CPA Australia, Sydney
Wednesday, 1 March 2023
Thanks very much, Wayne [Stokes], for the generous introduction. Thanks to all of you who have come here in person. In the slightly post-COVID age we’re in, it’s lovely to be in a room with other human beings, and that’s a theme that I’ll be touching on a little bit today. Welcome also to those who are joining virtually.
As Wayne did, I acknowledge that we’re meeting on the traditional lands of the Gadigal people, pay my respects to elders past and present, acknowledge any Indigenous people present and commit myself as a member of the Albanese Government to the implementation in full of the Uluru Statement from the Heart.
I just finished reading Katherine Rundell’s biography of John Donne. It’s called Super‑Infinite, a title that comes from the way in which Donne’s great focus was on the things that transcend us. When we think about John Donne, we think of that wonderful line, "no man is an island". Of course, a little gendered for his age, but still a powerful reminder of the importance of focusing on those activities that bring us together.
Indeed, it’s hard to point to many achievements of humanity, whether it is creating a great invention, winning a war or building a city, which have been done by a single person alone. Most of the achievements of which humanity can point back are collective achievements. They're achievements of "we", not achievements of "me". And yet over recent decades, Australia has shifted starkly from being a nation more of we to a nation more of me. I want to start by just taking you a couple of metrics for that.
The first is when we look at the number of organisations per person in Australia, that figure has dwindled. We can go to the Directory of Australian Associations, started in the late 1970s, which tracks the number of organisations in Australia, and we see from that a decline in the number of organisations per person. If you wanted to join an organisation in Australia today, there are simply fewer to choose from per person than there were in the late 1970s.
We’ve seen a drop, too, in the share of Australians joining large mass‑membership organisations. In a book we wrote a couple of years ago called Reconnected: A Community Builder’s Handbook, Nick Terrell and I surveyed major mass membership organisations – think Scouts, Guides, Rotary, Lions and the RSL – and asked them for their membership figures. That allowed us to put together a chart showing two things. We saw a postwar boom in membership in these organisations and then was a bust. Since about the late 1970s, there has been a steady decline in the share of Australians who are active members of these big community organisations. We looked, too, at surveys that asked people whether they are members of any organisations. That captures the new entities that may have emerged. Fewer Australians today say they’re active members of any organisation. That’s true if we look at political organisations, civil organisations, or sporting organisations.
We can also look at the propensity of Australians to play an organised sport. I got interested in community building in part because of an experience when I was studying at Harvard, working on the research team of Robert Putnam, who had just published Bowling Alone. When we look at Roy Morgan surveys of sporting activity in Australia, it’s very clear that Australians aren’t just bowling alone; we’re bowling less often. Tenpin bowling and lawn bowling numbers are down considerably. That’s also true of netball, tennis, cricket, rugby league. Most other major sports you can name have declined in participation rates. What’s rising instead is gym‑going and walking on your own. Essentially, solitary activities have replaced the shared community sport that was more common a couple of decades ago.
We’ve also seen a significant drop in the volunteering rate. It was trending down a little bit over the first two decades of the twenty‑first century but then really took a hit from COVID. Volunteering numbers fell from a little under a third to around a quarter of Australians and are yet to recover. That’s a challenge particularly for organisations that rely on older volunteers. Think Meals on Wheels, which doesn’t just service an older clientele. It also uses older volunteers. Many organisations tell me that they’re struggling to get help with volunteering, which is why we’ve recently funded Volunteering Australia to put together a national volunteering strategy and are looking to do further work in that space.
We’ve also seen a drop in the share of Australians who say that they have a large number of close friendships and know many of their neighbours. In 1984, a survey was done which asked Australians, "How many close friends do you have with whom you could speak in confidence?" The typical person in the 1980s said they had about nine close friends. Now that number is down to about five. The same survey asked people in your local area, how many people are there whom you could drop in on uninvited? Back then people would say about ten, now they tend to say about four. In other words, the typical Australian’s friendship networks have halved and the number of neighbours we know has halved. There’s more people now who say they have no close friends and know none of their neighbours than was the case in the past.
