charities and Not-for-profits Commission Bill 2012, this regulator—the Australian Charities and Not-for-profits Commission—was established in December 2012.[17] In the course of debate over that Bill, the issue of confidentiality clauses was raised. The Greens supported the insertion of a clause in the Bill that would limit the powers of the Government to include confidentiality clauses in the governance standards for NFP organisations. In response, the Government inserted a provision which provides that the governance standards must not require a registered entity not to comment on, or advocate for a legal or policy change, if the comment or advocacy is lawful and it furthers, or is in aid of, the purpose of the registered entity.[18] The governance standards, which are specified in the Australian Charities and Not-for-profits Commission Amendment Regulation 2013 (No. 1), reflect this intent.[19]

Queensland Government position

Last year, a spokesperson for the Queensland Health Minister confirmed that in funding agreements with some community service organisations, the Queensland Government had introduced conditions that restrict these organisations from advocating for state or federal legislative change. The conditions reportedly also stipulate that the organisations must not include on their websites links to other organisations that advocate for state or federal legislative change.[20] At this stage, the conditions have been confined to those organisations that receive a majority of their funding from the Queensland Government. They also appear to have been applied only to organisations funded by Queensland Health. According to a Queensland Government spokesperson, the conditions are intended to ensure that the Government is funding outcomes for Queensland residents and not for political campaigning.[21] However, as discussed below, there are a number of commentators who argue that advocacy is essential to the effective delivery of services.

Committee consideration

Senate Selection of Bills Committee

The Senate Selection of Bills Committee resolved to recommend that the Bill not be referred to a committee.[22]

Senate Standing Committee for the Scrutiny of Bills

At the time of writing this Bills Digest, the Senate Standing Committee for the Scrutiny of Bills had not reported on this Bill.

Statement of Compatibility with Human Rights

As required under Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the Bill’s compatibility with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of that Act. The Government considers that the Bill is compatible.[23]

Parliamentary Joint Committee on Human Rights

In its Fourth Report of 2013, the Parliamentary Joint Standing Committee on Human Rights (Human Rights Committee) examined all Bills introduced in the period 12-14 March 2013, which included this Bill.[24] The Human Rights Committee ‘considers that the bill does not give rise to issues of incompatibility with human rights.[25]

The Human Rights Committee notes that Bill engages a number of rights under the International Covenant on Civil and Political Rights (ICCPR) and is of the view that the Bill appears to promote:

  • the right to freedom of expression (as contained in article 19(2) of the ICCPR)
  • the right to participation in public affairs (as contained in article 25 of the ICCPR) and
  • the right to privacy (as guaranteed by article 17 of the ICCPR).[26]

Policy position of non-government parties and major interest groups

The position of the Greens and the position of the NFP sector itself on this matter are captured under the ‘Key issues and provisions’ section of this Bills Digest.

Financial implications

The Explanatory Memorandum to the Bill states that the Bill will not have a financial impact on the NFP sector. However, it further notes that the enactment of the Bill ‘may result in a minor financial impact to the Commonwealth’ as a result of the ‘retrospective aspect of invalidating ‘gag clauses’ in existing Commonwealth agreements’[27]:

In this highly unlikely circumstance, the Bill provides for reasonable compensation, where there has been an acquisition of property by the Commonwealth.[28]

Key issues and provisions

The aim of this Bill is to protect and promote the NFP sector’s freedom to advocate or oppose changes to Commonwealth law, policy and actions[29] (by removing and preventing ‘gag clauses’). However, as some commentators see it, it should not be assumed that NFP organisations have a right to advocate, especially where they receive government monies. The key issue would appear to concern the role and responsibilities of NFP entities and whether it is appropriate for them to operate as advocates within the community, especially when they are government funded. It should be noted that debate over the appropriate role of charities has a long history, with former Brazilian Archbishop Helder Camara’s oft quoted comment epitomising some of the tensions:

When I give food to the poor they call me a saint. When I ask why the poor have no food they call me a communist.[30]

Views on this issue are further discussed below.

