Within days of the lockdown beginning in March, Pastor Jon Owen of the Wayside Chapel was flooded with calls from families of the 600 volunteers who help the charity every month. Because of COVID-19, they asked him to “ban” their relatives – many older than 65 – from volunteering at the Kings Cross centre which provides services to rough sleepers and those in need.
It was a “beautiful thing” that these families cared, and equally “beautiful” that many volunteers had wanted to continue working but the risk was too great, says Owen.
Like Wayside, about 80 per cent of Australia’s 57,000 charities rely on volunteers. Because of COVID-19 restrictions, research by Volunteering Australia estimated a 66 per cent decline in the number of hours – about 12. 2 million hours of free labour a week – donated by the nation’s three million volunteers between February to April.
At Wayside, Owen says the pandemic made his mandate clearer than ever: “We have got to keep our guys alive.” It deployed staff to visit its homeless clients who were put up in hotels by the NSW government, and it organised food deliveries and other emergency services.
“It was a huge strain because we didn’t have the volunteer workforce,” he says. When events were cancelled and regular giving slowed, Owen says “it was kind of life or death [for clients] but also life or death for Wayside”.
About 20 per cent of its funding comes from government, about half the amount of many charities.
‘COVID19 was kind of life or death [for clients] but also life or death for Wayside.’
Pastor Jon Owen from Wayside
At the same time, demand for services increased and the type of help needed changed. Wayside was forced to redeploy or pay frontline staff to fill the volunteer gaps.
Before the pandemic, Wayside would normally see “10 new faces” a month.
Last week Wayside got requests for help from 70 people. Many were people, often extremely embarrassed, who had never asked for help or applied for Centrelink payments in their lives.
“When we look at the economic forecasts, it is scary and very bleak, ” he says.
Felicity (Floss) Powell of Mosman misses volunteering – more recently she helped Wayside clients who dropped in for a shower and clean clothing.
“It is a magical place. We live in a dichotomous culture of male, female; black, white; rich, poor,” Floss says. “It is such a narrow way of thinking. When you get out into these organisations, it shows you that there is so much grey out there and it is not something to be scared of.”
According to a financial analysis by Social Ventures Australia and the Centre for Social Impact at the University of NSW, Australia’s charity sector is teetering on the edge of a cliff.
“This is expected to be the biggest economic downturn since the Great Depression,” says Suzie Riddell, chief executive of Social Ventures.
Without charities, the organisations that Australians turn to in a crisis, our communities fall apart, she says.
These charities connect the rich and poor, the well and the sick, the well-heeled and well-housed with the down at heel and homeless.
“Past recessions tell us that if unemployment goes up by 4 or 5 per cent it could take us half-a-decade for it to go down again,” says Riddell.
If donations don’t increase and JobKeeper is removed as forecast at the end of September, the report forecasts about one in five charities may close, around 200,000 jobs in the sector may be lost and nearly 90 per cent of charities could record an operating loss.
The report is calling for JobKeeper to be extended, and wound back slowly: a ramp rather than a cliff.
Not many people realise the true size of this sector, says Riddell. It employs one in 10 people in the workforce, and generated revenue of $155 billion. Unlike the private sector, though, charities can’t raise funds on the sharemarket when revenue drops, she says.
“When fundraising gets cancelled, or a door-knock can’t go ahead, or a social enterprise has to close, non-profits are faced with the difficult decision of cutting services or cutting jobs.” Riddell says.
The coming year is equally bleak, with JBWere’s Outlook for Philanthropy, forecasting a 20 per cent drop in all types of giving – ranging from corporate funds, trusts and bequests to donations from individuals.
Across Australia, fundraising events have been cancelled, scaled back or gone online, like the Salvation Army’s Red Shield Appeal, snapping the fragile thread that connects those with the most to those with the least.
A study of 350 charities during the pandemic found nearly 70 per cent had seen donations and bequests drop.
