Lorraine Higgins (Labour) | Oireachtas source

I welcome former Senator Kathleen O'Meara.

Ms O'Meara works for the Irish Cancer Society. I see Mr. Hans Zomer from Dóchas who has been very strong in his efforts to establish a governance code for charities. Well done to him. I am pleased to participate in the debate and to second the Labour Party group’s Private Members’ motion on the Charities Act 2009. This is important legislation which, when it takes effect and is enforced, will place obligations and responsibilities on trustees and directors of charities and the charities themselves. The soon-to-be enforced legislation will also result in increased transparency and accountability for charities operating in this country. As a sector that benefits to the tune of millions of euro per annum from the Government and the public alike, it is imperative that the Government, as custodian of taxpayers' money, ensures the sector is regulated as we have learned, unfortunately, in other sectors of society that lack of regulation or enforcement can present us with significant problems.

I am a fervent supporter of the great work many charities do in this country. I recognise the important role they play locally, nationally and internationally. As a public representative I have engaged with many charities and their services on behalf of constituents. Their readiness to help and their impact must never be underestimated. They are of critical importance in every small town and village in the country and their tentacles stretch as far as delivering services in health, social services, education and emergency relief. From an international dimension we must not forget the part Irish charities play in helping to keep Ireland's international reputation right up there among the greatest benevolent countries in the world. This cannot be underestimatedwhen it comes to alleviating crises in war-torn and hunger ravaged countries.
With 11,700 organisations in Ireland, they also play a significant role in the socialisation of this country given the large numbers engaged in various humanitarian causes. In 2009, more than 100,000 people were employed by charities, with 560,000 volunteers and more than 50,000 people directly involved with their governance as directors. Furthermore, the combined turnover of these organisations is €5.75 billion which accounts for more than 3.25% of national income, which is not an inconsiderable amount. However, we must put the issue in the current context. Our economic climate and the financially straitened times in which we find ourselves present many challenges for charities. These pressures have had a detrimental impact on fund-raising at a time when most charities are experiencing an unprecedented demand for their services. In particular, almost 60% of organisations have experienced a decrease in income in the past three years, while two thirds of non-profit organisations have seen an increase in beneficiary numbers over the same period.
The Charities Act 2009 was passed on 28 February 2009 and represents a watershed for how the community and voluntary sector in Ireland will operate. As a consequence, all charities will have to comply with the new regulatory framework. The legal obligations and responsibilities pertaining to employees and management of charities is fully defined within the Act. Its principal aim is to acquire higher standards from the charities themselves and the main thrust of the Act is threefold. It seeks to achieve the following: ensure greater accountability for charities; protect against abuse of charitable status and fraud; and enhance public trust and confidence in charities. To that end the following measures will be introduced: a new charities regulatory authority will be set up to secure compliance by charities with their legal obligations; a new register of charities will be introduced and all charities operating in the State must register; it will be a requirement that the annual activity reports by charities be submitted to the new authority; the law relating to fund-raising and in particular to collections by way of direct debits will be clarified; a new charity appeals tribunal will be set up; and consultative panels will be introduced to assist the authority in its work and to ensure effective consultation with stakeholders.
These are all very important reforms, not least because charities in Ireland are the last sector in Irish life enjoying a high degree of unconditional trust from the public. As a lawyer, I am more than familiar with individuals making bequests to charities upon their death, something that can very often be the lifeblood of not-for-profit organisations. With Irish people readily contributing to good causes a greater focus is required for the achievement of maximum value for money for every cent spent - with clear accountability and measurable results. It is imperative that we make our decisions to donate based on knowledge of the percentage of funding trickling down to the coalface and targeting those who need it most. In that regard, one of the most important provisions of the Act is that all charities will be required to provide the authority with annual activity reports which I presume will be accessible to a charity's donors. However, we must be mindful that in the absence of the enforcement of the legislation we may very well usurp the trust that has been built up between the public and charities alike. To that end we must ensure that the entire sector and the goodwill it gets from the public is not decimated as a consequence of a financial scandal raising its ugly head. That is something we should be keen to avoid so that all genuine charities working hard for their respective causes can continue, safe in the knowledge that their sector is properly regulated and free from such risks. It is vitally important that we uphold the highest possible standards when it comes to charities.
While I have focused up to now on the pioneering rules about to be enforced, I take the opportunity to acknowledge and laud the great work done by organisations such as Dóchas and The Wheel, among others,which have endeavoured to voluntarily change the standards applicable to the not-for-profit sector. They have shown great initiative in their own individual endeavours and the spearheading of a governance code for community, voluntary and charitable organisations is a wonderful feat. While their efforts go some way towards initiating a charter for charities, if one likes, it is now imperative for us as a Government to help complement their efforts with the enactment of effective legislation.
While I acknowledge we are now in different times and in a different economic space, we are beginning to emerge from the abyss. Recent years have been difficult for the Government which means it has been hard to make a case for setting up a charities regulatory authority and an appeals board at a time when the country is trying to get off its back and bridge the current budgetary deficit. The cost associated with implementing the central tenet of the legislation is something we cannot afford when we still have the troika in the country. Its presence is not expected to be perennial. However, it does remain a specific and unique challenge facing the Government. While I know and understand that it is the intention of the Government to implement the Act in full, as resources permit, let us prioritise it when we are back on our feet.
I welcome the opportunity to contribute on this issue and hope some of the issues raised by me and my colleague, Senator Whelan, among other group members, will be taken on board by the Minister. It is imperative that the Government and the not-for-profit sector work together in solidarity to achieve the same goals of transparency, accountability and value for money. That is the only way we can move forward together. I acknowledge the presence of the Minister of State, Deputy Kathleen Lynch. I was so anxious to make my speech that I was unaware the Minister of State was sitting in front of me. I apologise for the oversight.