In Australia, for an organisation to be recognised as a charity, it must be registered as a charity with the Australian Charities and Not-for-profits Commission (ACNC). All charities are required to be registered under one or more charity subtypes, which reflect a charity’s purpose(s).

Charity subtypes are categories which reflect the 12 charitable purposes under the Charities Act 2013 (Cth) (Charities Act). In this article we explore the charitable purpose of ‘Advancing social or public welfare’.

What are the requirements for registration as a charity under the subtype of ‘Advancing social or public welfare’?

The Charities Act sets out eligibility requirements for an organisation to apply to be a charity, including that it:

• must be a not-for-profit;
• can have only charitable purposes that are for the public benefit (or any non-charitable purposes are incidental or ancillary to, and in aid of its charitable purpose(s));
• cannot be an individual, political party or a government entity; and
• cannot pursue any disqualifying purposes.

Disqualifying purposes include engaging in or promoting activities that are unlawful or against public policy, or promoting or opposing a political party or a candidate for political office.

Once registered with the ACNC, a charity will be included on the public Charity Register. The Charity Register includes various information about registered charities, including their subtype(s).

What is the charitable purpose of ‘Advancing social or public welfare’?

A charity’s purpose is the reason for its existence, in other words its objective or ‘why’. All charities must demonstrate how their activities will further their purpose(s). A charity may have more than one purpose. In fact, the ACNC reports approximately 30% of charities are registered with more than one subtype, demonstrating the complexity and often intersecting nature of the social, economic and environmental issues charities seek to address.

Upon receiving an application for charity registration or subtype review, the ACNC will determine an organisation’s purpose by considering a range of sources, including its constitution, activities, website, any business or strategic plans and even social media platforms.

The charitable purpose of ‘Advancing social or public welfare’ is a broad category, which includes historically recognised purposes under charity and common law, such as the relief of poverty, supporting those with disabilities and the relief of the needs of the aged.

Without limiting what constitutes this purpose, the Charities Act sets out examples of what may be considered as advancing the social or public welfare of the community. These include the purpose of:

• relieving the poverty, distress or disadvantage of individuals or families;
• caring for and supporting the aged;
• caring for and supporting individuals with disabilities;
• caring for, supporting and protecting children and young individuals; and
• assisting the rebuilding, repairing or securing of assets after a disaster.

The Explanatory Memorandum to the Charities Act (Explanatory Memorandum) also provides additional examples, including:

• alleviating disadvantage experienced by people with special needs, such as refugees;
• assisting and supporting people who are disadvantaged in the labour market;
• providing housing and accommodation support for people with special needs or who are otherwise in a special disadvantage in terms of their access to housing;
• addressing disadvantage through international development, for example, through overseas aid; and
• assisting and supporting First Nations People, including advancing economic opportunities in disadvantaged communities, and reducing the disadvantage experienced by First Nations People and enhancing their general wellbeing.

Some examples, provided by the ACNC, of charities registered under this subtype include: soup kitchens, residential aged care facilities, child-care centres, night hostels for homeless people, disability service providers and employment services, respite care centres, social, community and affordable housing providers, and support groups for people living with particular disabilities.

According to the Australian Charities Report 8th Edition, which compiles data from charities’ annual reporting over the 2020 reporting period, just over 3% of charities are registered solely under this subtype, making it the third most common registered subtype behind advancing religion and advancing education.

What is meant by suffering poverty in charity law context?

Where an organisation applies to be registered under the subtype of ‘Advancing social or public welfare’ through the relief of poverty, the ACNC will consider whether the charity’s beneficiaries have a need attributable to their socio-economic or poverty status, which could not be alleviated themselves or they would have difficulty alleviating themselves. For example, people with a low socio-economic background may have trouble accessing housing and could be at risk of homelessness. A charity may alleviate this need by providing community and affordable housing.

The Explanatory Memorandum specifies the people the charity is trying to benefit do not necessarily need to be destitute or on the border of destitution. However, they must lack the resources to obtain what is necessary for a modest standard of living in the Australian community. Poverty may be relieved through the provision of money, accommodation, legal or medical aid.

What kinds of activities does a charity pursuing this subtype undertake?

The activities a charity undertakes must be in support of and conducted in furtherance of its charitable purpose(s).

Activities considered under the Explanatory Memorandum and by the ACNC which support the advancement or fulfilment of ‘Advancing social or public welfare include’:

• providing accommodation services for people experiencing homelessness;
• providing food, clothing and other essential items to homeless people and others who cannot afford to buy such items for themselves;
• running international aid programs;
• providing activities to residents in residential care facilities to promote their physical and mental health;
• community services that provide food, home visits, home maintenance, social and recreational activities and assistance with shopping for the elderly;
• providing funding for disadvantaged young people to obtain an education in Australian primary schools, secondary schools or tertiary educational institutions, through scholarships and other means;
• work participation programs for refugees, people who are unemployed or people with a physical or mental disability, including training services and assistance with travelling to and from their place of employment;
• raising funds to repair not-for-profit community buildings or other assets damaged by cyclone, bushfire or other disasters; and
• providing temporary accommodation, money and goods to people who have lost their homes due to bushfires or other disasters.

Are there additional considerations for charities registering under this subtype?

While this article does not go into detail about deductible gift recipient (DGR) endorsement, overseas operations or community disaster relief, there are additional considerations certain types of charities registered under this subtype may need to consider.

Some charities registered under the subtype of ‘Advancing social or public welfare’ may be eligible for registration as a public benevolent institution (PBI), a DGR endorsed category under the Australian Charities and Not-for-profits Commission Act 2012 (Cth) (ACNC Act) and Income Tax Assessment Act 1997 (Cth) (ITAA). For more information on DGR endorsement and eligibility for registration as a PBI, read our previous article, ‘Could your organisation be endorsed as a deductible gift recipient?’.

Where a charity is running an overseas aid program, and otherwise operating or undertaking activities overseas, there are additional compliance obligations under the External Conduct Standards in the ACNC Act. The External Conduct Standards aim to provide confidence overseas operations are reaching the intended beneficiaries and are being used solely for charitable purposes, while promoting transparency. For more information on these obligations, read our previous article, ‘Where in the world are you operating? Five considerations for charities operating overseas’.

Finally, the Charities Act includes a specific provision for the purpose of assisting the rebuilding, repairing or securing of assets after a disaster, in other words community disaster relief. It is important this is recognised as different to disaster relief for individuals (which is also likely to be a charitable purpose registered under this subtype) or Australian Disaster Relief Funds. The intention of this provision is to extend charitable purposes to include re-establishing not-for-profit community assets after a disaster, independently of the relief of individual distress. This reflects the important role and contribution not-for-profit community assets hold in a community. Organisations wanting to register and pursue this purpose will need to meet additional criteria under the Charities Act around eligibility and the kinds of activities they can undertake.

How can we help?

If you would like to find out more about registering as a charity or amending your charitable subtype to include ‘Advancing social or public welfare’, please get in touch with our specialist Charities + Social Sector Lawyers.