The Salvos say COVID-19 had placed a strain on everyday Australians and had an impact on the amount it had raised – only $2.61 million of its $8 million target.
At the same time, demand for food banks, housing, emergency supplies, financial relief and advice, and refuge from domestic violence and abuse has skyrocketed, say charities. Like Wayside, the Salvos are seeing new faces, including people from more affluent suburbs.
Jane Jose of the Sydney Community Foundation – which supports a range of local charities – says Sydney had traditionally been a city that showed “a lot of generosity” when people were “in the room”, particularly at the end of the financial year.
A party before the pandemic raised $700,000 on a Saturday night, she says.
“The way people fund raise is about connection, and COVID-19 is about isolation.” she says.
The foundation has launched a Be Kind Sydney appeal to raise $1 million for smaller charities. One, a food bank in Bankstown, was feeding hungry international students.
In Melbourne, the Good Friday Appeal for the Melbourne Royal Children’s Hospital ran for an hour compared to the usual full day. In Sydney, youth homeless organisation Taldumande Youth Services has had to delay its gala, at the same time that it has seen a record surge in children as young as 12 needing help.
Some Indigenous non-profits have seen a bump in donations from the Black Lives Matters protests. But Weave Youth and Community Services in Waterloo, where 70 per cent of its clients are Indigenous, sent an urgent email in early June asking supporters to dig deep. It said its programs tackling intergenerational trauma and reducing recidivism were at risk.
The cancellation of its annual gala – which usually clears about $130,000 – meant it faced a significant fundraising challenge.
Karlie Stewart, 24, of Coogee, began work as a caseworker at Weave soon after graduating with honours in social work. It seemed right for her to return to the same place that had helped her mother, a sole parent, and her five siblings when she was growing up.
“I guess for me being an Aboriginal woman it has always been important to give back to the community in the way that Weave gave back to me,” she says.
Stewart and her brothers attended Weave’s Kool Kids – a free after-school and holiday program designed as an early intervention and prevention initiative. It also identified Stewart’s leadership abilities.
Stewart says there is anxiety about what would happen to jobs and programs when JobKeeper is stopped. Yet she had also “never been busier”.
Even before COVID-19, many charities were struggling with rising costs, smaller margins and a widespread reluctance by donors to cover administrative or operating costs, says the report.
Many philanthropists like Georgina Byron of the Snow Foundation in Canberra have responded to the pandemic by giving more, relaxing restrictions on funding and dipping into its reserves.
“Now is the time to double down,” Byron says.
Philanthropic funds usually limit their giving to the amount earned as interest on their endowments. Despite very little interest being earned and the capital diminished by market volatility, it was time to dig into these funds. “The world has changed,” she says.
‘Forever is now. The rainy day is here – it’s pouring,’
Bill Mithen, chief executive of Give Where You Live
A survey by Philanthropy Australia of big grant-makers found more than 70 per cent had increased flexibility in response to the pandemic.
When asked about the 20/21 financial year, nearly half said they’d give the same amount or less.
Only 22 per cent planned to increase spending. And more than 70 per cent said they weren’t considering digging into their endowments.
Bill Mithen, the chief executive of Give Where You Live in Geelong, argues that for 27 consecutive years the Australian economy has grown resulting in an unprecedented period of wealth accumulation.
A 2017 Credit Suisse report identified 3000 Australians who had net worth exceeding $65.5million.
The rules governing philanthropic trusts and foundations required that they give away 4 to 5 per cent of assets in grants each year. But in recent years, the trusts had grown at a rate that “far exceeds” the rate of
Mithen says the idea of these endowments being held in perpetuity – or forever – didn’t help those in need now.
“Forever is now,” says Mithen. Charities were already closing, and many more would close, making the most vulnerable even more exposed, he says.
“The rainy day is here – it’s pouring,” Mithen says. “This is not an economic argument. It’s a mission argument – this is what our mission is, this is what we’re here for.”
Julie Power is a senior reporter at The Sydney Morning Herald.