Australians are traditionally big supporters of charity. It's a part of our national character that we can rightly be proud of; when others are going through troubled times, whether it's earthquakes overseas or bushfires closer to home, we're quick to contribute.
So it's all the more troubling when we hear hard evidence of wastage and exploitation linked to the charity sector. On the weekend, The Age revealed details of a class action against fundraising giant Appco Group, claiming dodgy third-party arrangements and gross wage underpayment. Appco's clients include many high-profile, highly respected charities, such as Starlight Children's Foundation, Camp Quality and the National Breast Cancer Foundation.
![How charities go about the challenge of fundraising has changed considerably in a relatively short time.](/web/20161029052246im_/http://www.theage.com.au/content/dam/images/1/3/a/k/8/h/image.related.articleLeadwide.620x349.gsb44z.png/1477467782910.jpg)
The Appco case is shining a light on a disturbing aspect of fundraising, the growing role of third parties that collect money on behalf of charities, the companies that stand between your well-intentioned donations and the cause you want to support. How many of us have wondered, when we throw money into the bucket at the traffic lights or sign up to sell raffle tickets, what proportion of our cash is actually getting to the relevant charity?
According to those involved in the case against Appco, the company effectively takes a 60 per cent bite out of your donation. In one disturbing example, a voucher program run for Special Olympics Australia cost $7 million in fees to Appco for a campaign that raised $12.2 million.
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The class action also makes distressing claims of underpayment, with some workers reporting being paid as little as $2.50 an hour.
These claims follow a series of revelations of wage fraud across several industries includes convenience store giant 7-Eleven, some Pizza Hut franchisees and labour hire firms underpaying foreign workers in tourism, construction and entertainment.
While the exploitation of any workers is unacceptable and deserves to be exposed, it is particularly distressing to find evidence of this linked to charities whose purpose is, after all, to improve lives. Charities, particularly those supporting people living in poverty, surely want nothing to do with a company accused of underpaying workers. And like any sector, charities have a responsibility to ensure that fair and ethical work practices are in place across their whole supply chain.
Of course we will be watching the outcome of the Appco case closely, but this legal tussle involving one company raises broader issues about the checks and balances around the whole charity sector. As well as concerns over the practices and ethics of third parties who fundraise on behalf of others, questions are also being asked about whether the charity sector is too fragmented, with too many groups competing to raise money for similar causes.
How charities go about the challenge of fundraising has changed considerably in a relatively short time. It has become all but impossible to walk through the city without being approached by a chugger (charity mugger) or to sit down to dinner at home without a cold call marketer disturbing the meal.
Australia's charities regulator, the Australian Charities and Not-for-profits Commission, and the Fair Work Ombudsman launched a joint investigation into charity fundraising work practices this month. We welcome this investigation and urge the federal government to keep a close eye on the findings. There may well be a need for greater regulation of the charity sector, particularly those third-party operators who use sometimes murky practices to funnel money back to good causes, taking a large chunk out of it on the way.
It would be a great loss if annoying chuggers and reports of exploitation in the sector led to Australians turning their backs on charity. We're a lucky country indeed and the ethos of helping others ought be encouraged, not lost to cynicism and mistrust.
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