WEEKLY NEWS DIGEST (July 2-8, 2012)



Founder’s $40m tax bill will not force MONA to close.” By Adam Fulton. Sydney Morning Herald. July 7, 2012. The millionaire gambler and arts patron behind the $180 million Museum of Old and New Art, David Walsh, is determined to keep it running and says it is unlikely to close to the public. ”There is some risk but I would rate it as small,” Mr Walsh said, of suggestions the Tasmanian museum could close as a result of his retrospective tax bill, put at about $40 million. It is my intention to support MONA ongoing – that has been the work of my life,” he told the Herald yesterday. The museum has ”significant possibilities”. In saying that, the retrospective tax bill is not something that I can service. It is, in fact, more than 100 per cent of the money I’ve made. But I expect a negotiated settlement. I’m not just saying that – I fully expect to get an outcome.” The comments from Mr Walsh, a professional gambler and art collector who founded and owns the museum, come after the Australian Taxation Office gave him a bill for the 2004 to 2006 financial years of nearly $38 million plus interest. He is appealing against the bill and the Tax Office’s ruling, and the case is set to go before the Federal Court next month. The Tax Office alleged that an international gambling syndicate, including Mr Walsh, operated a billion-dollar business and tried to hide details of its operations. Mr Walsh said the tax bill meant he had put on hold expansion plans for the museum. But of it continuing to stay open,


Church shuttered inquiry into abuse.” By Linton Besser and Joanne Mccarthy. Sydney Morning Herald. July 6, 2012. eE church prematurely terminated an investigation last year into the alleged failure of a top Catholic education official to take action over the sexual assault of an 11-year-old boy in the 1970s by a lay teacher. A former principal of St Patrick’s at Sutherland, Brother Anthony Peter Whelan, had been accused by Robert Lipari of failing to take action against a science teacher, Thomas Keady, after he reported being molested by the man at a caravan park. Shortly before being employed at the school, Keady had completed a three-year jail term in Victoria for child sex offences. The church commissioned an investigation by the former NSW Police assistant commissioner, Norm Maroney, who substantiated the 1976 assault, and the fact it was reported it to another senior teacher at the school, Brother John Vincent Roberts. But Mr Maroney was told to stop his inquiries while he was still trying to substantiate the boy’s claims that he had personally reported the assault to Brother Whelan. The spokesman for the Australian Lawyers Alliance, Andrew Morrison, SC, said that in his view it appeared ”the investigation was ended prematurely in order to protect Brother Whelan”. ”It is very disturbing in circumstances where the investigation was almost completed and the overwhelming inference was that an adverse finding was highly likely against Brother Whelan … there were other potential witnesses, but he was not permitted to speak to them.” He said the inquiry should be reopened and he called for the police to investigate.
Related storiy:
Pennsylvania: Archdiocese Bars Two More Priests From Ministry.” New York Times. July 6, 2012.


Earthquake Relief Where Haiti Wasn’t Broken.” By Deborah Sontag. New York Times. July 5, 2012. On the first anniversary of the Jan. 12, 2010, earthquake, in a sleepy corner of northeast Haiti far from the disaster zone, the Haitian government began the process of evicting 366 farmers from a large, fertile tract of land to clear the way for a new industrial park. The farmers did not understand why the authorities wanted to replace productive agricultural land with factories in a rural country that had trouble feeding itself. But, promised compensation, they did not protest a strange twist of fate that left them displaced by an earthquake that had not affected them. Two and a half years after the earthquake, Haiti remains mired in a humanitarian crisis, with 390,000 people languishing in tents. Yet the showcase project of the reconstruction effort is this: an industrial park that will create jobs and housing in an area undamaged by the temblor and in a venture that risks benefiting foreign companies more than Haiti itself. Financed by $224 million in subsidies flowing to Haiti as a result of the earthquake, the Caracol Industrial Park is hardly reconstruction in the strictest sense. Its developers, though, take the more expansive view that, in a desperately poor country where traditional foreign aid has chronically failed, fostering economic development is as important as replacing what fell down. Caracol, the promotional materials say, will help make Haiti globally competitive “without compromising on labor and environmental standards.”


