CCA Submission to the Department of Social Security – A stronger more diverse and independent community sector

CCA Submission to the Department of Social Security - A stronger more diverse and independent community sector

Thank you for the opportunity to provide a submission in response to the issues paper: A stronger more diverse and independent community sector.

It is difficult to know how to respond to such a paper without suggesting that the knowledge about what is needed to strengthen community sector organisations and improve the way the Department of Social Services engages with the sector has already been clearly communicated for over a decade, and repeatedly ignored.

There is little or no contention, for instance, that the length of social service contracts requiring the employment of staff should not be less than three years, or that notice periods to end contracts should be at least six months.  There is also little contention that such readily accepted fundamentals are regularly ignored by the Department of Social Services.

More than a decade ago the Productivity Commission unambiguously laid out some of the reforms needed to boost community sector productivity through more effective and efficient contracting of non-government organisations in this report: Contribution of the Not for Profit Sector – Commissioned study – Productivity Commission (  CCA and our members support the recommendations of this report, at least ten of which relate to the way governments engage with and contract community organisations.  This report should be the reference point for any action.

In terms of paying what it takes to provide contracted services, this is another good starting point: Paying what it takes Report, Social Ventures Australia and the Centre for Social Impact

Eight years ago CCA provided a submission in relation to the way the Department of Social Services contracts NGOs.

A copy of this submission is attached (see: All of the recommendations in this submission remain current and CCA would like this submission to form the basis of our response to the latest issues paper.

The recommendations in this 2015 submission are:

Summary of Recommendations 

  1. Australian governments should urgently review and streamline their tendering, contracting, reporting and acquittal requirements in the provision of services to reduce compliance costs.  This should seek to ensure that the compliance burden associated with these requirements is proportionate to the funding provided and risk involved.  Further, to reduce the current need to verify the provider’s corporate or financial health on multiple occasions, even within the same agency, reviews should include consideration of:
    • development of Master Agreements that are fit-for-purpose, at least at a whole-of-agency level
    • use of pre-qualifying panels of service providers.

(Recommendation 12.7 Contribution of the Not-for-Profit Sector, Productivity Commission, 2010)

  1. The Department of Finance and Deregulation should develop a common set of core principles to underpin all government service agreements and contracts in the human services area. This should be done in consultation with relevant government departments and agencies and service providers.

(Recommendation 12.8 Contribution of the Not-for-Profit Sector, Productivity Commission, 2010)

  1. All government tendering processes should actively involve those being contracted to provide services and those who will benefit from the services in the design and implementation of programs.
  1. All government tendering processes should have a publicly stated policy goal, and a measurable indicator of success. 
  1. Funding decisions need to be supported by a clear and transparent account of the criteria used to assess applicants, the process by which these criteria were applied, the information used to inform decision making, and the rationale for final decisions. 
  1. Expertise in the area of service provision being contracted should be included in all decision-making panels. 
  1. When entering into service agreements and contracts for the delivery of services, government agencies should develop an explicit risk management framework in consultation with providers through the use of appropriately trained staff.  This should include:
    • allocating risk to the party best able to bear the risk,
    • establishing agreed protocols for managing risk over the life of the contract.

(Recommendation 12.6 Contribution of the Not-for-Profit Sector, Productivity Commission, 2010)

  1. All government contracts seeking to achieve a social purpose should have at least a 5% allocation to support the collection and reporting of appropriate performance measures.
  1. Contracts with not-for-profits to provide community services should be for at least three years and no program should lose funding with less than six months’ notice.
  1. Establish a closed independent feedback loop to enable NFPs a confidential solutions focused avenue in provision of feedback on government relationships with the sector.


As already noted, the questions about what needs to be done to strengthen the community services sector through better contracting arrangements have been repeatedly discussed and generally agreed by the sector, and by key inquiries and reports over more than a decade.  No doubt most of these recommendations will again be reported by the Department of Social Services in summarising this current process.

The most important question that now needs to be answered is whether the Department of Social Services has any real intention or commitment to implement any of the changes required?

Thank you for considering this submission.

David Crosbie

CEO, Community Council for Australia

Working for purpose deserves its own reward

Published in The Community Advocate: Working for purpose deserves its own reward

Working for purpose deserves its own reward

In an increasingly competitive employment environment, the charity and not-for-profit sector is crying out for a workforce strategy, writes Community Council for Australia CEO David Crosbie.

Staff skills, recruitment and retention is an area of concern that has been regularly raised with the Community Council for Australia (CCA) by charity CEOs over recent months.

Of course, charities and not-for-profits (NFPs) are not alone: a national skills shortage is already affecting productivity in Australia across the business and government sectors.

It is not unusual that staffing is one of the issues keeping CEOs awake at night, and nor is it new.

For as long as I can remember, the fact that charities and NFPs couldn’t afford to match what governments or business could pay staff has been a concern. But now the workforce challenges appear to be even more demanding.

Cost-of-living pressures seem to have pushed the remuneration side of salary packaging to the fore for many charity workers. Housing, transport, energy, and other living costs have become more expensive in recent years.

It is not surprising that many employees are seeking greater income to deal with their changing financial circumstances.

The ATO has ruled that employees of most charities and eligible NFPs can salary package up to $15,900 of their salary annually in approved household expenses, such as rent, mortgage, credit card payments and school fees.

In practice this means each year employees of eligible charities and NFPs can spend $15,900 of their salary tax-free.

This salary sacrificing used to be a major advantage for charities and NFPs.

I can well remember as a CEO in the late 1990s and early 2000s presenting salary packaging options to potential staff.

Often it was not until the figures were laid out in front of the potential recruit that they realised how much better off they would be with our remuneration package than with the slightly higher salaries offered by competing government agencies or for-profit organisations.

In 2003, average weekly earnings were approximately $920. Charities and NFPs could offer a salary sacrifice that was around one third of the average weekly salary ($15,900 or $306 a week) – in other words, one third of an employee’s salary could be tax free.

Average weekly earnings are now approximately $1840, yet charities and NFPs can still only offer the same amount in salary sacrifice – $15,900.

In practice, this means the charity employee on the average weekly income can salary sacrifice only one sixth of their income. It is still a significant benefit, but much less so than 20 years ago.

The same applies to meals and entertainment allowances for eligible charity and NFP employees, which have been capped at $2650 per annum. They offer a benefit, but a benefit that has reduced in real terms over time.

A lack of any indexing means the value of the salary sacrifice concessions to charities and NFPs has effectively been diminished over the last 20 years.

Another employee benefit that has diminished in value over recent years is flexibility.

As a charity CEO I could offer more flexibility to employees than would usually be provided by most businesses or government organisations.

For employees wanting to study, spend time with family, or care for someone, charities and NFPs could often accommodate their needs better than other workplaces.

Following the covid pandemic, when so many employees had to work from home, flexibility is no longer unusual in most workplaces. Companies are now more likely to go out of their way to meet staff needs as part of their recruitment approach across many more workplaces.

One area where charities and NFPs tend to lag other workplaces is in the provision of training opportunities.

This is not surprising, as most charities and NFPs operate on narrow margins and lack the kind of resources required to engage in leadership development and workforce capacity building at the same scale as government agencies and many businesses.

Allowances for staff training are rarely factored into contracting and other service agreements with charities. Professional development is rightly one of the indirect costs highlighted in the ‘pay what it takes’ argument.

Another important factor for many charities and NFPs is the loss of volunteers in recent years. At a time of increased competition to attract qualified staff, it’s also become more difficult to recruit and retain volunteers.

Despite all these challenges, many charities and NFPs have developed strong employee value propositions by listening to their staff and developing programs and support that are responsive and beneficial to both employees and the organisation.

Working in our sector can bring wonderful rewards beyond the individual remuneration package in terms of a sense of value and purpose in our lives.

Many of us enjoy our work not because it is fun or easy, but because we are a part of making a difference, part of driving positive change in the world. And that alone can mean charities and NFPs become employers of choice.

In a highly competitive employment market, and at a time when many charities will have to significantly increase their workforce over the next ten years to meet growing demand, there appears to be no considered investment in the workforce that charities and NFPs require in the short term, let alone in five or ten years.