Key provision—prohibiting and invalidating content in all Commonwealth agreements

Clauses 4 and 7 of the Bill serve to remove any ‘gag clauses’ and ensure that future agreements are free of ‘gag clauses’.[31]

Subclause 4(1) of the Bill prohibits an agency[32] from including in a Commonwealth agreement with a NFP entity any requirement that restricts or prevents that entity[33] from commenting on, advocating support for, or opposing a change to any matter established by law, policy or practice of the Commonwealth (prohibited content).[34]

Any prohibited content in a Commonwealth agreement entered into before, on or after the commencement of the Bill[35] is void upon the commencement of this Act.[36] Any right, privilege, obligation or liability acquired in relation to the prohibited content will continue to exist.[37]

Key issue—what is the role of NFP providers of government services?

The key issue raised by the Bill would appear to be competing understandings of what the role of NFP providers of government services is and should be.

The Government’s position is that:

 … a strong, independent and innovative NFP sector is essential to building an inclusive community.[38]

As such, the Bill is presented by the Government as a necessary means to ensure that NFP providers are free not only to provide services, but also to advocate on behalf of the communities they represent.

Position of previous governments

In the past, NFP providers that were involved in government service delivery were funded on the basis of government grants. They were provided with ‘core’ funding, partly in recognition of their representative role in providing informed advice to government. The 1990s saw governments adopt a ‘new managerialist focus’, under which funding arrangements have been shifted to a contractual basis, with governments purchasing specific units of service from NFP organisations that provide community services. The provision of particular forms of services was also opened to competitive tender.[39]

According to some commentators, with these changes NFP organisations came to be treated by governments as primarily service providers, with little appreciation of the social and political contribution that they can, and do, make. On this view, rather than seeing themselves as collaborators with the NFP community services sector, ‘governments have come to see themselves as playing the lead role, as purchasers of service from private providers’.[40] In doing so, governments have minimised the differences between NFPs and for-profit organisations.[41]

Queensland Government position

The Queensland Government’s position is similar to that described above, with a slight but important difference. The Queensland Government reasons that because the NFP organisations that are having confidentiality clauses inserted in their funding agreements receive a majority of their funding from government, they are, to all intents and purposes, government agencies. And, given that this is the case, it follows that they should be subject to the same conditions that apply to any other government agency. These conditions typically include the requirement that agencies should be apolitical—performing their role in an impartial manner—and that they should maintain appropriate levels of confidentiality. Thus, a Queensland Government spokesperson is reported as having stated:

If an organisation’s existence is based on a majority of funding from Queensland Health, then we [the LNP state government] would expect that organisation to conduct itself with the political impartiality of any other government sector, given it is majority funded by the taxpayer.[42]

The abovementioned Queensland Government spokesperson is also said to have argued that some NFP groups were funded by the previous Labor Government ‘to advocate for Labor’s political causes’.[43] Hence, the conditions are seen by the Queensland Government as a justifiable means of imposing political impartiality on these groups. It is worth noting that there is also the potential under the new arrangements for the Queensland Government to deliberately fund certain more outspoken NFP organisations as a means to procure their non-advocacy.

Position of NFP providers

As suggested above, NFP providers of community services do not agree with arguments such as those advanced by the Queensland Government in support of its position. While the NFP organisations receive government funding for the provision of services, they insist that furnishing these services to typically disadvantaged people is only one part of their role. As they see it, unlike government agencies, NFP providers also serve an important representative function. They are obliged to advocate the interests of the people to whom they provide services because, being marginalised, for the most part these people’s voices go otherwise unheard. Accordingly, in response to the Queensland Government’s actions, Queensland Council of Unions president, John Battams has declared:

I think that’s outrageous; it’s not about ‘being involved in politics’. It’s about groups that represent often the most marginalised people not being able to publicise bad decisions of government for fear of losing their funding … community groups are there to serve their particular community but also to represent them and governments are elected to put up with criticism because decisions actually result in that from time to time.[44]

NFP community service providers do not see their representative function as being confined to challenging the decisions of governments alone. In their advocacy role such providers may not only criticise the Government of the day; they may be impartial from a party political perspective, criticising the policies of all political parties. They also view themselves as helping governments to ultimately improve the services provided to disadvantaged people, based on their understanding of these people and their needs and on their hands-on experience of what does and does not work. Defending the importance of non-government organisation advocacy in the context of the Queensland Government’s changes, Public Health Association of Australia acting chief executive, Melanie Walker has said that groups

