The " Charity " Dollar !

We are not experiencing the " good times " in Australia at present.  Many people think we are heading into another recession and wages have not been increasing at the same ratio as profits.  The big end of town is doing well but the rewards are not being evenly spread,

Many people are irritated by the constant incoming phone calls from charity canvassers seeking donations for a host of worthy causes.  This is accompanied by a flood of letters in the mailbox depicting tragic hardship which can be alleviated with the donation of a few dollars.   It makes some wonder how their name got on a charity contact list  ?

Those contact lists have become big business in the charity realm.  If you have ever made a donation where your name and address was noted on the receipt this becomes a valuable asset for the charity involved.  It is not unusual for a charity to sell its donor list to other charities as a legitimate method of obtaining funds.

The reason you are receiving phone calls requesting a donation and the reason well produced colour brochures are arriving in tour mailbox - is because this form of charity collection brings results.  In fact it is the only source of revenue for many charities and so they colour their appeal to stand out and gain attention in the myriad business of charity collection.

Phone canvassing is often the work of unpaid volunteers who donate their time but the majority of incoming calls originate in " call centres " in low wage countries where staff are paid on the basis of their call success.  Postage is about to increase above the rate of a dollar per letter, but bulk mailings get a discount rate.  Charities complain that in the present economic climate, the rejection rate to both phone and mail appeals has sharply increased.

All charities are required to be licensed by the state government and need to file an annual financial return.  In some cases, the money flow to the intended purpose of donation collections is failing due to the cost of running the charity absorbing most of the incoming funds.  The charity overheads consist of an office, staff and probably a car for the use of the chief executive.   Some of these charities are deficient at submitting annual audits.

We are now finding instances where charities are ending up in liquidation when they face insolvency. One such charity has slipped $ 840,000 into the red according to its annual report and the jobs of its twenty-eight employees seem certain to be terminated.

The right to collect charity money from the public needs to be carefully monitored.  The big charities such as the Salvation Army and the Smith Family are above reproach but a responsible government audit of many smaller money raising functions will reveal working methods that are clearly uneconomic. Many would not withstand an objective scrutiny  !