Great question, thanks for asking: Q&A with Andrew Leigh

That was certainly the case when the sector’s chief government representative in Canberra opened the floor to questions after delivering a speech in Melbourne recently.

The topics raised by his audience ranged from how to resolve the tension between funding and service delivery to the merits of face-to face-versus online activism.

Top of mind, however, was what can be done to challenge the stereotype that a charity must be run on the smell of an oily rag.

Andrew Leigh

I'm certainly aware of that challenge of people regarding a good charity as being one that spends as little as possible on its administrative overheads.

That effectively means a charity that pays its staff as little as possible, that does as little training as possible, that is in the stingiest, most uncomfortable offices ever.

That's a mistake, because you don't get people building up the skills, the expertise, the careers that we need in the sector, and the risk that I'm most worried about is that if we don't have good measures of impact that allow donors to compare charities In terms of what they're doing on the ground, then donors will fall back on using administrative overheads as a proxy for impact.

They're simply not [the same thing], and the danger is that we take a feminised and underpaid industry and have a push towards paying people even less.

Katherine Ellis, CEO, Youth Affairs Council of Victoria

With organisations so busy trying to mobilise funding in order to keep running, how can they be empowered to devote more time and energy on core service delivery?

Andrew Leigh

We would like to see a larger and stronger charity sector in Australia.

We came to office with a target to double philanthropy by 2030, I think the first time that an incoming government had had a target of increasing philanthropy.

That's a big goal for the nation, and the way in which we're focused on achieving it is this Productivity Commission inquiry which will look at norms around giving, so how we get more Australians giving, everything from workplace giving to high-net-worth philanthropy.

At the moment, the Commonwealth effectively funds around $2 million a year through full bond tax income and charitable tax deductions.

And also thinking about how we do a better job of that impact measurement piece that I mentioned before.

There’s some direct budget support, as funding directed towards social enterprise and towards a Deep Disadvantage Fund. There’s $200 million partnering with philanthropy to look at philanthropic co-funded grassroots-led initiatives in areas such as Logan, Burnie and Bourke. We've seen what those local organisations have been able to achieve.

We're talking to the foundations about improving the quality of the evaluation. We've set up an Australian Centre for Evaluation to look at government programs, but we'd also like to get more evaluation in community sector programs.

We think if you've got better measurement as to what works, that will bring more and more donors in because they'll see the value of what they’re giving.

It’s a big goal, but it is about that notion of creating an Australia which is not just a nation of “me”, but also a nation of “we”.

Allison Troth, fundraising specialist, Pink Hope Australia

Not-for-profits can end up competing against each other when tendering to provide similar services, forcing them to cut costs to compete for the same pool of money. How can this be addressed?

Andrew Leigh

The degree of collaboration versus competition is certainly an issue that comes up a lot with the organisations that I chat with.

There's government-run competitive grants programs and that's one of the things that we do in order to try and find new ways of dealing with challenging social problems.

So, rather than government doing everything, we look for local community partners, particularly in areas around deep disadvantage who might have insights, knowledges, ways of working that allows those who are most in need to be helped.

But at the same time, we don't want to stop those learnings flying across organisations and there is a risk that organisations don't share their methods with others because they're scared that their competitors will take their secret herbs and spices and go and cook the recipe by themselves.

There's also the danger that if you set up those tendering systems the wrong way, that you prevent organisations working together in consortiums, you prevent the kind of collaboration that you want to see.

So, we've been holding forums around the country. One of the aims of that is to let people know what we're doing. Another one of the aims is just to give people or organisations an opportunity to link up with one another.

We're aware of, in the employment services space, the need to make some reforms. Julian Hill is currently chairing an inquiry into employment services. One of the things that's looking at is the role of social enterprises and how social enterprises might be brought into employment services.

More broadly, the issue of the duration of contracts has been frequently raised with us, so we made a commitment from opposition to longer term contracts in order to provide the sort of stability to organisations that you just don't get if you've got to go back in again and again every year to return for work.

Thu-Trang Tran, CEO, Volunteering Victoria

With not enough people volunteering, a lot of campaign investment has been around mobilising people to come out. How can the issue of capacity building for volunteer engagement and management of coordination of volunteers be addressed?

Andrew Leigh

The government has recently funded Volunteering Australia to carry out a long-term plan as to how we go about boosting volunteering.

Part of that is about making sure that volunteering is inclusive, that there are opportunities for people who've traditionally been marginalised from mainstream volunteering to get involved.

But also, that we're reaching out to corporations who might have nominally told their employees that they can have a day, a year or a couple of days a year to volunteer, but in practice don't really seem to have a strong commitment towards their employees volunteering, or at least that's what it looks like, because there's such low take-up of their programs.

So we want more of those organisations to be encouraging staff to volunteer, and when they do, when you get those experts volunteering, you get a much bigger impact.

Warwick Cavanagh, CEO, Bayley House, and director, Haven Home Safe

There’s been a trend over past 20 years by government to shift responsibility and risk to the not-for-profit sector to place a greater emphasis on quality and compliance, while at the same time driving down the price. NFPs might be not-for-profit, but they do need to be able to employ staff and to do so appropriately and responsibly in order to deliver those services safely. Is there an understanding of this in the Albanese government?

Andrew Leigh

One of the things that's been important for us as a government is recognising that a good portion of the gender pay gap in Australia has come from systematic underpayment of so-called women's work.

The caring economy has been underpaid relative to other economies where workers of similar skills operate.

So we supported the aged care workers case which saw a 15 per cent pay rise for aged care workers, and the past budget included $11 million to cover the Commonwealth share of that increase.

We're aware, too that in the National Disability Insurance Scheme that's going to involve costs to the Commonwealth and we understand that we have a responsibility as a government that's committed to closing the gender pay gap and seeing the wages of the lowest paid keep pace with inflation to funding that increase.

We argued that the lowest paid workers in Australia shouldn't go backwards after inflation and the minimum wage decision last Friday has a direct impact on the government's budget as a result.

And there’s a recognition within the government of the powerful role that charities and not-for-profits play.

You see this perhaps most starkly in the area of advocacy, where the former government had a real “be seen and not heard” kind of approach to charities and not-for-profits.

That you should work in soup kitchens but not talk about poverty. That you should plant trees but not talk about deforestation. That you should help legal centres but not talk about law reform.

We take a very different approach and we understand that you need a strong and thriving community sector, if you are to make that happen.

Russell Yardley, Board member, Alannah and Madeline Foundation

How can we move beyond the accounting of organisations for profit and money to value and impact?

Andrew Leigh

In terms of the impact of organisations, it is useful to be thinking about triple bottom line accounting.

In some sense, triple bottom line has devolved largely on a global sense to ‘what are you doing about climate change?’ But it should be about a lot more than that.

ESG should have the environmental side, but there's also the social side, the governance side.

There's the reconciliation action plans which are becoming increasingly common across large organisations and remind organisations of their obligation to work with First Nations peoples and to have First Nations represented within their staffing.

We also need some more clear benchmarks on the social side. Do we want to be comparing organisations based on total number of volunteer hours, for example. Total philanthropic donations as a share of revenue or as a share of profit.

So we're having a conversation with the accounting agencies which are responsible for doing the SG benchmarking as well as with the Business Council of Australia to think through whether we can better measure the holistic impact of corporations.

In some sense, that parallels what we're doing at a federal level through wellbeing budgeting, recognising that good economic management isn't just about maximising GDP, it also has to do with the environmental footprint, the social impact and the broad holistic impact that the government has on the wellbeing of its people.

Got a question for Charities Minister Andrew Leigh? Email us at [email protected]

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