Yahoo Finance Are your bushfire donations going to the right place?
Australia’s charitable heart is on show at the moment, with over $100 million raised by home-grown celebrities, billionaires and the public alike for fireys and bushfire-ravaged communities.
But despite our best intentions, donating to larger charities like Red Cross might not be the best way to support those affected, according to Black Saturday survivor, Brad Quilliam.
In fact, doing so would see bushfire-affected communities in the same position as Kinglake, the epicentre of the Black Saturday fires in 2009, found itself in the aftermath of the destruction, President of the Kinglake Ranges Business Network, Quilliam told Yahoo Finance.
“A lot of people are giving in goodwill, thinking that the money is going towards supporting communities,” Quilliam said.
Also read: Can't donate cash? Here's how you can still help bushfire victims
Also read: How to donate to wildlife injured by the Australian bushfires
“Red Cross money has restrictions, it was set up over 100 years ago, and farmers, schools, sporting clubs, churches - they can’t receive funds through the Red Cross,” he said.
This is the issue Quilliam remembers finding a decade ago in the aftermath of Black Saturday, which claimed 173 lives and over 2,100 homes.
“They’ll find the money situation is Black Saturday all over again. The money doesn’t go where you think it’s going to go to help.”
Yahoo Finance looks at where funds donated will go:
Larger administration costs
According to the Australian Charities and Not-for-profits Commission (ACNC), almost 50 per cent of all the Red Cross’ expenses are from employees.
As per its 2019 financial statements, the Red Cross received a total income of $867 million, $90 million of which was from donations, bequests and sponsorships.
It spent $442 million on employee expenditure and $262 million on operating costs.
Financial statements revealed $11.5 million was spent on disaster and emergency services. According to a statement from the Red Cross, these were funds raised for the drought appeal and were given directly to drought-affected communities.
The Red Cross’ financial statement says the remainder of its funds were spent on interest and debt servicing costs, depreciation and amortisation and the costs of services.
These “services” can include “everyday work with individuals and communities,” the Red Cross stated.
“The majority of our expenditure including employee expenditure goes towards humanitarian outcomes. We do this in many ways, from community engagement, response, outreach, volunteering management and principally delivering programs on the ground to help people who are experiencing vulnerability throughout Australia and overseas.”
Lack of transparency
The Red Cross’ financial statements don’t actually specify what initiative its donations were spent on - it just provides an overview of what category the money fell into.
In fact, trying to determine exactly where donations is particularly tough for all large charities.
In 2015, National Public Radio investigated where the American Red Cross’ US$500 million raised for Haiti in the aftermath of the 2010 tsunami really went.
While the charity, which is a separate entity to Red Cross Australia, claimed to have provided homes to more than 130,000 people, the number of permanent homes the charity built was six, the investigation found.
It was confirmed the Red Cross did provide emergency disaster relief in the form of food, blankets and shelter - but it did not, as it claimed, help get 4.5 million Haitians “back on their feet”.
"Five hundred million in Haiti is a lot of money," Jean-Max Bellerive, prime minister of Haiti until 2011, told NPR. "I'm not a big mathematician, but I can make some additions. It doesn't add up for me."
"You know, 4.5 million was 100 per cent of the urban area in 2010. One hundred percent. It would mean the American Red Cross would have served entire cities of Haiti."
Red Cross Disaster Relief
According to Red Cross Australia, the donations provided for the bushfires is separate to its everyday donations, and no more than 10 per cent will be put towards administration costs.
At the moment, the Red Cross is offering $5,000 grants to community members who have lost their homes to the fires.
“We are investing in a tailored recovery program of three years or more, and Red Cross will be doing needs assessments and working alongside the communities and agencies to ensure their specific needs are met,” a Red Cross spokesperson said.
“That will include cash assistance at various points, having someone to talk to, psychological first aid, good social networks, access to good information and services, and a connection to community for example.”
Facebook fundraisers
Celeste Barber’s Facebook fundraiser, which initially aimed to gather $30,000, has now surpassed $50 million.
Facebook doesn’t charge a processing fee for funds going to charity, and essentially the fundraiser works like any GoFundMe or Kickstarter campaign.
Your donation goes to the PayPal Giving Fund immediately, which is a public ancillary fund registered with the ACNC.
That fund then collects the money, which can take up to 90 days to process, and distributes it to the nominated charity - in Barber’s case, she nominated The Trustee for NSW Rural Fire Service and Brigades Donations Fund.
While we don’t know where exactly the funds are going from there, or now that they’ve skyrocketed, we do know Barber’s intentions.
"So it's going to the RFS and it will be distributed out,” Barber said on her Instagram earlier this week.
"So I'm gonna make sure that Victoria gets some, that South Australia gets some, also families of people who have died in these fires, the wildlife.
"I get it, I get it all, I'm hearing you all. I want you to know that, otherwise why raise this money if it's not going to go to the people who absolutely need it."
Where should you be donating?
Smaller not-for-profit organisations like the Animal Rescue Collective (ARC) are made up of purely volunteers, which means funds are going directly to wildlife and wildlife carers.
“I will say they are giving people exactly what they need,” Rae Harvey, wildlife caring facility Wild2Free founder told Yahoo Finance.
When the fires attacked Harvey’s kangaroo sanctuary on the south coast of New South Wales, she says ARC were her biggest supporters.
“They learned my property had been destroyed and that I was going to be staying on the ground here with no power, no water, no sewerage, because I’m going to have injured kangaroos coming home that I need to be around,” she said.
“The first truck that arrived was ARC. It wasn’t just food for the kangaroos, they were thinking outside the square.
“I got a generator and lanterns that worked, a phone charger a portable shower and...human stuff that helped me stay on the land,” she said.
Harvey said ARC set up tents for her kangaroos, and were, most importantly, sensitive to her needs.
“All our piping was destroyed, so they delivered water because I told them that was a big priority for me,” she said.
In terms of rebuilding communities, Quilliam told Yahoo Finance making donations to Rotary Clubs, local sporting clubs or Country Womens’ Associations are a better help than Red Cross.
“Working with those that are in the communities, like the clubs, is a smarter approach.”
Yahoo Finance has received comment from Red Cross Australia and amended the story as requested since its first publication on 13 January 2019.
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