Records tumble in latest ACNC Australian Charities Report

The 10^th edition of the Australian Charities Report revealed that revenue surged 5.6% in the 2022 reporting period, pumping an additional $11 billion into charities coffers compared to the previous year.

However, the good news was tempered by a $22 billion increase in expenses – which at 12.6% was more than double Australia’s inflation rate.

Employee-expenses alone increased by almost 10% – the highest annual rise ever recorded.

ACNC commissioner Sue Woodward said it was important to recognise that the report’s comprehensive analysis helped highlight some of the challenges faced by charities.

“Our latest data demonstrates charities make an enormous contribution to Australia’s social fabric, its economy and employment,” she said.

“It is important to recognise that the rise in expenses and liabilities outpaced the rise in revenue and assets in percentage terms.”

The annual analysis of the charities sector looked at the annual information statements of more than 49,000 charities from the 2022 reporting period.

The report also revealed that in the 12 months to 30 June 2023:

• donations and bequests to charities increased 4.4% to more than $13.9 billion (lower than the 5.3% increase in 2021)
• volunteer numbers increased 500,000 to 3.5 million
• for the first time, charity revenue from government exceeded $100 billion, up 5.6% to $103 billion on the previous year
• the ACNC registered 2,622 charities
• the registrations of seven charities were revoked for compliance reasons
• there is one charity for every 439 Australians
  

The report found that while the sector remained a major employer and accounted for 10.5% of the Australian workforce – adding more than 47,000 new employees in 2022 for a total of 1.47 million people - it was still heavily dependent on volunteers, with more than half of all charities operating with no paid staff.

The number of volunteers increased by 500,000 to more than 3.2 million, still below the pre-pandemic level of 3.77 million in 2018.

Ms Woodward said charities distributed $11.7 billion in grants and donations, mainly to other charities and not-for-profits.

“That’s an increase of 21% on the previous period, which is a substantial rise in philanthropic giving.

“As the government considers the Productivity Commission’s recommendations to boost giving in Australia, this data offers an important insight.”

The education sector dominated Australia’s top charities by revenue, with the Victorian Catholic Education Authority ($3,269,680,738) ranked number one, followed by the University of Sydney ($3,159,373,417) and the University of Melbourne ($2,998,419,000).

World Vision Australia topped the list of charities with the largest donations and bequests at $291,340,000 followed by mining magnate Twiggy Forrest’s Minderoo Foundation ($266,410,388) and the Australian Red Cross Society ($146,220,000).

While the previous year’s report focused on philanthropy, the latest version put extra-small charities – those with annual revenue under $50,000 – under the microscope.

The report found that while these charities constituted almost a third of the sector (31%), they operated with just 0.1% of total revenue.

This compared to extra-large charities (defined as those bringing in more than $100 million in annual revenue), which make up only 0.5% of the sector but pull in more than half (54%) of total revenue.

An analysis of data relating specifically to extra-small charities for the five years up to 2022 revealed:

• almost 90% of these organisations operated with no paid staff
• they experienced a 17% fall in volunteers
• they lost 18% of their paid staff.

Ms Woodward said the differences between Australia’s smallest and largest charities could not be starker.

“This five-year focus data shows the cost of operating and delivering services has increased but extra-small charities haven’t received sufficient revenue or donations to keep pace.”

Ms Woodward said the latest Australian Charities Report highlighted the enormous diversity – and different needs – of the sector.

“While the ACNC does not set policy, we can highlight that most of the sector operates on low revenue with no paid staff.”

Ms Woodward said this made it even more important to ensure the differences in resources and capacity among charities was top of mind when talking about the needs of charities and formulating policy to meet them.

“So many Australians rely on programs that charities provide, especially as cost-of-living pressures impact across the community.”

More information

Australians more generous to the tune of $676 million: ACNC Report

Charities report reveals covid-era volunteering drop could have been worse