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Monday, 17 September 2012
Page: 10800


Mrs ELLIOT (RichmondParliamentary Secretary for Trade) (19:32): I am very pleased to be speaking on this bill which establishes the Australian Charities and Not-for-profits Commission, ACNC, as a national regulator for the not-for-profit sector. The Australian community sector—sometimes also labelled 'the not-for-profit sector', 'the non-profit sector', 'the third sector' or 'the social sector'—encompasses a very broad range of social institutions that are neither commercial nor governmental. It can include entities of all different sizes. They can be hospitals, aged-care services, community services, universities, sports clubs, religious groups, day care centres, recreation clubs, environmental groups, job training centres, family counselling agencies and so many more. The list goes on.

In fact, the number of Australian community sector organisations was most recently estimated at around 600,000. That is a huge number. Some 440,000 are smaller unincorporated organisations. The majority of Australian not-for-profits operate below the radar at a very local level. We all have a range of them in our electorates that do outstanding jobs.

Those local community groups play many roles within society. They provide services that are very responsive, relevant and accountable to their communities. They give voice to concerns and advocate for change across a whole range of issues. They also provide a place for people to participate and engage with each other in community life and they often break down isolation and enable people from a diversity of backgrounds to join in. I certainly congratulate them for the remarkable work they do.

This government believes in the importance of a strong and resilient charitable and not-for-profit sector, an important sector that contributes to strengthening communities right across the country. The introduction of this bill represents a significant milestone in delivering reforms that will strengthen and support the sector so it can continue to grow, flourish and improve into the future.

The sector itself has long called for a dedicated national regulator that understands its needs. The Gillard government is committed to establishing the ACNC in order to drive the implementation of a national approach to regulation. We understand how important it is to do that. We want NGOs and charities not weighed down by regulation and red tape but to get on with what they are best at. Having a one-stop shop regulator that strengthens the sector is our focus.

Various reviews have recommended simplifying and harmonising taxation and regulation for the not-for-profit sector with a national regulator and a statutory definition of charity. At the last election, the government committed to introducing the most extensive national reforms the sector has experienced in our nation's history. Following on from this, in the 2011-12 budget, the government announced a series of reforms to strengthen and support the sector. The cornerstone of the government's reform agenda is the Australian Charities and Not-for-profits Commission—the ACNC.

Not-for-profit entities play an important and valuable role in our society. In recognition of this significant role, the sector receives a whole range of funding, including donations from members of the public, tax concessions, grants and also lots of other support from the government. What is important is enhanced transparency and accountability. They are essential to the ongoing growth and sustainability of the sector overall. What it needs is a regulatory system that promotes good governance, accountability and transparency for non-profit entities that will help to maintain, protect and enhance the public trust and confidence that underpins the whole sector.

Equally important is promoting a reduction in unnecessary regulatory obligations on the sector. The sector is in some ways currently subject to overlapping, inconsistent and duplicate regulatory and reporting arrangements, creating unnecessary burden. The lack of an independent national regulator with a dedicated focus on the particular needs of the sector has hindered and held back the implementation of more streamlined regulatory arrangements right across the country, creating many problems. Initially the ACNC will focus on regulating charities only; however, into the future the regulatory framework will be able to be extended to all NFP entities.

The bill also establishes a publicly available online information register that contains details of entities registered with the ACNC. The register can be easily accessed by members of the public, including by donors and volunteers. Of course, that is vitally important from the transparency perspective. The public will be able to use the register as a source of reliable information, giving them confidence in their decisions to donate to or volunteer for a registered charity. The ACNC will work to provide education and guidance to the sector to assist in their participation in the national regulatory framework. Likewise, the ACNC will play a key role in providing information and education to the public about the sector and how it is being regulated. This educational role of the ACNC will help to improve the public understanding of and engagement with the important work of the sector as a whole.

The ACNC bill has three objectives. Its first objective is to maintain, protect and enhance public trust and confidence in the not-for-profit sector. Its second objective is to support and sustain a robust, vibrant, independent and innovative not-for-profit sector. The third objective underlines the important role that the ACNC will have to promote the reduction of unnecessary regulatory obligations on the not-for-profit sector.

The bill establishes the statutory office of the Commissioner of the ACNC. The ACNC commissioner will have the general administration of the ACNC legislation. In undertaking this role, the commissioner will have regard to a number of factors, including the diversity and distinctive role of the not-for-profit sector and the importance of providing education and guidance to not-for-profits.

