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Is the IPA the tail that wags the dog?

Article (1,749 words) posted on 22 May 2018 by Rosie Williams

This article is also published on Medium and Independent Australia under the title John Lloyd APS scandal: Should the partisan IPA lose charitable tax status?

Senate estimates this week have thrown a spotlight on relationships between the highest echelons of the APS and right wing charity, The Institute of Public Affairs. The Australian Public Service Commissioner (no less), has been quizzed on his email communication with IPA Director, John Roskam for the strongly partisan opinions they contain.

It has been revealed that formal complaints have been made against John Lloyd for breaches of the Public Service Code of Conduct although the specifics of the allegations or who made them remain undisclosed.

The argument animating Twitter revolved around whether, if it were a union and anti-Liberal sentiments under question, would Senator Wong and the Twitter left be so scathing of the openly partisan behaviour displayed by an APS representative or would they be talking up the right to political freedom?

It is fair to assume that the interest of many a protagonist has been piqued (and justifiably so) by the close ties between such a high level mandarin and the right wing Liberal training ground that the IPA has proven itself to be. But is it only John Lloyd's professional obligations that should be scrutinised or is it equally problematic that the IPA have been publicly documented discussing partisan politics at such a high level given their obligations under the Charities Act?

For legal purposes, communication with or by a union and communication with the IPA are not comparable activities, at least not from the organisation's viewpoint. When it comes to political advocacy, registered charities and unions operate under very different rules. Unions are Associated Entities operating under the Commonwealth Electoral Act which provides some transparency regarding their activities. Registered charities, on the other hand, must comply with the Charities Act and unlike unions, are forbidden from having as a main purpose, the support of political parties or candidates.

What is particularly ironic in this instance is that the laws proscribing registered charities like the IPA from close ties with political parties (and presumably the APS) were developed out of a report prepared in 2003 by the IPA themselves! Regulation specific to the charities sector is a relatively recent concept formulated late in the Howard era through a process during which the IPA was commissioned to write this report as input to the draft legislation!

The report begins with what is in hindsight, the stunningly hypocritical statement that 'Charities have changed the way they do business, the work of charities is more ambiguously political than was once the case, indeed the very notion of a charity is problematic.'

The IPA was particularly concerned with lobbying activities associated with registered charities and with clause 8 of the draft charities Bill

The strong stance taken by the IPA in 2003 on relationships between registered charities and supporting candidates for political office appears to fly in the face of the fact that several IPA representatives have since become Members of Parliament representing the Liberal party.

Historical annual reports published by the IPA claim 'no political affiliation whatsoever', an ideal which seems to have been abandoned in recent times for a distinctly partisan approach, causing many people to publicly question the legitimacy of their charitable status.

In 2003, after receiving the contract from the Howard Government to provide comment on the draft charities Bill (and ironically claim the need for just this kind of scrutiny of charities), the IPA claimed it would publicly release the list of their donors with their next annual report.

Accountability should be important for think tanks, says Nahan, which is why he says the IPA intends for the first time to publish a full list of sponsors and contributions in next year's annual report.

A look at their annual reports from the period in question shows no sign of this list. Direct enquiries to the IPA for this list have remained unanswered. For an organisation that has played such an influential role in the legislation governing the charities sector it is interesting that they appear to have made false promises about their own willingness to be transparent. AusGov.info data show two organisations with DGR status linked to the IPA:

Enquiries to the charities regulator reveal only that it has received nearly 1,700 complaints about Australian charities. 39 complaints relate to whether 28 of these charities were operating with the disqualifying purpose of either:

  • promoting or opposing a political party or candidate for political office, or
  • engaging in, or promoting, activities that are unlawful or contrary to public policy.

No information was offered as to which charities had been subject to complaint or the outcome of any subsequent investigations although the ACNC provides news of compliance measures here.

According to an email from the ACNC, the IPA Research Trust is registered as charity sub-type 'Purposes beneficial to the general public and analogous to the other charitable purposes' but no information was provided as to how the Institute of Public Affairs Limited gained DGR status perhaps because this status came from the ATO prior to the founding of the ACNC:

Organisations listed by name as a DGR in the income tax law do not need to apply for endorsement.

That the IPA has managed to establish itself as an Approved Research Institute and by this means obtain DGR status while arguing against well-established scientific viewpoints strikes many people as an offensive exploitation of the legislation the IPA themselves helped to draft. That the organisation is believed to be representing the interests of multinational corporations instead of Australian citizens raises valid questions about whether they should be entitled to register as a charity and the lack of transparency about their funding sources only reinforces their questionable ethics.