Just to go to that “we versus me” point that I started off with, you can look at Australian books. Thanks to Google’s Ngrams, we have scanned copies of thousands of books, which have been written in Australia, fiction and nonfiction, over the decades. And from that, you can look at the number of books which use collective words like “we” and “our” and individualistic words like “I” or “me”. That then allows you to build a “we to me” index for Australian books published each decade. That index holds roughly stable from the beginning of the twentieth century right through to the early twenty-first century. But then it falls off a cliff. We’ve seen a significant decline in the share of Australian books using collective words and an increase in the share using individualist words. Quite literally, our books are telling a story of a more individualistic Australia.
Now, none of this was helped over the course of the last decade by a series of attacks on charities. Appointing someone to run the charities commission who had a track record as a charities critic caused a range of concerns in the sector and left many feeling that the charity watchdog was not just there to crack down on bad behaviour, but wasn’t on the side of charities as a sector.
We saw a range of attacks on charitable advocacy under the former government, attempts to crack down on charitable advocacy by environmental charities, by legal charities and by social justice charities. There was very much an attitude from the former government that charities should be seen and not heard. I don’t want to pretend for a moment that the tectonic changes I’ve talked about were solely driven by partisan attacks on charities, but what I do want to argue is that those attacks came at a tough time for the sector and made the problem worse.
We went to the election with an ambitious set of policies, aimed not just at getting charitable regulation right but on breathing a sense of life into the community sector. I’ve talked about this broader context which we’re facing and we’re aware that we need not just government but the community sector working together to turn this around. A country in which Australians are more likely to be donating to causes they support, participating in community events, enjoying more friends is going to be a more productive Australia. We know very clearly, commerce works better when deals can be done by a handshake, rather than having to write every little detail down in a contract because you’re scared that the other party will swindle you. We know too that people tend to be healthier in connected communities. And you’re more likely to find someone who can drive you to the doctor and you’re less likely to need mental health support if you have close networks of friends.
We know too that living in a connected community is simply more fun. You can tell this through attending the funeral of somebody who has lived a good life, somebody who has lived a long life. Think of a person who’s passed away in their nineties. What is talked about at those funerals are not the accolades and the awards that the person received. It’s how they made others feel. It’s their friendships. It’s what they gave back to the community around them. That’s what friends and family remember at the end of a big full life. So, we know that reinvigorating Australian community will be good for the economy, good for health, and good for well-being more broadly. But how do we get there?
Prior to winning government, we set a target of doubling philanthropy in Australia by 2030, working with Philanthropy Australia to engage donors and charities in order to make it easier. I’ve been reaching out to philanthropic foundations, talking about causes they might support and the importance of identifying impact, which I think is absolutely critical if we’re to build a stronger culture of donations. I’m impressed by organisations such as Kids in Philanthropy, that seek to build a culture of giving among school kids.
I recently spoke at a Vinnies ACT event to announce they’re partnering with a range of local Canberra businesses, to set up a workplace giving program. Workplace giving is a very straightforward way that Australians can assist their favourite charity without the need to collect tax receipts and claim them back at the end. A small amount comes out of your pay packet every month and because it’s pretax income there’s no further acquittal required. Four million Australians are in workplaces that have workplace-giving programs but only about one in twenty participates in those programs. In other words, many Australian workers could but few Australian workers do participate in workplace-giving programs. We’re keen to change that.
We’re also keen to fix the outdated mishmash of fundraising laws that currently requires that a charity that raises money online needs to do the paperwork in seven different jurisdictions. Only the Northern Territory gives charities a leave pass. That means that it can cost up to a week of a staff member’s time to do all the registration paperwork to make sure you’re compliant under our fundraising laws.
