The charities sector is under increasing pressure. Fundraising revenue is stalling, government funding is harder to obtain and retain, and making money from fees and service charges is now more competitive than ever before. This does not mean that the sector is doing less valuable work, or that all charities are struggling to survive. In fact, some are thriving. It does mean that there has never been a more important time in terms of planning for our future.
In almost a decade of CCA Pre-Budget Submissions to federal governments the issue of sector-wide planning has consistently been a priority for CCA members. The following recommendation was included in the CCA 2019 Pre-Budget Submission:
“Work with the NFP sector to develop a future blueprint for the sector, including extensive consultation; economic modeling of future scenarios; strategies to capitalise on emerging opportunities; and increased capacity to respond to emerging risks and limitations.”
The submission argued that:
“The future of Australia’s NFP sector is too important to our economy and our communities to grow in an ad hoc manner with little comprehensive planning or strategic investment. At present there is no plan, no strategy and no real projection about the future viability or even the sustainability of the current levels of growth across the NFP sector. The effective development of a blueprint will include developing clear goals and measures of what the NFP sector is seeking to achieve.”
Not waiting for government, CCA has been working with key members including: Philanthropy Australia; Impact Investing Australia; Volunteering Australia; the Centre for Social Impact; Pro Bono Australia; Community Broadcasting Association of Australia; Our Community; the Australian Scholarships Foundation; and Justice Connect on what process may best deliver a plan for the sector. As noted in the recommendation, such a plan must involve both wide consultation and deep consideration about the purpose of the sector. In a meeting partly facilitated by CCA chair Tim Costello, four key principles emerged for our collective work towards the development of a sector wide plan:
1. Enhance what already exists. Add value to the work we all do.
I never cease to be amazed at the outstanding work being done across the charities sector. Parts of our sector are incredibly innovative and responsive, approaching problems with real insight and developing a strong evidence base around their impact and value. Unfortunately, this excellent work is often not shared, adapted or adopted, and many charities keep re-inventing the same wheel without drawing on what we know works or doesn’t work. This first key principle in future planning is about both highlighting and addressing this issue – we will need a sector that can better enhance what works and let go of what is not working if we are to be both sustainable and effective over the coming years.
2. Be sector-led and not compromised by a funder agenda.
It may go without saying that the sector needs to be driven by its charitable mission or purpose rather than operating like for-profits and just trying to make money, but the reality is charities often need to make money to pursue their purpose. Getting the balance right is not always straightforward. Choosing what not to do can be more difficult than choosing to do everything. In any planning for the sector the goal can never be about satisfying the biggest funders (governments) or a mythical market concerned about overheads and fundraising costs. The goal cannot even be about trying to ensure growth. The sector needs to own its own future and to do so it will need to articulate what it wants to achieve and demonstrate a sustainable balance between strategies that are about effectiveness in achieving purpose versus strategies that focus on generating income streams to sustain organisational activities.
3. Build sector capacity and appetite for investing in capacity.
The starvation cycle in charities suggests that when things are tight, the first thing to go is organisational investment in infrastructure and capacity. We know from research conducted into our sector that over a third of medium to larger charities have no staff training budget. We also know many charities do not have the information systems they need to create and share information about the value of their work. The priority for most charities is doing their work, providing their services, running their programs. Investment in organisational capacity is seen as taking resources away from these priorities even though investing in capacity can make organisations more effective and efficient in the medium and longer term. A more sustainable charities sector with enhanced capacity to serve our communities will require a different approach in addressing the issue of organisational capacity.
4. Recognise where we are strong and where we are weak.
The charities sector is not as good at knowing its strengths and weaknesses as we might think. This is a product of many factors. For instance, most charities have their own service bias in that they are usually blind to the people they do not see. If the only people a charity engages with are people who like and use their services, they may develop the perception that all they do is good. Sometimes the people who most need services are the least likely to access them because what is on offer does not meet their needs. To fully understand the value of their work, charities need to be involved in measurement, evaluation, and engagement with those outside of their services. All of these activities take time, resources and skills that are often not readily available within charities.
In the lead up to the next election, CCA will be seeking policy responses from all political parties in relation to future planning for the charities sector. Developing a future sector wide plan will require government engagement and support.
One of my favourite Irish jokes goes something like: I got lost in Dublin so I asked a local Irishman how to get back to my hotel. He laughed at me and said, “well if you want to go there I wouldn’t start from here”. There is an ongoing discourse about what is wrong with the charities sector that has that same sense of circularity to it. Rather than focusing on where we are and what is wrong with the sector, we need to start with where we want to go.
A blueprint for the future of the charities sector should not be about a stronger charities sector, but about how our purpose can be better realised, how our communities can flourish despite all the emerging challenges, and how our country can better realise its place in the world.
The current failure to plan for our future will inevitably expand our irrelevance.
First published on Pro Bono Australia