2.1
Community is the strength of regional Australia. In response to the Committee’s first survey question on what respondents liked about their town, the word ‘community’ featured more than 1000 times. People told the Committee:
All rural communities are important for that development of a sense of belonging and value to each member of the community. That tends to get lost in cities.
All communities are important, particularly those in regional Australia. Like everywhere else, it’s where people feel at home.
2.2
The Centre for Social Impact at Swinburne University of Technology noted that the dominant paradigm of ‘regional Australia’ fails to take into account its diversity and, consequently, undervalues its contributions:
‘Regional Australia’ is portrayed as a homogenous cultural periphery to the capital cities, continues to obscure the real contributions, roles, and potential of Australia’s diverse regions…they cause us to overlook the distinctive attributes of regions as well as the knowledge and agency of regional communities.
2.3
The diverse nature of regionally-based communities was highlighted by inquiry participants. Mildura Rural City Council noted that 4.6% of the Mildura local government area’s population identified as Aboriginal or Torres Strait Islanders, and a further 79 nationalities were represented, with 74 languages other than English spoken.
2.4
Anglicare Australia stated that community identity in some regional areas has been influenced by the type of employment opportunities in an area, and provided the example of regional areas with a large fly-in-fly-out (FIFO) population. It cautioned that in FIFO communities, there may be a division between those who are permanently based in that area and those who choose only to work there. It further noted that although there may be benefits such as community grants, jobs and increased numbers of apprenticeships, issues such as higher rents and income disparities can harm cohesion.
2.5
These factors need to be taken into consideration when building regional communities; plans need to be place-based, led by the community, and focused on building cohesion and liveability. This chapter discusses these factors, as well as measures to enhance community philanthropy in regional areas, as one measure towards building community cohesion.
Liveability
2.6
Job security, lower living costs, good public and private infrastructure and fostering a feeling of belonging, shared purpose and connectedness are critical to the liveability of regional areas. The Albury City Council highlighted the findings from the Evocities campaign which identified a number of key factors for people looking to relocate to regional areas including:
Housing affordability and lower cost of living
Minimum Key Services—healthcare, education (primary, secondary, tertiary)
Connectivity—telecommunications and reliable physical/transport infrastructure
Social Networks—access to new social networks or existing (for example family)
Cultural Fabric—cultural venues, sporting, entertainment, food and beverage
Natural environment and space
Short commute times—no traffic congestion, gives back time for residents to enjoy life and spend more time with family and friends.
2.7
The City of Kalgoorlie-Boulder acknowledged the importance of liveability factors in attracting people to live and work in the region:
The City would like to enhance its liveability through measures such as improving our soft infrastructure which includes improvements made in social, health and educational infrastructure. Through this the City would like to primarily retain its population and secondarily increase its population.
2.8
Greg Conkey, Mayor of Wagga Wagga suggested a number of actions the Federal Government could undertake to enhance the attractiveness of the regions:
But to attract more people to rural and regional Australia governments must provide incentives—incentives for businesses to relocate, which includes taxation incentives; and infrastructure such as high-speed internet. We need good connectivity such as good transport links. This is where regional airlines such as Rex are so vital and need support and subsidising. Rural and regional Australia also needs the same educational opportunities as metropolitan areas, as well as good health facilities.
2.9
The City of Greater Bendigo noted the importance of regional areas in providing:
Liveable, investable and affordable alternatives to the major metropolitan capitals are needed by building the economic capability of Australia’s regional capital cities through investments that drive economic diversification, along with proactive policies which aim to increase the development and population of regional capital cities can deliver more liveable, equitable, and efficient outcomes for all Australians.
2.10
Councillor Sarah Stanley of the Shire of Collie also recommended an increase in federal assistance grants to regional areas to enable them to attract more people:
Regional and remote local governments are expected to provide the same level of facility, services and governance as our metro counterparts, with fewer ratepayers to shoulder the burden. On top of this, we’re also home to industries covered by state agreements….And in regional areas, often we’re disproportionately burdened with social issues….So a greater level of assistance to regional and remote local governments would help to even the playing field, allowing us to attract and retain residents, and helping to shore up the long-term sustainability of our local communities and regions.
