Non-Profit News Service No. 0334 - Public ancillary funds: draft legislation and guidelines released

On 14 July 2011, the Assistant Treasurer released for public consultation an exposure draft of legislation and draft guidelines that provide a new regulatory framework for public ancillary funds.

Some extracts from the Assistant Treasurer's media release No. 113 are included below:

"These reforms have been much anticipated by the sector and I am pleased to consult on changes that will bring the standards of accountability and governance of public ancillary funds in line with private ancillary funds," Mr Shorten said.

Under the reforms the Treasurer will have the power to make legislative guidelines to establish and maintain public ancillary funds. The changes also give the Commissioner of Taxation the power to impose administrative penalties on trustees who fail to comply with the guidelines and to remove or suspend trustees of non-complying funds. This function may later move to the new Australian Charities and not-for-profits Commission once it is up and running.

The legislation also defers the previously announced start date of 1 July 2011 until 1 January 2012. Trustees of existing funds will be given a choice whether to apply the minimum distribution requirements in the new guidelines immediately or wait until 1 July 2012.

For information about how to make a submission, and to view the exposure draft and draft guidelines, refer to the Exposure draft - legislative framework for public ancillary funds on the Treasury website.

The closing date for submissions is:

• Monday 1 August 2011 for the exposure draft
• Wednesday 31 August 2011 for the draft guidelines.

We previously advised of this measure in Non-Profit News Service No. 0283 - 2010-11 Budget: measures relevant to non-profit organisations.

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