Federal Minister for Social Services Kevin Andrews has confirmed the pre-election promise of the Government to abolish the Australian Charities and Non-for-Profits Commission (ACNC).

The Government intends to establish a National Centre for Excellence (NCE) to replace the ACNC.

The intention is for the NCE to be modelled on the US-based Charity Navigator, which posts charity ratings based upon their financial health, accountability and transparency. Such a model will mean charities will not be compelled to provide information in the same way as the ACNC currently requires.

This approach will, according to Andrews, fulfil the aim to ‘…transfer the focus from coercive compliance and regulation to collaborative education, training and development.’

In addition to establishing the NCE, the proposal is to restore the role of the Australian Tax Office in regulating the sector.

The Government intends to introduce a Bill into Parliament on 19 March 2014 that will abolish the ACNC and repeal the Charities Act, which commenced on 1 January 2014.

Further, the Bill that is intended to achieve this dual purpose is also likely to repeal other legislation affecting the sector in an attempt to carry out the Government’s promise to cut what it views as red tape in the sector.

Until the ACNC is abolished, entities registered with it should continue to comply with the relevant requirements. Further, most entities with tax endorsements will need to be or remain registered with the ACNC to continue to receive the benefit of such endorsements until legislation is otherwise introduced.