2.11
The intertwining factors contributing to liveability in regional Australia were also noted by respondents to a survey undertaken by the Committee:
Digital connectivity, competitiveness, always trying to get equity in services provided in the cities. There isn’t much at the moment that’s a benefit it’s more expensive to operate your business in the bush, transport is more, electricity is more. Housing if you can afford it is probably the only benefit.
Lack of good telecommunications, shortage of doctors, health facilities, poor roads.
Place-based communities
2.12
What makes regional communities distinct from metropolitan communities is the connection to a sense of place. People in regional areas often share a connection to place as they work, live and play within the same spaces. One survey respondent said ‘We have a sense of proudly belonging to a ‘spot’, which is missing in cities’.
2.13
A number of inquiry participants advocated for place-based solutions as a means of building regional communities and addressing the current city-country divide that results in poorer regional outcomes in areas including health, education, employment, and infrastructure and population growth.
2.14
For the purposes of this report, regional Australia is defined as all places outside the major capitals. While on one level, this is a useful construct, it fails to acknowledge the wide social, economic and geographic diversity of Australia’s regions and the best way to address specific regional challenges. The Organisation for Economic Co-operation and Development (OECD) concurs:
Place-based policies can effectively address the diversity of economic, social, demographic, institutional and geographic conditions across regions. They target specific territories and provide the tools that traditional structural policies often lack in order to address the region-specific factors that cause economic and social stagnation. They also ensure that a wide range of sectoral policies, from transport and education to innovation and health, are coordinated with each other and meet the specific needs of different regions across a country – from remote rural areas to the largest cities.
2.15
Regional Australia is far from homogenous—the elements that make one area successful in an industry do not necessarily translate to other regions. Accordingly, Regional Development Australia Loddon Mallee reasoned that it would be beneficial to pursue:
…‘place-based’ regional development approaches further, solutions need to be ‘matched’ to the situation rather than applying a particular model….
2.16
The Department of Infrastructure, Transport, Cities and Regional Development (Department of Infrastructure) elaborated:
It is essential to understand that every region is different and the broader trends affecting the nation will play out in individual regions in different ways. Accordingly, there is merit in looking towards more targeted, coordinated, place-based policy responses that respond to local priorities and enable individual regions to assess where there may be opportunities to exploit key growth drivers.
2.17
Major General Hocking from the National Bushfire Recovery Agency also noted the importance of not treating all regions as if they were identical:
Local governments and communities have very different needs and they have very different capacities wherever you go. We need to ensure that we can set policy and mechanisms, including recovery mechanisms, that account for that.
2.18
Doing so would mean that rather than focusing on economies of scale, there needs to be a focus on economies of scope:
The whole structure of our liveability support systems is around looking for economies of scale, which is important because we want to get best bang for buck. But in our smaller places there are no economies of scale. What we need to be looking at are economies of scope which draw across different portfolios to develop a package that works well for that particular place.
2.19
The Central NSW Joint Organisation cited the need to provide regions with the agency to determine their outcomes:
To achieve this there needs to be sufficient delegation in the region to support local decision making and program implementation.
2.20
The Regional Development Australia Barwon South West called for:
…a Regional Australia Blueprint that empowers regions to deliver collaborative, place based initiatives, and guides the way government works with regions to ensure investment works for local economies and communities.
2.21
The endorsement of a place-based regional development paradigm, however, was not universal among inquiry participants. The University of Western Australia noted the approach favours growth opportunities and assumes the existence of a market, when there can be market failure. It concluded that building upon competitive advantage can actually entrench the existing disparity between regions.
Place-based regional development
Existing programs
2.22
There is a suite of Australian Government programs which facilitate regional development. Some of these are dedicated regional programs including drought support while others are national programs which also benefit the regions. During 2020, focus has been on the delivery of existing programs with particular attention given to enhancements or additional programs to the needs highlighted by COVID-19.
2.23
The Department of Infrastructure also outlined how, since the beginning of the COVID-19 pandemic, its work has been particularly focused upon supporting regional connectivity, business and employment opportunities and leadership and collaboration. These measures include ‘… establishing a special working group of major carriers, led by NBN Co, to share relevant information and discuss emerging engineering, security or operational issues in relation to COVID-19’. The Department of Infrastructure is further supporting businesses by:
…continuing to ensure that essential regional programs that build vital community infrastructure are continuing to be delivered. An example of that is the Building Better Regions Fund.
