Charitable Gifts to Non-Charities

Is there a problem? There are a number of charitable institutions that will not, as a matter of policy, make grants or gifts to entities that are not also recognised or registered as charities.  This has always struck me as an “over-the-top” approach, perhaps demonstrating some lack of sophistication in the screening of grant applications.  Even if the donee is a charity, poor donation decisions can still be made which may cause trouble. I believe there is nothing inherently wrong if a charity makes a gift, grant or donation to a non-charity as long as that gift, grant or donation is for a charitable purpose.  Of course, if the donee is not accepted as having “donee status” by the Inland Revenue Department (see below), the donor may not be able to obtain revenue advantages from the donation. If a donor charity declines to give to any entity unless it is also charitable, that still begs the question of whether its gifts will actually be used for charitable purposes. Analysing the issues Problems can arise because of the uncertainties that arise after any gift, grant or donation is made.  It is inescapable that those potential problems still exist even when money is given to a charity; every donee needs to be taken on trust that they will use the gift, grant or donation for the intended charitable purpose.  In Audits or Review of Accounts I referred to the inherent limitations in any audit or verification process – “no auditor is able to supervise every transaction to ensure that money received does get banked, or to verify that goods and services...

Privacy of Society and Charity Records

The problem – ignorance about the Privacy Act 1993 For many lawyers and other professionals the implications of the Privacy Act 1993 are scarcely “top of mind,” or particularly well-known and well-understood.  Briefly, the Privacy Act controls how what are called “agencies” in the Act collect, use, disclose, store and give access to “personal information.”  An “agency” is “any person or body of persons, whether corporate or unincorporate, and whether in the public sector or in the private sector …” so the Act clearly covers incorporated and unincorporated societies and charities. In response to my request for topics for this series of articles, a staff member at the Privacy Commissioner’s office advised me that they receive a number of complaints about how small organisations like charities and societies handle privacy issues such as requests for personal information.  Such privacy issues usually arise in the context of disputes between members, or between the committee and members.  As is normal with most community organisations, the committee and officers are usually volunteers and don’t know what to do and make a mess of things. Clearly, knowing about the Act and what to do about privacy issues should save amount of time, anguish and stress. So what is “personal information” under the Privacy Act? Anything about an identifiable, living human being is personal information, and it doesn’t have to be in any way sensitive or “private.”  For societies and charities personal information may include information about members and former members (name, home, postal and email addresses and phone numbers, offices held, awards, skills, references, and photographs), but also information about individuals other than members who...