SOME of Australia's biggest charities and community sector groups have banded together to warn the federal government it will commit a "huge mistake" by closing the national charity regulator.
The federal government will introduce the first of two bills disbanding the Australian Charities and Not-for-profits Commission (ACNC) on its red-tape "repeal day" on Wednesday.
It will replace the commission with a smaller, charity-focused centre for excellence, which will act as an advocacy, training and development body. It will not be a regulator.
On the same day, more than 40 supporter groups - including the heads of the RSPCA, Youth Off The Streets, Lifeline and the Ted Noffs Foundation - will write an open letter to Prime Minister Tony Abbott asking the government to reconsider those plans.
"The ACNC has done what few new regulators achieve - gained widespread support across the sector it is regulating," the letter reads.
Scrapping the ACNC will be a "huge mistake" and potentially handing its powers backs to the Australian Tax Office will create more red tape and reduce services to the public and charities.
Community Council for Australia chief executive David Crosbie said returning to the "bad old days" of having the ATO determine what is and isn't a charity would create a clear conflict of interest.
"It is simply putting the fox in charge of the hen house," he said in a statement on Wednesday.
"It is a failed model from the past. It will not work."
Mr Crosbie accused the government of being dismissive of charities in assuming it knew what was better for the sector without consultation.
But Social Services Minister Kevin Andrews said the ACNC was increasing red-tape and making life harder for the sector.
"No evidence has been provided to justify establishing such a big regulatory structure with such extensive enforcement powers," he told AAP in a statement.
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