Ashok Chavan charged in Adarsh housing scam.” No by-line. Times of India. July 4, 2012. Former Maharashtra chief minister Ashok Chavan was among 13 people charged by CBI today in the multi-crore Adarsh Housing scam. The 10,000-page CBI chargesheet was filed before the registrar of a sessions court, nearly 18 months after the agency registered a case. The Adarsh scam had fuelled a political storm in Maharashtra leading to the resignation of Chavan as the chief minister. Earlier in the day, the CBI informed the Bombay high court, hearing a batch of public interest litigations seeking the court’s supervision of the probe, that it would be filing a chargesheet later in the day. The CBI has registered a case on January 29 last year against Chavan and others which included bureaucrats and retired army personnel. The agency had in March arrested nine out of the 14 accused after receiving a rap on its knuckles from the high court for not initiating action against the accused persons. The nine arrested accused are – R C Thakur, secretary of Adarsh, retired brigadier M M Wanchoo, former Congress MLC Kanhaiyalal Gidwani, both promoters of the society, former deputy secretary of urban development department P V Deshmukh, IAS officers Ramanand Tiwari and Jairaj Phatak, retired major generals A R Kumar and T K Kaul and former city collector Pradeep Vyas. They were released on bail by a special CBI court after CBI failed to file charge sheet within the stipulated 60-day period after arrest. They have been charged with criminal conspiracy, cheating and the Prevention of Corruption Act.


Foreign-Funded Nonprofits in Russia Face New Hurdle.” By Ellen Barry. New York Times. July 2, 2012. In the latest move to rein in dissent, Russian authorities have introduced a draft law that would require nonprofit organizations that receive financing from outside Russia to publicly declare themselves “foreign agents” — a term that, to Russians, evokes cold war-era espionage and is likely to discredit the organizations’ work in the eyes of the public. Lawmakers from United Russia, the governing party, have accelerated work on the bill and are scheduling the first of three readings on Friday. If passed, the bill would complement a new law penalizing Russians for taking part in unauthorized protests, which was rushed through Parliament at a similar pace last month. The bill would also put new burdens on nonprofit groups with foreign financing that are judged to be involved in politics, including annual audits and unannounced checks for the use of “extremist speech” in published materials. Organizations could face fines of as much as 1 million rubles, or $30,000, for violations. Rights activists have excoriated the proposal as an attempt to discredit their work, arguing that Russian donors are afraid to support organizations that criticize the government, which then leaves them dependent on foreign sources for money. The bill’s sponsors say the law is no more restrictive than the Foreign Agents Registration Act, an American law requiring organizations to disclose foreign support. That law, however, applies only to entities that represent governments; the Russian proposal includes individual and private financial support as well.
Related story:
Russia plans to register ‘foreign agent’ NGOs; Critics say bill targeting foreign-funded NGOs involved in political activities is part of a crackdown on independent activists.” Guardian. July 2, 2012.


Live Q&A: International social enterprise: To mark the launch of our new international hub, join us on 6 July to discuss the role of social enterprise in your corner of the globe.” Guardian. July 6, 2012.

Live Q&A: International social enterprise.” Friday 6 July, 10am – 12 midday BST.” To mark the launch of our new international hub, join us on 6 July to discuss the role of social enterprise in your corner of the globe. We recently launched our new hub for international social enterprise and, to celebrate, we’re inviting you – wherever you are – to join us for a live Q&A on social enterprise around the globe. We’ll be asking:• How social enterprise is supported around the globe; • How social enterprise is defined and perceived in different countries; • What’s the main driver behind social enterprise? Perhaps it’s to create jobs for young people, an off-shoot from the charity sector, or a desire to ‘socialise business’? Log in and let us know what you think about the the progress of social enterprise in your country.


Care home children sent north to save cash.” By Andrew Norfolk. Times of London. July 2, 2012. Hundreds of troubled children are being moved many miles from family and friends — in breach of official guidelines — to private care homes bought cheaply in northern England, The Times reveals today. The south-to-north exodus, which comes to light as the Government prepares to open an urgent inquiry into residential childcare, is seen most starkly in Rochdale, Greater Manchester. The town, with 205,000 residents, has 47 children’s homes, four more than the 14 inner London boroughs combined, where the population is 3.1 million. Girls placed far from home are known to be particularly vulnerable to men who pursue young teenagers in care for sexual grooming. Over the past five years, there have been 631 reported cases of children’s home residents in England being sold for sex. Looked-after children should be placed more than 20 miles from home only in exceptional circumstances, the guidelines state, yet 23,000 young people, more than a third of all children in care, are living outside their home local authority. Most are in foster care, but those with the greatest needs are often sent to children’s homes run by private operators, which have built a portfolio of premises in areas of the country where property prices are low. Such companies, some owned by global investment funds, charge fees averaging £200,000 a year per child. Annual fees at one home were as high as £378,000. A government source described child sexual exploitation yesterday as “an abhorrent crime” and acknowledged that “for years we — police, social services, schools, agencies and governments — have collectively failed to tackle the problem”. An MPs’ report last month into children missing from care said that a belief that it was acceptable for adults to have sex with children who “consent” to their abuse was ingrained within the child protection system. The Government will announce tomorrow a review into “all aspects of the quality of provision in children’s homes”, including local authority commissioning practices and “the location and ownership of homes.”