… working on the front line often do have insights about what changes can be made in government policy or legislation to assist the recipients of their services.[45]

Views of the Productivity Commission

Such observations are supported by the findings of the Productivity Commission in its study of the contribution to the nation made by Australia’s NFP sector. Having considered the issue of government control over NFP activities that are beyond those required to achieve the funding outcome, the Productivity Commission concludes that:

Where influence or control is exerted by government over funded organisations in order to limit advocacy and other activities of NFPs, it is likely to be wasteful of public funds, and may also distort the best endeavours of community organisations.[46]

In line with this conclusion, the Productivity Commission recommended that:

Australian governments funding service provision or making grants should respect the independence of funded organisations and not impose conditions associated with the general operations of the funded organisation, beyond those essential to ensure the delivery of agreed funding outcomes.[47]

Further issue – legislative measure

The Government has implied that the Bill has been introduced in response to the Queensland Government’s inclusion of ‘gag clauses’ in contracts with some NFP providers of government services in that state.[48]

However, should the Bill be passed, the legislation will only ban the inclusion of confidentiality clauses in federal government contracts with NFP providers. This will leave the Queensland Government clauses untouched, and the Government has called on:

 … all State Premiers and Territory Chief Ministers to introduce legislation to similarly ban the use of gag clauses in their government contracts.[49]

The Government has also indicated that the Bill is intended as a means to ensure that should there be a change of federal government in the future the incoming government will not be able to
re-introduce ‘gag clauses’ to contracts with NFP providers (without introducing amending or repealing legislation).[50]

As noted above, to date, Government policy on the use of ‘gag clauses’ has been captured in guidelines and standards and implemented under individual contractual arrangements between the Commonwealth and the NFP entity.

This Bill, should it be enacted, will enshrine the government position in legislation.

The Bill reflects what has been Labor’s policy since we came to office: that advocacy from the not-for-profit sector is important and should not be restricted.[51]

Other provisions

Definitions

Clause 3 of the Bill defines the terms: agency, Commonwealth agreement, confidential information and not-for-profit entity. It also provides for the definition of prohibited content set out under clause 5 of the Bill.[52]

Compensation for acquisition of property

Item 6 of the Bill provides that any acquisition of property resulting from the operation of the Act, must be on just terms (within the meaning of 51(xxxi) of the Constitution).[53]

Under subclause 6(1) of the Bill, the Commonwealth is liable to pay a ‘reasonable amount’ of compensation to a person in the:

 … highly unlikely circumstance that a party to an agreement with the Commonwealth that was entered into before the commencement of the legislation would suffer loss because a ‘gag clause’ in the agreement became void upon commencement of the legislation.[54]

In the event of a disagreement, a person may institute proceedings in the Federal Court of Australia for the recovery from the Commonwealth of a reasonable amount of compensation (subclause 6(2) of the Bill).

Application

As noted above under the heading ‘Key issues and provisions’ of this Bills Digest, if a Commonwealth agreement contains prohibited content, the prohibited content becomes void on the commencement of this Act.

Comment

In relation to this ‘retrospective’ application of the Bill (in relation to invalidating ‘gag clauses’ in existing Commonwealth agreements) a NFP entity would not be expected to be disadvantaged in any way by the voiding of any prohibited content in a Commonwealth agreement entered into before the commencement of this Act. In addition, any rights et cetera acquired under the prohibited content before the commencement of the Act will continue to exist and can be enforced.[55]

Concluding comments

Given the recent history of ‘gag clauses’ in Australia and the perennial debate over what is considered to be the appropriate role of the NFP sector, this Bill deals with an important issue. Some commentators believe that NFP providers of government services have a right and responsibility to advocate on behalf of the people to whom they provide services, irrespective of whether or not and how much funding they receive from government. Others either do not believe that NFP organisations have a special advocacy role, or believe that they relinquish their independence to speak out against government policy in areas for which they receive any government funding. Advocates of the former position are likely to feel that, should the Bill be passed, then this will advance their cause.

