Taming the "Charity Dollar " !

It would be a rare person who does not get unsolicited charity appeal letters in the post or an approach from a charity collector in the street.   There are more than fifty-one thousand registered charities in Australia and they compete strenuously for the charity dollar.

How often does someone reveal a glaring need in a news broadcast that prompts a response from the public - and becomes a new charity ?   Unfortunately, some of these charities are not what they seem and to get tax accreditation they must be registered with the Australian Charities and Not-For-Profit Commission, and provide regular balance sheets.

Figures show that fifteen thousand such organizations have been deregistered by the ACNC since 2012 for failing to report their earnings and expenses.   Another four hundred and fifty charities have had their license revoked because they have dropped off the reporting map and have not been heard of for more than two years.

Now there are moves to create a logo which should ensure public confidence that whatever charity is permitted to display it is properly registered with the ACNC and meets all relevant charity guidelines. The public is advised to do their own research because while charities may meet all required reporting standards, the actual cents in the dollar that reaches the supposed recipient can be very sub standard.

Some charities are notorious for maintaining a very well paid elite of "managers " who run the organization and have a need for expensive cars.   It was recently discovered that some organizations relied on street collectors who worked on a commission basis.  While they received a major share of each dollar collected, their pay was seriously below the minimum wage.

Those appeal letters arriving through the mail also provoke thought.  Today's strategic thinking seeks to put the recipient under an obligation.   Often the request contains gifts, and some of these inflate the cost of each letter accordingly.  Pens and greeting cards are often inclusions,but the tendency has been to more exotic content.   With postage stamps now costing one dollar this form of charitable collecting has become expensive.

The use of a logo to signal that a product meets standards is not new.    The health people applied it to food and that certainly resulted in controversy.  As a reporting standard, awarding a "tick " to denote approval across such a wide spectrum must include many questionable inclusions.

Perhaps the application of a different standard would deliver a clearer picture.  When a charity submits its balance sheet to the ACNC each year it should disclose the two most important items of interest to its donors.   The amount of charity dollars collected -  and the actual funds disbursed to the purpose of that charity.

That allows the donor to decide whether that charity is run efficiently and whether it serves the purpose for which it is designed.   The ultimate is what percentage of each charity dollar actually reached the charity target.

That should be the required disclosure on all and any literature produced by the charity.    It would tend to weed out the inefficient and reward the well run charities who keep their expenses low.  The public could therefore place their support where they are certain that the major portion of each dollar  donated finds its way to the coal face - and is now swallowed up in "expenses " !

The ACNC has the ability to deliver a gold standard to charity accountability !