Recently, the states and territories through the beautifully named CFFR, Council on Federal Financial Relations, announced that they have agreed to a set of harmonised fundraising principles. Those harmonised fundraising principles will then be embedded in legislation over the course of the year. It’s now incumbent on States and Territories to set down their own plan by the middle of the year as to how they intend to achieve that goal.
Fundraising laws are complicated, but the end result of a mess of fundraising laws is very simple. It means more money being spent on complying with unnecessary regulation and less money being spent on assisting the causes charities were set up to focus upon. The cost of complying with these laws is more than a million dollars a month. That’s a million dollars a month being diverted into compliance, rather than to the core activities of charities.
We’ve made very clear that the war on advocacy is over. Mark Dreyfus has announced that legal assistance charities won’t face gag clauses in their agreements. As the Attorney General has put it, some of the very best ideas on law reform come from those who work at the coalface with vulnerable clients. It makes no sense to tell someone working at an Aboriginal legal centre or a community legal centre that they can’t be part of a national conversation on law reform. Likewise, it’s sensible to say to environmental charities that they can have a voice as well as using their hands to plant trees or to clean up the local environment, and it makes sense that anti‑poverty charities should be involved in the conversation about building a fairer Australia.
We’ve also announced, through the Productivity Commission, a review of Australia’s philanthropic settings to make sure we can meet that goal of doubling philanthropy by 2030. This is going to be a substantial review. The Productivity Commission has brought Krystian Seibert on board. Krystian has extensive experience in the charity sector and in philanthropy. Krystian understands, as I’m sure by the time the review has finished the Productivity Commission will, the broad gamut of charitable organisations in Australia and the importance of getting philanthropy right. It’s critical that we meet that goal to double philanthropy and it’s also important that we look at where we can tweak the rules to get it right.
I’m not pretending this works without a budget constraint. As my colleagues in the Treasury portfolios point out, current tax deductions for philanthropic giving exceed a billion dollars a year. If we’re successful in our goal of doubling tax‑deductible philanthropy immediately that’s got another billion dollars a year cost to the budget bottom line and that’s before we make any changes to the rules around tax deductibility. But that doesn’t mean we’ve got a closed mind on what ideas the Productivity Commission comes forward with. Indeed, we’re commissioning this once-in-a-generation review to make sure we get those settings right and that the charitable deductions are best targeted at improving giving.
I’m also really attracted to initiatives such as givewell.org, which looks at the evidence of impact of charities working in overseas aid. I’m curious to see whether similar models might work effectively in Australia, whether we might be able to learn more about what charities do in order to build a stronger culture of giving and to ensure greater impact among Australia’s charities and not-for-profits.
We’ve set up a blueprint process which is being run by sector experts from the Community Sector Advisory Group. This will be a process that will look at a whole range of issues in the sector such as the need for updating IT systems, the way in which organisations report to government, ways in which the charities commission might be more effective.
We have a head for the charities commission in Sue Woodward who is firmly on the side of the charitable sector, who understands the importance that the sector plays in Australian community life, who worked with a whole range of charities through her former activities in Justice Connect and who understands deeply the importance of a well-regulated, thriving charitable sector.
We want more charities to be set up in Australia, more entities like Orange Sky Laundry, set up by a couple of young blokes in Brisbane who thought it would be a great idea to put a couple of washing machines in the back of vans and drive around and use that washing point as an opportunity to start conversations with marginalised people. More entities that are springing up is also vital to building that sense of a thriving community sector, to revitalising an Australia of 'we', not just a nation of 'me'.
So I hope I’ve given you a little bit of a sense in those open remarks as to the priorities of the government. We’re trying to take a broad view of this portfolio and of these challenges. We recognise that it requires what basketball fans call a "full-court press"; all players working together, not just one superstar running up the middle. It’s not just an activity for the federal government or for state governments or for not‑for‑profits. It’s also a vital activity for the business sector, and it’s critical for citizens to get engaged in this conversation and this wider project.