August 05th, 2020
In a special preview, the QUT’s Australian Centre for Philanthropy and Nonprofit Studies researchers, Associate Professor Wendy Scaife and Senior Research Assistant Marie Balczun, have shared some top line findings from their annual giving report.
The report is compiled from a deep analysis of Australian Tax Office’s tax deductibility data for 2017-18. A series of webinars offering participants the opportunity to ask their own questions will be available after the full report becomes available next month.
1. What do these most recent figures tell us about giving in Australia?
Giving in these latest tax deductible giving statistics is confirmed as still an important way that many Australians express their values and tangibly support their communities. This is particularly vital to note given the continuing concerning trend over seven years and several other studies that fewer Aussies are participating in giving. An erosion in giving participation has enormous consequences for charity and for community.
Private Ancillary Funds (PAFs)
There was a 10.37 per cent increase in the number of PAFs bringing the total number of PAFs existing to 1,650 in 2017–18. This is only the third time since the GFC in 2007–18 where the growth in the net number of PAFs has been greater than 10 per cent.
Public Ancillary Funds (PubAFs)
In 2017-18, there were 1,355 PubAFs with 51 new PubAFs approved during the year. This is an increase of 3.91% from the previous year.
2. What’s changed from last year? And do those changes indicate long-term trends?
Donations as a percentage of taxable income have increased to 0.43% up from 0.42% in 2016–17. This is the highest since 2007–08. This figure is particularly high for female donors (0.46% of their taxable income). Males by the way gave 0.41% of their taxable income.
As highlighted though, the percentage donating has once again fallen to 31.01%. This is the lowest percentage since 1979–80 and is the seventh year in a row this figure has fallen.
The average donation, however, has risen by 9.84% to $845.73.
3. What can you identify as some of the major reasons to help explain some of this data? Are we any closer to an understanding of Australian’s natural generosity? Does such a thing as “natural generosity’ exist?
Any explanation about the ‘fewer giving but those who give donating more dollars’ is a bit speculative. However, qualitative work in other research (e.g. Giving Australia 2016) points to factors such as:
as possible forces in play.
This trend is not just in Australia. Comparable Western nations are seeing similar trends.
Some countries link declining attendance at religious services to this drop in giving.
4. It appears that Western Australia is the most generous state in the nation. What does this tell us about that state and the rest of the country? This trend in WA became evident two surveys ago – does it suggest that this will be sustainable into the medium to longer term?
On paper this is so but it’s a story of one postcode rather than one state - WA 6011, which comprises Cottesloe and Peppermint Grove. Postcode 6011 contributed 64.54% of the total amount donated in WA. Remove this postcode and the average WA donation was $523.51 with 28.43% of individuals making and claiming a deduction for gifts. WA moves back down the list in this case.
5. What about those who with a taxable income more than a $1 million a year? Those not donating has remained fairly static for a number of years: does that matter in the overall terms of Australian giving?
Our analysis reveals that the percentage donating in all income bands has decreased significantly over the past ten years. In 2007–08, on average 35.47 per cent of taxpayers claimed a donation. This average rose to more than half of taxpayers for those earning over $80,000. However, by 2017–18 on average only 31.01 per cent of taxpayers claimed a donation. This figure only rose above 50 per cent for those in income bands above $250,000.
For those with a taxable income of $1 million or more, the percentage claiming a tax-deductible donation has decreased from 63.12 per cent in 2007–08 to 54.48 per cent in 2017–18, a 13.69 per cent drop.
When looking at the share of the national total for those earning more than $250,000, on average, they contributed 24.20% of the national total from 2007–08 to 2016–17 (with a high of 33.16% in 2014–15). This year’s figure of 41.06% suggests that overall, Australia is relying more heavily on the higher income earners than in previous years.
6. What other wage brackets seem to be increasing or decreasing their donating? Do you have any thoughts why that trend is emerging?
We’ve seen a healthy increase in the $250,001 to $500,000 income band. Again, it is speculation but one factor may be that giving is more in the media and workplaces and boardrooms than ever before, prompting more awareness particularly at leadership levels of organisations. I would also expect that as PAFs as an option move from adolescence to nearly 20 years old that more people may be discreetly talking about their giving or involving friends in causes they have come to know well through their giving.
7. If would be a fair speculation that the current economic circumstances will impact significantly on Australians’ capacity to donate. Are there any indications in any of your research (e.g.: GFC) how big an impact that may have on giving in the 2019-20 figures?
Let’s look historically at what this dataset tells us.
In the year following the GFC (2008-09), total tax-deductible donations fell 10.28% from $2,141 million to $2,033 million and the average donation fell 14.86% from $525.96 in 2007–08 to $447.23 in 2008–09. Donations as a percentage of taxable income fell from 0.42% in 2007–08 to 0.37% in 2008–09. The percentage making a donation increased from 34.91% in 2007–08 to 37.04% in 2008–09.
But there was good recovery.
With the drought, bushfires and in 2020 COVID-19 joining the trilogy, giving is in uncharted waters. It is a picture of more demand and community need for giving that was responded to manfully when people were able. Increasingly though tragic personal and economic consequences for large numbers of Aussies who might have given will likely have dampened the giving dollar. Some, including the Foundation and philanthropy sector step up at such times wherever possible but even that is unlikely to cover increased need and less ability to give from households.
The hope is that all who can share more have been doing that, and that giving has been a pause for others not a full stop. Giving is mostly resilient in research about crises across the decades and Australian generosity finds other outlets – such as virtual volunteering and family support – until recovery is in place.