Charities with a conscience are in a funding fix; Organisations may be sighing with relief at the government’s U-turn on charitable tax reliefs, but traditional sources of funds are drying up.” By David Brindle. Guardian. July 3, 2012. There will be sore heads tomorrow at the Institute of Fundraising’s annual convention, following tonight’s convention party. There always are: fundraisers know how to put on a good bash and the event is justly renowned. But many at this year’s party will have special reason to celebrate. For the government’s headlong retreat on its budget plan to cap charitable tax reliefs has lifted a dark cloud that for 10 weeks hung over the heads of big-gift fundraisers as their wealthy clientele pondered whether to put away their cheque books. Voluntary sector leaders can still scarcely believe their luck. Although the sector put up a solid public front in arguing for the plan to be dropped, as it ultimately was amid a flurry of budget U-turns, the picture behind the scenes was less united. The institute itself offered a compromise that would have exempted donors from the proposed cap only if they passed up their own tax reclaim to the charity receiving the tax-deductible gift. As Karl Wilding, head of policy at the National Council for Voluntary Organisations has now acknowledged, the sector was scratching round for evidence to justify continuation of uncapped reliefs. And “an awful lot” of charities thought it wrong to campaign to keep them, he told a conference last week. Some member organisations even told the NCVO to desist. The truth is that there is considerable discomfort in the sector at the exposure of a system by which rich people appear able to dictate how their contributions to the common good are spent – getting out of paying taxes for (state) schools and hospitals by electing to donate to projects of their choice, which very often will be in the arts or higher education rather than in general social welfare.

Non-hierarchical structures: could it work for you? Breaking down the usual power structures and responsibilities can help charities improve and achieve better results.” By Liz McDowell. Guardian. July 2, 2012. If I say ‘collective decision-making’ you might picture activists outside St Paul’s taking turns to speak. And no wonder – collaborative, non-hierarchical ways of organising have recently been catapulted into the public eye through the Occupy movement. It’s unsurprising that those trying to bring about a radically better world would want to break down structures of power and privilege through different ways of working. But these egalitarian approaches are spreading further than you might imagine – beyond protest groups to charities and even private sector organisations. The new generation of entrepreneurs is less comfortable with hierarchy and more ready to embrace the creative chaos of collective working. The Otesha Project UK has spent six months transitioning to a non-hierarchical structure. From having one executive director, we’ve shifted into a team of five co-directors, alongside decently paid interns who have an equal say but don’t take on any managerial or administrative responsibility. So why choose this potentially risky course? We wanted to show that we value eveyone’s skills equally in our decision-making, governance and salary structures. Meanwhile, long hours and feeling single-handedly responsible for the organisation’s success or failure was difficult for me as the founder. Since going public with our new structure, other charities and social enterprises have been clamouring to know how it works.

Notable & Quotable: Joel Mokyr on the private provision of public goods in “The Enlightened Economy: An Economic History of Britain 1700-1850” (2009). Wall Street Journal. July 4, 2012. The argument that economic development in Britain in the age of the Industrial Revolution was the result of “the rule of law,” that is, well-defined and enforced property rights through third party (i.e. the state) enforcement, is a gross oversimplification. . . . Private law enforcement remained of substantial importance until well into the nineteenth century . . . The enforcement of property rights through private-order institutions reflects something deep and supremely important about British institutions in the eighteenth century. The culture of respectability and gentility helped solve the standard collective action problems that bedevil the production of public goods. The emergence of a plethora of networks, clubs, friendly societies, academies, and associations created a civil society, in which the private provision of public goods became a reality and created what might be called a civil economy. What was true for property right enforcement was true for other projects, for which elsewhere in Europe the state had to play a major role. Roads, harbors, bridges, lighthouses, river navigation improvements, drainage works, and canals were initiated through private subscriptions. In some cases, of course, there was the hope of making a profit, but commonly the entrepreneurs were motivated by a desire to improve local trade and employment.

