Federal Budget

Not-for-profits are an essential service in need of a better framework

Simon Hancox
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The not-for-profit sector is diverse with more than 600,000 not-for-profit organisations and nearly 5,000 trusts and foundations – delivering a variety of services, including education, health, aged care, disability services and social services. In fact, in 2018 the charitable sector alone turned over $155b and employed 1.3 million people (or 8% of the Australian workforce).

It’s one of the few sectors that the Government continues to heavily invest in – it’s right up there with healthcare – however the level and timing of funding is inconsistent from year to year. It’s highly competitive with more and more not-for-profits wanting to access the same funding pie. It is uncertainty in funding levels that has made organisations unable to forward plan.

COVID-19 has seen a pendulum swing in demand

COVID has seen an increase in demand for services in some areas – like mental health and domestic violence support – and a sharp decrease in others – such as refugee support networks. We’ve seen an increase in spending in 2020. But like most measures, we can expect this to be temporary and targeted. The sector needs more funding, and it also needs reform to ensure its long-term sustainability and viability as an important service provider to the community.

It is likely that there will be another Budget in May 2021. However, we know this will be cold comfort for not-for-profits who have not received the funding they need to operate as they need to. Forecasting will be essential for the sector to really understand demand and the resources they have to meet that demand. Without certainty of funding and in an uncertain economic environment, it’s best to be conservative on what the next financial year will look like.

In our report we cover:

  • An essential service in need of a better framework
  • More funding for mental health and domestic violence – but where else do we need funding?
  • Missing voices in the Budget
  • Philanthropy and fundraising
  • Reform is needed for the not-for-profit sector
  • So where to from here?


Looking back to look forward

We were initially writing the ‘Federal Budget: A 10 year retrospective’ report before COVID-19 as an advocacy piece for more industry investment and support. Of course, the way the year started is not the way the year is ending. Many sectors that had been left to their own devices are now key for our recovery. Sovereign capability. Jobs. Digital economy. Modern manufacturing. Renewable future. Deregulation. Innovation. These are the terms we will use as we settle into COVID-normal.

Our report looks retrospectively at 13 different industries, the investment made into them by Government and their contribution to GDP. This is then overlaid with the opportunity we see for industry in this new normal based on recent Government announcements.

Download report