How do New Zealanders rank as philanthropists?

by Sally Blundell / 28 April, 2017
Photo/Getty Images

Photo/Getty Images

Kiwis take little persuasion to give to a good cause, but the demands are ever-growing and there are questions about how much money gets to where it’s needed.

We love to give. Faced with Anzac Day poppies, collection buckets, stickers, crowdfunding platform passwords and multimillion-dollar contracts for overseas aid, we give and give. But how we give is changing.

“This almost Victorian ideal of a paternalistic state that taxes the populace and spends money on public services and other good causes legitimated by an election every few years needs to be renewed and refreshed,” says Danny Sriskandarajah, secretary-general of the Johannesburg-based Civicus global civil society network.

Sriskandarajah, a speaker at a philanthropy summit in Wellington next month hosted by Philanthropy New Zealand, is calling for new forms of civic action and new mechanisms for citizen participation.

“Wherever I go in the world, I see really dynamic new ways of channelling citizen voices,” he says from his home in London. “We see it on online platforms such as change.org, where tens of millions of people are mobilising online. We see it offline in social movements like the Occupy movement and the Pacific Climate Warriors. People are using new tools to organise and mobilise to come together in powerful ways.”

Danny Sriskandarajah.

Businesses, he says, have an important role to play here. “There’s a huge responsibility on those actors that have independent resources to use their philanthropy to make some of these changes happen.”

He is not talking about a mere 1% lift in corporate social responsibility giving. “Enlightened businesses are seeing what they can do 100% of the time to make the world a better place. So we need to name and fame some of those companies that are transforming their business models and hold to account those that are failing to reform.”

Collectively, says Philanthropy NZ chief executive Tony Paine, “it is fair to say we are a generous country”. Bang on. Over the past 18 months, we have stumped up $2 million for a beach now part of Abel Tasman National Park, almost $3 million for the Kaikoura earthquake relief appeal and more than $450,000 for the Nepal earthquake. We have given $2 coins and $2 million deposits to cancer, health centres, sports teams, cultural institutions and art – last year the Te Papa Foundation was launched with a gift of $1.45 million, with the promise of a further two works by Jackson Pollock with a combined value of more than $1 million.

According to Philanthropy NZ, we gave an estimated $2.8 billion to charitable and community causes in 2014, just over half of which was personal donations. Last year, taxpayers handed over $6.3 million through payroll giving, up from $1.5 million in 2010.

Charities, meanwhile, are multiplying at a rate of about 18 a week; there are now about 28,000 registered charities and 115,000 not-for-profit organisations. But there have been warnings: about donor fatigue, charity creep and generosity wearing thin.

Between 2011 and 2014, personal donations fell by 4%, from $1.42 billion a year (perhaps a response to the Canterbury earthquakes) to $1.37 billion. Giving by voluntary trusts and foundations decreased by 4% and business and corporate donations dropped by nearly a quarter over the same period. Although funding growth for the sector has averaged 5.7% a year since 2004, an increasing proportion of that is from Government grants and contracts.

A recent member survey by the Council for International Development, representing 39 non-government organisations (NGOs), showed overall donations to NGOs and charities in real terms have fallen 15% in the past decade. “There is a lot of churn happening,” says council director Josie Pagani, “a lot of disruption.”

Kiwis donated nearly $5 million after the Kaikoura quake and for Awaroa Beach. Photo/Getty Images

Uberising giving

The collection buckets and the street appeals will continue – more than $57 million was received by charities via face-to-face fundraising in 2015 – but many NGOs are now having to adapt to the new philanthropic environment. “They’re saying we have to Uber ourselves,” says Pagani, “before Uber comes along and happens to us.”

Although philanthropic giving by New Zealand businesses fell from $98 million in 2011 to $77 million in 2014, Pagani believes this is changing. Increasingly, she says, NGOs and private businesses are working together in what is a “win-win” fashion. “There is inherent suspicion about partnering with the unlike-minded, but the guiding principle is for NGOs to sit at the table as professional, experienced voices, as partners.”

Already, she says, New Zealand NGOs in the Pacific have developed a reputation for working well with locals. “So we have something valuable to offer private-sector partners – we are not just benefiting from their largesse.”

Skewing the traditional philanthropic picture is the growing popularity of crowdsourcing platforms such as Givealittle and Everyday Hero. One of the newest kids on the block, Givealittle has raised $65.7 million since it was launched in 2008, but not, says the crowdfunder’s Tom Beyer, whose title is chief giving officer, at the expense of other charities and philanthropic goals.

Josie Pagani.

