October 28th, 2020
Key charities at the heart of the national bushfire response acted legally and responsibly according to a landmark review by the Australian Charities and Not for profits Commission.
Image provided by RFS member Gena Dray
The review was undertaken to address concerns that there was a gap between the public’s expectations of charities and the challenges of responding to the rapidly changing disaster.
It found that although the disaster was a complex and frequently changing situation that posed problems for charities, they responded professionally to allocate funds to bushfire relief programs while also protecting their donations from fraud.
ACNC Commissioner Dr Gary Johns said: “We are …fortunate in Australia to have a diverse, experienced and skilled charity sector able to respond to the broad needs that arise following a disaster.’’
Three large charities – the Australian Red Cross Society, the Trustees for NSW Rural Fire Service and Brigades Donations Fund (NSW RFS Trust) and the NSW Wildlife Information Rescue and Education Service Incorporated (WIRES) – were the review’s focus. The trio of charities all received significant donations.
The review found the charities were credible and professional in managing their donations, and balanced immediate relief with need to provide funds for long-term recovery.
The devastation of the bushfires triggered a deep outpouring of generosity across Australia: $640 million was raised for relief and recovery. A Fundraising Institute of Australia survey indicated that in four days in January, 53 per cent of Australians donated to a bushfire appeal with a median value of $50. But the scale of the bushfires and the spontaneous generosity raised public expectations that donations were reaching the people who needed it most.
However, there were challenges on the ground that complicated charities’ capacity to deliver quick relief and impacted on the public perception of their effectiveness. The review identified several important issues, particularly the three charities not knowing:
the number and amount of donations and other funding they would receive
when they would receive funding
when they would receive requests for aid and services.
the total demand for aid and services
The review identified the importance of charities being able to plan the use of their resources to effectively manage risks during such uncertain times, as well as being able to meet community needs. The three charities also identified crucial information gaps that could have helped them with program delivery. This ranged from a lack of comprehensive data on bushfire damaged properties, a shortage of information on how animals were affected and the absence of national licensing for wildlife carers and rescue organisations.
The review noted: “Red Cross had to resort to staff physically inspecting some properties to find people in need and verify grant requests. The lack of current and comprehensive information meant the charities had to take time to understand people’s needs and where they were to properly deliver programs in response.’’
Dr Johns said some public concerns were based on a misunderstanding of charity operations and the costs of delivering services.
“In emergency situations it is not always possible for charities to begin delivering programs immediately because they need information and time to plan how to maximise their impact,’’ he said.
There were also the added difficulties posed by the extent of Australians’ generosity. The large increase in funds required greater planning and stricter governance processes, plus enhanced fraud protection measures.
“The extraordinary event of the bushfire disaster led to great generosity, but it also led to an upswing in fraudulent claims,’’ Dr Johns said. “The charities had to balance measures to prevent fraud with the need to get money out the door quickly. We were satisfied they managed this appropriately.’’
And there was no basis to some public concerns that charities had withheld funds or not distributed them correctly.
“Donated funds are ‘charitable funds’, as in any interest they earn, and legally charities can only use their charitable funds to deliver their charitable programs,’’ Dr Johns said.
One feature of the bushfire donations was the role of a third-party in raising funds for a charity. In that instance, the charity has no control over the message from that third-party fundraising campaign.
The ACNC is not usually able to publicly release its reviews because of secrecy provisions but this time, the Commission had the charities’ co-operation and permission to publish the report. Its’ publication is designed to provide the public with an insight into charity operations and to maintain public trust and confidence in the sector.
“I am satisfied with the outcome of these reviews and I want all Australians to feel reassured that their generosity and trust in charities is well placed,’’ Dr Johns said.