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Don't take the wrong lesson from latest cult case

Helen Andrews | 01 August 2014

helen-rittelmeyer Preparations are already under way within the federal government for the launch of a new Civil Society National Centre for Excellence (NCE) to serve Australia's large and growing not-for-profit sector.

But even as those preparations proceed, some are still trying to save the Australian Charities and Not-for-Profits Commission (ACNC), the failed charity regulator the NCE is intended to replace.

The latest occasion for these last-ditch efforts was a report by the ABC's Four Corners on a group known as Christian Assemblies International (CAI). Four Corners alleged in a broadcast earlier this week that CAI is a cult and its former leader used his position to abuse CAI members.

Independent Senator Nick Xenophon stated that this report demonstrates the 'foolishness' of abolishing the ACNC.

'It would mean that organisations that are behaving unethically, that are dodgy, would still be getting taxpayer funding in effect due to [their] tax-free status.'

That short statement of Senator Xenophon's contains several flaws and fallacies. The first is that tax exemptions amount to the same thing as taxpayer funding. This conflation of money forgone and money disbursed is a common tactic used to justify government interference in independent organisations.

The second is the idea that not-for-profits can engage in 'dodgy' behaviour with impunity. Illegal behaviour is illegal whether perpetrated by an individual or a registered not-for-profit. In this case, the alleged cult leader identified by Four Corners was charged with abuse under existing criminal law.

The third is that charity registration will become an uncontrolled free-for-all when the ACNC is abolished. According to the Options Paper released by the Department of Social Services earlier this month, the abolition of the ACNC will not leave charities unregulated.

Whatever form the post-ACNC regulatory regime ultimately takes, groups applying for charitable status under the law will still have to demonstrate that they qualify for it, and groups that cease to qualify can still be deregistered if they are found to no longer meet those criteria.

Cults are a dangerous phenomenon, and those who escape from them deserve support. But sensational stories should not be allowed to distract from the ACNC's shortcomings as a regulator.

Helen Andrews is a Policy Analyst at The Centre for Independent Studies.