Alert

Who does this affect?

All not-for-profit organisations operating in Australia.

What do you need to do?

Review the Productivity Commission's Issues Paper and decide whether or not your organisation wishes to make a submission. Submissions are due by 29 May 2009. We can help.

Authors
Geoff Adams  
Senior Associate (Pro Bono & Community Programs)

Katherine Urbanski  
Solicitor

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Chris Wheeler  
Partner
T +61 2 6217 6081

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Sydney
Robyn Chalmers  

Melbourne
 

Perth
David Perks  

Brisbane
David Bell  

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The Australian Government is seeking to improve its understanding of the contribution of not-for-profit organisations as a means of informing policy and identifying better ways of working with the sector. This may lead to significant changes in the laws regulating not for profit organisations.

The Treasurer has asked the Productivity Commission (“Commission”) to report on the contribution of the not-for-profit sector. As part of its study, the Commission has released an Issues Paper. Initial submissions to the Commission are due by 29 May 2009.

The Commission’s study follows the Senate Standing Committee on Economics (“Senate Committee”) report “Disclosure regimes for charities and not-for-profit organisations”, released on 4 December 2008. The recommendations in that report, if implemented, will dramatically change the form and operation of not-for-profit organisations in Australia.

The Senate Committee recommended a national approach be taken to regulating the sector, including the creation of a single legal structure for all not-for-profit organisations. The Senate Committee’s view was that a central, uniform system would greatly improve the operation and accountability of the sector.

The Commission’s study will adopt a broad definition of the not-for-profit sector. It will also consider the Government’s Taxation Review headed by Dr Ken Henry and the 2001 Inquiry into the Definition of Charities and Related Organisations.

The Commission is seeking comment in respect to issues falling within five broad categories:

• measuring the contribution of the not-for-profit sector

• ways of enhancing the efficiency and effectiveness of the sector

• the sector’s provision of government-funded services

• trends and developments impacting on the sector, and

• the impact of the taxation system on the ability of not-for-profit organisations to raise funds and the extent to which the tax treatment of the sector affects competitive neutrality.

The Australian Government has foreshadowed the need for changes in the governance arrangements underlying its relationship with the sector, including through a National Compact or agreement setting out the basis on which future collaboration will occur.

If you would like more information on the Commission’s study, the Senate Committee’s report or the Government’s Taxation Review, or if you require assistance with any submissions to the Commission, please contact us.