OPINION: The industry of philanthropy is powerful, but only a small portion ever gets attention.
Philanthropy means “private initiatives for the public good” or “the practice of helping people less well-off than one’s self”.
So if you have something good that will help the less well-off in the public, then it’s likely your project will fall under philanthropic funding.
The Maori art of giving is sacred and important, in that you offer a gift (koha) with the expectation it helps the receiver and will do good.
The donor receives prestige (mana), knowing they have done something good.
The estimated wealth in New Zealand of community trusts and foundations is about $30 billion, of which $1.5b is distributed back to communities via grants.
That’s approximately $333 per person in New Zealand that is being gifted to communities, to do good projects.
The above excludes philanthropists. These are families who feel strongly about giving back to society and create perpetual charitable family trusts.
A local example is the Olive Hutchins Charitable Trust. You then have individual philanthropists, who continuously give money to the community – our most generous, of course, being the Edgar whanau.
So you may wonder why we need community funding at all, when we pay taxes to central government.
The government recognised that special community circumstances existed at a regional level and gifted assets to community trusts, recognising that these would appease community needs.
Local government, such as Queenstown’s council, provides core services, but community needs extend beyond core services and that’s where community trusts fill the void.
Here are some local community trusts.
Central Lakes Trust
Born when the government-owned Otago Central Electric Power Board transferred its power-generating assets of Pioneer Energy in 2000. Current assets are $330 million, made up of $136m Pioneer and diversified managed funds of $194m. Its annual grants budget is $6m.
Queenstown Casino Community Trust
QCCT is funded from gaming proceeds of Otago Casinos Limited and Queenstown Casinos Limited, as part of their licence requirements. In 2016 the two companies contributed $108,079 to QCCT which, in turn, were distributed back to the Queenstown-Lakes community.
Community Trust of Southland and Whakatipu
CTOS was born when central government-owned Trust Bank Southland sold the bank to Westpac in 1996. Current assets are $210m made up of 100 per cent diversified managed funds. Its annual grants budget is $6.5m. Trustees, including me, are responsible for all grants, governance and funds manage-ment. A $1m innovation fund was created last year. (It’s interesting looking at applica-tions received – how widely the term innovative is interpreted!)
One thing is for certain. There is never enough money to help communities – especially as the wealth gap widens.
I would expect demand to continue in this area, as baby boomers look to fill their time in retirement by joining charitable organisations. This will increase demand for philanthropic funding.
Warren Skerrett is an authorised financial adviser and a trustee on the Community Trust of Southland and Whakatipu