Australian Charities and Not-for-profits Commission: Report from the House of Representatives Economics Committee

The report from the Committee issued on 15 August 2012.

In summary, the Committee recommends that the Australian Charities and Not-for-Profits Bill 2012 be passed but subject to some recommended changes:

1. That a specific object be included to "reduce red tape". This would be in addition to the other 2 express objects of maintaining "public trust and confidence" and "a vibrant not-for-profit sector".
2. - That the explanatory material contain an explanation of the phrase "public trust and confidence" and the way it might be interpreted; and

• That the Guide to the Act emphasise the educative and enabling role of the Commission

3. That during some introductory phase, the ACNC have a discretion to accept reports and material prepared by charities for other agencies and other levels of government. ACNC specific reporting only to be required once the portal is functioning as a report once use often point of focus.
4. That governance standards already in use by some sectors, (provided they meet some minimal tests of "charitable objects" and "fit and proper person") be adopted into the Bill by regulation, with the Parliamentary draftsman creating a set of default standards.
5. That private donors be protected from public identification if they wish to keep their philanthropy private.
6. That the section of the Bill dealing with obligations, liabilities and offences (eg directors liability) should be sent back to Treasury for redrafting as they are uncertain and not easy enough to understand.
7. That the Bill also be modified so that the Commissioner be required to give written notice of her intention to revoke or suspend registration or remove a responsible entity (eg a director) so that the entity has an opportunity to be heard. The one exception would be if the Commissioner believes immediate action is required. Likewise the Bill be modified so an entity has an opportunity to be heard prior to publication of certain information and requiring that the material be removed from the Register once an appropriate amount of time has elapsed, provided the matter has been resolved and there is no public interest in retaining the material.
8. The explanatory memorandum should clarify that the Commissioner has a discretion not to impose an administrative penalty, for example, for failure to lodge a document, instead of being obliged to impose a penalty
9. Interestingly, that the Bill contain a provision requiring that it be reviewed after operating for five years.

The Liberal members of the Committee have published a dissenting report. Both reports are available at the House of Representatives Committee website.

There is no specific recommendation made concerning the Basic religious charity exemption, so for the time being, we can conclude that that material will remain as drafted.

We now await the journey of the Bill through both Houses to see how many other changes will be made before it is enacted: or whether, of course, it secures the appropriate majorities to ensure it is enacted after all. The revised Bill is expected to be introduced into the House of Representatives next week, so we will keep you updated.

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