STATEMENTS BY SENATORS;Australian Charities and Not-for-profits Commission – 18 Mar 2015

During the last sitting week, the Senate received the latest annual report of the Australian Charities and Not-for-profits Commission the ACNC. Although charity registers exist in most developed countries, the ACNC is the first of its kind in Australia.

It was established in 2012 by the previous Labor government. As of 30 June 2014, there were 60,736 charities on the register. In the last financial year, charities and other not-for-profit institutions contributed $58 billion to the Australian economy.

Australian charities do important work—caring for Australia’s most vulnerable and disadvantaged people, supporting development projects and providing disaster assistance at home and overseas, caring for our natural environment and protecting the welfare of animals. Unfortunately, that work is undermined by a small number of unscrupulous operators who use charities as a front for scamming, money laundering or, disturbingly, financing terrorist activity. Obviously, if donors and supporters cannot identify genuine charities, then it damages our faith in the entire sector. That is why the sector has a need for a strong and effective regulator. It gives Australians confidence that when they donate their money or time it is to a genuine charity that complies with basic governance standards.

The ACNC’s annual report demonstrates that Australians have embraced the agency and that it has been an outstanding success. Their website had 3.6 million views, including 1.5 million page views of the charity portal. There were 300,000 views of the charity register. Forty thousand annual information statements were submitted by charities, of which 98 per cent were submitted online. The commission processed 252 complaints against charities. Of these complaints, 92 per cent of investigations were completed with advice given to the complainant within the benchmark time of five days.

Despite its success, it is curious that the Abbott government has been pursuing a policy for the past 17 months of abolishing the ACNC. The Abbott government claims its commitment to abolishing the charities commission is a measure to ‘reduce red tape’. But I ask: if Australia’s charities are so concerned the ACNC will impose more red tape, then why are four out of five of them in favour of retaining the commission and its regulatory role? The fact is the ACNC itself is helping to reduce red tape for charities by working to reform a complex and fragmented regulatory framework. The ACNC is working with state and territory governments on the harmonisation of charity regulation and reporting.

The commission’s ‘report once, use often’ framework has led to the creation of the Charity Passport, a single report to the ACNC that can be sought by different government agencies when providing grants. The ACNC is also working with governments to adopt an accounting standard across the not-for-profit sector. When a charity, or not-for-profit organisation registers with the ACNC, it is automatically registered with state and territory authorities too, provided that their home state or territory has signed up to the scheme. The governments in South Australia and the ACT have already progressively linked their charities rules to the national scheme over the past few years, and I am pleased that the Labor opposition leader in New South Wales, Luke Foley, has announced that his state would sign up to the ACNC, should a Labor government be elected there on 28 March.

As I mentioned before, charities overwhelmingly support retaining the ACNC. The last two State of the Sector surveys by Pro Bono Australia showed more than 80 per cent support, despite the government’s ongoing campaign against the commission. In other words, four out of five charities prefer regulation through the ACNC to alternatives such as co-regulation, self-regulation or regulation through the Australian Taxation Office. In March last year, 40 charities—including the RSPCA, Lifeline and Save the Children—signed an open letter to the Prime Minister urging the government to retain the ACNC. The letter stated that, in returning the regulation of charities to the Tax Office,

… red tape will continue to grow, the size of the bureaucracy will grow, and services to the sector and the public will be reduced.

I welcome the recent statement by the new social services minister, Scott Morrison, that abolishing the ACNC is not a ‘high priority’ for the government, but I wonder why it is on their list at all. The ongoing uncertainty over the future of the ACNC is holding back the progress of streamlining regulation and reducing red tape for charities. Abolishing the ACNC is bad policy. It will result in poorer regulation, more red tape for charities, and will damage Australians’ confidence in charities and not-for-profit organisations. It is about time the Abbott government listened to the charity and not-for-profit sector and abandoned its ideological campaign to scrap the ACNC.