Appendix: Relevant articles of the International Covenant on Civil and Political Rights (ICCPR)

Freedom of expression

Article 19(2) of the ICCPR provides:

Everyone shall have the right to freedom of expression; this right shall include freedom to seek, receive and impart information and ideas of all kinds, regardless of frontiers, either orally, in writing or in print, in the form of art, or through any other media of his choice.

Right to take part in public life

Article 25(a) of the ICCPR provides that:

Every citizen has the right and the opportunity … to take part in the conduct of public affairs, directly or through freely chosen representatives'.

Right not to be subjected to arbitrary interference with privacy

Article 17(1) of the ICCPR provides:

No one shall be subjected to arbitrary or unlawful interference with his privacy, family, home or correspondence, nor to unlawful attacks on his honour or reputation.

Members, Senators and Parliamentary staff can obtain further information from the Parliamentary Library on (02) 6277 2500.



[1].     Clauses 4 and 5 of the Bill.

[2].     Productivity Commission (PC), Contribution of the not-for-profit sector, Research report, Commonwealth of Australia, Canberra, January 2010, p. xxiii, viewed 29 April 2013, http://www.pc.gov.au/projects/study/not-for-profit/report

[3].     Treasury, Australian Charities and Not-for-profits Commission Bill 2012 [and] Australian Charities and Not-for-profits Commission (Consequential and Transitional) Bill 2012, Explanatory materials, p. 223, viewed 17 September 2012, http://www.treasury.gov.au/Policy-Topics/PeopleAndSociety/NFP-reform/~/media/Treasury/Policy%20Topics/People%20and%20Society/Not-for-profit%20reform/2012/House%20of%20Representatives%20Standing%20Committee%20on%20Economics/Downloads/PDF/Exp_Material_ACNC_Bill_2012.ashx

[4].     Productivity Commission, Contribution of the not-for-profit sector, op. cit., p. xxvi.

[5].     Treasury, Australian Charities and Not-for-profits Commission Bill 2012 [and] Australian Charities and Not-for-profits Commission (Consequential and Transitional) Bill 2012, Explanatory materials, op. cit., p. 223.

[6].     M Thomas and P Pyburne, Australian Charities and Not-for-profits Commission Bill 2012, Bills Digest, no. 21, 2012–13, Parliamentary Library, Canberra, 2013, viewed 13 May 2013, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22legislation%2Fbillsdgs%2F1927319%22

[7].     See J Staples, ‘NGOs out in the cold: Howard Government policy towards NGOS’, Discussion paper, no. 19/06, Democratic Audit of Australia, 2007, viewed 15 April 2013, http://apo.org.au/research/ngos-out-cold-howard-government-policy-towards-ngos and G Edgar, Agreeing to disagree: maintaining dissent in the NGO sector, Discussion paper, no. 100, 2008, The Australia Institute, viewed 13 May 2013, http://apo.org.au/research/agreeing-disagree-maintaining-dissent-ngo-sector

[8].     J Staples, op. cit.

[9].     G Edgar, op. cit.

[10].   U Stephens (Parliamentary Secretary for Social Inclusion and the Voluntary Sector, Parliamentary Secretary Assisting the Prime Minister for Social Inclusion), Speech, ACOSS Conference, 9 April 2008, viewed 16 May 2013, http://parlinfo/parlInfo/search/display/display.w3p;adv=yes;orderBy=customrank;page=3;query=%22non%20profit%22%22social%20inclusion%22%20Dataset%3Apressrel%20OtherSource_Phrase%3A%22parliamentary%20secretary%20-%20social%20inclusion%20and%20the%20voluntary%20sector%22;rec=4;resCount=Default

[11].   Ibid.

[12].   Ibid. See also M Thomas and P Pyburne, Australian Charities and Not-for-profits Commission Bill 2012, Bills Digest, no. 21, 2012–13, op. cit., (in particular footnotes 29 and 39 of this Bills Digest).

