A Liberal senator has grilled the Productivity Commission on whether it addressed the concerns of faith groups and revised its recommendations relating to reforms in the charity sector.

At Senate estimates on Tuesday, Dean Smith told officials from the Productivity Commission that he was seeking “a level of satisfaction” that the body had responded to what he claimed was “widespread criticism” of its recommendations.

Late last year, the Productivity Commission released its draft report, Future foundations of giving, for its inquiry into philanthropy. In the report, it called for: the removal of the concept of ‘Basic Religious Charities’ (BRCs) in order to enhance “public transparency and accountability” in the charities system; and reforms of the Deductible Gift Recipient (DGR) system, including to exclude all activities for the purpose of ‘advancing religion’ and removing a DGR category that enabled faith schools to raise money for buildings.

Religious groups have described the recommendations as demonstrating “a clear anti-religion agenda” and “direct attack” on faith communities.

Productivity Commission Deputy Chair Alexander Robson told Senate estimates that the final report was delivered to government on 10 May, but he would not comment on the report until the government made it public.

Senator Smith referred officials to Assistant Minister Andrew Leigh’s comments in the media that the recommendations did not represent government policy and asked if the Dr Leigh’s statements “influenced” the final report.

“No, Senator,” said Mr Robson.

“So the government has been out there telling stakeholders that the Productivity Commission draft recommendations do not represent government policy. And that has in no way influenced your work on the final report, which is now with government?” said Senator Smith.

“Correct,” replied Mr Robson.

Senator Smith cited comments by Catholic and Jewish leaders expressing concern about the recommendations and describing them as “puzzling and disturbing”.

“My point is that, since the release of the draft report, there has been very, very widespread criticism in regards to the draft recommendations of the report and the damaging effect they would have on the existence and operations of religious charities in Australia, also the damaging impact they would have on school building funds…” said Senator Smith.

“So my point of inquiry is to understand how the final report – how your work between the release of the draft report and providing the final report to government – has changed to incorporate what has been very, very widespread criticism…”

“Prior to the release [of the report] – and we have to wait 25 sitting days – I’m just looking for a level of satisfaction that the Productivity Commission has taken seriously those concerns that have been raised publicly…”

Mr Robson said the Productivity Commission held additional public consultations, including with faith-based organisations, earlier this year.

“I would agree that there has been a great deal of criticism on those issues that you refer to. We take those concerns very seriously,” he said.

“We’ve also, obviously, received many hundreds of submissions on that particular topic, and they were taken into account in the preparation of the final report.”

The Productivity Commission’s draft report referenced the Rationalist Society of Australia’s submission, which argued that the lack of transparency regarding BRCs was undermining the public’s trust and confidence in the charities system.

As the RSA reported last month, the Australian Charities and Not-for-profits Commission has acknowledged that “reduced transparency” around BRCs may be impacting public trust and confidence in the charities system.

Si Gladman is Executive Director of the Rationalist Society of Australia. He also hosts ‘The Secular Agenda’ podcast.

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Image: Senator Dean Smith (Facebook)