Charity by the book
Posted on 15 Jan 2025
Looking for some insightful summer reading on the charity and not-for-profit sector before the year…
Posted on 17 Dec 2024
By Greg Thom, journalist, Institute of Community Directors Australia
It’s been a busy year in the charity and not-for-profit sector.
From the culmination of multiple inquiries aimed at introducing much-needed reforms, and groundbreaking initiatives such as Australia’s first philanthropic fund run by women for women, to some truly wild and whacky charity fundraising initiatives, 2024 has brought the full spectrum of news, views, inquiries, recommendations and exhortations.
Some issues, though, resonated with our readers more than others.
Here’s a look back at the most popular Community Advocate stories for 2024 and why they made such an impact.
Regulator threatens to deregister charities
The threat by the Australian Charities and Not-for-Profits Commission (ACNC) to deregister certain charities was our most read story of the year.
The Olivia Newton John Foundation, Moreton Bay Regional Community Legal Service and Kids Outreach International were among 70 charities in the regulator’s sights for failing to submit two or more Annual Information Statements (AISs).
“Good governance and accountability are vital for maintaining public trust and confidence in the sector,” said ACNC general counsel Natasha Sekulic.
“Ensuring the accuracy of data on the Charity Register is one way we support this, and that is why it is crucial charities are proactive in keeping us informed.”
The ACNC eventually revoked the registration of 60 of the 70 charities who had failed to update their details by the October 7 deadline.
Major charity hit by cyber criminals
Fear of falling victim to cybercrime is never far away in the sector, which is why it should come as no surprise a data breach at one of Victoria’s oldest and largest charities was our second most read story in 2024.
The cyber-attack on Geelong-based Meli Community, a provider of services ranging from kindergartens and foster care to mental health, homelessness and financial assistance, was big news.
The perpetrator of the data breach, Qilin ransomware group, claimed to have stolen 215 GB of data and 420,000 files including photographs, financial documents and passport information, which it wasted no time publishing on the dark web.
The story served as a wake-up call for charities and NFPs on the importance of boosting digital capability, training, and protection of personal data.
Volunteer-run NFPs face tax red tape tangle
Perhaps no single issue provoked as much discussion, concern and anger in the sector as the Australian Taxation Office’s introduction of contentious self-review returns for NFPs.
Charities are exempt from the changes, which require up to 155,000 NFPs to submit a self-review return or risk losing their tax concessions.
The new requirements prompted a deluge of NFPs to apply to be registered as charities with the ACNC.
The issue, which ran hot for most of the year and continues to be a sore point for many organisations, accounted for five out of ten of the most read Community Advocate stories of 2024.
Those stories included reports that the tax changes had created widespread confusion for NFPs, articles on increased political scrutiny of the changes amid reports organisations were struggling to understand the new requirements, and questioning of the ATO’s strategy for implementing the changes.
The most well-read story of all, though, was a warning from Josh Chye, partner and head of tax at accounting and consulting firm HLB Mann Judd, that small, under-resourced, volunteer-run not-for-profits were unprepared for the significant changes being introduced by the ATO.
Chye said thousands of organisations faced being strangled by red tape as they struggled to comply with the new rules.
“It’s unlikely these organisations currently have the appropriate governance and procedures in place to lodge an annual self-review return,” he said.
Sector unrest over the changes led to a Senate inquiry initiated by Opposition Charities spokesman Senator Dean Smith, which heavily criticised the tax office for ignoring sector concerns and urged the ATO to go back to the drawing board.
The ATO for its part has refused to back down, dismissing calls to simplify the changes and standing by its claims the new rules were introduced on the back of widespread sector consultation.
Just 15,000 NFPs have lodged a return so far out of the 155,000 required to do so by the end of March 2025.
Win for charities on fixed-term contracting
Charities and NFPs scored a major win in October with confirmation recently passed fixed-term contracting laws would be amended to better reflect funding realities in the sector.
Alarm bells first tolled in January, when peak sector body the Community Council for Australia raised concerns the new laws banning fixed-term contracts of longer than two years could put greater pressure on NFP budgets.
The problem arose as a result of unintended consequences of 2023 changes to the Fair Work Act that limited the length of fixed-term contracts and introduced new limits on when they could be used.
The changes, introduced as part of the government’s Secure Jobs, Better Pay package, meant many sector organisations were no longer able to align employment and funding contracts, raising fears of increased overhead costs and a negative impact on service delivery.
New exceptions to the Act allowing fixed-term contracting of staff to align to funding periods came into effect on November 1.
The importance of the issue to many organisations was reinforced by the fact that both the story highlighting the emergence of the issue and the news it had been successfully resolved were among the most read of 2024.
Not-for-profit sector in battle to retain top talent: salary report
Our story on a report exploring the reasons for NFP staff turnover also made it into the top 10 most read list.
The Pro Bono Australia Salary Survey Report revealed that of the organisations finding it difficult to retain staff, “more competitive remuneration elsewhere” was the main reason for 38% of them.
The report found that despite NFP employees’ dedication to the cause, they often found themselves grappling with the reality of lower salaries than the for-profit sector and limited career opportunities.
General burnout was also described as a formidable adversary with the sector.
“The relentless pursuit of noble goals, coupled with limited resources and understaffed teams, exacts a toll on employees’ mental and emotional well-being, leading many to seek greener pastures for the sake of their health and sanity,” the report found.
The news landed amid the sector’s continuing efforts to grapple with rising overhead costs and competition from other industries to attract and retain talent.
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