[13].   Explanatory Memorandum, Not-for-profit Sector Freedom to Advocate Bill 2013, p. 4, viewed 13 May 2013, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22legislation%2Fems%2Fs913_ems_ccbee43d-b03e-4144-8bd5-0329fd1dec1a%22

[14].   Ibid., p. 3. The Commonwealth Grant Guidelines (CGGs) establish the Government’s policy framework under which government agencies undertake their own grants administration activities. As one of a number of developments in grants policy the Finance Minister recently issued an update to the CGGs which will commence on 1 July 2013. Further information on the CGGs can be found on the Australian Government, Department of Finance and Deregulation website, Commonwealth Grant Guidelines, Financial management guidance, no. 3, second edn, June 2013, viewed 15 April 2013, http://www.finance.gov.au/publications/fmg-series/3-commonwealth-grant-guidelines.html

[15].   Australian Government, Commonwealth Grant Guidelines, Financial management guidance 3.24—‘Suppression clauses’, Department of Finance and Deregulation, second edn, June 2013, viewed 15 April 2013, http://www.finance.gov.au/publications/fmg-series/docs/FMG-3-Commonwealth-Grant-Guidelines-June-2013.pdf.
As noted in the footnote above, the second edition of the Guidelines only becomes operative on 1 July 2013.

[16].   In 2010 the Productivity Commission recommended the establishment of a national ‘one-stop-shop’ for Commonwealth regulation and tax endorsement of the NFP sector. See M Thomas and P Pyburne, Australian Charities and Not-for-profits Commission Bill 2012, Bills Digest, no. 21, 2012–13, op. cit.

[17].   The text of the Australian Charities and Not-for-profits Commission Act 2012 can be viewed at: http://www.comlaw.gov.au/Details/C2012A00168/Download

[18].   Subsection 45-10(6) of the Australian Charities and Not-for-profits Commission Act 2012. See M Thomas and P Pyburne, Australian Charities and Not-for-profits Commission Bill 2012, Bills Digest, no. 21,
2012–13, op. cit.

[19].   The Australian Charities and Not-for-profits Commission Amendment Regulation 2013 (No. 1) is available at: http://www.comlaw.gov.au/Details/F2013L00402

[20].   D Hurst, ‘NGOs told they are right to remain silent to keep funding’, The Brisbane Times, 21 August 2012, viewed 13 May 2013, http://www.brisbanetimes.com.au/queensland/ngos-told-they-are-right-to-remain-silent-to-keep-funding-20120820-24ilb.html

[21].   D Hurst, ‘Gag clauses help ‘stop grant abuse’’’, The Brisbane Times, 19 September 2012, viewed 13 May 2013, http://www.brisbanetimes.com.au/queensland/gag-clauses-help-stop-grant-abuse-20120919-265tm.html

[22].   Senate Selection of Bills Committee, Report No. 4 of 2013, 21 March 2013, viewed 7 May 2013, http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=selectionbills_ctte/reports/2013.htm

[23].   The Statement of Compatibility with Human Rights can be found at page 2 of the Explanatory Memorandum to the Bill.

[24].   Parliamentary Joint Committee on Human Rights, Examination of legislation in accordance with the Human Rights (Parliamentary Scrutiny) Act 2011, Fourth Report of 2013, 20 March 2013, viewed 23 April 2013, http://www.aph.gov.au/Parliamentary_Business/Committees/Senate_Committees?url=humanrights_ctte/reports/2013/4_2013/index.htm

[25].   Ibid., p. 66.

[26].   Articles 17, 19(2), 25 of the ICCPR are described in the Appendix. The Statement of Compatibility with Human Rights mentions only that the Bill relates to article 19 of the ICCPR. Further information on how each of these rights is engaged in contained in the Fourth Report of 2013, op. cit.

[27].   Explanatory Memorandum, p. 2.

[28].   Ibid. This issue is further addressed under the heading ‘Other provisions’.

[29].   Explanatory Memorandum, op. cit., p. 2. The Explanatory Memorandum further states that the Bill will enable ongoing positive engagement, together with open communication and debate between the federal government and the NFP sector.

[30].   Archbishop Dom Hélder Câmara, ed., Francis McDonagh, Dom Helder Camara: Essential Writings, Orbis Books, 2009. See generally: http://en.wikipedia.org/wiki/H%C3%A9lder_C%C3%A2mara

[31].   Explanatory Memorandum, op. cit., p. 2. ‘Gag clauses’ are those clauses that prevent NFP organisations from engaging in policy discussions, advocacy and debate with the Commonwealth on behalf of the community.