Where is the workforce strategy for our sector?

A good starting point for a strategic workforce plan might be to acknowledge that some of the benefits of working in the charities and NFP sector have been significantly eroded over time.

If governments, funders, and the broader community are not prepared to invest more in our sector’s workforce capacity, the quality and accessibility of critical services across all our communities will diminish.

And that’s a scenario we should all be concerned about.

Published in the Community Advocate:


Letter to the Prime Minister and Minister for Cyber Security

Letter to the Prime Minister and Minister for Cybersecurity

The Hon. Anthony Albanese
Prime Minister of Australia
House of Representatives
Parliament House
Canberra     ACT    2600

CC: The Hon. Clare O’Neil, Minister for Cybersecurity,

 Air Marshal Darren Goldie AM CSC, National Cyber Security Coordinator


Dear Prime Minister

We write expressing our serious concerns about cyber security risks to Australian charities and NFPs.

Every organisation in Australia is aware of the growing threat posed by bad actors seeking to exploit illegal access to information.

For businesses, including SMEs, your government has provided various programs and incentives to promote better data security and preparedness.  Most of these incentives are in the form of tax concessions and grants (e.g. The Cyber Security Business Connect and Protect Program, the Cyber Wardens program for small business).

The 2023 – 2030 Australian Cyber Security Strategy discussion paper does not mention charities, not-for-profits, or community organisations, although it specifically mentions business 12 times and SMEs twice.

Governments across Australia do not always recognise the size and nature of the charities and not-for-profit sector.  Charities alone employ over 1.3 million workers or 10.5% of the Australian workforce, and contribute over 5% to GDP in our annual turnover of $190 billion.  Perhaps more importantly in the context of cybersecurity, charities hold extensive personal and financial information from millions of Australians.

Despite this massive footprint in our economy and in our lives, charities and not-for-profits have not been provided with the support they need to deal with an increasingly sophisticated level of cyber-attacks.  Unlike business, charities spend every spare dollar they can find on serving their communities.  Allocating more resources to strengthen cyber security would mean reducing the level of services available in our communities.  Many charities and NFPs struggle to withdraw services, even though cybersecurity is clearly an important priority.

There will be cyber-attacks on charities and there is real potential for certain kinds of attacks to significantly damage confidence and trust in our sector.  Cyber-attacks in our sector could also have devastating impacts on individuals and communities.

We ask that you consider providing increased support for charities across Australia to be able to review their current cybersecurity preparedness and to invest in better data security and protection.  This is no more than what your government is already providing to business.

Leaving charities to fend for themselves in dealing with the threat posed by global cyber-security attacks is not an acceptable policy approach.

We look forward to your response.

Yours sincerely


Rev Tim Costello AO, Chair, Community Council for Australia

David Crosbie, CEO, Community Council for Australia

22nd of August 2023                   


Community Council for Australia Board of Directors 2023

Rev Tim Costello              CCA Chair

Claire Robbs                      CCA Deputy Chair and CEO, Life Without Barriers

Louise Baxter                    CEO, Starlight Children’s Foundation

Jon Bisset                           CEO, Community Broadcasting Association of Australia

Sharon Callister                CEO, Mission Australia

Anna Draffin                      CEO, Public Interest Journalism Initiative

Deirdre Cheers                 CEO, Barnardos Australia

Richard Mussell               CEO, RSPCA Australia

Mark Pearce                      CEO, Volunteering Australia

Marc Purcell                     CEO, Australian Council for International Development

Suzie Riddell                     CEO, Social Ventures Australia

Nicola Stokes                    General Manager, AMP Foundation

About CCA

The Community Council for Australia is an independent non-political member-based organisation dedicated to building flourishing communities by enhancing the extraordinary work undertaken by the charities and not-for-profit sector in Australia. CCA seeks to change the way governments, communities and not-for-profits relate to one another. It does so by providing a national voice and facilitation for sector leaders to act on common and shared issues affecting the contribution, performance and viability of NFPs in Australia.  This includes:

·         promoting the values of the sector and the need for reform

·         influencing and shaping relevant policy agendas

·         improving the way people invest in the sector

·         measuring and reporting success in a way that clearly articulates value

·         building collaboration and sector efficiency

·         informing, educating, and assisting organisations to build sustainable futures

·         providing a catalyst for the sector to work in partnership with government, business and the broader Australian community to achieve positive change.

Our success will drive a more sustainable and effective charities and not-for-profit sector in Australia making an increased contribution to the well-being and resilience of all our communities.

CCA Submission to the Productivity Commission Review of Philanthropy

CCA Submission to the Productivity Commission Review of Philanthropy

This submission briefly outlines some of the key issues for Australia’s not-for-profit sector in response to the Productivity Commission review of Philanthropy.

This CCA submission has been prepared with CCA members  as well as other key organisations working within the broader not-for-profit sector. 

It is important to note that this submission does not over-ride any policy positions that may be outlined in any individual submissions from CCA members.  This is especially true when talking about charitable status and DGR eligibility as several CCA members currently comply with different codes of practice, different regulators, have different DGR entities, and are listed on different registers in relation to their Deductible Gift Recipient (DGR) status.

CCA believes that structured giving programs are not realising their potential in Australia partly because of the complexity of fundraising regulations and partly because the current fundraising and philanthropy environment is lacking in incentives for giving that apply in many international countries.  

CCA would urge the Productivity Commission to build on existing reviews and recommendations in this area, most of which involved extensive consultation and due consideration, but then failed to be implemented.

CCA welcomes this opportunity to provide comment on the discussion paper and is willing to engage in further discussion about any of the issues raised in this submission.

The Community Council for Australia

The Community Council for Australia is an independent non-political member-based organisation dedicated to building flourishing communities by enhancing the extraordinary work undertaken by the charities and not-for-profit sector in Australia. CCA seeks to change the way governments, communities and not-for-profits relate to one another. It does so by providing a national voice and facilitation for sector leaders to act on common and shared issues affecting the contribution, performance, and viability of NFPs in Australia.  This includes:

  • promoting the values of the sector and the need for reform
  • influencing and shaping relevant policy agendas
  • improving the way people invest in the sector
  • measuring and reporting success in a way that clearly articulates value
  • building collaboration and sector efficiency
  • informing, educating, and assisting organisations to build sustainable futures
  • providing a catalyst and mechanism for the sector to work in partnership with government, business and the broader Australian community to achieve positive change.

Our success will drive a more sustainable and effective charities and not-for-profit sector in Australia making an increased contribution to the well-being and resilience of all our communities.

Current situation – the context

The charities and NFP sector encompasses over 600,000 organisations – from large to very small – and employs well over 1.3 million staff (around 11% of all employees in Australia).  Australia’s 55,000+ charities collectively turn over more than $160 billion each year and hold around $300 billion in assets. 

These facts tell only a small part of the story. The real value of the broader NFP sector is often in the unmeasured contribution to Australian well-being and quality of life.  NFPs are at the heart of our communities, building connection, enriching lives and environments, nurturing spiritual and cultural expression, and enhancing the inclusion and productivity of all Australians. Collectively, they make us a more resilient society. 

For many decades there was no consistent regulation of charities in Australia other than the one-off requirement for those seeking any form of taxation concession to register with the Australian Taxation Office. 

The establishment of the Australian Charities and Not-for-profit Commission (ACNC) has proved to be a positive step towards red tape reductions, increased transparency, and enhancing trust in the community.  The national charities register has also provided invaluable information to millions of Australians including potential donors.

While charity regulation has advanced in recent years, the same cannot be said about regulation of the fundraising activities of charities.  Charitable fundraising regulation from States and Territories dates back around 100 years to the horse and cart days when the length of pole attached to a donation collection box was restricted in legislation to prevent horse riders using extended handles to poke collection boxes into public bars.  And while Australians can be generous in a crisis, they are not as good at regular giving and resist shifts in taxation policy such as the reintroduction of estate duties that would incentivise philanthropy.

