A Bill requiring collectors for charities to disclose how much they keep for themselves faced opposition from charitable organisations at a parliamentary committee hearing today.
Drafted by National MP Amy Adams, the Fair Trading (Soliciting on Behalf of Charities) Amendment Bill applies only to companies which collect for charities, and aims to address uncertainty and concern about what slice of a personal donation actually reaches the charity intended.
Disclosure would apply if the proportion retained by collectors was more than 20 percent, if it was between 20 percent and 50 percent the collector would only have to disclose that a portion was in fact being withheld, but if the proportion retained exceeded 50 percent, the collector would have to disclose that percentage.
The Bill doesn't apply to charities collecting money themselves through their own volunteers, but organisations submitting today said it was common to use third party telemarketers or collectors as most outfits simply didn't have the resources to collect themselves.
Fund-raising Institute of New Zealand (FINZ) chief executive James Austin told the commerce select committee that a code of industry standards already existed and was in the process of being thoroughly re-written.
He said almost half of nearly 1000 professional fund-raisers were aligned with FINZ and told the committee new regulation was unnecessary and would only serve to favour some charities over others.
Mr Austin and other submitters said it was justifiably expensive to solicit one-off donations or to get donors initially signed up on an ongoing basis, but the preference in many cases was to establish ongoing relationships, and in that case administration costs reduced significantly over time.
Greenpeace fund-raising manager Amanda Briggs-Hastie said the organisation understood the concerns involved with where money was ending up, but was opposed to the mechanisms of the Bill.
Compulsory disclosure statements would only make it "confusing and upsetting" for donors and liable to create suspicion and put them off, and it also appeared to treat all donations as if they were one-offs, which were more much expensive to administer.
Ms Briggs-Hastie said a miniscule number of "cowboys" in the industry had sparked media frenzies and bad publicity, and that was harming the entire charity industry. "It kind of makes all fund-raisers guilty until proven innocent," she said.
Riding for the Disabled also submitted against the bill, saying it had a small administration unit and no option but to use a third-party telemarketing company to raise funds. "Not all of them are gun-toting, gun-slinging outfits that are only out for themselves," said executive director Guy Ockenden.
Life Flight chief executive David Irving said parts of the bill were "unworkable" and stifled legitimate charities.
He said a change in accounting standards would be acceptable if the aim was to get more transparency, but all charities had to operate in different ways and the bill could hit some of them hard.