2.24
Activities directed towards improving connectivity, planning, furthering regional education and employment, and supporting the interests, businesses and diverse cultures found outside of Australia’s capital cities all contribute to strong, resilient regions:
The Regional Development Australia committees have noted, however, that the resilience of the regions, combined with government stimulus measures, is enabling our business community to adapt and find ways to deal with and moderate the economic impacts of the outbreak.
2.25
The Department of Agriculture outlined the focus of its work in the context of COVID-19 through:
extensions to the visa arrangements for:
Pacific Labour Scheme; and
International Airfreight Support Package; and
Agricultural Workforce Strategy.
Regional Deals
2.26
Regional Deals were formulated in response to the Regions at the Ready Report which recommended that the Federal Government’s City Deals program be extended to regional communities. Like the City Deals, they share the same focus on collaboration between all three levels of government.
2.27
The report of the Expert Panel which followed the Regions at the Ready report agreed with the recommendation:
Regional Deals – these should be negotiated and delivered in partnership with all three levels of government, private sector and regional communities, with funding available to enable regions to undertake the initial collaborative planning and preparatory work necessary to attract a deal.
2.28
The Regional Deals program aims to boost regional development, driven at the local level:
…Regional Deals bring together all levels of government around a clear set of objectives.
Deals are tailored to each region’s comparative advantages, assets and challenges and reflect the unique needs of regional Australia.
Regional Deals support ‘a place-based approach’ by putting community-identified priorities at the centre.
2.29
This program aligns with the strategy proposed by the former Select Committee to strengthen regional communities. In response to that report the Government stated:
The Government is committed to taking a long-term approach to regional development that is based on best-practice partnerships, collaboration, and maximises and complements Commonwealth investment.
2.30
Despite Regional Deals being in the pilot stage, with only two deals operational and a third under negotiation as at November 2021, the concept was highlighted in a number of submissions as a highly competitive regional development opportunity. They have been praised for encouraging ‘good regional planning’ with Regional Development Australia Tasmania adding that it needs to be considered in a long-term capacity.
Box 2.1: Barkly Regional Deal
The first regional deal to be signed was the Barkly Regional Deal. Signed in April 2019, it is a 10-year, $78.4 million deal between the Australian Government, the Northern Territory Government and the Barkly Regional Council.
The Deal includes 28 initiatives to facilitate ‘economic, social and cultural outcomes’ and establishes a ‘community-based governance model to build capacity and engagement’. Deal initiatives are being developed through community working groups, which are:
Youth Infrastructure and Services Working Group;
Regional Workforce Strategy Working Group;
Economic Growth and Support Working Group;
Youth Justice Facility Working Group; and the
Tennant Creek Visitor Park Working Group.
The Deal is providing infrastructure upgrades to youth facilities in Tennant Creek, regional roads and the Alpurrurulam airstrip; a focus on keeping young people in community by development of a youth justice centre, improvements to the Aboriginal hostel for medical patients otherwise sleeping rough; and feasibility studies for the development of an art centre and a Tennant Creek visitor park.
Because the Deal is place-based, it has allowed the Council to identify what measures to implement first. It states:
A ‘housing first’ approach has been adopted for the Barkly Regional Deal because without attempting to reduce chronic overcrowding, other long-standing social and economic challenges in the Barkly region are unlikely to improve.
The Barkly Regional Deal is still in the early implementation phase and has had some challenges due to the COVID-19 restrictions on movement. Nevertheless, the responsible Ministers and Mayor stated:
Through the hard work of the interim Barkly Governance Table and community engagement in Working Groups, Barkly residents are taking control and leading the implementation of the Deal’s projects. The Barkly Regional Deal, Australia’s first Regional Deal pilot, provides testament to what can be achieved when all levels of government work collaboratively with communities.
The place-based approach means that, rather than centralised government decision-making, communities decide their priorities. In contrast to the Barkly Regional Deal’s key themes of social, economic and cultural and place making, the Hinkler Regional Deal’s key themes are economic development, resilience, and liveability and community.
Access to grant funding
2.31
Some inquiry participants raised issues with gaining access to grant funding. This form of funding allows place-based solutions to locally-identified needs.