At a broader level, the recent history of the NFP sector is generally framed by growth, but growth has slowed and new issues and challenges are emerging.  The level of volunteering and number of people donating to charities is lower than in previous years.  Cost of living and wage pressures are squeezing many charities. The discretionary revenue available to governments to support the work of charities is effectively falling in real terms against a backdrop of increasing demands and higher community expectations.  Competition for fundraising and income from providing services has increased. 

The level of uncertainty across the charities sector is having a negative impact on medium  and longer-term strategic planning and reducing investment in organisational capacity.  This translates into limited expenditure on organisational activities that increase the quality and responsiveness of services provided to communities.

Given the size of the sector and its critical role in our community, governments, funders and the broader community can achieve real economic and social benefits if there is increased investment in strengthening charities and supporting more efficiency and effectiveness in their regulation.  This is especially true when it comes to encouraging and supporting philanthropy.

Ten key issues

For the purpose of this submission, CCA has chosen to highlight ten key issues we think need to be factored into the goal of doubling giving in Australia.  These are briefly listed below and are discussed in more detail within the submission.

  1. Why people give and the perceived value of charities including the trends – this includes direct-to-individuals (e.g. GoFundMe) and cause vs traditional giving to charities
  2. DGR mess
  3. Fundraising regulations mess
  4. The cost of fundraising, decreasing returns and increased time to receive returns
  5. Patient capital vs one off funding, and short-term contracts
  6. Pay what it takes and the overhead myth – including comparisons sites
  7. The scope for foundations to use their corpus as a positive investment vehicle and other forms of new (impact) capital (given the lack of debt financing for charities)
  8. Estate duties or capital gains tax on large estates, and living legacy trusts
  9. Superannuation and payroll giving
  10. Review the generous tax concessions provided to gaming, catering, entertainment and hospitality income for mutual organisations, especially licensed clubs.
  1. Why people give and the perceived value of charities including the trends – this includes direct-to-individuals (e.g. GoFundMe) and cause vs traditional giving to charities

Giving in Australia is changing.  There are many reasons why people give although there is little research to suggest that giving involves a rational evidence-based process to determine the most efficient use of donations.  This does not mean that how charities represent themselves and their work doesn’t matter.  The reality is that if the work of a charity is not valued, the charity is vulnerable.  How we see charities, our perceptions of their value, is at the heart of emerging patterns of giving in Australia. 

While many larger charities invest in developing their brand and engagement to promote giving, most do not have the resources required to promote their value through multiple channels to multiple cohorts of potential supporters and donors.  The lack of resourcing also impacts the capacity of charities to develop outcome measures and impact statements that can be messaged to resonate with target audiences including donors.

Research CCA has conducted through Saatchi and Saatchi has found that young people are more likely to be motivated to give to a cause, to make the world a better place.  Older people – above 65 – are more likely to give in a traditional charity sense to people in need or supporting the unfortunate.

CCA has long argued that there needs to be an ongoing campaign to promote the value charities bring to our communities, our economy, our environment, and our wellbeing.  Unfortunately, there is no strategic engagement in this area from government or from major philanthropists.  In practice this means charities tend to be undervalued.

If we are to significantly increase giving in Australia, the value proposition of giving to charities needs to be much better communicated and promoted across all our communities.

  1. DGR Mess

The purpose of DGR

The goal of the DGR process should be to encourage community involvement, engagement, and ownership of issues individuals and communities are concerned about.  Encouraging citizens and civil society to own their issues of concern is not only good public policy, but also very good economic policy. 

In the past, governments and The Treasury have tended to define donations to DGR charities in negative terms.  Foregone revenue through tax concessions afforded by DGR status are seen as a cost to government, rather than a benefit. The implication is that charities receive ‘generous’ concessions resulting in government losing significant revenue.  There is little acknowledgement that the level of DGR benefit is entirely dependent upon the level of community support for DGR organisations.

The Treasury tends to extrapolate the real cost to government of DGR concessions based on an assumption that every dollar given to a DGR charity or other organisation would otherwise have been taxable revenue.  This assumption is compounded by the failure to factor in the significant transfer costs of having government collect, administer, and redistribute funds back to the community.  The implication that every dollar given to a DGR charity represents a loss in revenue is grossly inflated. 

Unlike most businesses, which seek to benefit owners, when a charity provides programs or services to a community it often enables governments to reduce their costs because more community needs (that might otherwise require support and intervention from government) are being supported by charities and those who support them. This creates very real savings for government.  Charities also often provide services at less cost than equivalent government services. 

Even using the Treasury’s flawed assumptions about the costs to government, if the total DGR concessions amount to less than $2 billion each year, that is still only approximately 1% of the total annual turnover of the charities sector. 

Ideally, governments would reframe any reform of DGR within a context that explicitly acknowledges the benefits as well as possible costs, and highlights that providing DGR status enhances our communities. 

The current DGR processes are dysfunctional and need reform

CCA supports the view that the complexity of the current DGR arrangements make it an almost unworkable system, particularly for small charities.  As CCA has pointed out in several previous submissions, the process to obtain DGR status can be very lengthy and expensive.  CCA has previously been quoted at least 12 months of work and a legal bill of $30,000 to obtain DGR status.

The way DGR status is administered with the ATO determining most eligibility as well as having four separate Departmental registers and a wide range of specific listings by Treasury Ministers reflects a dysfunctional, confusing, and costly approach to obtaining DGR status.  It favours large charities over small, rich over poor, those with strong political connections over those with weak.  While some reforms have been proposed to cut back the number of Departments involved, they fall well short of what is needed.

Not one review of the current DGR system has ever supported its continuation.  It needs to be reformed.

All DGRs should be charities and all charities should be DGR.

It is difficult to justify the current distribution of DGR eligibility which reflects the arbitrary and ad hoc way DGR eligibility has developed.  In some cases, for instance, DGR is only given for a specific period even though the charitable organisation is ongoing and pursuing the same purpose in the same way.

It makes good policy sense that all donations made to registered, complying charities should be tax deductible.  This is the practice in comparable countries like the UK and Canada.  It also makes sense to consider changing circumstances that might inform new definitions of charity and public benefit, including areas like media and public interest journalism.

Australia has a well-functioning regulator determining charitable status through an effective process, and the definition of charitable status is now clearly embedded in the notion of public benefit.  DGR should be directly associated with charitable status, not a separate process that actively discriminates against smaller charities. 

This position has been supported by the Productivity Commission and the Not For Profit Tax Concessions Working Group. This position has also been strongly supported by CCA for many years.

  1. Fundraising regulations mess

The current regulatory system applying to charities engaged in fundraising is broken.  Separate jurisdictional fundraising regulatory regimes in Australia is not justifiable, especially given the diminishing relevance of geographical boundaries.  Fundraising regulations need to be workable, efficient and fit-for-purpose.  Current regulations fail this basic test.

Despite decades of inquiries, reports and recommendations calling for reform, very little meaningful progress has been made in any of the multiple attempts to harmonise fundraising regulations and requirements.

CCA has supported the Australia wide adoption of a core set of fundraising guidelines or principles that would need to be complied with by all charities engaged in fundraising.  At the same time, CCA is open to any suggested solution including the potential to rely on consumer law as already happens in some jurisdictions.

  1. The cost of fundraising, decreasing returns and increased time to receive those returns

The shift in emphasis around the ways in which people give means charities and NFPs can no longer simply rely on traditional ways of fundraising.  Fundraising channels that have previously proved effective may or may not work for a particular fundraising campaign at a particular time. 

The primary impact of these trends is that the cost of fundraising is increasing while return on investment is decreasing. Major organisations may still be reaching their fundraising targets, but it is costing more to achieve the same return as previously and taking longer for that return to be realised.

Fundraising investments can take five to ten years to fully realise which makes it quite difficult for many charities that lack the resources, or the time required to build a donor base.

Most charities cannot put aside significant funding to underwrite their fundraising activities even though this is often what is required to achieve a sustained revenue stream.  Consequently, many charities are struggling to undertake fundraising without having the capacity to invest what would be needed to achieve their targets.  

