NFPs Not Confident About Future

Large Not for Profits have a negative outlook on the future and aren’t confident about meeting escalating demands in their industries, according to a survey of Australia’s NFP organisations.

The survey was conducted by the Centre for Social Impact and PricewaterhouseCoopers and looked at the well-being and confidence levels of the Not for Profit sector.

Chief Executive Officers of 362 NFPs were surveyed in the PwC-CSI Community Index to provide decision makers working in business, government and the social sectors with data which allows them to make informed policy decisions.

CEOs were surveyed about their views relating to funding, people, meeting demand and the state of their relationships.

Mark Reading from PricewaterhouseCoopers said: “The 2012 Productivity Commission highlighted a lack of data as a big constraint on supporting Not for Profits. This is an important survey as it presents how Not for Profits are faring and measures confidence levels regarding the sector’s ability to meet its immediate and future demands.

 “The reality is that Not for Profits are relied upon to provide more, not less, services across the nation. In difficult economic times, it is important to ensure they receive the support from business and government to provide these critical services”.

Seven out of 10 industries have clear negative confidence levels and an overall negative outlook for the future, the survey found.

From a State perspective, all States and Territories, apart from Queensland and South Australia, reported negative levels of confidence.

The survey revealed an increase in demand since the 2012 survey, and organisations said they were more concerned about their ability to meet that demand, according to the results. The findings demonstrate confidence levels remained negative for Not for Profit organisations of all sizes and those with revenues less than $250,000 were the least confident.

The 2013 PwC-CSI Community Index showed the overall confidence level of the Not for Profit organisations surveyed was minus 3 per cent.

CEO of Community Council for Australia David Crosbie said the report findings were disturbing.

“Many Not for Profits are really struggling and find it hard to retain employees because of low wages and career prospects,” he said.

“It seems Government funding is stalling for Not for Profits. Demands aren’t stalling – they are getting bigger by the day. The growth in Not for Profits in the past decades is huge. Yet the funds to help Not for Profits are often just the same at best or are being cut. Many Not for Profits are – frankly – in survival mode. They want to be adding value but may well be pre-occupied with survival because of their uncertain future.

“It is extremely alarming that demand on our Not for Profits is outstripping our ability to supply them with what they need to deliver to people. This sector is a critical part of Australia and it’s just not being focused on enough.”

Centre for Social Impact CEO Dr Andrew Young said: “The Not for Profit industry is not confident about meeting demand. Confidence is well below par.”

Dr Young emphasised that Not for Profits would play a bigger role as Australia's economic pressures increasd. He pointed out that the forecast between 2010 to 2050 for the amount of Government revenue spent on ageing will jump from 25 per cent in 2010 to 50 per cent in 2050.

“Governments are increasingly working with Australia’s Not for Profits to deliver services to society,” he said. “Many of these organisations are working with some of the most vulnerable people in our community. In spite of the significant funding reforms in disability and education, and in spite of the relative strength of our economy by international standards, the sector is unconfident about its future. We need to plan for the sector’s future now if we are to deal with the challenges of the coming decades.”

CEO of Mission Australia, Toby Hall said a major challenge for the sector was securing the right people to work with them.

“The lack of confidence among organisations that are delivering such critical services is of great concern,” he said.
“It is alarming to find that Not for Profits in Australia’s two biggest States have such negative scores. Victoria has -2 per cent confidence and New South Wales -8 per cent.”

The research reveals:

• The Education and Research industry’s overall confidence has decreased since the first survey. Confidence about meeting demand has fallen from +1 per cent to -11 per cent, and this has offset gains in other areas.
• The Law and Advocacy industry has the second lowest confidence level of – 16 per cent. 64 per cent of the industry has concerns about increasing high demand.
• The Development and Housing industry sector expects to be impacted by government funding cuts. The industry helps many Australians to find housing and employment. Its confidence level is a score of -17 per cent (the sector is averaging -3 per cent), the lowest confidence in the sector and the gloomiest outlook. The industry is driven by strong concerns about its paid and volunteer workforce and an inability to attract and retain employees.
• Education and Research, Social Services and Philanthropy and Volunteerism are more optimistic about Government funding than in the previous survey but the rest of the sector is pessimistic.
• The social services sector has a confidence level of -8 per cent (previously it was -15 per cent). The industry remains very concerned about the level of demand for its services and its ability to meet this demand.

Read the report.