2.32
Regional Development Australia Limestone Coast said that short grant application timeframes, ‘as little as 4 weeks’, can have a substantial effect on the capacity of smaller, less resourced organisations to develop competitive applications:
Consideration should be given to how the funds can be structured and administered differently to require collaboration at a larger scale, resulting in fewer applications but applications that are far more impactful and of a higher quality. It would be beneficial to actively encourage collaborative grant applications where these “big picture” benefits can be demonstrated. Preference could be given to these combined grant applications.
2.33
Wukalina Walk found the application processes for Commonwealth and state government funding to be difficult:
The Tasmanian government wouldn't give us money until they were guaranteed that the Commonwealth government would give us money. We could never get either to agree because they were both waiting for the same assurance.
2.34
Flexibility in grant funding was stressed as a critical element to receiving useful grants, while priorities need to ‘be context specific and place based’.
What we need from government is fit-for-purpose solutions. We run a program called the Entrepreneurship Facilitators program … We now have 23 entrepreneurship facilitators across the country—I think all of you have one within your electorates—offering 15 different business models, because they are all fit for purpose.
2.35
The George Town Council raised the financial dependence local government has on state and federal funding as a limitation of their capacity to develop their regions:
…we're literally dependent. If we do anything bold and ambitious, we have to go with a business plan to our state and federal levels of government and seek their support.
Local government
2.36
The important role that local governments play in regional areas was noted by the Australian Local Government Association (ALGA), which stated that they are ‘… the epicentres of communities, providing infrastructure and services that sustain their communities’. Local governments may often be the major employer in a community, and deliver a number of local services, including:
…roads and road maintenance, water supply and sewerage, community facilities like swimming pools, public halls and libraries, stormwater drainage, waste management, natural resource management, economic development, green and public space provision and maintenance, and emergency and disaster response and recovery.
2.37
The ALGA further noted that local governments are increasingly providing ‘… vital human services, including aged and child care, housing and health services’, adding:
Local governments often step in where thin markets exist for human services or where there is a need for local coordination and sensitivity to unique community needs. Local governments fill the breach despite generally being inadequately resourced to do so and become a service-provider-of-last-resort when poor services impact community wellbeing and cohesion.
2.38
The power of regional communities and Councils to be leaders was put forward by the City of Greater Bendigo, which noted:
The demonstrated capacity of regional centres and their Councils to be leaders, to be innovators and to garner community support for collective action in regard to climate change, waste, water and energy.
2.39
The Central NSW Joint Organisation (CNSWJO), a coalition of western NSW councils, submitted that there needs to be greater direct funding of councils by the Commonwealth government, rather than dispersing funding through the states highlighting:
This region is also supportive of setting aspirational targets and taking a pragmatic place-based approach to planning and service delivery. To achieve this, there needs to be sufficient delegation in the region to support local decision making and program implementation.
2.40
CNSWJO articulated what many councils and local government organisations told the Committee:
There is an opportunity for State and Federal agencies to leverage the Community Strategic Planning process mandated for Local Government in NSW. Imagine a regional NSW that is well informed about their demographics, health, education, environment, economic indicators and recidivism to empower them to make better decisions for themselves and their communities.
Community resilience
2.41
The recent devastation of the 2019-20 bushfires and the COVID-19 pandemic have demonstrated the resilience of regional communities in unprecedented circumstances.
2.42
Dr Sebastian Cordoba from the Australian Association of Social Workers noted that:
Something that we do quite well is the immediate provision of services. We saw that with the Black Summer bushfires, where there were teams of social workers and mobilised units providing key and immediate support where possible. That plays an important part in terms of the initial crisis, but what we know from Black Summer, Black Saturday and every other bushfire is that that's a part of the impact. But the more significant impacts, as with many forms of trauma, come in the months, if not years, after. So we seem to have systems that are able to provide immediate support––immediate mental health supports, for example––but not in the long term, which is when they are desperately needed. That then speaks to infrastructure issues. The infrastructure of support is not there.
2.43
The physical destruction of homes, businesses, farmland and infrastructure has damaged regional communities across the country. The resilience shown by those in devastated areas is a reflection of our strong, connected communities.