“We’ve added to the pot. But it does show people are looking for a more direct connection with people they are giving to. So if you want to support an orphan in Vietnam through social media, you can give straight to an orphanage without giving to Oxfam or Unicef or Red Cross. In a world that is increasingly marked by fragmentation and mistrust, there is a strong desire for true connections and real relationships.”

There are challenges as the seductiveness of one face, one family, one wounded kitten inevitably wins hearts and money over and above the need for deeper, more systematic approaches to poverty – or less-“acceptable” illnesses or less-engaging personal stories.

But there’s always been a split between humanitarian projects and development projects, says Pagani. Even though long-term development will help communities be more resilient in a crisis, “it is much easier to raise funds for a humanitarian emergency – a cyclone, or famine”. And many traditional aid agencies, says Beyer, have crowdsourcing pages.

Crowdsourcing platforms carry the promise of financial transparency and lower overheads. While Givealittle now charges a flat 5% fee to cover administration costs, a recent JB Were report on the charity sector lists employee expenses at about 40% of total spending in the not-for-profit sector. But overheads in the charity sector, says Paine, are generally low. “Although philanthropy in New Zealand contributes $3 million to the community, it is a small sector in terms of the number of people employed directly or sitting around trust boards.”

And it is not credible, he says, “that 100% of every dollar you give to an organisation gets magically transferred to a particular programme. There will always be administration costs and marketing costs.”

Tony Paine.

Major change required

Sriskandarajah says it is time for change on a massive scale. On a global level, large sums of taxpayer money are being channelled into the hands of big institutions with big headquarters and big overheads in the countries of source tied up in what he calls “the developmental industrial complex”.

“Most people probably think some of their tax money going to good causes in the global south is going to support citizens’ organisations and those people working on rights or delivering development, but very little of that money goes to the coalface.”

In some cases, he says, as little as 1-2% of allocated state funds reach those doing the work on the ground. And even when the resources do trickle down, he says, power does not. “Instead, it remains in the hands of a relatively small number of big players, predominantly based in the global north. But it has been demonstrated again and again that local organisations offer more efficient, sustainable development solutions.”

He is calling for better citizen participation to support and encourage more grass-roots organisations and to give more autonomy to local people from the most marginalised groups in society. Those groups can be anywhere.

“The increasing majority of the world’s poorest people now live in middle-income countries, not in countries with extreme poverty. And some of the challenges we worry about are universal: climate change, domestic violence, gender equality, indigenous rights – they are just as relevant in New Zealand as they are in Nicaragua or Nigeria.”

Such challenges, he says, require not just a few billion dollars’ worth of aid, but change on a social-justice level. “You can’t just deliver [anti-mosquito] bed nets without fighting corruption, just as in New Zealand I presume you can’t deliver services for the victims of gender-based violence without challenging some of those social norms that underpin violence in the first place.”

Holding steady

New Zealand’s aid budget is administered by the Ministry of Foreign Affairs and Trade. At 0.27% of gross national income – $1.7 billion for the 2015-17 triennium – it is still well below the 0.7% target set by the United Nations Development Programme, but at least, says Mfat deputy secretary Jonathan Kings, we are not dropping below the 0.27% level. Most of the money, about 60%, goes to Pacific Island recipients, about 12% to South Asia and 18% to multilateral institutions such as the World Bank, the United Nations and a host of other partnerships and funds.

The funds are delivered either from government to government, through NGOs in New Zealand and in recipient countries or directly through Mfat programmes.

When working with partner countries, says Kings, “we sit down and work through their priorities with them. It doesn’t change much from triennium to triennium – we have been doing education in Solomon Islands for nearly 20 years – but these are long-term programmes. We don’t make sudden shifts.”

Yes, there is an issue about overheads in some agencies, but in partnering with New Zealand-based NGOs, the private sector and the state sector, the guidelines state that no less than 80% of the total budget should directly support the delivery of outputs.

Again, the road ahead does not look easy. In the Pacific, he says, some issues could overwhelm others. “We are not there yet, but I can imagine a scenario when climate change and non-communicable diseases such as those caused by smoking and obesity are the two biggest issues for the Pacific – both could overwhelm our budgets in some scenarios. But the challenge we always face is with our available resources, what will make the biggest difference?”

Differences have been made. Pagani points to the reduction in the number of people living in extreme poverty, from 40% in the 1980s to 11% now, although this decline is attributable to such factors as reduced debt, increasing fair trade and better understanding of the real causes of poverty as much as it is to aid.

To fix the remaining 11%, says Pagani, there is a job to do in convincing the public. “It is not just about wanting to fund media-friendly tragedies – but that people are interested in what we are going to do about this long term.”

This article was first published in the April 15, 2017 issue of the New Zealand Listener. Follow the Listener on Twitter, Facebook and sign up to the weekly newsletter.

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