CCA Submission to the Review of the ACNC Legislation

CCA's submission outlines key issues in relation to the past performance and future direction of the Australian Charities and Not-for-profit Commission (ACNC) with a focus on possible legislative changes.

CCA has consulted with members  in framing this submission, however, it is important to note that this submission does not override the policy positions outlined in any individual submissions from CCA members.

CCA has long been a supporter of the need for an independent regulator of charities in Australia.  CCA has advocated for the establishment and retention of the ACNC as a way of delivering increased transparency, accountability, and sustainability for the Australian charities and not-for-profit sector.

The content of this submission includes: a brief background to CCA; a summary of key points within this submission, an overview of the current context for the NFP sector; an overview of advocacy and charities, a listing of fourteen specific issues to be considered in reviewing the ACNC operations and legislation, and a conclusion.

This submission also draws on the contribution to the review process by the ACNC itself and notes our appreciation that this submission was circulated early enough to allow the charities sector to consider the ACNC recommendations as part of their submissions.

CCA welcomes this opportunity to provide input into this review of the ACNC and is keen to engage in detailed discussion about any proposals arising from the Inquiry.

It is important to note at the outset the David Crosbie, CEO of CCA, was one of the founding ACNC Advisory Board members.

Summary of key points in this submission - please see full submission for detail

  1. The first five years of the ACNC have been remarkably successful

The ACNC has set the standard internationally for what a charities regulator can and should be.

  1. Changing the objects of the ACNC will serve no useful purpose

CCA see no reason to change the ACNC objects in any way.

  1. Secrecy and enforcement

The current secrecy provisions applying to ACNC investigations and enforcement activities need to be reviewed.

  1. Red tape and the charities passport

More work needs to be done to have the current ACNC charities passport adopted across governments, the various regulators and major funders of the sector.

  1. Fundraising and consumer law

CCA would like to see a carefully staged application of Australian Consumer Law to the charities sector. 

  1. Protecting charitable assets

Wherever possible, all funds raised for a charitable purpose should be used for that charitable purpose, even if a charity ceases to operate.

  1. Advocacy and political activities

Further involvement of the ACNC to restrict the advocacy activities of charities would be an over-reach.

  1. Better data and the charities register

More should be done to ensure data provided to the ACNC has a higher level of consistency and comparability. 

  1. Research

Greater investment in charity sector research drawing on the ACNC data sets should be a priority for governments and researchers across Australia.

  1. Expansion to not-for-profits

The ACNC should be allowed to consolidate and expand their work with charities for at least a further three years before starting to examine the development of a register of not-for-profit organisations.

  1. Exemption for religious charities

It may be time to consider phasing out the current exemptions over the next five-year period for larger religious charities.

  1. Appointments to the Advisory Board and future role

An open process involving applications and selection against set criteria should be adopted in filling all Advisory Board appointments.

It may also be appropriate to give the ACNC Advisory Board the power to review the performance of the ACNC and the Commissioners on an annual basis.

  1. Appointment of the ACNC Commissioner

A merit based transparent appointment process is essential in maintaining public and charity trust in the ACNC.

  1. Reaction to the ACNC submission

In general, CCA support most of the recommendations for legislative changes outlined in the ACNC submission to the review, but note the following exceptions.

CCA see no reason to change the objects (ACNC submission recommendation 2).

It is important to encourage a diversity of people to become involved in charities and their governance – this may include people who have previously committed a criminal offence (ACNC submission recommendations 7 and 8). It is often the case that charities want to appoint diverse Boards including consumers of their services or representatives of their communities.  In some cases, this may involve ‘responsible persons’ that may have criminal records – for instance former drug users who have been through treatment programs and are on the Board of the alcohol and drug agency that provided the services. 

Requiring charities to maintain records with multiple regulators, including the Australian Securities and Investment Commission, represents extra work for little gain (ACNC submission recommendation 16).

In Conclusion

The ACNC has been an outstanding success, despite numerous barriers and years of uncertainty about its future.  It enjoys a strong reputation in Australia and around the world as one of the best charity regulators.  The remarkable achievements of the ACNC across the first five years of operation are a testimony to the expertise and resolve of an outstanding group of people working at and with the ACNC during the first five years. 

CCA would encourage the Federal government to exercise caution in any moves to change the role of the ACNC or its enabling legislation.  It is not good public policy to undermine what is already working well.

There are some areas and activities where the ACNC can further strengthen its role and effectiveness as a charity regulator.  These have been outlined in this submission.  Beyond these minor changes, CCA would again commend the ACNC for all it has achieved in its first five years of operation.  The ACNC is a public-sector success story that highlights the strong commitment of all charities to be accountable in order to build the trust and confidence of the communities they serve. 

Read CCA's full submission.