Three years ago, Parliament amended the Charities Act specifically to include the promotion of amateur sport as a charitable purpose. The change followed a review prompted by departmental warnings that sports clubs may not qualify for charity grants from gaming machine societies. At that time, the Internal Affairs Minister, Nathan Guy, offered reassurance. Sport, he said, could still receive money as long as the sporting activity was being used to achieve a charitable purpose, for example promoting health, fitness, education or physical or social wellbeing. Given the clarification by Parliament, it is odd as well as unfortunate that sporting bodies are continuing to be dogged by the issue.
The latest flare-up involves a threat by the Internal Affairs Department's Charities Services branch to deregister potentially hundreds of sporting bodies from the register of charities. More than 1800 sporting bodies are on that register. Donors to them can get tax rebates, and the bodies can raise money from some philanthropic trusts that give only to registered charities. Particularly worried is Rowing New Zealand. It plans to raise $1 million from philanthropic donors to send more rowers to the Rio Olympics than it has fielded at past Games. Given the medal hauls achieved by the country's rowers at recent Olympics, that is surely an objective shared by most New Zealanders.
Already, Swimming NZ has been deregistered on the basis that its promotion of competitive swimming is "an end in itself", and is not "charitable". It says the change might force cuts in water safety and learn-to-swim programmes. Therein lies the potential damage. The officials, for their part, insist that sports bodies must fit within the definition of charitable purposes. But this comes from a 414-year-old law that invites legal argument. Parliament's intention was to leave no doubt, just as Britain had done six years earlier.
In a country where sport plays such a major role, there need be no ongoing debate. The public benefit of improved physical fitness and the potential for sports clubs to change social behaviour dictates that the promotion of amateur sport should be a charitable purpose. If that encompasses elite athletes as well as the wider community, so be it. The vast majority of New Zealanders, thrilled by Olympic deeds, are unlikely to quibble at either their inclusion or the tax benefit they enjoy.
A potential penalty of another kind is worrying charities and volunteer groups. They face a proposed $5 to $7 charge for police vetting, which is now provided at no cost. Some have told the Government it will mean they have to cut back on services. The Cancer Society, which vets about 1500 volunteers annually, says it faces a bill of $10,500 a year unless exempted by the Government.
