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Getting to the bottom of the IPA's right to DGR status

Article (1,225 words) posted on 28 Jul 2018 by Rosie Williams

If people are going to challenge the activities of the IPA, it is important to have a thorough understanding of the legislation governing its activities. While I do not pretend to be an authority at this stage, I do have information based on my work which is missing in the existing discourse.

I've now read several articles by professional journalists decrying the IPA on the basis that it is a registered charity while also participating in what many people consider to be, in the words of the charities regulator, operating with a 'disqualifying political purpose' through incubating representatives of the Liberal party and working on Liberal party campaigns (Roskam in AFR, 2005) to name just a couple of obvious concerns.

The question of the IPA's charitable status is valid and one which I have been researching with some enthusiasm based on the extensive work I have done this year with charities data. The ACNC provides open data on all registered charities which includes financial information for the past three years. It is important to note that the ACNC has only been in existence for five years which is why data from previous years is not available.

The existing data confirms that there is a charitable trust associated with the Institute of Public Affairs which has been providing financial information as required over the three available years.

Readers will note that DGA status for the trust is recorded as being actively endorsed from 2008 long before the charities regulator came into being in Dec 2012. As the ACNC points out, it does not administer Deductible Gift Recipient status, this is done by the ATO and it was through the ATO that the IPA originally sought and received DGR status.

Yet this is not the full story because registered charities are not the only legal entities that are entitled to apply for and receive DGR status from the ATO. So called 'Approved Research Institutes' can also obtain DGR status from the ATO and it is under this legislation that the IPA gained its DGR status.

There are in fact two organisations registered to the Institute of Public Affairs. As many journalists have noted, one is a trust which is a registered charity regulated by the ACNC. There is also a corporation registered to The Institute of Public Affairs which is presumably the Approved Research Institute that is being funded by donors including Gina Rinehart (given that the trust shows no sign of such large sums of income).

As can be seen from the dates above, DGR status for the corporation/ARI is documented in the open data published by the Department of Industry and Innovation as dating from 2006 prior to the registered charity in 2008 and probably as part and parcel of setting up as an Approved Research Institute.

Open data provided by the ATO puts the total of ARI's at 169, however there is no list of Approved Research Institutes anywhere and the ATO did not reply to my request for a list.

I think that the IPA holds its DGR status not from its dealings with the ACNC, but under law administered by the ATO and this could be instrumental to questions about the legitimacy of the actions of IPA under ACNC legislation which would not apply to Approved Research Institutes.

While there are prohibitions under the Charities Act relating to political advocacy of registered charities, the registered charity itself is not the entity in receipt of the donations or publishing Annual Reports at the IPA website. Given the size of the donations under question, the entity reporting at the IPA website would have to be the corporation, which as an Approved Research Institute, is not governed by the Charities Act.

Whether Approved Research Institutes can be closely involved with a particular political party is another matter as the governing requirements relate to scientific legitimacy. While this is in itself fair grounds to question the legitimacy of the ARI and the DGR status it holds, it is a different question to political bias and I do not have enough information on the rules governing Approved Research Institutes at my fingertips to comment.

Quentin Dempster has been calling loudly for the ABC to require think tanks that provide spokespeople to their programs to disclose their donors. While donations from organisations such as Hancock Prospecting do not enjoy the protection of the Privacy Act, it is important to point out that revealing the source of donations from individuals without their consent probably is.

There may be cause exclude donors to Approved Research Institutes (or perhaps even registered charities) from the Privacy Act but this would require a change in the legislation.

The reason political parties are able to publicly disclose donors to the AEC is due to the specific exclusion in the Privacy Act for political parties- which also incidentally means if the party itself holds membership information, it is not protected under the Privacy Act (a fact confirmed to me by the OAIC).

I hope this article goes some way to answering at least some of the questions people have regarding the Institute of Public Affairs. I consider my research into the organisation to be in its infancy and there will be much more to report as time permits. You can support this research at Patreon.