If interest free loans were available to support charity investment in fundraising, many more charities would be able to find the resources needed to run an effective donor acquisition program even though the costs may outweigh the benefits for at least three to five years.  If a charity knew it had money to spend to build its giving program and the time required to generate an income stream before having to make any repayments, it would enable more fundraising activity from a much broader range of charities.

CCA believes the government should consider ways of establishing this form of investment option in charities.  Offering low or no cost loans builds on the principle that you can give a small family fish to feed them for a day, or you can give them the skills to catch their own fish for the rest of their lives.  Enabling more charities to access low or no cost loans for their fundraising activities would be a good investment over time.

  1. Patient capital vs one off or tied funding, and short-term contracts

There are many different ways to give to charities and some are more beneficial to the charity then others.

One of the best forms of giving from a charitable perspective is ongoing regular giving to the organisation without the donation being tied to any specific expenditure requirement other than to be advance the charitable purpose of the organisation.  This type of donation allows the charity to use the money to maximise its impact and be able to invest in the full range of options including difficult to fund areas like staff training and development, research including outcome and impact measurement, communications and marketing, cybersecurity and technology, etc.  All these areas are critical to organisational effectiveness, but are usually not top of the list in terms of how donors like to think their money is being used.

Donating a resource that provides an ongoing income stream is also highly valued by charities, for much the same reason.  Having untied income makes the organisation more flexible, adaptable and capable of responding to community need.

At the other end of the scale, there are donors and sponsors who might insist the organisation use their donation in a particular area, and in a particular way.  Sometimes these tied grants are so restrictive and at the same time so demanding of outputs that they actually cost more to run than they raise for the organisation.

CCA believes it is important to acknowledge the complexity of treating all giving in the same way when there are very significant differences between an untied donation to support the organisation and a tied contracted grant that imposes significant requirements and reporting on the charity.

As noted in the previous section on fundraising, time can be an invaluable aspect of developing good outcomes because a rushed or short-term project is unlikely to produce the same benefit as a longer term and more flexible investment.

  1. Pay what it takes and the overhead myth – including comparisons sites

The first year of a major donor acquisition program, the set-up costs of the donor acquisition process will almost certainly be higher than any return. 

In business terms this is sunk capital and it can be claimed against taxable income over many years (mining companies are a good example).

Charities do not pay income tax so sunk capital in areas like fundraising or program evaluation are just costs the charity has to wear.

If I was judging charities on some mythical ratio about the level of funding allocated to administration and fundraising compared to the level of expenditure in front line services, a charity in the first stage of a donor acquisition program is going to be well below a charity where the setup has been done and regular income is coming into the organisation.

Similarly, if a charity has invested in properly following up on its work and evaluating both its outcomes and impact in order to improve how it goes about fulfilling its mission, the well evaluated charity will compare badly next to a charity that has no research, measuring or monitoring programs in place.

There are also issues here in how you allocate costs within a Profit and Loss Statement.  By hiding costs for areas like fundraising or evaluation in individual program budgets, charities can pretend their overheads are low.

For these reasons CCA supports the pay what it takes approach that encompasses the true cost of providing whatever is required to not only complete a given project, but also enable the charity or NFP to improve the work it undertakes.

CCA is not a supporter of comparison web sites and other charity investment services that adopt a very simplistic, and sometimes misleading, analysis of which charities offer better value to donors.

  1. The scope for foundations to use their corpus as a positive investment vehicle and other forms of new (impact) capital (given the lack of debt financing for charities)

Knowing regular income is coming into an organisation can unlock access to capital – usually through debt financing – but not for most charities.  The lack of access to debt financing makes management of inconsistent or lumpy income streams very difficult.  Most charities cannot smooth out income flows over a year or multiple years through access to lines of credit and other credit tools.

Charities need better access to capital.  Even if all that charities are seeking to do is maintain capital infrastructure and organisational capacity, access to discretionary income to undertake renewal or updating of organisational systems and structures is fundamental to good longer term management practice.

Just as importantly, charities and not-for-profits can often identify programs and services that can offer real benefits to the communities they serve, but without some form of venture capital, the investment in innovation, trialing, and scaling of more effective approaches cannot be undertaken.

CCA has previously advocated for a subsidised loan scheme and continues to believe that access to no interest or very low interest loans would benefit many charities.

CCA has also argued that there should be incentives within the system to enable foundations to use their corpus (rather than just the income earned) to invest in charities. 

One of the keys to unlocking the latent potential to benefit communities across Australia is ready access to patient low-cost capital.  It seems counterproductive that significant levels of capital are put aside to support charities, but generally only the interest is used or leveraged to create investment and support for charity and not-for-profit programs and services.

With a more considered and clever approach to financing the charities and not-for-profit sector, increased effectiveness and efficiencies could be unlocked providing significant benefits to Australian communities. 

  1. Estate duties or capital gains tax on large estates, and living legacy trusts

Estate duties

National estate duties exist in many countries including: the United Kingdom, Germany, Italy, Belgium, the Republic of Ireland, France, the Czech Republic, Canada and the USA.  Not only do these duties provide substantial government revenue, they also increase philanthropy by offering relief from estate duties for any money left to charity.  The Henry Review drew on this international experience in supporting estate duties as a taxation measure.  Among other benefits, estate duties can apply a small brake on growing levels of inequality in our communities. 

Until 1979, Australian governments gained substantial income through various forms of death or estate duties. 

Australia’s growing gap between rich and poor, and the gap between government income and demand for government supported services, can both be partially addressed by applying a form of estate duty on the richest 1% in our communities.  A targeted 35% estate duty on all estates over $10 million (with appropriate exemptions) would raise substantial new government revenue and stimulate philanthropy.

Living Legacy Trusts

Over the next two decades $2.4 trillion in wealth is expected to pass from Australian ‘baby boomers’ to the next generation.  It is expected that charities will benefit from this wealth transfer through bequests. However, giving by bequest is currently low – in 2012 only 7.6% of final wills had a direct charitable bequest, and charitable bequests accounted for only 2% of the total value of estates.

Living Legacy Trusts involve a donor placing an asset in a trust for the benefit of a charity upon the donor’s passing.  The asset is irrevocably committed to the charity, but the donor can still receive an income stream from the asset while they are alive. In return for irrevocably committing the asset to the charity, the donor receives a tax deduction when they place the asset in the trust, worth a percentage of the asset’s value. This percentage may vary with factors including the donor’s age.  There are also models where intermediaries may be established to manage the donations and enable charities access to the donated funds prior to the passing of the donor.  This immediate access is particularly important given the current economic climate.

This measure would encourage giving and enables intending donors to act on their bequest intentions at the time of greatest need (rather than time of death). It extends the policy intent of DGR concession, while supporting donors to maintain a self-supporting income stream.

  1. Superannuation and opt out payroll giving

Superannuation charitable investment options

Using employee super contributions to drive improvements for communities is increasingly being adopted around the world.  CCA support a model similar to that applying in France where all employees are given the option of investing 5-10% of their superannuation into ‘solidarity organisations’ (the equivalent of our charities).  In 2008 the French government regulated that all super funds needed to provide this option to employees, and since that time the amount invested has grown to over $5.5 billion.  This has stimulated social entrepreneurship, created opportunities to achieve social impact, improved the capital base and capacity of solidarity organisations.

The success of the French 90/10 rule shows what could be achieved if Australia chose to provide employees with some limited choice about how their superannuation contributions are invested.  If just 2% of the MySuper funds were invested this way it would generate around $8.5 billion, or enough to significantly reduce homelessness by investing in social housing initiatives that could assist 50,000 Australians struggling to maintain secure and appropriate housing.

This measure could be transformative in encouraging the charities sector to find ways of establishing social enterprises that strengthen our communities.  It would also link into the work of the Social Impact Investing Taskforce and provide a boost to impact investing across the charities and NFP sector.

Opt-out workplace giving provisions

When in place, ‘opt out’ systems of workplace giving have ensured much higher levels of success in workplace giving programs. 

