Commissioner’s Column – 25 January 2018

Recently, the ACNC has been busy drafting submissions to a range of government inquiries that will impact the Australian not-for-profit sector.

Last week, we made our contribution to the five-year review of the ACNC’s legislation. The review has invited responses from all interested parties, encouraging comments on the performance of the legislative framework and the regulation of the charity sector in Australia.

The review is the perfect opportunity for discussion and debate. I encourage you to share your thoughts and ideas by making a submission. Submissions close on 28 February 2018. For more information or to make a submission, visit the Treasury Consultation Hub.

The ACNC’s submission focuses on what we have learned over 5 years of operation as Australia’s national charity regulator and provides our suggestions and recommendations for the future of the ACNC’s legislation.

In our view, there are three major areas which the review of the ACNC legislation should address.

The first is the ACNC’s secrecy provisions. Currently, we are unable to publish information about the ACNC’s decisions on an application for registration, or the reasons why we decided to revoke a charity’s registration.

We feel we need the ability to disclose information where it is in the public interest – for example, confirming if an investigation has commenced, disclosing action the ACNC took in relation to a registered charity, and publishing a reason for decision if we decide to revoke a charity’s registration. Donors have a right to know whether a charity is involved in an investigation. This level of transparency is critical in building trust.

The second recommendation relates to the ways we can use the information we collect. Currently, some information about registered charities is published on the ACNC Charity Register – but we believe more can be done to highlight the depth, diversity and achievements of our charity sector to donors. Changes to the legislation will allow further information to be displayed and publicised, which we believe will be beneficial to all stakeholders.

The final focus area is the ACNC’s objectives, which are prescribed as objects in the ACNC Act. I believe there is benefit in adding two objects to the ACNC Act:

To promote the effective use of the resources of not-for-profit entities; and
To enhance the accountability of not-for-profit entities to donors, beneficiaries and the public

These recommendations are similar to those listed in the Charities Act 2011 (UK), the law which governs the Charity Commission of England and Wales. They are designed to encourage the responsible and accountable use of charitable resources.

There has been a great deal of scrutiny recently about the effectiveness of charities, and whether charities use their funds and resources to achieve the best results.

Organisations across Australia are also advocates for the responsible management of charities and charity funds. The Community Council for Australia, for example, completed a series of CEO forums on the topic of Owning Our Future in 2014 and 2015, which resulted in reports on key efficiency topics including the better use of assets, and mergers and collaborations.

These recommended objects are not designed to create restrictions or impose limitations on charities. They are not additional enforcement powers, but rather a mandate for the ACNC to support and promote effective and efficient use of resources.

We believe the ACNC can play an important educative role for charities and the public on the importance of efficiencies, the challenges of operating in a not-for-profit market, and the opportunities available to organisations to increase their own efficiency.

Overall, the ACNC’s establishment has been a success – now is our opportunity to analyse charity performance in Australia, and to continue to educate the public about the effectiveness and outcomes of our 55,000 registered charities. After all, accountability and transparency builds healthy, trusted charities.

Our full submission is available to download on the ACNC website.

ACNC submission to the Joint Standing Committee on Electoral Matters

In addition to the review of the ACNC legislation, the Joint Standing Committee on Electoral Matters is also seeking submissions regarding amendments to the Electoral Funding and Disclosure Reform Bill, which will impact many registered charities.

The ACNC has submitted a response in relation to the proposed amendments. It is our view that the Bill, as formulated, will place a further regulatory burden on charities, and may inhibit their ability to advocate as a method of achieving its charitable purpose.

We are unable to publish our submission unless we have permission from the Senate, which we have requested. As a subscriber to the Commissioner’s Column, you’ll be the first to know when our submission is available online.

Submissions to the Joint Standing Committee on Electoral Matters close today, and a report is expected in early March. To find out more, visit the Joint Standing Committee on Electoral Matters website.

2017 Annual Information Statements now due

For many charities, the 2017 Annual Information Statement due date is just one week away. Charities reporting on a financial year period are required to submit their annual reporting by 31 January 2018.

I am aware that there have been issues with the speed and responsiveness of the ACNC website during the lodgement process, and would like to apologise for any inconvenience caused.

The ACNC is currently undergoing a major redevelopment of our IT infrastructure, which will significantly improve the ACNC’s website, and Charity Portal. We expect to have the new system in place for the 2018 Annual Information Statement.

In the meantime, I encourage charities to submit their Annual Information Statement outside of peak hours (the peak hours are 11am-4pm weekdays), allow additional time to lodge the submission, and remain patient with the system as it operates throughout its peak busy period.

To submit your organisation’s Annual Information Statement, log in to the ACNC Charity Portal at charity.acnc.gov.au.

To access resources including the 2017 AIS Guide, visit acnc.gov.au/2017AIS.

Cyber security remains important issue for charities

On the topic of technology, there is a growing emphasis on the importance of cyber security across all industries – and the charity sector is no exception.

It is important for charities to carefully consider their approach to cyber security, conducting regular risk assessments and ensuring their own systems and procedures are up to date.

Our Community have an excellent resource designed specifically for charities and not-for-profits which highlights the importance of cyber security, providing advice and recommendations on topics including data security, identifying vulnerabilities, preventing data loss and more.

The guide, “Damn Good Advice on Cyber-safety and Fraud Prevention”, is available on the Our Community website.

ACNC compliance action reaches record high in 2017

Last week we announced that the ACNC revoked the charity status of 26 organisations throughout 2017, following investigations into misconduct and mismanagement.

I believe this is indicative of the public’s increasing awareness of the ACNC, and the understanding that members of the public can come to us with their concerns about registered charities.

It is important to note that the overwhelming majority of charities in Australia are professional, capable organisations providing vital support to their community – and that is why we must respond to the small number of charities that abuse their position.

A full list of the ACNC’s compliance activity is available at acnc.gov.au/compliancedecisions.

Telstra Business Awards nominations now open

Nominations for the 2018 Telstra Business Awards are now open, with revamped categories including the “Social Change Maker” – designed to recognise charities, not-for-profits and social enterprises where a positive social impact is their core purpose. Finalists and winners are rewarded with a range of opportunities including access to masterclasses, networking opportunities, benchmarking insights and more.

Many great charities and not-for-profit leaders across Australia have been recognised by the Telstra Business Awards in recent years – and we look forward to seeing another worthy winner crowned this year.

To learn more about the awards or to nominate your organisation, visit the Telstra Business Awards website.

Best Wishes,

The Hon Dr Gary Johns

Stay in touch

Contact our Advice Services team on 13 ACNC (13 22 62) or by email at advice@acnc.gov.au

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