As much as $15 million every year in charity donations is being wasted on admin costs instead of being delivered to those people in need or victims of disaster, Not for Profit Organisations have stated.
The charity sector is worth $134 billion and argues that it is simply drowning in red tape. There is so much bureaucracy that as many as 45,000 registered charities are being forced to break the law because they simply find they cannot comply with multiple regulations.
Over 100 of the country’s largest charitable organisations such as the RSPCA and the Smith Family have written an open letter to Prime Minister Malcolm Turnbull asking him to fix what they have dubbed an “almighty mess” The letter goes on to add that Australian charities wish to do the right thing but brush up against the rules which work against them. There are regulations at the Federal, State and Territory level and those Governments need to work together in order to provide charities with one set of coherent laws that are consistent nationally. The new laws should be modern and fit for the purpose of the fundraising regime as Australia continues is present review of consumer laws.
The aid agencies say that action is needed immediately, so that their donors who support them can operate under a 21st century nationally consistent and fit for purpose regulatory regime. Over the last couple of years, the Australian Charities and Not-for-profits Commission withdrew the legal status of 37 organisations which resulted in the loss of Commonwealth tax concessions. Susan Pascoe, the commissioner said despite this fact, the vast majority of organisations registered with the Commission were run by dedicated and honest people.
There were a number of signatories to the letter which demanded fundraising reform. These include:
The Law Council of Australia
The Australian Council of Social Services
The Australian Institute of Company Directors