Sue Barker: charity lawyer on the calls for Destiny Church to lose charity status

There's been growing debate concerning the status - and tax exemptions - of charitable groups.

Followers of Destiny Church stormed an Auckland library to protest a drag storytime event and disrupted a rainbow parade last weekend, prompting calls to evaluate their status.

Many have suggested Destiny Church's charity status should be revoked, with Labour's Phil Twyford writing to the Charities Regulator to get them struck off.

Charity lawyer Sue Barker says the current Charities Act is not fit for purpose.

"The original Charities Bill that went through Parliament in 2004 was widely regarded to be fundamentally flawed - and it was almost completely rewritten at the select committee stage and rushed through under urgency without any proper consultation." 

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Episode Transcript

Speaker 1 (00:06):
You're listening to the Sunday Session podcast with Francesca Rudgin
from News Talks EDB.

Speaker 2 (00:12):
The debate around charity status and tax exemption certainly got
reignited this week, didn't it. Following on from Pride event
protests from Destiny's Church members last weekend, there have been
many calls for their charity status to be removed on Friday,
that included Labor calling for them to be struck off
the Charities Register. So for an explainer on charity's law

(00:33):
and to find out if, in fact Disney Church have
overstepped the mark. Here, I'm joined by charities and public
tax lawyers Sue Barker. Thanks for your time this morning, Sue.

Speaker 3 (00:44):
Thank you. Frank Jessco, good morning, Good morning.

Speaker 2 (00:47):
Now could the behavior we see from Destiny's Church last
weekend be enough to have their charity status removed?

Speaker 3 (00:55):
Well, I think a preliminary question would be what which
entity would be removed or is up for removal. I
had a quick look at the Charities Register yesterday and
I found twenty five Destiny Church entities on the Charities Register.
Of those, eight deregistered voluntarily in twenty ten, seven have

(01:15):
been deregistered for failure to file and your Returns. One
closed down in November twenty twenty four, and of the
remaining nine current entities, one of them is Destiny Church,
New Zealand Trust. But Destiny International Trust, which is the

(01:35):
appears to have been the kind of head entity that
was deregistered for failure to file and Your Returns on
fifteen February twenty twenty two, so it's not a registered charity.
It has already been deregistered, so you know, it's not
subject to oversight from Charity Services. And Destiny New Zealand

(01:57):
Church is interesting as well if that's taking on perhaps
some kind of role as the lead organization, and certainly
that's the one that's filled twice for complaints. Mentioned first,
they haven't filed and your Returns now for two years,
so Charity Services applies a double defaulter approach. If you

(02:18):
fail to file and your returns for two consecutive years,
then many, many thousands of charities have been deregistered for
that reason. So it is interesting why they are still
on the register given that they haven't filed and your
Returns for two years. And actually I did read something
in the media, Charity Services is saying that this church,

(02:41):
Destiny Church New zeel In Trust has filed and your
returns post twenty twenty two, but quote they currently have
outstanding actions they need to address. In order to prioritize
transparency for the public, we are actively reviewing where the
reports can be published for entities with outstanding actions, which

(03:01):
strikes me as very odd. If they have filed the returns,
they should be on the register for everyone to see.

Speaker 2 (03:09):
So this is just so much more complicate complex, isn't
it very complex? And it doesn't might not even come
down to bad behavior. It sounds like there's a variety
of reasons here why this should be considered.

Speaker 3 (03:21):
Well. I would argue that actually the Charities Actor is
our capone legislation. It's about information of the many, many
thousands and thousands of charities that have been deregistered over
the We got the Charities Act in two thousand and five,
the Charities Register in two thousand and seven. Since then,
many thousands of charities have been deregistered, but from what

(03:42):
I can tell from Charity Services website, only six of
those have been deregistered for serious wrongdoing, which is very hot,
because that's what it was supposed to be all about.
It was about providing charities with an opportunity, a forum
for them to demonstrate to their stakeholders that they were
or anyone the public at large, that they're worthy of support,

(04:03):
and also a means for weeding out the badge charities,
those engaged in money laundering, tax avoidance flowed, whatever it
might be. So it is interesting that of the many
thousands that have been deregistered, only six so far has
been deregistered for serious wrongdoing.

Speaker 2 (04:18):
Okay, So is the current Charities Act fit for purpose
or does it need to be reconsidered?

Speaker 3 (04:23):
It is absolutely not fit for purpose. The original Charities
Bill that went through Parliament in two thousand and four
was widely regarded to be fundamentally flawed, and it was
almost completely rewritten its selectimittee stage and rushed through under
urgency without proper consultation. But the charitable sector was appeased

(04:44):
by an indication from the former Minister of Finance, the
Honorable Lates Sir Dr Michael Cullen, that the Charities Act
would be subjected to a full first principle's post implementation
review and you would normally expect a significant piece of
legislation like this to have a proper first principle's post
implementation review. But here we are nearly two decades later,

(05:06):
and we have never had a proper first principles post
implementation review. Instead, we've had almost two decades of piecemeal,
knee jerk tinkering that is making things worse rather than better.
And after some hundred million dollars of charitable regulation, public
test and confidence and charities has declined so significantly, so

(05:30):
I would argue it is not working at all, and
we need to look at this properly. We actually need
to stop and take a step back and think what
are we actually trying to do with this legislation, because
we don't even have agreement on what this legislation is for.

Speaker 2 (05:44):
Oh my gosh, so much to work, got, Sue, thank
you so much for talking us through that.

Speaker 1 (05:48):
For more from the Sunday session with Francesca Rudkin, listen
live to News Talks there'd be from nine am Sunday,
or follow the podcast on iHeartRadio