The Committee has received over 150 responses from a wide range of stakeholders including schools, charities, religious organisations, private individuals and representative associations when public submissions closed on 2 May. Accounting firms, as well as the Accounting Bodies and the ACNC itself, also lodged submissions.

Nearly 80% of submissions were clearly in favour of retaining the ACNC and did not support the government’s plans to repeal the ACNC Act and abolish the ACNC. In summary, these respondents supported:

• a single national regulatory framework, the elimination of inconsistent State based fundraising, compliance and reporting obligations;
• a single one-stop shop for education, support, regulatory and compliance functions for the sector;
• the necessity for state/territory alignment of regulations to ensure elimination of duplication and red-tape, especially for those entities operating across State borders.
• a single national register for charities; and
• the independence of the ACNC from other regulators, including the ATO.

These numbers do not include an open letter to the Prime Minister in March from the Community Council for Australia in support of retaining the ACNC which contained the signatures of 57 CEOs and leaders of not-for-profit agencies and charities. It is interesting to note that the percentage of submissions in favour of retaining the ACNC is similar to a survey conducted by Probono Australia in August 2013 of 1,500 not-for-profit stakeholders which showed that 81% of the sector supported the ACNC.

Many respondents commented on the success to date of the ACNC, its responsiveness and understanding of the not-for-profit sector, and arguing that it would be premature to disband it. Given the ACNC has only been operating for 16 months, there was clear acknowledgement for the good progress the Commission has made. Many respondents also indicated that they did not want the ATO to replace the ACNC as an alternative regulator.

Around 10% of submissions appeared ambivalent on retaining the ACNC in its current form, but suggested that certain national regulatory functions should be retained, regardless of which agency enforces them.

Only 10% of submissions supported the repeal of the ACNC Act as currently proposed. These submissions highlighted the ‘increased regulatory burden’ along with apparently ‘oppressive’ ACNC powers. Many of these organisations stated that they already operated in a highly regulated educational environment prior to the ACNC and many indicated that the ACNC had provided no significant net benefits to them.

Public hearings were conducted on 23 May and 13 parties who had previously provided written submissions were invited to address the Committee. Interestingly, excluding the ACNC itself, only three of those parties attending the hearings were clearly in favour of retaining the ACNC in its current form. The majority of the invited attendees supported abolishing the ACNC – an amazing dichotomy compared to the percentages of written submissions. The transcript of the public hearings makes fascinating reading and highlights great examples of self interest and politics overtaking good public policy.

The Committee’s report was tabled in the Senate on 16 June. Perhaps not surprisingly, and despite the overwhelming majority of respondents’ objections to the repeal bill, the Committee’s report reflected the government’s position that the repeal bill be passed. Further, the Committee “sees no reason why” the ATO could not replace the ACNC to administer the charity sector. The Labor and Greens Senators dissented from the Committee’s findings and recommended that the bill not proceed.

Ultimately, the fate of the ACNC will be decided by the eight cross bench Senators who now hold the balance of power. Until the repeal bill is passed, charities should continue to comply with their obligations under the ACNC Act.

Martin Olde, Nexia Australia and NZ Accounting and Audit Technical Director