Change For Change

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Where are your charity donations going?

WORDS Hannah McNicholas

There’s loose change in your pocket. It’s not enough for a train ticket or a pre-tute coffee, but there’s a stall selling cookies for the charity du jour, and you do have enough for that.

We buy pins and flowers and fridge magnets all in the name of a good cause, but we rarely stop to think where our money is going. It’s comforting to believe that our donations are helping those in need, but how much of our well-intentioned tithing goes to the sick and suffering, and how much ends up in the charity’s pocket?

The good news is that the charity groups run on campus are subject to the student organisation rules and answer to the Deputy Vice-Chancellor and University Registrar. The rules state that student groups on campus must not “carry on any activity so as to provide or obtain financial gain”. Furthermore, the document decrees that all student groups and their members must “act honestly” and not profit, directly or indirectly, from their group’s activities.

Most on campus charity groups and social justice organisations are run by and targeted at students, with the understanding that, as much as we want to help, university life rarely leads to disposable income. Brita Penfold, liaison officer for the Macquarie University branch of Amnesty International, says that they encourage activism and engagement over monetary contributions. “The Macquarie student group doesn’t accept financial donations,” she says. “If anyone offers us money we suggest sending the money directly to the Amnesty organisation. We much prefer people offer their support!”

Student run societies like the Amnesty group offer alternatives to giving money. “We’ve had stalls with petitions and information to raise awareness and support,” says Brita. “We deal with a range of issues, from Refugee rights in Australia, to the Indigenous homelands campaign, and global events such as the arms treaty.” But getting students to donate their time can be equally challenging. “There are a lot of really passionate people on campus who are interested in issues of social justice,” Brita said, “but it is a struggle to find people wanting to take a more active role in the society.”

Macquarie also encourages staff and students to support non-profit organisations that exist solely for charitable purposes, both through fundraising activities and volunteering programs. The university supports charities such as the Australian Red Cross, the Salvation Army and the RSPCA, some of the nation’s most well-known and widely supported social welfare providers.

Unfortunately, outside the university campus, it’s harder to be confident of where your money is going. While Australians seem to favour humanitarian causes, community outreach and health services, there are over 60,000 charities and non-profits vying for your spare change. All too often, donations that we think are providing much needed help are, in fact, supporting the charity itself, footing the bill for office space, uniforms, promotional knick-knacks and nation-wide advertising campaigns.

All organisations incur running costs, but when one considers the ratio between funds raised and the cost of raising them, some startling truths come to light. Effective charities contribute 60-75 per cent of donations to funding aid and relief programs, with ideally no more than 40 per cent spent on advertising and administration. Figures from 2011 show that some of Australia’s most beloved charities fundraising efforts leave something to be desired. The Surf Life Saving Foundation, for instance, spent over 60 per cent of donations – nearly $15 million – on advertising and events promoting their organisation. Other offenders included the Make-a-Wish Foundation, spending 51 per cent of funds raised and SIDS and Kids NSW at 47 per cent.

At the opposite end of the spectrum are equally recognisable names, including World Vision Australia and Medecins Sans Frontiers Australia, both boasting a 14 per cent donation to costs ratio, as well as RSPCA and WIRES both clocking 11 per cent. Topping the nice list is Diabetes Australia with just two per cent of donations funding the charity’s management.

In 2011, the government established the Australian Charities and Not-for-Profits Commission (ACNC) to regulate charities and monitor where the public’s donations are going. In an effort to promote transparency and accountability, the ACNC website hosts a registry of verified charitable organizations and maintains a database allowing donators to look up information about their charities. Other sites such as, ConnectingUp.org provide information and resources to strengthen trust between charities and the community, while independent watchdog groups like GiveWell.com conduct in-depth evaluations of aid groups and rate them on their potential to do good.

Regardless of reputations or ratios, the best way to make sure your donations are doing good is to do your research. Many charities issue annual reports outlining the allocation of funds to help you know where your dollars are going, while others encourage you to nominate where you want your money spent. Be wary of charities offering incentives or gifts for donations. Try to resist being pressured into spontaneous donations, pledging money over the phone or being drawn in by emotional guilt trips. If you can, volunteer your time to learn first-hand what your charities are doing in your community or abroad. Don’t be afraid to ask questions before handing over your hard-earned cash.

That’s not to say be afraid of your altruistic side, but we should be smart with our donations. With a little investigation you can make sure your dollars are going where they’re needed. That loose change in your pocket could change or even save somebody’s life. But maybe think twice before buying that cookie.