2.44
The Country Women’s Association of Australia highlighted the campaigns initiated by rural people in response to these disasters including the ‘Buy from the Bush’ and ‘Empty Esky’ campaigns aimed at showcasing the products from rural communities that have been affected by drought or bushfires.
2.45
Respondents to the Committee’s first survey expressed pride in the resilience of their community in the face of natural disasters. Comments included:
[We are a] very diverse and very creative community. During and after the floods in 2017, it was amazing to see the resilience and all the help provided by all. We think we live in paradise!
We are a very resilient community and try to help each other in bad times.
We are part of the essence of what makes Australians a unique people. Regional, innovative, resilient humans who give empathy, joy, hard work and humour to the rest of the world.
2.46
Anglicare Australia discussed the importance of fostering strong and engaged communities so they are better equipped to respond to disasters:
Research into community resilience – how communities prepare for, respond to and recover from disasters and other crises – show the factors that contribute to ongoing viability and wellbeing. As an example, research on six communities following a series of devastating earthquakes in the Canterbury region of New Zealand showed that connected communities, with strong pre-existing community infrastructure, made it easier to initiate local responses, foster community involvement and access support. Communities with fewer community based groups, local leaders or existing networks found it more difficult to respond and adapt. Existing hardship and socioeconomic disadvantage seemed to be exacerbated by the disaster and its consequences.
2.47
Anglicare Australia also emphasised that ‘social service infrastructure underpins the wellbeing of regional communities, and makes sustainability, innovation and resilience possible’.
2.48
There are multiple community implications for the availability of good social services. Established social services are attractive for people to relocate and stay in regional areas; they create employment and they provide a framework for social cohesion in times of adversity:
Community services have a key role to play as one of the largest growing sectors of employment and economic development in regional areas. These services are also critical to making these communities more liveable, helping to retain and attract workers.
2.49
Further, short-term funding contracts make community services vulnerable. Anglicare Australia set out that:
The precariousness and insecurity of contracts has undermined the ability of community organisations to meet local need, to make the best use of limited resources, and to act as a hub for other economic activity….Long-term stable contracts would give staff employment stability and security, and would counteract some of the challenges in recruiting and retaining qualified staff. It would allow service providers to develop relationships and trust within community, creating the opportunity for them to invest in innovation and improvement by collaborating with other providers, businesses and governments. This in turn helps to build sustainable community development and resilience.
2.50
This vulnerability was noted also by the Australian Association of Social Workers who wrote of the weakness in the mental health support system:
Regional Australians are experiencing a significant need in mental health supports due to the devastating summer bushfires and now COVID 19…. Unfortunately, people are not accessing the supports they need due to a range of factors, or are falling through the cracks in the system.
Embracing community character
2.51
Throughout the inquiry, participants offered examples of regional communities that had drawn upon unique aspects of their geography, culture, community and commodities to promote themselves to a broad audience.
2.52
Survey respondents highlighted the local characteristics of their community or geographic location that sets their town apart, including clear views of stars at night without light pollution and access to natural features like beaches or bushwalks.
2.53
These characteristics have the capacity to transform local economies but face challenges receiving funding and support.
Cultural amenity
2.54
Cultural amenity is an important feature of regional liveability. Regional Arts Australia noted the considerable contribution that the arts make to local identity and its relationship to the economy. Accordingly, in order to support the cultural identity of towns, they wrote that it is necessary for:
… long-term planning to integrate and support artistic practice and creative industries in a regional framework. … Cultural infrastructure and facilities such as performing arts centres, galleries … festivals and gathering spaces all contribute to the fabric of regional communities.
2.55
In response to the COVID-19 crisis, the Commonwealth Government has announced support for the Regional Performing Arts Touring Program, the Contemporary Music Touring Program, and the Contemporary Touring Initiative which supports delivery of performing arts, visual arts, and music to regional communities across Australia.
Box 2.2: The Unconformity
The Unconformity in Queenstown, Tasmania grew out of an existing local arts festival and celebrates the challenging environment of the west coast of Tasmania:
The Tasmanian West Coast community inhabits a big, contradictory landscape. Imposing mountain ranges are plumbed for riches, biblical rains feed hydro-electric generators that power Tasmania. Mines abut world heritage areas; in Queenstown, kids chase footballs down our dead, sulphur-stained river. Grass football fields? We do gravel. Boom and bust, acceptance and rejection, risk and conservationism, hope and despair lie in the bones of our landscape and history.
