Taken for granted? Charities’ role in our economic recovery
This report explores the implications of the revised JobKeeper wage subsidy arrangements announced by the Commonwealth Government in July 2020.
Taken for granted? Charities’ role in our economic recovery is a report published by Social Ventures Australia (SVA) and the Centre for Social Impact (CSI) that calls for reforms to support the charity sector as post-COVID recovery partners. The report finds that charities employ more people than the mining and manufacturing sectors combined, are key players in Australia’s economy contributing the equivalent of 8.5% of direct and indirect value to GDP, and could be an important source of job growth.
Modelling from the report reveals that under the revised JobKeeper payments 110,000 people employed by charities are still at high risk of becoming unemployed by September 2020, with a further 70,000 by September 2021. The report also found that JobKeeper will keep many charities viable in the short term – but won’t be enough to preserve all charities, with 14 per cent at risk of becoming unviable and 44 per cent making an operating loss by September 2021.
The report is the third instalment in the SVA and CSI Partners in Recovery research series, following the Will Australian charities be COVID-19 casualties or partners in recovery? A Financial Health Check report published in June and Partners in recovery: Why charities need tailored support published in July. The series explores the unique social and economic contribution charities make to Australian society and how they are affected by the confluence of service disruption, falling income, rising demand and higher operating costs.
The financial modelling SVA and CSI has undertaken shows that if JobKeeper ends without additional investments and reforms the sector will still face dire consequences, where the majority of charities would be in operating deficit with limited assets to draw on. The job losses that would result as charities either cut costs to survive or shut down altogether would be in the tens of thousands. Comprehensive reform is required to prevent this from happening.”Suzie Riddell • CEO, SVA
The Partners in Recovery research series from Social Ventures Australia and the Centre for Social Impact explores the unique social and economic contribution charities make to Australian society and how they are affected by the confluence of service disruption, falling income, rising demand and higher operating costs.