Less than 2% of working Australians currently donate to charity from their pre-tax income through workplace giving. When in place, the ‘opt out’ approach to workplace giving can result in 60-70% of employees in an organisation participating.  With ‘opt-in’, average participation rates are less than 5%.  Uncertainty over provisions in the Fair Work Act are an impediment to more widespread use of the ‘opt-out’ approach. Clarifying the Fair Work Act would help increase the number of Australian employees participating in workplace giving. Growing to 10% of employees donating 0.35% of their pre-tax income, would raise over a quarter of a billion dollars each year through workplace giving.  This is a realistic target based on local and international experience that would increase philanthropy and the engagement of Australians in the broader NFP sector.

  1. Review the generous tax concessions provided to gaming, catering, entertainment and hospitality income for mutual organisations, especially licensed clubs.

CCA is often asked by politicians and policy makers about the cost of the kinds of measures outlined in this submission to the Productivity Commission.  The simple answer is that there are substantial savings to be made if some of the largest pseudo for profit groups that pretend to offer mutual benefits were forced to pay their fair share of tax.

The mutuality principle that rightly applied in the late 1800s in Australia is no longer appropriate or consistent with existing taxation arrangements, particularly for organisations involved in gaming.  Large licensed clubs that act as gaming venues should not be able to treat over 75% of their income as tax free, especially when they have not satisfied the basic requirements of being a not-for-profit organisation that exists to provide a public benefit.  As pointed out in the Not-for-profit Tax Concessions Working Group Report (May 2013), concerns with the current application of the mutuality principle include:

  • integrity concerns about member and non-member receipts;
  • competitive neutrality concerns where mutual organisations are trading in competition with taxable businesses;
  • social policy concerns about significant gambling and hospitality receipts of some organisations, which are not subject to income tax at the Commonwealth level; and
  • concerns about private member benefit.

It is recommended, on public benefit grounds, that above a certain threshold of say $10 million, the tax law should be amended to treat all member and non-member income of mutual organisations as assessable for taxation purposes in line with normal income tax principles. 

If this recommendation for tax reform is not supported, all income above a threshold that is derived from gaming, catering, entertainment and hospitality trading activities of mutual organisations should be treated as assessable.  It is difficult to justify the hundreds of millions of dollars of tax concessions provided to large, licensed gaming clubs based on the mutuality principle.  It is time to review these concessions taking into account any unintended consequences on mutual organisations that do provide a real benefit to members.


This submission to the Productivity Commission promotes measures to strengthen the charities and NFP sector and deliver sustainable economic and social benefits for governments and our communities. Never has there been a stronger case for increasing investment in the charities and NFP sector to build more resilient communities through greater engagement in our society and our economy. 

As noted in the introduction, CCA believes previous reports provide an important reference point that should prevent the reinvention of already accepted priorities such as streamlining fundraising regulations.  There have been extensive inquiries and reviews that have made over 100 considered recommendations that have yet to be implemented. Are any more recommendations worth implementing from nearly 30 years of Commonwealth nonprofit reform reports? (ACPNS) (  

It is important to note that CCA does not see increased giving as a cost to government but a benefit to the communities we all live and work in.  It is counter-productive to treat increased philanthropy and social impact investment as a government loss of potential tax income or ‘foregone revenue’.  The whole community benefits when individuals or organisations choose to direct their resources into strengthening communities, increasing economic and social activity, and improving health and well-being.  This is particularly the case if the money involved avoids the significant transfer costs of moving into, through, and out of government.  Philanthropy and social investment are about encouraging greater ownership of local issues by enhancing the role of charities and NFPs.

The times we live in present us all with many challenges. Inequality continues to rise in Australia.  We need fairer and more inclusive ways to strengthen our communities and our environment, and more impact investment to grow the capacity of charities to make a positive difference across Australia.  Estate duties, living trusts, opt out workplace giving, better access to vesting capital, and the French 90/10 rule are just some of the examples of sustainable policies that have the potential to be transformative.

The NFP sector is too large and too important to be left on the margins of economic debates and major policy reforms within Australia, especially in difficult times.  Increasing giving can be leveraged through government investment in incentives, removing red tape and enabling NFPs to be more efficient and effective through greater access to longer term and discretionary capital.  If these measures are introduced, they will ultimately deliver stronger, more resilient, and productive communities across Australia.


CCA’s Submission to the Productivity Commission Review of Philanthropy

A ‘tentatively good’ budget for not-for-profits and charities

A 'tentatively good’ budget for not-for-profits and charities

CCA CEO David Crosbie rates the 2023 Budget 3.5 Lamingtons out of 5 for the Our Community and Institute of Community Directors, Our Community Matters Special Budget edition – this year’s go-to summary of sector  reaction to the Federal Budget.

Not-for-profits hail federal budget as a good first step

Our Community Matters Budget Special 2023


A ‘tentatively good’ budget for not-for-profits and charities

David Crosbie, CCA CEO

“Tentative efforts lead to tentative outcomes” – Epictetus (Roman slave who became a Stoic philosopher)

Our assessment is that this budget passes – and takes some important steps in the right direction – but it is not a bold or assertive budget, and lacks significant and sustained investment in programs and services that could make a real difference to charities, not-for-profits, and the communities they serve.

It is a well-constructed budget, delivering a surplus that will help pay down our pandemic debt, but also offering targeted cost of living relief and many initiatives supportive of the broader communities sector.

But the weakness in this budget is that the level of support is limited and spread relatively thinly. We see this in the Jobseeker increases – less than $3 a day – and in the rent assistance increase of 15%, but we also see it in programs that are important for charities and not-for-profits.

Take for instance this announcement:

“The Government will deliver a $199.8 million integrated package to address entrenched and concentrated community disadvantage.”

It promises to allocate the funds from 2023–24 with “place-based approaches”, engaging with philanthropy and promoting social impact investment.

It sounds like a lot of money, but when we break that down year by year, we are talking about small amounts being spread over a six-year period.

These details from the Department of Social Services budget statements spell out the actual breakdown:

Funding includes:

  • $100 million over five years from 2024–25 to establish a social impact investment Outcomes Fund to make contractual payments to states, territories and service providers based on delivering agreed, measurable outcomes through specific projects
  • $64 million over six years from 2023–24 to extend the Stronger Places, Stronger People program to deliver place-based initiatives in partnership with 10 local communities and state and territory governments to improve outcomes for disadvantaged children and their families, and to enhance place-based initiatives in six of these communities
  • $16.4 million over four years from 2023–24 to the Australian Bureau of Statistics to implement the Life Course Data Initiative to capture data insights to inform long term policy responses aimed at interrupting cycles of intergenerational disadvantage
  • $11.6 million over three years from 2023–24 for a Social Enterprise Development Initiative to provide grants, online education and mentoring for eligible organisations to build capability to access capital, better participate in the social impact investing market and support improved social outcomes
  • $7.8 million over two years from 2023–24 to develop a whole-of-government Framework to Address Community Disadvantage that will identify strategic objectives and key principles to guide how the Commonwealth will work in partnership with communities to enable them to build their capability to address cycles of disadvantage.

We’re also pleased to see the continuing support for the Economic Inclusion Advisory Committee, which was established to advise the government about ways to best tackle disadvantage, and which lodged its first report before this budget. It wins $8.7 million over four years from 2023–24 (and $2.2 million per year ongoing) for secretariat and research support.

The Community Council for Australia is supportive of all these initiatives, but they are relatively tentative steps rather than significant investments that could have a sustainable impact across Australia.

These initiatives will, in all probability, create lighthouse projects that will do good for a time, but how sustainable are they, and how many more of these initiatives are needed to drive real reform across multiple systems in multiple communities?

Similar comments could be made about government initiatives in many areas that are important to charities and community groups. The intent is good, but the scale of investment is low in areas including the arts, community education, energy transition, aged care, childcare, disaster preparedness, domestic violence, cybersecurity, environmental protection, rent assistance, social security payments, targeted cost of living relief, access to medicines and Medicare, NDIS improvements, international development and gambling reform.

This budget now has Australia facing in the right direction, but real challenges lie ahead. To move forward and occupy the space between us and the horizon will require significantly more investment in building the kind of Australia we want to live in.