The bill provides the ACNC commissioner with the power to register not-for-profit entities under their specific charitable type or subtype. Registration is voluntary; however, entities will need to be registered to access government support in the form of concessions, exemptions and other benefits. The bill also sets out the processes and grounds for the revocation of registration by the ACNC commissioner. The commissioner will maintain a public register, containing key details about registered entities. Registered entities will need to comply with a set of minimum principles based governance standards.

The bill establishes a single reporting framework, which is proportional to the size of the registered entity, based on revenue thresholds. Registered entities will be required to notify the ACNC commissioner of any changes that do occur. The commissioner will have the powers to conduct regulatory oversight in an effective and efficient manner. These powers include information-gathering and monitoring powers, the ability to give entities warning notices or directions, the ability to accept enforceable undertakings, the ability to apply for injunctions and the power to suspend or remove a responsible entity. To ensure the accuracy of information provided to the ACNC, the bill provides a proportional administrative penalty regime and establishes an advisory board to provide advice and make recommendations to the ACNC commissioner in relation to his or her functions under the act.

The bill establishes a framework to ensure appropriate protections for personal or confidential information, whilst ensuring the ACNC is able to fulfil its functions as the not-for-profit sector's central regulatory body. The legislation also imposes certain obligations, liabilities and offences on entities that are responsible for managing the registered entity. This ensures that there is appropriate accountability for complying with regulatory requirements.

Of course, the government has worked in very close consultation with many dedicated people and organisations that make up the sector to develop this legislation. The government has been responsive to issues raised during the extensive consultation process and has taken into consideration issues raised during the House of Representatives Standing Committee on Economics inquiry into the draft bills. Recommendations of the committee have been incorporated. Additional detail has also been added to the explanatory memorandum to clarify the ACNC commissioner's discretion regarding the issuing of administrative penalty notices.

Transitional reporting arrangements have been included to allow the ACNC commissioner to treat a statement, report or other document provided to another government agency as meeting the reporting obligations of a particular registered entity under the ACNC reporting framework. This arrangement will apply until the 2014-15 financial year and can be extended by regulation. Consistent with the committee's recommendation, the legislation will be reviewed after five years.

We can see there are so many positive improvements throughout this bill in terms of having this national regulatory system in place. This is quite interesting when we look at some of the points opposition members have been making in their contributions. We have heard many of them selectively quoting a whole variety of different stakeholders in the not-for-profit sector and often they have quoted them out of context. What we hear is really their ongoing, relentless negativity and their refusal to support sensible, future orientated reforms such as this establishment of the ACNC. Indeed, that is often what we hear from them—their negative approach. We are committed to making sure we have improvements of the sector. It is important to get on the record that there is broad and strong support for the ACNC from right across the not-for-profit sector. The opposition's attitude can be described as quite arrogant and/or ignorant—either one or both. They are refusing to recognise how important these contributions by the sector are. ACOSS have said:

The establishment of a national regulator for the community sector has long been championed by ACOSS. We welcomed the Government’s commitment to this reform in 2011 and have worked closely with the Government and our members towards its establishment …

We strongly support the ACNC opening on 1 October.

Philanthropy Australia said:

Philanthropy Australia supports the principles of the ACNC being an independent regulator to deliver smarter regulation, reduce red tape, and improve transparency and accountability within the sector. Philanthropy Australia believes that this will foster a strong, growing and accountable not for profit sector, which is vital for a vibrant, inclusive and resilient civil society in Australia.

Those are strong endorsements. The Smith Family, in their submission to one of the inquiries on the ACNC bills, state:

The Smith Family would welcome the passing of this legislation and the establishment of the Commission.

A whole series of different groups have put forward very positive responses to this legislation. That certainly is in contrast to the negatives from the opposition. I am sure the next speaker will have some more negative comments. Instead, they should be getting on board and supporting these important reforms to have the national regulator in place. The fact is that the work of the not-for-profit sector has a profound impact upon the lives of so many individuals and communities right across the country. The government is committed to working collaboratively with this very vital sector, to implement this series of important regulatory reforms because we want to support and strengthen the sector and ensure that in the future they continue to grow within a robust regulatory framework. The establishment of the ACNC is a key step throughout this process. We are committed to ensuring we can improve the sector now and into the future so they can continue to do the remarkable work they do right throughout our community. I commend the bills to the House.