Update: Abolition of the ACNC

28 March 2014 Topics: Not-for-profit

On 7 March 2014 we reported that the federal Minister for Social Services, Kevin Andrews, had confirmed the pre-election promise of the government to abolish the Australian Charities and Non-for-Profits Commission (ACNC).

A Bill was introduced to parliament on 19 March 2014 but its debate was delayed until 2 April 2014. Subsequently, at its meeting on 26 March 2014, the Selection of Bills Committee resolved that the Bill be referred to the Economics Legislation Committee for inquiry and report by 16 June 2014.

The reasons for referral are to thoroughly consider the impact that repealing the ACNC will have on the charitable sector and to ensure adequate stakeholder consultation occurs. A number of representative groups of the not-for-profit sector were named in the referral as possibly being in a position to provide submissions or evidence.

Opposition leader Bill Shorten has said that the proposed repeal of the ACNC is an insult to the regulator and to taxpayers who want to see where their donations go. Mr Shorten has further commented that repealing the ACNC will mean that charities will lose visibility and governance support and the public will be more vulnerable to frauds and scams.

Senator Rachel Siewert has also stated that the Greens will oppose the repeal of the ACNC. T

he Explanatory Memorandum to the Bill provides that the repeal will not take effect until a later Bill that establishes the replacement regulator, the National Centre for Excellence, is enacted.

At this point in time little information is available as to what shape the National Centre for Excellence will take and whether the charity register established by the ACNC will remain.

While the government has previously stated its intention to also repeal the Charities Act, which commenced on 1 January 2014, this was not included in the repeal day Bills.

A pre-election survey conducted by Pro Bono Australia and letters to Kevin Andrews from charities express the sector’s support for the ACNC.

While the ACNC remains, entities registered with it should continue to comply with the relevant requirements, including lodgment of annual information statements by 31 March 2014.

Further, most entities with tax endorsements will need to be or remain registered with the ACNC to continue to receive the benefit of such endorsements until legislation is otherwise introduced.

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