See the full Our Community Matters, Special Budget Edition: Not-for-profits hail federal budget as a good first step


Be very wary of politicians such as Peter Dutton sounding the youth crime alarm

Be very wary of politicians such as Peter Dutton sounding the youth crime alarm

Opinion piece by CCA CEO, David Crosbie, published in the Canberra Times, 20 April 2023

Opposition Leader Peter Dutton and the “no” Voice campaigners appear keen to make the link between youth crime, child abuse and the Voice – I for one am struggling to make the connection.


Firstly let’s look at the issue of youth crime and wellbeing. Because here Dutton is returning to an established pattern of alarmist politicking. Youth crime is apparently out of control again, a national emergency that needs a quick fix. Or so we are being told. 


The first major academic paper I ever delivered was at a national criminology conference. I was a probation officer and a teacher who had taught in Pentridge Prison and Turana Youth Centre. My paper was about young offenders and the power of positive engagement. 

In the 30 years since, I have seen the political weaponisation of crime, particularly youth crime, repeated many times by many different politicians. In the narratives behind most law-and-order platforms, we rarely hear words like equality, hope, opportunity. This applies whether we are talking about Western Sydney, Townsville, or even Alice Springs.


In the 90s I was directly involved in developing responses to alcohol-fuelled crime in Alice Springs. I chaired forums of local businesses, police, officials, charities, and various Indigenous communities. No one believed the solution to youth crime was turning Alice Springs into a police enclave with gated communities. Everyone wanted their kids to have more opportunities than they experienced. The highest priority strategy across the many interest groups was creating meaningful and workable pathways to employment, particularly for Indigenous young people. 


I have little respect for politicians who call out crime, while at the same time promoting strategies that will further discriminate against marginalised young people. Prisons and youth training centres should never be seen as garbage dumps for our troublesome youth, places where we can punish and hide away those we deem to be the failures and misfits, the impoverished and unhealthy.


Across all our communities, we offer advantages to some of our children and disadvantages to others. We may think we are a fair go society, but young people across Australia experience vastly different opportunities to succeed.


Of course, there is no excuse for crime. Every offender I have met has a reason for their crime, but that doesn’t justify their actions. The most important question is how we react to offending and alienation from our communities. Ignoring or justifying crime is not a solution, but neither is further marginalising and withdrawing opportunities from young people. 


There have been thousands of studies around the world on youth crime and we know what works. If politicians are serious about reducing youth crime, they can start by putting aside the megaphone politics, the law-and-order campaigns, and the cheap shots at people doing the best they can. Listen, not just to the outraged who can provide alarmist talking points, but to the kids themselves. Take the time to know them, find their strengths and build on them. 


We can draw on the positive power of youth, including positive youth justice which has now proven to be effective in international research and practice. We know that investing in strength-based programs reduces crime, increases wellbeing and productivity. 


Unfortunately, in Australia most of the charities and community groups running strength-based programs lack the resources to operate at scale and document their impact, so they are not valued for the work they do. At the Community Council for Australia we see this every day – programs that are making a real difference in people’s lives often struggle to find the money they need to keep operating.


And so to the Voice. Mr Dutton and the “No” campaigners are right to say the Voice is not a magic wand, a quick fix, an instant solution to youth crime, child abuse, domestic violence, lack of housing, employment, healthcare or better educational outcomes. But they should also acknowledge that the Voice is a way to try and improve our ongoing failure to address Indigenous disadvantage across our communities. The Voice does not compel any government or senior official to do anything, other than listen.


How effective the Voice can be, whether or not it can impact Indigenous youth crime, child abuse and other issues, is likely to depend on governments themselves. Will they be prepared to invest in the under-funded local organisations that are making a difference? The one thing we know for certain is that it is charities and community groups who will be left to pick up the pieces after the alarmist politicians and their media entourage leave town.

Losing our most important news platform

Losing our most important news platform

CCA CEO David Crosbie reflects on the impact and contribution of Pro Bono News over its 22 years.

Losing our most important news platform, Pro Bono News, 23 March 2023

Over a decade ago when the Community Council for Australia (CCA) was being established, the need to increase charity and NFP access to timely and relevant information was seen as a critical role for our new peak body. There were many discussions about how this goal could possibly be achieved, especially given the limited resources available to CCA. 

In 2010, the first CCA board agreed that the best approach to information provision for the sector was to back the maturing Pro Bono News, and to partner wherever possible with Karen Mahlab AM and her team to build the knowledge base across the charities sector. For almost 13 years, this partnership has served CCA and the charities and NFP sector well. 

Pro Bono News has provided timely information on an incredible range of important issues over many years including: giving and philanthropy, leadership and development, outcome and impact measurement, volunteering, governance and legal issues, marketing and communications, mergers and collaborations, government relations and policy, innovation and digital transformation, social enterprise and impact investing, the list goes on. In many of these fundamental areas Pro Bono News has provided an essential reference point, a stepping off platform for charities and NFPs to think about their own organisational structures and practice, and how they might increase their effectiveness and capacity.

This issues driven information provision has been invaluable for our sector, but it is really only the starting point for how significant Pro Bono News has been. 

Charities and the programs they run are often vulnerable, largely because they are not valued as much as they should be. For charities to build their value and reduce their vulnerability, they need to create and share knowledge about their outcomes and impact on individuals, families and communities. They need to be able to tell their stories of change.

With mainstream media increasingly lost in superficial click bait competition, it has become harder to find appropriate channels for our stories. Pro Bono News has provided hundreds of charities and their leaders the opportunity to tell their stories on their terms, to share their perspectives and build value in the work they do, the communities they serve, the organisations they are part of. In promoting the work of charities and NFPs, Pro Bono News has built the value of many organisations, enabling them to increase their profile and their capacity to survive.

Beyond offering a knowledge base and a platform to build sector value, Pro Bono News actively promoted and supported a collective voice. In doing so, Pro Bono News became a critical driver of sector reform.

Anyone who thinks the charities and NFP sector is not competitive has clearly had limited exposure to the realities of running a not-for-profit organisation. There are limited resources available from government, fees for service, or fundraising. Need almost always far outstrips supply. Those who care about the work they do and want to see it continue know they’re probably going to have to compete to get the resources they require to keep operating. This ongoing competition is not conducive to organisations working collaboratively together, even on issues of mutual benefit.

Karen and her team are one of the few groups who take a broader view – beyond individuals, organisations or causes – to how our efforts, leadership, values and contribution can come together to create the kind of society and the kind of future we want. 

It is no accident that the charities sector response to the horror Abbott-Hockey Budget in 2015 was the convening of our sector’s most exceptional changemakers and big picture thinkers – the first Pro Bono Impact 25 and CCA members – to articulate an alternative vision for Australia. Generating national mainstream media coverage of what the ABC called a “council of war”, we called for an aspiration beyond a set of economic numbers, articulating a vision for the just, fair, safe, inclusive, equal opportunity, authentic, creative, confident, courageous, united, kind, generous and compassionate Australia we want. A vision that has enduring value.

The contribution of Pro Bono News proved pivotal yet again when the Coalition government developed a bill to dismantle the Australian Charities and Not-for-profit Commission. In addition to providing a forum to raise concerns about the government’s approach and promote the value of the ACNC, Pro Bono Australia conducted important national surveys demonstrating sector wide support for the ACNC. 

I know from my discussions with several key politicians that the Pro Bono News surveys showing strong sector backing of the ACNC were important in making the arguments about keeping the ACNC. As was pointed out to me by several cross benchers and even some government MPs, it is generally unheard of for a sector to argue in support of its own regulator. 

In my view, without the active collaboration of Pro Bono News and CCA, I doubt we would still have the ACNC. The battle to keep the ACNC was about collective action, and Pro Bono News was a focal point for our collective voice.

I could continue to write about the various ways Pro Bono News has been invaluable to our sector, but there is one other fundamental point that needs to be emphasised. 

For as long as Pro Bono News has been published, it has been watched over and financially supported by one person, Karen Mahlab AM. Over the years I have had many conversations with Karen and the one consistent theme has been her drive to support and improve the charities and NFP sector as a fundamental lever to create the change we want to see in our society, our world and our future. Pro Bono News has been a costly exercise, and not just in monetary terms. Karen has spent countless hours ensuring it was able to continue. I know that at times the personal toll has been enormous. 