[32].   ‘Agency’ is defined at clause 3 of the Bill as an entity mentioned in paragraphs (a) to (f) and (h) of the definition of ‘agency’ in subsection 6(1) of the Privacy Act 1988. This includes Commonwealth departments and Ministers; bodies established by the Governor-General or under Commonwealth legislation; and the Australian Federal Police. The Privacy Act 1988 is available at: http://www.comlaw.gov.au/Details/C2013C00125

[33].   This includes staff of the entity (subclause 5(1) of the Bill).

[34].   The meaning of prohibited content is outlined under clause 5 of the Bill. Under subclause 5(2) of the Bill, to the extent that the requirement restricts or prevents the release of confidential information (as defined under clause 3 of the Bill) or personal information (within the meaning of the Privacy Act 1988) it is not prohibited content. The Explanatory Memorandum at page 3 states that the ‘definition should be read narrowly’ and that ‘parties to the agreement must be able to justify why particular information is confidential’.

[35].   Subclause 7(1) of the Bill.

[36].   By virtue of subclause 4(2) of the Bill as applied by clause 7 of the Bill.

[37].   Paragraph 7(4)(b) of the Bill.

[38].   Explanatory Memorandum, op. cit., p. 3.

[39].   See J Casey and B Dalton, ‘Ties that bind? The impact of contracting and project-based funding regimes on advocacy’, Paper presented to the Australian Political Studies Association Conference, University of Adelaide, 2004, p. 10, viewed14 May 2013, http://www.adelaide.edu.au/apsa/docs_papers/Pub%2520Pol/CaseyAPSA.pdf and S Maddison and R Denniss, ‘Democratic Constraint and Embrace: Implications for Progressive Non-Government  Advocacy Organisations in Australia’, Australian Journal of Political Science, September 2005, viewed 14 May 2013, http://www.tandfonline.com/doi/abs/10.1080/10361140500204025

[40].   M Lyons, ‘Improving government—community sector relations’, Journal of Contemporary Issues in Business and Government, vol. 9, no. 1, 2003, p. 10, viewed 15 April 2013, http://parlinfo/parlInfo/download/library/jrnart/9YE96/upload_binary/9ye962.pdf;fileType=application/pdf#search=%22improving%20government%20community%20sector%20relations%22

[41].   Although many NFP community service organisations are increasingly operating like private businesses, they are nevertheless committed to the welfare of their clients and to providing the best services they can. As organisations with a professed welfare ethos, they consider they should continue to provide services to their often disadvantaged clients, regardless of whether or not they are in a financial position to do so, or to realise a profit in the process. Business organisations, by contrast, have an obligation to provide returns to shareholders.

[42].   D Hurst, ‘Gag clauses help ‘stop grant abuse’’’, The Brisbane Times, op. cit.

[43].   Ibid.

[44].   D Hurst, ‘NGOs told they are right to remain silent to keep funding’, The Brisbane Times, op. cit.

[45].   D Hurst, ‘Gag clauses help ‘stop grant abuse’’’, The Brisbane Times, op. cit.

[46].   Productivity Commission, Contribution of the not-for-profit sector, op. cit., p. 296.

[47].   Ibid.

[48].   P Wong (Minister for Finance and Deregulation), M Butler (Minister for Mental Health and Ageing, Minister for Housing and Homelessness, Minister for Social Inclusion, Minister assisting the Prime Minister on Mental Health Reform) and D Bradbury (Assistant Treasurer, Minister Assisting for Deregulation), Government Bill Introduced to ban gag clauses, media release, 13 March 2013, viewed 15 April 2013, http://parlinfo.aph.gov.au/parlInfo/search/display/display.w3p;query=Id%3A%22media%2Fpressrel%2F2296960%22

[49].   Ibid.

[50].   Ibid.

[51].   Ibid.

[52].   The definition is outlined under footnote 34.

[53].   There is, entrenched in section 51(xxxi) of the Constitution, a guarantee which stipulates that property acquired by the Commonwealth Government must be acquired ‘on just terms’.

[54].   Explanatory Memorandum, op. cit., p. 3.

[55].   Paragraph 7(4)(b) of the Bill as noted under the heading ‘Key issues and provisions’ above.

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