2014 Federal Budget: what’s in it for charities?

This update identifies key aspects of the 2014/15 Federal Budget relevant to charities and not-for-profit organisations. It also provides some other news.

ACNC and the Federal Budget

In the 2011-2012 Budget, $53.6 million was allocated for the Australian Charities and Not-for-Profits Commission (ACNC) over a four-year period.  There has not been any change to this evident in the Budget papers. The Coalition government has said it will abolish the ACNC, and introduced legislation to achieve this into the House of Representatives on 19 March 2014.There was some expectation this may flow through to the Budget but that does not appear to have eventuated.

Neumann & Turnour Lawyers’ submission to the Senate Economics Legislation Committee enquiring into the future of the ACNC is submission 45, and can be found here. In summary, our submission identifies a potential interim middle ground between the two positions of no change and complete abolition of the ACNC.

FBT caps to be increased

Some in the sector have been concerned about a possible loss of the FBT rebates and the decline in value of caps. The contrary is the case. Budget paper No. 2 provides:

The cash value of benefits received by employees of public benevolent institutions and health promotion charities, public and not-for-profit hospitals, public ambulance services and certain other tax-exempt entities will be protected by increasing the annual FBT caps. In addition, the fringe benefits rebate rate will be aligned with the FBT rate from 1 April 2015.

Community Business Partnership to be re-established

The Community Business Partnership will be re-established at a cost of $6.0 million over four years and will be chaired by the Prime Minister. Its role will be to advise the Government on philanthropy in Australia and ‘bring together prominent business and community leaders to provide leadership and high level advice for encouraging growth in volunteering and philanthropy and promote partnerships between business and community organisations’. Details are contained in Budget Paper No. 2.

New homelessness funding

The government announced in March that there would be funding to address homelessness. The budget provides $115.0 million in 2014-15 to extend the National Partnership Agreement on Homelessness for a further year and Budget paper No. 3 provides:

In addition to the National Affordable Housing SPP funding, the Commonwealth will provide a total of $656 million in 2014-15 through National Partnerships to support state affordable housing services.

Cuts to NRAS

Concerns in the sector that there would be cuts to National Rental Affordability Scheme have been justified. The budget provides that Round 5 of the Scheme will not be funded. Budget Paper No. 2 states:

The Government will achieve savings of $235.2 million over three years by not proceeding with Round 5 of the National Rental Affordability Scheme (NRAS). Funding for incentives from earlier rounds that are uncontracted or not used within agreed timeframes will be returned to the Budget. Funding for tenanted NRAS properties is not affected.

The savings from this measure will be redirected by the Government to repair the Budget and fund policy priorities.

Budget Paper No. 1 also provides that there will be lesser funds paid under NRAS in the next financial year. It states:

Payments under the National Rental Affordability Scheme which are expected to be $121 million lower in 2014-15 ($312 million over the four years to 2016-17), reflecting a lower than anticipated number of dwellings delivered through the National Rental Affordability Scheme…


Other news

Dr Matthew Turnour back from the UK

Dr Matthew Turnour has returned from sabbatical. He will speak on the topic “The Regulation of Charities and Not-For-Profits: What the Future Holds” at the TEN conference in Melbourne on 15th May 2014. There are a limited number of seats still available if you would like to attend.

Social investment

For those interested in social investment, the Law Commission in the United Kingdom has issued a consultation paper, with feedback open until 18 June 2014. The paper is an excellent summary of current issues and could contribute significantly to the discussion in Australia. The Commission concludes that ‘the law concerning charity trustees powers to make social investments is not as certain as it should be, and would benefit from being put on a solid footing’.

Latest edition of NFP Legal Almanac now available

One of the finest summaries of not-for-profit and charity law that is readily accessible to the public is the Legal Almanac published by the Australian Centre for Philanthropy and Non-Profit Studies at QUT. An online copy of the latest edition is available here.

A New Book

Those interested in law and policy may like to take a look at the new Not-for-Profit Law: Theoretical and Comparative Perspectives, released on 26 April 2014. Dr Turnour and his daughter Elizabeth Turnour, a Moores Legal lawyer working in not-for-profit law, contributed Chapter 2: Archimedes Aid/Watch, Constitutional levers and where we now stand, which explores the law regarding advocacy by charities.


DISCLAIMER: This update contains general information only. It is not all inclusive and should not be considered legal advice. You should always obtain legal advice for your specific circumstances before relying on general information.