Joe O'Brien (Dublin Fingal, Green Party) | Oireachtas source

I thank the Leas-Chathaoirleach and members of the committee. I am delighted to be here today, alongside officials from my Department, as we commence Committee Stage of the Charities (Amendment) Bill 2023. The purpose of this Bill is to strengthen the charities sector, ensuring greater transparency, clarity and fairness, which will serve to enhance public confidence in the sector. The Bill will consolidate the existing legal framework for the Charities Regulator to conduct its statutory functions.

The Bill delivers on a programme for Government commitment to ensure that the Charities Regulator has the necessary powers to carry out its duties, and to increase trust and confidence in the management and administration of charities. Throughout this legislative process my officials and I have actively engaged with the charities sector to listen and take on board the observations of a wide number of stakeholders.

During pre-legislative scrutiny, Deputies raised a number of issues which I have sought to address in the published Bill where feasible. Members will note the changes around removing the statutory requirement to report significant events, moving instead to non-statutory guidelines, and the inclusion of a definition of "significant event". I have also introduced amendments regarding removal procedures that adhere to the principles of natural justice and due process and which include recourse and appeal to the Charity Appeals Tribunal and a High Court determination.

The published Bill proposes to introduce a new charitable purpose of "the advancement of human rights". A key part of this process will be the introduction of guidelines in relation to this proposed charitable purpose. These guidelines will be developed in consultation with experts in this area, including representatives from the sector.

In view of observations raised since publication of the Bill, I am seeking to introduce certain amendments to provide greater clarity and ensure operational efficiency. A number of these amendments are technical and of a drafting nature. In addition, there are proposals to clarify and strengthen existing provisions. Amendments Nos. 3 to 10, inclusive, seek to update the definition of “charity trustee”. The references to "officer" and "office" contained in the definition of "charity trustee" in the published Bill may lead to unintended consequences in practice. If the wording is not changed, there is a real possibility that certain people who the definition is not intended to cover may inadvertently be recognised as trustees, due to the application of company law. One such example would be statutory auditors. It is also proposed to include a reference to a de facto director under the definition of “charity trustee” to reflect this recognised position under company law and to ensure all persons with the requisite control and management over a charity are correctly covered in this important definition.

Amendment No. 11 proposes the insertion of an additional general charitable purpose. This amendment recognises there may be instances where a charitable purpose proposed by an applicant does not exactly match the description of any of the 13 purposes established under the Bill but is nonetheless of benefit to the community. It is essential for both the regulator and potential applicants that our legislation provides flexibility in these instances.

Amendment No. 12 deals with annual audit of accounts. It is proposed to increase the financial limit that can be set out in regulations in respect of the requirement for charities to carry out an audit from €500,000 to €1 million. Further to consideration of observations received from stakeholders, it is my intention to set the threshold for audit in the regulations at €500,000, which I note is more in line with neighbouring jurisdictions. This amendment will future-proof the legislation, allowing for any increase as considered appropriate in the years ahead in line with industry practice.

Amendments Nos. 13 to 25, inclusive, concern section 34 and refer to charities entering into agreements and appointments with relevant persons. Revised wording in this section includes clarification of the responsibilities of trustees in respect of entering agreements and appointments.

Amendment No. 20 will allow for regulations under section 34 to include those instances in which an employee can become a trustee of the same organisation. However, the general principle that trustees are not paid remains, and payments to board members can only be made in very limited circumstances and will not become or be considered standard practice.

Amendment No. 26 includes provision to allow for the appointment of an interim chairperson of the Charities Regulator. This amendment will ensure full functionality of the regulator until such time as a permanent chairperson is appointed. I advise members that there are certain matters still under consideration in relation to declarations from the High Court about certain removals from the register, entering agreements and appointments with relevant persons, and bankruptcy and insolvency provisions contained in the published Bill.

It is likely that amendments will need to be introduced on Report Stage. I welcome the opportunity to discuss the Bill with the committee and look forward to hearing from committee members. Go raibh maith agaibh.