Not for profit: Call for administrative reform

Anglicare chief executive officer Ian Carter believes the not-for-profit sector in Western Australia needs to challenge rising compliance demands from government and raise its profile in the community.

Speaking at an Australian Institute of Management function last week, Mr Carter said the sector needed a better profile, to the point of having its own ministerial representative in government.

He said not-for-profit groups in WA needed to follow the leads of organisations in Queensland and Victoria in seeking administrative reform.

“There is that experience in other states, where the sector has been pushing and government has acknowledged that it needs to get itself together,” he said.

Key to reforming the sector would be an acknowledgement that it is large and complex.

“We want an across government – federal and state – recognition that the third sector needs to be understood as a totality,” Mr Carter said.

He said a streamlined tender process for government agencies would also vastly improve the service delivery of not-for-profit organisations.

“We need to convince government that in (simplifying procedures) they are going to unlock significant potential which is latent in our community at the moment,” Mr Carter said.

On the issue of increased transparency in the not-for-profit sector, Mr Carter told those at the function that agencies needed to reject the assumption that they should be protected or looked after because of their status.

 “I think there are some people who sometimes exercise too much the mission or value of the organisation,” he said.

In order to improve accountability, Mr Carter said the sector should adopt a more professional approach to advocacy.

“We can’t say ‘the rich are getting richer and the poor are getting more numerous’ without having data to back it up,” he said.

“We’ve got to have the empirical evidence. We have to be accountable, both in terms of our advocacy and in terms of what services we can look at for government.”

However, Mr Carter said improving transparency should not involve burdening the sector with an increased compliance regime or micro-management.

“The sector has no concerns about being accountable. We need to challenge ourselves in the way we deliver services and the outcomes, but we don’t need that added on to nonsensical record keeping,” he said.

In the past few months, there has been a growing dialogue between not-for-profit groups, accounting bodies and government on the issue of financial accountability and reform.

Last week, the WA human services industry roundtable met to discuss ways to reduce the financial reporting burden faced by not for profits.

This follows announcements made in June by national accounting body, CPA Australia, and the Australian Accounting Standards Board, which called for reforms to financial definitions and reporting standards in the sector.

According to Mr Carter, unreasonable reporting demands from government are creating a drive to rationalisation in the sector.

“Agencies like (Anglicare) are growing bigger, and sometimes we’re growing bigger at the expense of smaller community organisations, which simply have got drowned under the compliance and accountability regimes that are now imposed upon them,” he said.

Mr Carter also pointed to inadequate funding as a hurdle for the not-for-profit sector.

“If funding from government remains at the current level, you’re probably going to have to be a large organisation to survive,” he said.

“Only the smaller organisations that are running niche services, absolutely characterised by higher levels of volunteerism, will survive.”

According to Mr Carter, Anglicare had been approached by a number of medium-sized organisations in recent years seeking to amalgamate, and the sector was likely to see more of this.

Mr Carter said the sector faced other major challenges, such as staff shortages and increased competition in fundraising, with more organisations competing for a limited pool of money.