Minister smoothing the way for more cultural philanthropy
New research from the Ministry for Culture and Heritage shows New we are not a great nation of philanthropists with less than 3% of all the gifts, grants and sponsorships being provided by individuals
Minister for Arts, Culture and Heritage Christopher Finlayson said “This research complements the work the Ministerial Cultural Philanthropy Taskforce is undertaking in this area. The report illustrates ways in which cultural organisations can identify useful and practical fundraising opportunities, such as payroll giving.”
“It also serves to remind us of the huge remaining potential for individual giving to boost the arts in New Zealand – something I’ve asked the Cultural Philanthropy Taskforce to look at.”
The Ministry’s research, which covers the 2007-2008 tax year, found that just 2.6%, or $9.9 million, of the $383.2 million in gifts, grants and sponsorships received by cultural organisations came from individuals. Just under 6%, or $22.6 million, came from companies. The rest came from central and local government, and from the Lottery Grants Board, trusts and foundations. Of those organisations that did not receive any cash, or received non-cash support from individuals, 78% had not sought it, while 87% of those without corporate support had not sought it.
“Increasing charitable giving by individuals on top of the government’s commitment to funding could have enormous benefits for the arts sector,” Mr Finlayson said.
The ministry’s research found only 53% of 480 cultural organisations that responded had “donee status” with Inland Revenue. Without donee status, individuals or companies cannot claim tax relief on donations to that organisation. Unless an organisation has donee status, it cannot participate in the new IRD-administered payroll giving scheme which enables company employees to donate through regular, automatic deductions from that employee’s before-tax pay.
“I’ve asked the ministry to work with a range of partners across the cultural sector to help promote better awareness of recent changes to the tax system such as the payroll giving scheme that came into effect in January this year,” Mr Finlayson said.
Mr Finlayson said that he expects the Cultural Philanthropy Taskforce to advise him on ways in which further tax changes and other incentives can support giving and sponsorship in the cultural sector.
The Cultural Philanthropy Taskforce is headed by Peter Biggs, former chairman of Creative New Zealand along with Margaret Belich, Carolyn Henwood, James S Hill, Dame Jenny Gibbs, and Dayle Mace
Key findings of the Ministry for Culture and Heritage report on giving and sponsorship in the cultural sector.
• The total amount of gifts, grants and sponsorship, both cash and non-cash, received in 2007/08 by cultural organisations that responded to the survey was $383.2 million.
• Central and local government contributed 80% of this support; Lottery Grants Board, trusts and foundations contributed 11%; corporate organisations contributed 6%; and individuals contributed 3%.
• Organisations that focused their cultural activities mainly on Auckland or Wellington-Wairarapa, or that had a nationwide focus, got 87% of the total $383.2 million support.
• Major organisations obtained 61% of the total support. Small organisations received just 1%.
• Across all respondents, 97% of their support was cash and 3 percent was non-cash.
• 8% of respondents obtained some direct support from the Lottery Grants Board; 5% obtained some trust/foundation support; 29% obtained some support from central government; and 41% obtained some local government support.
• 44% of respondents received some corporate support. Cash sponsorship made up the highest proportion of this corporate support.
• 65% of respondents that received corporate support received this support from businesses within one or two corporate sectors.
• 62% of respondents received some support from individuals. Membership and “friends schemes” made up the highest proportion of this individual support. Payroll giving made up only a small fraction of respondents’ support from individuals.
• Of those organisations that did not receive any corporate support, 87% said they had not sought support from this source. Of those organisations that did not receive support from individuals, 78% said they had not sought it.
• Of the total $383.2 million support received by respondent organisations, 29% percent was spent 2% percent was unspent and held in reserve.
• Across all respondents, of the total workforce working on gaining and keeping support, 28 percent were paid employees and 72% were volunteers.
• 80% of respondent organisations had “registered charity status.” An organisation must be a charity registered with the Charities Commission to be exempt from income tax and for donors of gifts to be exempt from gift duty.
• 53% of respondent organisations had “donee status.” An organisation must have donee status to participate in the payroll giving scheme administered through the Department of Inland Revenue.