The Unconformity has emerged from this uncompromising environment as a cultural organisation that is fundamentally of its place.
It also recognises the spirit of the community of the west coast—one that traditionally relied on mining as a major employer and experienced the boom and bust cycle of industrial regions. Instead of imposing ideas on the community, organisers say that the Festival is underpinned by the ideas of risk-taking, being disruptive, and thinking creatively—characteristics embodied by its location and its people. It has helped the community reimagine itself and, in doing so, has become an internationally recognised arts festival.
2.56
The City of Greater Bendigo noted the role played by its cultural life in contributing to the vibrancy of the town:
Bendigo is known for its incredibly successful art gallery and theatres, but the City also has a strong culture of creativity (recognised by its admission to the prestigious UNESCO Creative Cities Network and joining 245 other cities around the world in late 2019 in the category of Gastronomy), invention and innovation (celebrated by its Invention and Innovation Festival) and a strong design, digital and advanced manufacturing sector. Recognising the impact and value of the digital age and technological advances to our creative community aligns us with leading-edge cities around the world and we will continue to support creativity in all its forms across our region.
2.57
Sport also plays a significant role in Australian communities. The Department of Health outlined several programs, with a focus on Regional Australia, designed to encourage greater participation in sport. Many councils noted that being able to participate in local sports greatly enhanced the liveability of their regions.
2.58
Major sporting events are also an economic drawcard that the regions are keen to host. Mildura Regional City Council noted that the development of the Mildura South Regional Sporting Precinct is ‘anticipated to boost sports tourism to the region, and with an AFL-standard oval as part of the project it is anticipated that we will be able to attract an increase the number of major events held in Mildura.’
Community philanthropy
2.59
Sporting, arts and social groups play a major role in connecting communities, developing their identities and enhancing their liveability. Community foundations in regional Australia are rely heavily on the support of volunteers with 30 per cent entirely volunteer-led.
2.60
These groups are the fabric of these communities, but often rely on the goodwill of volunteers and uncertain funding to survive.
Volunteering in regional communities
2.61
Volunteering in regional Australia plays ‘… an integral part of the fabric of community and community wellbeing.’ Volunteering Australia highlighted the community connection that volunteering provides:
Volunteers in regional communities link their volunteering efforts with a sense to connection to place and a sense of self. It's what binds regional communities together and enhances social connectivity. It's also worth noting that much of the volunteering that takes place in regional Australia is informal; it doesn't take place through organisations.
2.62
They deliver critical services such as meals, aged care services and firefighters to community radio and businesses.
2.63
Volunteering Australia highlighted that people were more likely to volunteer in rural and regional areas than metropolitan, ‘34 per cent compared with 31 per cent’, but that the figures could potentially be larger:
Much of the volunteering in regional and rural areas goes unnoticed and unmeasured. To date, official ABS statistics only include formal volunteering for organisations. This does not catch the social contributions made by Indigenous communities.
2.64
Meals on Wheels Australia stated that out of a network of 592 outlets across Australia, about ‘… three-quarters of them are located in regional, rural and remote communities’ with ‘about 40,000 volunteers supporting regional Meals on Wheels services’.
2.65
The Volunteer Fire Fighters Association estimated that there were ‘… 18½ thousand—maybe 20,000—active volunteers on the front line’ in New South Wales.
2.66
However Anglicare Australia said that, in communities with large FIFO workforces, there may be ‘a shift away from the perception “we do it tough but do it together” to a stronger sense of division between cohorts’.
2.67
The Community Broadcasting Association of Australia also noted the significant contribution that volunteers make to the sector with over half of stations entirely run by volunteers—over 26,000—with 17 per cent under 26 years of age. So too did the National Ethnic and Multicultural Broadcasters’ Council, stating it harnesses:
…the skills, expertise and time of more than 4000 volunteers from 125 distinct cultural groups who create 2,070 hours of content every week in over 110 languages broadcast via 100 radio stations.
