On 9 August 2024 the Labor Government abandoned its efforts to introduce the Religious Discrimination Bill. The Prime Minister cited the lack of bipartisan support. He also spoke about his concern for social cohesion, conscious that the bill would have elicited a divisive debate. There were very real fears that removing the provisions of the Sex Discrimination Act which provided protections for faith-based institutions to act in accord with their beliefs and tenets would threaten the capacity of faith-based schools in particular to carry out their mission.

 

While this outcome is encouraging in that the existing provisions for religious freedom in federal law are preserved, there are still other matters of some concern in relation to the protection of religious freedom in Australia. On 10 May 2024, the Productivity Commission, which conducts economic research at the request of the Federal Government, released a report entitled ‘Future Foundations for Giving’. This report should raise some serious alarm in relation to recognising the religious freedom of charitable organisations to operate in accord with their religious foundations.

In the report, the Productivity Commission recommended systemic changes that, if implemented, will affect how charities operate. This report is among others that have recently proposed repeals to the current accommodation for religious belief in federal legislation. The report proposes that faith-based institutions remove their religious foundation in conducting charitable works.

One particular matter of concern relates to the removal of Deductible Gift Recipient status from charities that have a religious purpose, while extending DGR status to many other types of charities that have no connection to religion. The DGR is a tax status given to an institution that provides a positive societal contribution, for example, educational, healthcare providers, and the like. This tax status provides financial donors with a 100 percent tax deductible donation. For many charities this is a critical factor in attracting donations.

The Catholic Church in Australia has always contributed to the wellbeing of all Australians in a very wide range of charitable works.

Recommendations in the report suggest that if the advancement of religion is in any way a part of the charity’s actions, the charity will lose its ability to be a DGR approved institution. This nation-wide implementation would be highly detrimental to not only all religious institutions – as they are highest percentage of charities – but also threaten the very Catholic identity of our charitable works.

Charities with a faith-based foundation make a very significant contribution to the wellbeing of Australian society.

For example, DGR status is currently attached to building funds of non-government schools. As they receive comparatively little government funding for capital expenditure, these building funds provide non-government schools with an almost exclusive source of funds to improve existing buildings and develop new ones. However, the Productivity Commission recommended even these building funds lose their DGR status. An implementation of this proposal would have serious implications. Private donations to building funds from individual members of the community raised $1.96 billion to further development and expand Catholic schools in 2022. By comparison, the total of all federal and state government grants for capital projects allocated to Catholic schools was $230 million.

Catholic schools provide education to 806,000 students across 1,764 schools in Australia, saving the Government $1.11million per school in capital expenses.

The Federal Government announced they would not be stripping DGR from school building funds, though the Government has not yet announced how it will respond to other troubling recommendations contained in the report.

In another recommendation, the report proposes to end all current accommodations afforded to Basic Religious Charities under the current Australian Charities and Not-for-profits Commission guidelines, functionally abolishing religious independence in Australia. Among other things, the removal of protections for Basic Religious Charities would allow the ACNC Commissioner to exercise powers to suspend, appoint and remove the leaders of charities, including bishops.

It is naïve to believe that charities stripped of their religious purpose (or leaders, for that matter), would continue to have the same impact on society.

Pope Benedict XVI rightly taught that charitable works provided by Christians offer a distinctive contribution to human society. In Deus Caritas Est (2005) he said, “Love—caritas—will always prove necessary, even in the most just society. There is no ordering of the State so just that it can eliminate the need for a service of love. Whoever wants to eliminate love is preparing to eliminate man as such. There will always be suffering which cries out for consolation and help. There will always be loneliness. There will always be situations of material need where help in the form of concrete love of neighbour is indispensable. The State which would provide everything, absorbing everything into itself, would ultimately become a mere bureaucracy incapable of guaranteeing the very thing which the suffering person—every person—needs: namely, loving personal concern”.

What the Catholic Church and other Christian charities offer is a service to people inspired by Christian love.

Thus, the Pope comments, “charity workers need a ‘formation of the heart’: they need to be led to that encounter with God in Christ which awakens their Love (agape) and opens their spirits to others”. Our society needs more than soulless efficiency; Pope Benedict reminds us that it needs agape, the love of God. This is how the work of faith-based institutions is able to benefit the broader community and provide a service uniquely beneficial to those they serve.

The Productivity Commission’s report raises several concerns about the capacity of regulators to appreciate the contribution that faith-based institutions make to the social wellbeing of Australians. Its implementation would have a serious effect on the capacity of faith-based charities and schools to continue to provide their much-needed service to Australians.