A report from Australian researchers into philanthropy has found that the pace of wealth creation among Australia’s affluent far exceeds their levels of charitable giving.
The report, entitled “Good Times and Philanthropy: Giving by Australia’s Affluent”, found that in the decade leading up to 2005, the average household income for Australia’s affluent – those with taxable incomes between $100,000 and $500,000 – increased by 36 per cent. But charitable giving, measured as the percentage of taxable income claimed as donations, rose from 0.36 per cent to little more than 0.45 per cent. The report was commissioned by the Petre Foundation and completed by the Australian Centre for Philanthropy and Nonprofit Studies (CNPS) within the Queensland University of Technology. It found that, with the exception of some isolated examples, small evidence existed to prove that high net-worth Australians, who have more than $1 million in taxable income, were giving at the same rate as their counterparts overseas. The Merrill Lynch/Capgemini 2007 World Wealth Report stated that the top 17 per cent of high net-worth donors distributed 10 per cent of their assets to charities each year. But in Australia, levels of donating in the decade to 2005 increased from 0.7 per cent to 1.98 per cent of their taxable incomes. “While no detailed figures exist in Australia, tax statistics indicate that making substantial donations still constitute an exception rather than a norm for the wealthy,” the report states. Speaking at the launch of the yesterday, Daniel Petre, chairman of the Petre Foundation, said affluent Australians had the fiscal capacity to boost our society’s level of giving without adversely affecting their lifestyles. Petre said that if Australian families with a wealth of more than $30 million donated 20 per cent of their wealth to a private foundation, it would create a $42 billion pool, which would distribute roughly $2 billion each year. “Our wealthy donate considerably less on a pro rata basis than their counterparts in the US. “But they are in a compelling position to make a substantial social impact.” Dr Kym Madden, CNPS senior research fellow, said that new philanthropists in Australia “want to use their wealth and their acumen in giving. They are testing the philanthropic waters. This is probably because, in Australia, philanthropy is largely unexplored.” Madden said the CNPS had also started a program instructing charities on accountancy to help them become more transparent. The report was launched with the support of Social Ventures Australia.
Future Fund chief investment officer Ben Samild said that FY24 has been a great year for alpha creation, thanks to strong returns in equities and, unusually, across multiple hedge fund strategies all at the same time. He reflected the past few years have been “a difficult time to be an asset owner and to generate positive returns for risk assets” but the Future Fund is tracking well of its long-term mandate.
Simon Hoyle and Darcy SongSeptember 4, 2024