Charities protest at delay in decision on care for elderly; Crucial decision on how to fund reform to be postponed until next year’s spending review.” By Daniel Boffey. Guardian/The Observer. July 7, 2012. Charities and health organisations reacted with fury to the breakdown of cross-party talks on the future of social care for the elderly as ministers said key decisions on how to fund reform would be postponed until next year’s spending review. A long-delayed white paper on the future of social care will be published on Wednesday along with a draft social care bill. But most attention will focus on a separate progress report – not endorsed by the Labour party – that will make clear that funding for the changes has yet to be agreed. The Treasury denied claims, circulating within the coalition, that chancellor George Osborne had blocked changes that would cost at least £1.7bn a year. In 2011 a review chaired by economist Andrew Dilnot recommended a number of changes to adult social care funding in England. These included placing a cap of £35,000 on what people should pay towards home visits or care home costs before they get help from the state. In England, council-funded home help and care home places for the elderly and adults with disabilities are currently offered only to those with assets of less than £23,250. The Dilnot report said the threshold for assets should rise to £100,000 and a £35,000 cap would be fair. It is estimated that the reforms would cost an additional £1.7bn a year, rising to £3bn as numbers of elderly grow. Currently £14bn a year is spent by councils on social care. Health secretary Andrew Lansley and the Liberal Democrats are understood to have been keen to agree the Dilnot plans, but had to accept that the Treasury’s hands would not be tied ahead of the 2013 spending review. A Treasury spokesman said: “It is completely untrue that we have blocked anything. We have not even been in the talks.”


German Bishop to Head Vatican Orthodoxy Office.” By Stacy Meichtry. Wall Street Journal. July 2, 2012. Pope Benedict XVI tapped German bishop Gerhard Ludwig Mueller to head the Vatican’s office in charge of doctrinal affairs, placing a respected theologian at the helm of one of Roman Catholicism’s most powerful posts. Monday’s appointment comes at a delicate time for the Vatican. Bishop Mueller, 64, succeeds retiring U.S. Cardinal William Joseph Levada as the prefect of the Congregation for the Doctrine of the Faith, the formal name of the Holy See’s doctrinal office. Cardinal Levada, 76, presided over a turbulent period in church history as the Vatican struggled to overcome controversies ranging from tensions with dissident movements to the long-running child-abuse scandal. Bishop Mueller cut his teeth in the world of academia, following a path very similar to the pope. He is the bishop of Regensburg, Germany, the same city where Pope Benedict taught theology in the 1960s as the then-Rev. Joseph Ratzinger. Like the pope, Bishop Mueller has distinguished himself in theological circles. A prolific writer, Bishop Mueller has published a wide array of works, and he is the editor of Opera Omnia, a collection of the pope’s theological writings. , The Congregation for the Doctrine of the Faith is spearheading the Vatican’s response to some of the most sensitive issues facing the Catholic Church. In Europe, the office in involved in efforts to bring the breakaway traditionalist group Society of St. Pius X back into the Catholic fold. Bishop Mueller will also oversee the Vatican’s controversial effort to overhaul an umbrella group of nuns in the U.S. He will also continue to lead the Catholic Church’s world-wide efforts to crack down on sexual abuse. Due to the importance of his new post, the prelate is likely to be named a cardinal in the future. In a statement announcing the appointment, the Vatican said Pope Benedict was elevating the prelate to be an archbishop.
Related story:
Pope Names German Bishop as Leader of Doctrinal Office.” New York Times. July 2, 2012.

Pope Defends His Top Aide Amid Vatican Infighting.” By Stacy Meichtry. Wall Street Journal. July 4, 2012. Pope Benedict XVI defended his closest aide against a tide of “unjust criticism” in an unusual open letter that underscored the pontiff’s struggle to quell months of infighting within the Vatican’s corridors. The pope’s July 2 letter to his top lieutenant Cardinal Tarcisio Bertone marked a rare acknowledgment of the cardinal’s controversial standing among Roman Catholic officials. As the Holy See’s secretary of state, Cardinal Bertone acts as the papacy’s prime minister, running day-to-day operations of the Vatican’s government, the Roman Curia, and keeping church officials united behind the pope’s ministry. Publication of the letter, which praised the cardinal’s “enlightened counsel,” aims to put an end to weeks of reports in Italian newspapers that Cardinal Bertone’s ouster was imminent. In the hushed world of Vatican politics, however, the standing of a secretary of state is rarely questioned in the first place. The fact that the pontiff, on the eve of his summer holiday, publicly defended Cardinal Bertone is a clear sign that the cardinal is under siege, according to Vatican analysts. Some Catholic officials are unhappy with Cardinal Bertone’s handling of myriad crises facing the papacy, ranging from his response to the long-running sexual-abuse scandal to his struggle to referee turf battles over Vatican finances. The battle has been laid bare by a hemorrhage of internal documents that have recently been leaked to the Italian media.

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