Updates to the Education Regulation for non-government schools
Learn about changes to the Education Regulation including what’s new, what hasn’t changed and what schools need to do.
Key information
- The amended regulations are now in effect.
- Updated NSW Non-government Schools Not For Profit Guidelines (NFP Guidelines) were published in April 2026 with supporting materials to be released later in 2026 to help explain the changes.
- Subscribe to our Not for Profit News to stay informed about the changes.
What are the changes?
The amended regulations make it clear that certain uses of school income, assets, and payments for property, goods and services won’t be considered for profit activity. They also establish more timely and less costly ways to address breaches.
The changes:
- make it clear that schools can use resources to support survivors of child sexual abuse, reflecting a commitment to student wellbeing and community responsibility
- provide confidence for schools seeking to compliantly support community engagement and charitable initiatives
- allow for a wider range of remedies to help schools comply with the obligation not to operate for profit
- will be supported with updated NFP Guidelines which address additional issues that the Review identified as needing clarification.
Why were these changes made?
These changes follow the NSW Government’s Review of Section 83C of the Education Act 1990 (NSW), which identified the need for new regulations to clarify how schools can use income and assets and to simplify how breaches are managed.
The changes aim to improve:
- transparency
- accountability
- oversight of public funding for non-government schools.
NESA consulted with key stakeholders to assure the clarity and practicality of the amended regulations.
Learn more about the reform process and timeline.
What hasn’t changed?
To be eligible for NSW Government assistance, a non-government school must not operate for profit.
The Education Act 1990 (NSW) remains unchanged.
When do the changes start?
Changes to the Education Regulation for non-government schools will commence effective immediately.
What you should do now
You can stay informed and supported by:
- reviewing the changes so you understand the not for profit requirements
- checking the NESA website, updated NFP Guidelines and supporting materials that will be available in early 2026
- contacting NESA for advice at any stage.
Summary of the changes
This information will help you understand which parts of the Education Regulation have been amended and what the new rules include.
Amended Regulation
Overview of the change
The amendment confirms that a school does not operate for profit because of redress payments for child sexual abuse. It broadens the provision to:
- allow payments above the prescribed amounts under the National Redress Scheme.
- permit payments to other formal redress schemes that align with the objectives and characteristics of the national scheme.
Reason for Amendment
The amendment provides flexibility for schools to act in the best interests of survivors, particularly where:
- additional support is warranted
- the school is participating in alternative or supplementary redress schemes.
New Regulation
The amendment confirms that a school does not operate for profit because of joint use arrangements in circumstances where the asset is owned or jointly owned by the school.
It clarifies that:
- schools may make payments and use school income and assets for joint use arrangements
- schools may enter into arrangements with other parties to develop facilities that benefit the school and the other party.
The amendment clarifies that a school does not operate for profit because it makes payments or uses school income or assets to develop or build new facilities for school use that are owned by another entity, provided certain conditions are met.
It supports schools in collaborating with external organisations to build or upgrade facilities while maintaining compliance with not for profit requirements.
The amendment clarifies that a school does not operate for profit when it makes its facilities available to certain groups at no or minimal cost, provided the facilities are not needed by the school at the time.
The regulation supports schools in sharing their assets with the broader community while maintaining compliance with the not for profit requirements under the Act.
Schools may share their facilities at no cost or below reasonable market value:
- other non-government schools
- local government bodies
- not-for-profit community organisations
- the general public, for recreational purposes or other purposes that benefit the local community.
The amendment clarifies that a school does not operate for profit when it donates equipment that is depleted, disused, or of low value, provided the donation is made for charitable or benevolent purposes.
The regulation supports schools in responsibly disposing of redundant equipment in a way that benefits the community, while maintaining compliance with the not for profit requirements.
Schools may donate equipment that is:
- fully or substantially depreciated, or
- no longer required for school operations under specified circumstances.
Schools may make reasonable payments to cover the cost of transporting the equipment to its new location.
The amendment clarifies that schools do not operate for profit when they engage in fundraising for external charitable causes, hold these funds for the relevant entity or cause, before making a donation to that cause provided the recipient is a charity registered with the Australian Charities and Not-for-profits Commission (ACNC) or an international charity.
Schools may use their assets to support these activities, as long as the use does not compromise educational delivery.
Schools cannot make donations that include the income of the school.
The regulation supports schools in using their resources to contribute to broader social good, while maintaining compliance with the not for profit requirements under the Act.
The amendment enables the Minister to issue a direction to a school or proprietor to take specified action to remedy a breach of the not for profit requirements, under section 83I(1)(d) of the Education Act 1990 (NSW).
This allows more flexible and proportionate responses to breaches, ensuring timely and constructive compliance.
The Minister may issue a direction to a school or proprietor where:
- a breach of the not for profit requirements has occurred
- the breach is considered minor
- the breach is reasonably capable of being remedied.
More information
NESA will update this page with the latest information.
To access a copy of the laws, you can visit the NSW Legislation.
Need help during this transition period? Contact NESA for advice at any stage of implementation.
For the latest updates, sign up to Not for Profit News.