While it is very sad to see Pro Bono News ending, those of us who know what it has taken to keep it going for 22 years can only offer our thanks and appreciation to Karen for carrying the load for so long. 

Many of us will miss many aspects of Pro Bono News, and we are incredibly thankful that it has existed and made such a valuable contribution to our sector, but we also understand the realities of the current media landscape. 

I offer my heartfelt thanks to Karen and all who have been part of Pro Bono News. I hope you know and appreciate the difference you have made. 

Read on Pro Bono News: losing-our-most-important-news-platform


Submission to the ACNC – related party transactions disclosure

Submission to the ACNC - related party transactions disclosure

This brief submission outlines key areas of concern for the Community Council for Australia (CCA) in relation to proposed related party transaction disclosure requirements.

CCA welcomes the opportunity to engage with The Australian Charities and Not-for-profit Commission (ACNC) on this important issue.

CCA has consulted with our members (see listing in Appendix 1) in framing this submission, however, it is important to note that this submission does not override the policy positions outlined in any individual submissions from CCA members.

In general terms, CCA is supportive of the proposed changes, but with the proviso that unintended consequences, including more onerous reporting and potentially restricting in-kind and at-cost support to charities, are factored into the implementation of the proposed measures.

The content of this submission includes a brief background to CCA, some key issues relating to the proposed new related party transaction requirements, and a conclusion.

CCA looks forward to ongoing discussions about how these measures can be introduced without negatively impacting the charities sector.

The Community Council for Australia

The Community Council for Australia is an independent non-political member-based organisation dedicated to building flourishing communities by enhancing the extraordinary work undertaken by the charities and not-for-profit sector in Australia. CCA seeks to change the way governments, communities and not-for-profits relate to one another. It does so by providing a national voice and facilitation for sector leaders to act on common and shared issues affecting the contribution, performance, and viability of NFPs in Australia.  This includes:

  • promoting the values of the sector and the need for reform
  • influencing and shaping relevant policy agendas
  • improving the way people invest in the sector
  • measuring and reporting success in a way that clearly articulates value
  • building collaboration and sector efficiency
  • informing, educating, and assisting organisations to build sustainable futures
  • providing a catalyst and mechanism for the sector to work in partnership with government, business and the broader Australian community to achieve positive change.

Our success will drive a more sustainable and effective charities and not-for-profit sector in Australia making an increased contribution to the well-being and resilience of all our communities.


CCA response to the proposed requirement for disclosure of related party transactions as outlined in Recommendation 14 of the 2018 ACNC Legislation Review requiring: all registered charities to disclose related party transactions, with small registered charities to make a simplified disclosure involving a brief description of related party transactions.

It is important to note that: medium and large entities preparing general purpose annual financial reports are already making the necessary disclosures of related party transactions. 

CCA understands that the Commissioner of the Australian Charities and Not-for-profits Commission is now proposing that all registered entities disclose up to four related party transactions as part of their annual information statements.

CCA is supportive of the requirement to provide information about related party transactions in the Annual Information Statement, but with the proviso that a level of materiality be established to trigger such disclosure.

Accounting for charitable expenditure should always be transparent.  Members of the charity and the communities served should know how the resources of the charity are being applied.  It is clearly in the interests of all involved that where a significant related party transaction occurs within a charity, the transaction should be transparent and accountable. 

It would be difficult to argue that a charity making a significant payment to a related party – board member, family member of an executive, company of an executive – should be able to do so without any public disclosure of both the payment and the relationship.

In practice, the vast majority of cases where there is a related party transaction within a charity are likely to be legitimate expenditure for services provided, often below market rates, by someone who is supportive of the charity.  This might be someone who offers their skills at a lower than commercial rate to fix a computer system, repair a building, provide catering, undertake gardening, or service a car.  These typical ‘at cost’ type arrangements that involve a level of ‘in-kind’ donation are to be encouraged.  Providing cooking ingredients to voluntary bakers supporting a cake stall should not trigger a compliance activity or additional paperwork beyond the normal record keeping.  These types of smaller related party transactions can be critical to charities in managing tight budgets.  

Generally, even smaller charities declare their related party transactions as part of their financial reporting, but CCA understands that there may be concerns when significant payments to related parties are made above market rates, or are made for services that are not specified. 

CCA is uncertain why the ACNC is proposing that charities only disclose up to four separate related party transactions.  Doesn’t this allow for a lower level of accountability if a charity is actively engaged in multiple significant related party transactions?  If there are a number of smaller related party transactions and one very large related party transaction, does the charity have to report the larger transaction or will four small transactions suffice?  The rationale for this approach is unclear.

CCA’s main concern – the question of materiality

If a small sporting charity has their lawns and playing fields mowed by a local farmer who is the spouse of a volunteer Board Director and who uses his own equipment but charges the charity the equivalent of petrol money, should the charity have to declare a related party transaction?

CCA is concerned that if small charities are to be required to declare related party transactions, the trigger for such reporting needs to be set at a level that does not discourage ‘in-kind’ and ‘at cost’ type contributions to the work of smaller charities.

To this end, CCA would propose that the ACNC Commissioner introduce a threshold for related party transactions that is above $10,000 total payments or their equivalent in benefit to a related party in a given financial year.  Below this threshold, smaller charities should not have to separately report these transactions to the ACNC.

CCA supports Annual Information Statement reporting option 1

Of the options outlined in the ACNC consultation, CCA supports option one.  Options 2 and 3 both try to prelist and categorise related party transactions in a way that may or may not fit the type of activity or relationship that applies in a particular instance.  Allowing each charity to stipulate the nature of the relationship, the payment and the amount makes more sense.


CCA has always supported the ACNC and its role promoting transparency and accountability for Australian charities.

The ACNC review panel found in 2018 that the requirements of disclosure for related party transactions needs to be clearer than just relying on accountancy standards and governance principles.  CCA has been supportive of the 2018 ACNC review panel Recommendation 14, but always with a view to streamline and clarify reporting requirements rather than make them more onerous and difficult to comply with.

CCA is therefore supportive of the disclosure changes to reporting of related party transactions, but would like to see a clear definition of materiality to avoid smaller charities feeling as though they need to closely monitor and report all ‘in-kind’ or ‘at cost’ donations involving any level of payment or benefit provided from the charity to a related party. CCA has proposed the test for materiality be set at a minimum of $10,000 in any financial year.

The goal of streamlining charitable reporting while increasing transparency is to be commended and CCA looks forward to further engagement in this area.  Charities are still having to deal with many areas of duplicated reporting and onerous requirements created by a lack of consistency across regulatory bodies and the misguided notion that increasing reporting requirements for charities is an acceptable or cost-free way to lower the levels of risk. 

CCA hopes the related party transaction changes are just the start of a long overdue compliance reform process.

CCA Submission to the ACNC – related party transactions disclosure (pdf)

As long as it takes…

As long as it takes...

Short-termism in government and philanthropic funding is failing the mission for impact and sustainable outcomes. Patient capital, whether from government, philanthropy, or impactinvesting, is a key to bright, new horizons writes CCA CEO David Crosbie in Pro Bono News.

As long as it takes… Pro Bono News, 8 March 2023

In a panel on impact investing facilitated by Perpetual this week, Paul Ronalds pointed out that the average grant received by Save the Children is for just 18 months. 

Ronalds is former CEO of Save the Children Australia and now leads impact investing for Save the Children globally. As Paul highlighted, it is not realistic to expect to establish, implement and evaluate a new human service program in 18 months.

Every charity leader in Australia and around the world knows that having the time and resources to deliver sustainable outcomes is one of the most important components of success. And yet, in an increasingly impatient world, there is little evidence that governments or philanthropists are willing to offer longer term grants that enable charities to learn from their mistakes and build and sustain effective programs and services.

Most government agencies and philanthropists continue to operate within a framework of short termism embedded in one-off grant rounds where funding might be provided for a year, or two, or even three, but rarely five or longer.  

