A boom for philanthropy?

Wednesday, October 5, 2011

By Tim Costello
CEO World Vision Australia

Published in The West Australian on Wednesday 5 October, 2011

Western Australia is at an unprecedented point in history. It sits at the centre of a resources boom, perfectly placed in the region during the “Asian century” and blessed by social and political stability. 

Of course today’s mining boom is not the first Australia has experienced. My home state of Victoria benefited spectacularly from the gold rush of the 1850s. Yet what many people don’t know is that this boom - more than 150 years ago - created a lasting legacy of philanthropy that can be witnessed today. 

It’s a remarkable thing that Victoria with just 25% of Australia’s population remains such a strong epicentre of philanthropy, accounting for over half of the philanthropic trusts in Australia. 

And it was the gold rush philanthropy that set the example and got the ball rolling. They started something that still echoes in the Victorian community today. It was the bedrock upon which many other philanthropists such as Sidney Myer and the Myer family built upon. 

Similarly in the United States more than 100 years ago, great wealth created a legacy of great philanthropy. Some historians have not been kind to people like Andrew Carnegie and John D. Rockefeller. 

Carnegie and his ilk weren’t saints but they had a powerful realisation that wealth was not an end in itself. “The man who dies rich dies disgraced” said Carnegie. 

Carnegie gave to many causes, in total $350 million by the time of his death in 1919 – an astonishing amount for the time he lived in. One of his projects was to see public libraries built wherever they could be of benefit – including one at Midland, WA. 

So what will be the legacy of Western Australia’s resources boom? 
Will it create a legacy that future generations will look back on – with gratitude, with pride and as a source of inspiration? 

Australia does have a proud tradition of philanthropy. Yet at the same time I think for such a wealthy nation, we could do a bit better than we have been. 

And make no mistake, Australia is well placed. Our incomes are rising – Australia ranks 7th in the world for GDP per capita, as of 2010 – behind only the very wealthiest small nations like Switzerland, Norway, Denmark, Luxembourg, Qatar and the UAE. 

But among the top 5 per cent of income earners in Australia, 40 per cent don’t claim any tax deductions for charitable giving at all. 

Among those earning between $100,000 and $500,000 the average donation is 45 cents for every $100 of income – not all that much higher than the average of 33 cents for the whole population. However those earning over $1 million a year give almost 2% of their income. 

Since 1995 charitable giving has grown more slowly than incomes generally. 

In Western Australia, generosity is very broad, with 90% giving, according to the University of WA’s Rising Tide report. However the dollar value of their donations is lower than Australia’s as a whole and Australia’s average is lower than the rest of the western world. 

Also, although WA personal wealth has grown faster than any other state, levels of giving aren’t growing at the same rate. The UWA research says the Perth average donation is $303 – while the national average is $424. 

But philanthropy is not just a matter of sacrificing income. Nor should leaving a legacy be confused with leaving a monument. 

Philanthropy is about others, and it’s about creating positive change. It’s about translating the abstract idea of love for one’s fellow humans into practical reality in the world. 

Generous philanthropy, well considered and well managed, not only creates opportunity for others, but lays the foundation for a culture and ethos of responsibility and strong community – reaching down through the generations. 

Western Australia has a rare opportunity to start building a philanthropic legacy now that will still be looked at 100 years from now – with pride, with gratitude, and as a source of ongoing inspiration. 

I am sure that Western Australian individuals and companies will rise to this historic opportunity. 

But history teaches us not to wait. It teaches us to take action while the opportunity is there. Don’t wait for the boom to ‘peak’ – that will come and go before you realise it.

Opinion Pieces, Poverty, Asia and the Pacific, Disaster relief, Foreign Aid, International Development, NGO, Philanthropy, Tim Costello

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