Senate Report on ACNC ‘Retrograde’ Step

A Senate Committee report into the abolition of the charity regulator, the Australian Charities and Not-for-profit Commission (ACNC), has failed to break the deadlock between the Government and other parties, and if the majority report is implemented it would be retrograde step for public trust and confidence in sector, the ACNC Advisory Board Chairman Robert Fitzgerald has warned.

Fitzgerald said despite 80 per cent of submissions received by the Senate Committee supporting the retention of the ACNC, the majority senate report recommended the ACNC Act be repealed.

“This recommendation was saying the Australian community had no right to information about a sector that receives substantial tax concessions and benefits every year,” he said.

The report was tabled in Federal Parliament along with two dissenting Senate Economics Legislation Committee reports from the Labor Party and the Greens, which both recommended the repeal of the ACNC not proceed.

Fitzgerald said it was credit to the ACNC that all three reports recognised how much work the Commission had achieved in areas such as regulatory harmonisation and defining what constitutes good charity regulation in a relative short space of time.

“Unfortunately, the majority report repeatedly refers to the proposed Not for Profit sector National Centre of Excellence as a successor component to the ACNC. However, the consultation on the NCE explicitly says the issues related to the abolition of the ACNC are out of scope. Further, the proposed NCE has not been promoted as a regulator,” Fitzgerald said.

“The charity and Not for Profit sector is one of Australia’s fastest growing and important sectors. It has taken 17 years, at least six inquiries, 2000 submissions and volumes of evidence to get an effective national regulatory model. And now the effect of the majority opinion is would be to undermine basic transparency, the tackling of duplicative reporting and proven and effective regulation.

“By moving to abolish the ACNC, the Government is going against the tide: England and Wales has had an independent charity regulator for more than 160 years; Scotland and Singapore established regulators and a public charity register following charity scandals; New Zealand has had a charity regulator since 2005.  In the last 12 months Ireland, Jamaica and now Jersey have moved to establish independent charity regulatory bodies and public registers. Hong Kong has also recommended establishing a public charity register.”

Fitzgerald said the basis for creating a body such as the ACNC was always about fixing regulatory failure and to create a platform by which the sector could grow.

“Instead, the effect of the majority report is to return to a flawed and ad hoc regulatory system,” he said.

“Rather, a review of the ACNC should occur after five years of operation, as allowed by the ACNC Act, to allow for a proper examination of what the regulator has achieved and to identify further opportunities for enhancement.

“Since the ACNC’s inception, three separate surveys have each found an 80 per cent satisfaction rate with respondents supporting the ACNC.

“In a relative short period of time, the ACNC has created Australia’s first free, publicly available national charity register, provided sound education and advice services to support charities in their governance, and implemented the Charity Portal and Charity Passport, which is critical to reducing duplicative reporting across government.

“It is now a matter for the Parliament to determine if it wishes to have an efficient and effective regulator, or return to a regulatory regime that will ultimately increase compliance burdens on the sector and fail to deliver transparency to the Australian public.”