2.68
Regional Arts Australia noted the economic value contributed by volunteers to the sector:
The value of volunteer services to arts and heritage organisations was $983 million in 2016-17, $227 million more than in 2008-09. The value of volunteer services to arts and heritage organisations was $983 million in 2016-17, $227 million more than $756 million in 2008-09. This value is identical to the total cultural and creative value of volunteer services due to the cultural and creative overlap of arts and heritage organisations.
2.69
The South Australian Chamber of Commerce and Industry stated that local Chambers were supported almost entirely by volunteers ‘to assist businesses across the entire State.’
Philanthropic funding
2.70
Funding community organisations is a challenge across Australia and most rely on some form a philanthropic funding, whether through public grants or private donors. A number of submissions argued the case for specific funding models for regional communities, given the roles these groups play in the community.
2.71
Australian Community Philanthropy (ACP) is the peak body representing ‘Community Foundations’—a loosely grouped collection of philanthropic organisations that are:
engage in community building activities and can make grants, often for a defined geographic region;
have directors and members that are connected to their geographic region;
support a wide range of charitable purposes; and
receive support from numerous donors.
2.72
Ben Rodgers, Chair of ACP, further explained:
Community foundations focus on place. They exist for community benefit in places, and these foundations are custom built for their place […] Through a Community Foundation, anybody can contribute to an enduring asset for their community. The typical model starts with a gift. Capital is protected and invested. Investment returns are used for grants to support community priorities. Other gifts are pooled and other forms of community capital are harnessed. This includes flow-through grants from other funders that can shift capital from where it is in the cities to out in the regions through a network of trusted local networks.
2.73
ACP contended that Community Foundations, with their local knowledge and networks, make excellent investment partners in regional Australia. Currently, it works through intermediaries such as the Foundation for Rural and Regional Renewal to support community initiatives.
Barriers to accessing funds
2.74
In its submission to the inquiry, ACP argued that the current regulations governing deductible gift recipient (DGR) endorsement create ‘… a significant barrier to effective partnerships with other trusts and foundations’.
2.75
Ancillary funds are ‘special funds that provide a link between people who want to give (‘donors’) and organisations that can receive tax deductible donations as DGRs. This sort of fund does not perform charitable work, but is used as a collection and distribution point. ACP explained:
To support such worth-while local initiatives, Community Foundations have to work through intermediaries. One of these intermediaries is the Foundation for Rural and Regional Renewal (FRRR), which has been a valuable partner and proactive supporter of Community Foundations since its establishment in 2000. Similar mechanisms exist in other domains; for example the Australian Cultural Fund and Australian Sports Foundation allow culture and sports projects to receive tax- deductible charitable contributions.
Most regional Community Foundations (and also Australian Community Philanthropy) have donations accounts with FRRR that provide a practical solution for working around current DGR restrictions, and we value our partnerships with FRRR. Nonetheless, working around a regulatory system that is not enabling incurs administrative overhead for Community Foundations that often have very limited administrative resources. (NB: 30% of CFs are entirely volunteer-led and have no staff; a further 25% have only one part-time staff member. The majority of these are regional foundations.) If the DGR restrictions were removed, it would free up Community Foundations and FRRR to collaborate and partner in more value-adding ways for the benefit of regional communities.
2.76
The Chair of ACP noted that this acted as a disincentive to private philanthropic funding of regional communities:
I would say that there’s a variety of different intermediary bodies that help provide that support. It is very challenging for donors who want to give in a place, and want to be generous, but have to go through a third-party to do that.
Private and public ancillary funds
2.77
There are two types of ancillary funds: Private Ancillary Funds (PAFs) which cannot solicit donations from the public, and Public Ancillary Funds (PuAFs) which may receive donations from the public.
2.78
In its submission, ACP claimed many Community Foundations operate as PuAFs which hold DGR2 status – meaning they are permitted to accept donations only from, and provide funding only to, DGR1 status entities.
2.79
PAFs can also be eligible for DGR status, and have emerged as a popular form of philanthropic giving. However Community Foundations are unable to receive donations from PAFs or other PuAFs due to their own DGR status.
Disadvantages of the current system
2.80
Many PAFs are based in capital cities. In its submission, ACP claimed that regional based Community Foundations are denied the opportunity to access this potential revenue pool, and as a result, are seriously disadvantaged.