While the “pay what it takes” argument is regularly advanced by charities, the “for the time it takes” argument is a less conspicuous theme in debates about charity effectiveness. It is not that people are unaware of this issue, but very little progress is being made. 

CCA has consistently called for the length of government contracts to be extended over the last ten years.  The current government agreed in its election platform: to review and reform the funding models for contracted services to support longer-term planning and better service provision. 

The CCA pre-budget submission called for the following initiatives to be part of that review:

  • an agreed notice period of six months prior to the ending of any major government contract, incentive or concession, with limited exemptions for cases of fraud, other criminal actions, etc.
  • increasing the length of government contracts where possible to at least five years,
  • more transparent and accessible processes for reviewing the performance of NFPs,
  • more transparent and accountable processes for government funding decisions relating to NFPs,
  • a commitment to covering the full direct and indirect costs of delivering services, 
  • funding practices that recognise non-profit organisations are better positioned than for-profit corporations to provide community services, including via provisions in funding agreements with States and Territories. (An example is prioritising the involvement of NFP community providers in the boost to VET funding, valuing their established outperformance of for-profit providers in engaging disadvantaged and vulnerable communities.)

The business investment world tends to take a longer-term view on investment and returns, knowing that achieving success can take many years. They know building value in a company is not a short term activity. Investment in charities is not seen through the same lens.

All too often charities are expected to establish a program and have it delivering results within ridiculous time frames like three to six months. When we are talking about achieving sustainable changes around entrenched behaviours in individuals, families and communities, the expectations are unrealistic at best.

The other side of this theme is the question about how long we should take before we call something a failure and close it down. Effective leaders in our sector know that letting go of programs and services that are not working well is often critical to success. There may well be better ways to use the same resources to achieve the change and impact we seek – but letting go can be very difficult when charities, their leaders and their Boards have invested time, resources, heart and brand in a particular program or approach.

It is a similar story for those making grants, especially in government. The inability to acknowledge and learn from failure can (more often than we might like to believe) see the continuation of practices that have been shown over time not to produce the desired change or impact. 

Success is dependent on our ability to invest the time required; and to call time when it is clear we are not achieving the results we want.  

In this area of program performance monitoring there have been many recommendations, including the Productivity Commission recommendation to establish a National Centre of Excellence for the sector so good practice can be documented, shared and adapted across multiple communities.

Charities often do good work, but trying to operate in a short-term environment reduces the capacity to invest in better infrastructure, monitoring and documenting, training and development, and other areas that directly contribute to organisational effectiveness.  Patient capital, whether from government, philanthropy, or impact investing, adds a new dimension to organisational effectiveness.  

While we await government announcements about the review of contracting, we should all be vigilant in ensuring we do not sell ourselves short – of time. 

Read on Pro Bono News: as-long-as-it-takes

Learning from the past to reform the NFP sector

Learning from the past to reform the NFP sector

CCA CEO David Crosbie nominates his three most important recommendations from a report that summarises all major recommendations from the key national inquiries into charities and NFPs over the past 30 years.

Learning from the past to reform the NFP sector, Pro Bono News, 22 February 2023

“Those that fail to learn from history are doomed to repeat it.”
Winston Churchill

This is the most important report I have seen in several years: Are any more recommendations worth implementing from nearly 30 years of Commonwealth nonprofit reform reports? (ACPNS) ( 

Professor Myles McGregor-Lowndes has summarised all the major recommendations from the key national inquiries into the charities and NFP sector over the last 30 years, as well as the Henry Review of Taxation.  For those of us interested in improving the capacity of charities and NFPs to serve their communities, this report is a compelling reference point.

The reports examined are: – The Industry Commission 1995: Charitable Organisations in Australia – The Productivity Commission Report 2010: Contribution of the Not-for-profit Sector – Senate Inquiry 2008: Disclosure Regimes for Charities and Not-for-profit Organisations – Australia’s Future Tax System (The Henry Review) 2010 – The Not-for-profit (NFP) Sector Tax Concession Working Group 2012 – The Australian Charities and Not-For-Profits Commission Legislation Review 2018.  

Myles notes in his review , “In these reports alone, I counted over 160 recommendations, with 21 implemented, 113 unimplemented, and 33 partial or no longer applicable implementations.”

ProBono News has asked me to discuss which three recommendations of the 113 that have not been implemented should now be prioritised.  This was a difficult task because I believe around 100 of the recommendations listed in the report still deserve serious consideration.

The issue of better demonstrating our value and our impact is important to us at CCA.  For this reason, I would prioritise this recommendation from the 2010 Productivity Commission Report:

“Australian Government to establish, through tender, a Centre for Community Service Effectiveness. This will provide a portal for gathering and disseminating evaluations, providing guidance for impact evaluation, and support meta-analysis of the effectiveness of government funded services.”

Ideally such a centre would look beyond community services, but as a starting point, having a well-resourced national clearinghouse of ideas and reports about the effectiveness of many government funded charities would be a huge step forward in documenting the value charities provide.  In 2014 there was a national consultation around establishing a Proposed Civil Society National Centre for Excellence in response to this recommendation.  Unfortunately, it did not eventuate.

In 2012 the Not-for-profit Sector Tax Concession Working Group produced one of the best reports on taxation related matters for the charities and NFP sector.  Most of the recommendations remain relevant and would benefit the sector. 

One that CCA and others continue to champion is:

“DGR status should be extended to all charities that are registered with the ACNC, but use of tax deductible donations should be restricted to purposes and activities that are not solely for the advancement of religion, or the advancement of education through child care and primary and secondary education, except where the activity is sufficiently related to advancing another charitable purpose.”

As CCA pointed out in our recent submission to The Treasury around proposed changes to DGR, the goal of the DGR process should be to encourage community involvement, engagement, and ownership of issues they are concerned about.  Encouraging citizens and civil society to own their issues of concern and support charities is both good public policy and good economic policy.

It is difficult to justify the current unequal distribution of DGR eligibility which reflects the arbitrary ad hoc way DGR eligibility has developed.  It makes good policy sense that all donations made to registered, complying charities should be tax deductible.  This is generally the practice in comparable countries like the UK and Canada.  

CCA understands that exemptions outlined in the recommendation from the NFP Sector Tax Concessions Working Group were primarily about making revenue neutral recommendations.  Excluding schools and churches, as described in the recommendation, is a way of making this measure affordable. 

Given there is a well-functioning regulator determining charitable status through an effective process, and given charitable status is grounded in demonstrating public benefit, DGR should be directly associated with charitable status.  

My final priority recommendation from the 113 would be to again return to the Productivity Commission recommendation:

“An Office for NFP Sector Engagement within a central Commonwealth agency should be established to drive the reform agenda. Each state and territory level also needs to build the capacity of their agencies to implement long overdue reforms.”

As Myles has demonstrated in his analysis of sector reform, “The government has produced nearly 3,000 pages of reports, and the sector made over 4,500 written formal responses generating about 29,000 pages.” We are talking millions of words.  Yet most of the great work done in consultations, submissions and putting together these reports has gone unrewarded.  Only 21 out of 160 recommendations have been fully implemented.  

There are notable exceptions of course, like the establishment of the Australian Charities and Not-for-Profit Commission. But in some ways these exceptional reform successes serve to highlight how much stronger the sector could be if more of the substantive reform recommendations had been implemented.

Part of the reason for the failure to follow through on so many recommendations is that charities don’t have a home in government.  Where would a reform agenda be based and who would drive it?  Without central leadership, appropriate resourcing and significant input into policy that crosses many departmental silos, reform will be patchwork and negligible at best.  

And that is exactly where we are now. The Assistant Minister for Charities sits outside of Cabinet and has been allocated very limited resources to drive any reform across the sector.  Cabinet has relegated the Sector Blueprint Planning to a line agency with limited clout, and sector reform is not a significant priority on the government agenda.

If anyone in government is serious about both productivity and community resilience, they might do well to read this report and ask why so many sensible recommendations have been ignored or dismissed.  

The unimplemented recommendations detailed in this report should be a touch stone for sector reform, now and into the future. 

Read on Pro Bono News: learning-from-the-past-to-reform-the-nfp-sector