Brian O'Shea (Waterford, Labour)
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Question 132: To ask the Minister for Community, Rural and Gaeltacht Affairs his Department's proposals for a league table of charities to allow for more public information regarding the way in which money is spent by charities; and if he will make a statement on the matter. [23056/04]

Noel Ahern (Dublin North West, Fianna Fail)
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The Government decided it was unacceptable to continue to have a completely unregulated charities sector. In the programme for Government we undertook to enact a comprehensive reform of the law relating to charities to ensure accountability and to protect against abuse of charitable status and fraud.

Some areas of charitable fund-raising are particularly vulnerable to abuse under the current system. For example, modern methods such as selling tokens like flowers and lapel pins, or collecting promises of money such as standing orders or direct debits, do not need a permit from the Garda. The lack of regulation to date has meant that there is no reliable information on the number of active charities, their financial worth and how they spend their funds. Moreover, there is no requirement to show where donations come from, how much money was received, or what it was spent on; there is no legal obligation to spend donations on the charitable purpose for which they were collected; and there is no requirement to show what percentage of donations was spent on, for example, administration, advertising, professional fund-raisers etc.

These are just some examples of the kind of issues that will need to be tackled by the regulatory body to be established under the legislation which my Department will now prepare. A statutory body to regulate charities will specifically aim to supervise charities and subject them to full regulatory scrutiny. I intend there to be a requirement for charities to provide regular accounts to this body to ensure public accountability. This body will regulate and monitor charities, including their charitable fund-raising activities, on an ongoing basis, and it will protect the public interest by monitoring and investigating possible abuses, including in regard to charitable fund-raising activities.

Additional information

The body will also be tasked with issuing performance reports on areas of the charities sector and I would expect matters such as the publication of league tables to come under this aspect of its responsibilities.

Informed, vigilant trustees also have a crucially-important role to play in guarding against fraud or abuse. I am pleased to report, in that regard, that the Law Reform Commission has been engaged to assist and advise my Department on the updating of charitable trust law, which will form an integral part of the draft charities regulation Bill. This specialist area of the reform will be the subject of a separate public consultation, under the aegis of the Law Reform Commission, in December 2004. At this stage, the current best estimate for publication of the Bill is end 2005. This is a hugely ambitious goal, as the legislation is likely to run to about 200 sections and numerous schedules.

Brian O'Shea (Waterford, Labour)
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In the wake of the events of 11 September 2001, did the Minister receive a request from the United Nations, which went out to member countries, to review the laws governing charities? The UN claimed that a number of charities were being used for fund-raising and money laundering for international terrorist organisations. If this took place, has the Minister had the opportunity to investigate? Has he concerns regarding the use of so-called charities in this country for that type of purpose?

Noel Ahern (Dublin North West, Fianna Fail)
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Yes. The programme for Government includes a provision for a totally new regime for charities. I am pleased this was included because the relevant legislation has been in force for more than 40 years. Since the 1990s, three reports have been drawn up to suggest the action we should take, including those drawn up by the Law Reform Commission and the Minister of State at the Department of Foreign Affairs in 1996, Deputy Burton. Reform of the legislation governing charities is a part of the programme for Government and we are working on this.

I accept concerns exist following the events of 11 September 2001 that charities set up here could be abused. While we have been asked by the UN to consider and update our legislation, we were working on this in any case. There is concern at different levels because the current regime is totally unregulated. The aim is to have compulsory regulation and a regulatory body following up on these groups and controlling what they do. The situation up to now was wide open and anything could happen.

Brian O'Shea (Waterford, Labour)
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Will the Minister confirm that some charities here do no fund-raising? Does he not think it urgent, if it is a possibility that so-called charities are fund-raising or money laundering for terrorist organisations, that something should be done in advance of the legislation? As this type of activity can lead to awful terrorist acts, must we wait for the legislation? Can something be done in the interim?

Noel Ahern (Dublin North West, Fianna Fail)
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I do not think anything can be done in the interim. It is full steam ahead as far as the Department is concerned. However, this is not simple legislation. If we manage to get it published by the end of next year, we will be doing well. It will be a comprehensive Bill with more than 200 heads. Public consultations have been held and in recent days the independent evaluation of the submissions made has been published. The Law Reform Commission is working in the area of trust law. However, much work needs to be done and new legislation is needed.

The area is unregulated. Most of the charities we hear about daily do great work and fully support our efforts. The public reaction and that of the charities has been very favourable because all charities doing good work need this legislation as a protection and the sector needs to have safeguards. However, as the sector is unregulated, there are no provisions short of the legislation. We are progressing that as best we can.