Brian Rudman: Women's advocacy fails test for charity

The Venerable National Council of Women is about to be defrocked of its charitable status, and the inheritors of the suffragist dream are not happy. Who could blame them?

They've fallen foul of an ancient British law, the Statute of Charitable Uses 1601 (Statute of Elizabeth), which makes no mention of 21st century "advocacy" among its definition of charitable activities.

If the women had included the "relief of aged, impotent, and poor people" into their mission statement, or the "maintenance of sick and maimed soldiers" or even the repair of bridges, ports, havens and seabanks, they would have been away laughing.

Alternatively, they could have pledged themselves to the "maintenance of houses of correction", the "marriage of poor maids" or the support of "persons decayed", all acts of charity under the 1601 law.

But instead, the 114-year-old council wrote to the Charities Commission and honestly declared its purpose was "to serve women, the family and the community at the local, national and international level".

Honest, but unwise.

On April 16, the commission's chief inquisitor, Steve Brunton, sent notice of its intention to remove the council from the register of charities. He said that "for a purpose to be charitable ... the purpose must be very similar to the spirit and intent of those purposes listed in the preamble to the Statute of Elizabeth".

He archly added "it is difficult to ascertain" how serving "women, the family and the community" reflected the spirit or intent of that ancient law.

When the Labour Government established the Charities Commission in 2007, the main purpose was to improve the transparency and accountability of the charitable sector by registering and monitoring charitable organisations wanting to retain their tax-exempt status.

The problem is, this 21st century legislation relied on common law relating back to the 1601 act to define "charity".

In the United Kingdom, the Charities Act 2006 moved with the times and added, for example, "the advancement of human rights, conflict resolution or reconciliation or the promotion of religious or racial harmony or equality and diversity" as a new and separate charitable purpose.

But here, charities had to abide by "The Four Heads of Charity", listed as relief of poverty, advancement of education, other purposes beneficial to the community (as long as they followed the 1601 Statute of Elizabeth) and public benefit. Any "non-charitable" advocacy has to be secondary to the charitable work.

In the run-up to the law being passed in 2006, a few prescient charities, the Council of Women and the Sensible Sentencing Trust among them, warned it was an attack on their civil liberties and would lead to critics of government being stripped of their tax-free status. How right they were.

The Sensible Sentencing Trust lost its charitable status in March. Any day now, the NCWNZ seems set to join them. Other campaigning "charities" that have lost or been declined charitable status by the commission include Greenpeace, in April, and the Society for Promotion of Community Standards in July 2007.

One of the loudest critics of the new law at the time was Prime Minister John Key, then National's finance spokesman. He called it outrageous, predicting that "most charities will say they do not want to get on the wrong side of a government that's going to strip them of their status and so we will see less advocacy and people will be less informed of the issues".

He told Television One that stifling the ability of charities to speak out was a dangerous road to go down and effectively, charities would be penalised for disagreeing with the government.

He said a huge range of charities from Plunket to Greenpeace would seriously have to consider the advocacy role they played. As of now, Plunket has survived, but not Greenpeace.

Mr Key also said the tax-free status of charities should be decided on what they did, not what they said. The changes were a threat to charities' income. "That threat is a powerful incentive for these organisations to toe the line."

Prime Minister Helen Clark's response was "there's obviously no intention to in any way to threaten such organisations", noting that "perfectly valid charities have from time to time taken a swipe at governments of all stripes".

NCWNZ president Elizabeth Bang says the loss of charitable status could be financially crippling. Major funding organisations such as the Lotteries Commission, Lion Foundation, pub charities and community trusts give money only to registered charities. Individual donors might also lose the ability to claim back their tax on donations.

What is farcical in this case is that the NCWNZ is partially funded by the Government to advocate on behalf of women's issues. "We are in a catch-22 situation," says Ms Bang. "One side of government contracts us to advocate while the other side seeks to punish us for this."

One thing seems clear. After 400 years, we need a new legal definition of "charity".