Letter to members – Inquiry

Fellow League Members,

Report of the Charitable Fundraising Inquiry into RSL NSW

The Bergin Inquiry report was made public yesterday and this 700-page report can be read HERE.

The inquiry, and the events leading up to it, have been a difficult but necessary time for the RSL. Today, we can start to put this behind us. There is still much to be done to rebuild the League, but the Report acknowledges the progress we have already made. The Public Inquirer writes “it is important to refer to the extraordinary efforts that have been made by Messrs Brown and Condon in reviewing and refreshing the leadership of each of the entities, gathering information, advice and support and implementing positive change. Although it is appropriate to focus on these two leaders of change, it is obvious that the members, employees and advisers have enabled them to execute their plans” (p 467). Key findings for RSL members are summarised below:

Fundraising Failures (Chapter 7)

The Public Inquirer concluded that there has been “extensive non-compliance with the statutory regime for fundraising at the sub-Branch level” (p 139) as well as a failure by State HQ to comply with numerous parts of the Fundraising Act, the Regulations and the fundraising authorities issued under the Act. Chapter 7 of the report lays out the non-compliance issues, which include:

• Failure to implement accounting systems that accurately track how the proceeds of each fundraising appeal were expended.
• Failure to keep money raised from fundraising appeals in separate accounts or ledgers.
• An inability to prove that all funds raised from the public were used for the promised purpose.
• Failure to comply with the law in terms of accounting and auditing financial statements to include records of proceeds raised from fundraising. RSL NSW accepted that its financial statements did not comply with condition 6 of its fundraising authority in that: they did not include an income statement summarising the income and expenditure of each fundraising appeal conducted during the relevant financial year, nor a balance sheet summarising all of the assets and liabilities resulting from fundraising appeals at the end of the financial year; and they did not include a declaration by the President, principal office or some other responsible member of RSL NSW verifying the income statement and balance sheet and whether the organisation had complied with the provisions of the Act, the Regulations and the conditions of the fundraising authority.

As to sub-Branch compliance, the Inquirer acknowledged that RSL NSW did ‘not have complete certainty’ as to how sub-Branches had accounted for fundraising proceeds. The Inquirer noted however that the survey responses from sub-Branches (which RSL NSW was legally compelled to provide to the Inquiry), showed, on a preliminary review, extensive non-compliance with fundraising laws also at a sub-Branch level.

In response to the findings of the Inquiry, the Minister for Better Regulation has now formally imposed a number of additional conditions on RSL NSW’s Charitable Fundraising Authority. Notice of these new conditions will be sent to all sub-Branches in a separate communication.

All of this confirms the need to fix and centralise our fundraising systems and change the way we conduct all fundraising appeals conducted at both State Branch and sub-Branch level. With 353 sub-Branches and another 200 subsidiaries fundraising for the league across NSW this will take some months to complete.

ANZAC Day 2018

Whilst we fix our fundraising systems, we are negotiating an interim arrangement for our 40,000 volunteer members this ANZAC Day; RSL NSW will fundraise for the Invictus Games Sydney 2018. This inspiring event, created by His Royal Highness Prince Harry, will bring wounded warriors from 18 nations to Sydney in October to compete against each other, and show to the world they remain unconquered by their war wounds. The Invictus Games are a cause all Australian veterans can and should support and we are excited to get RSL NSW behind them and look forward to our members spreading the word this ANZAC Day. On the day, and in the lead up to ANZAC Day, our members and volunteers will be fundraising for Australian International Military Games (AIMG), the charity organising the Sydney Invictus Games. Each dollar raised by RSL NSW members and volunteers will be deposited directly into the account of AIMG. ANZAC House will be in touch with further details on how this will work at a sub-Branch level soon.

The Inquirer also observed that the care for needy veterans and their families is of enormous public interest, as is the survival and future of our great institution. Fundraising has traditionally been used to financially support the work of our sub-Branches. Without it, nearly half our sub-Branches will struggle to remain open. Whilst we fix fundraising systems to be compliant with the law, we will need to change our league’s financial model to ensure that better-resourced sub-Branches apply the surplus funds they hold to support smaller sub-Branches. We will separately issue a State Council Directive outlining the new financial model for the league during 2018. We must make sure our smaller sub-Branches, particularly those in the bush, can keep doing welfare and commemoration work in their local communities.

Individual Failures

The Inquirer was scathing in her assessment of certain former leaders of the league who she considered took the RSL “close to the brink of destruction”. She criticised State Councillors who served between 2014 and early 2017 for their ignorance of the fundraising law and their duties as directors and found that “each of them engaged in a cover-up” regarding misleading statements made to league members about the resignation of former President Mr Don Rowe (p 306). She has recommended the Minister consider referring Messrs Crosthwaite, Haines, Harrigan, Henderson, Humphreys, Hutchings, James, McManus-Smith, Metcalfe, Stephenson, Toussaint, White and Dr Bain to ASIC and the ACNC for appropriate investigation in respect of their involvement in covering up Mr Rowe’s misuse of RSL NSW funds as outlined in the report. The Minister did so last Friday. Mr Rowe has also been referred to the NSW Police.

Current RSL NSW leadership

As the Inquirer outlines in her Report, a matter relevant for consideration by the Minister is whether the people in charge of an organisation such as ours, that wishes to hold a fundraising authority are “fit and proper” persons.

She notes that “until the rebuilding began, there clearly were grounds which would justify the Minister in concluding that the entities were not fit and proper persons to conduct fundraising appeals.”

She concludes however that insofar as the identity of the individuals who are now in the leadership roles is concerned, the Minister “would be satisfied that those persons are fit and proper persons.”

Chapter 11 of the report explains in detail the efforts that RSL NSW, WBI, and RSL Lifecare have made to rebuild the league in the past six months.

Thank you

I am grateful to the current State Council, the staff at ANZAC House, trustees of WBI, current board members of RSL Lifecare, and its chairman Andrew Condon for all the extraordinary work they have done in the past six months to keep this organisation alive. And to you, our members, for keeping faith in the league. Whilst this brings the inquiry process to a close, we still have much work to do to fix the league and keep our charitable status. I urge each of you to read the report and reflect on why this happened, and how we can make sure it never happens again.

The State Council will, as a matter of urgency, work through the report recommendations and deliberate on the issues, and determine the work required to continue rebuilding the League and establishing fundraising compliance.

This work and our progress will be a central focus in my updates. While there is more work we all need to do, we can all be proud of the progress we have made to date.

Thank you for your continued support and watch THIS VIDEO for an update regarding upcoming communications.

James Brown

President