2.81
According to ACP, a Community Foundation has ‘in-depth knowledge about local community needs, strong local networks and is a trusted intermediary to foster local community engagement in development projects’. Accordingly, ACP advocates that Community Foundations serve a critical role in facilitating charity work within regional communities, and recommends:
…DGR1 endorsement available to Community Foundations to enable them to attract increasing private philanthropic investment to their local regions and communities, and to cut red tape and increase operations efficiency of grant-making in regional Australia.
2.82
Place-based decision making is central to the Community Foundation model. The Committee took evidence that at times of natural disaster, the issue with DGR status affects a Community Foundation’s ability to both collect and distribute funds and respond to place based needs in an agile way.
…we said that we'd raised $9,000 to distribute in a bushfire here which was nowhere nearly as devastating as the eastern states fires; however, we eventually distributed over $20,000 to the Keilira fire victims. Those funds were paid out of a fund that we hold which is not affected by the tax-deductibility status, DGR status, so we were able to get those funds out without worrying about the DGR1 materials. However, we've no doubt the evidence on the ground was that if we were able to provide tax-deductibility status to donors we would have raised probably two or three times the amount we raised in the time that we raised that money, which would have been very, very welcome. So ‘nimble’ is the word.
2.83
The Committee also heard evidence that changes to DGR status for Community Foundations, sooner rather than later, will benefit rural communities - as ease of gifting will ensure local families are able to create lasting legacies.
We know that there is a transfer of wealth happening between one generation and the next. We know that in the next 30 years there will be three trillion dollars of wealth going from one generation to the next. Community Foundation in other places have positioned themselves to talk to local people to say: ‘This place, this community, made you. You make this community. If you leave five per cent of your estate to this place, we will look after it forever to have a lasting legacy for the place that you called home.’ Those gifts will happen, and it will be easier to benefit rural communities if there is a DGR1 category for Community Foundations.
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Georgina Somerset, Chair, Red Earth Community Foundation South Burnett, told the Committee that the enduring and place-based nature of Community Foundations means that they could have a role ‘… planning with government for stronger regional communities’.
We think about 50- or 100-year time frames; we’re not thinking about one or two or three years. The great role that we can play with economic development organisations, local governments and things is actually to have that long-term view and, in essence, scaffold our regions and the investment that come into those regions and have a long-term planning window, looking at both the social and economic needs, along with the human and the natural capital; working alongside government to have the long-term vision; and planning that means when disaster strikes or opportunity arises you have a plan in place and you can work together with a place based organisation, so that government can effectively invest with a long term result.
Committee comment
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Engaged, connected communities are the result of dedicated everyday Australians—people who contribute and people who also know that the community to which they belong will, in turn, look after them. Community is about strength in numbers, shared purpose, giving back and staying strong together. Australia is home to many strong, resilient regional communities that have formed organically—but can also benefit from government support.
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Community can grow when such tangible services (such as an oval or swimming pool) are supported by volunteers (such as a sports coach) and dedicated funding programs (such as an incorporated sports club). It is how these layers interact—the provision of facilities, the programs that utilise these facilities, the operators that run such programs and the individuals that ultimately benefit—that is a test of community strength and resilience.
2.87
The Committee is encouraged by the first Regional Deals that have been signed and hopes that this will provide more place-based funding and policy solutions for regional areas.
2.88
The Committee notes the limitations co-contributions present, particularly for small regional organisations. The Committee considers that, with the appropriate safeguards, the Regional Deals program could be a mechanism for administering small grants to local projects, including safeguards to ensure funding decisions respond to real community need, meet Commonwealth Grant Guidelines, and have appropriate levels of transparency.
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The Committee was also concerned at reports of the red tape involved with attracting private philanthropic investment in regional communities and the administrative burden this places on community-based charitable foundations in administering grants. The Committee considers that this should be remedied as a matter of priority.
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The Committee recommends that the Australian Government implement mechanisms to allow regional community groups to more easily receive tax deductible gift recipient status so that private philanthropic funds can be donated to, and stay in, regional communities.
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The following three Chapters discuss the infrastructure, business and services needed to continue to support Australia’s vibrant regional communities. The report then concludes by bringing these themes together and discusses the need to develop a master plan for Australia’s regions.