Charities, other not-for-profit organizations, and increasingly, for-profit companies play very important roles in the provision of a wide range of public and community services, and this is especially so as ageing populations require more health and social care. In this issue we focus specifically on charities, which are provided favourable fundraising status by legislation, while also being required to follow strict financial guidelines.
Foundations which do not provide services, but instead hold or collect donated money for distribution to charities, are also considered charities (and may cause some distortion of charitable giving statistics).
In Canada, Statistics Canada reports that giving totaled $10.6 billion in 2010, “about the same amount as in 2007.”
The average annual amount per donor was $446 in 2010, while the median amount was $123. A median amount means that half of donors gave less than this amount and the other half gave more.2
In addition to financial donations, many people gave clothing, toys or household items to charitable or non-profit organizations (79 per cent) and others gave food (62 per cent). Overall, almost all Canadians aged 15 and over (94 per cent) gave goods or food, or made a financial donation.
While most categories of organization maintained a stable giving base from 2007 to 2010, there were decreases in religious giving (both percentage of the population giving, and total donations), while donations to social service organizations increased from 39 per cent to 42 per cent of the population, and total donations increased from $956 million to $1.155 billion (2010 dollars).
In the USA, the total figure was $135.8 billion, according to Philanthropy Today (2012 report). (Politudes: We cannot be sure that the research methodology is the same, so comparisons could be misleading.)
A Wall Street Journal article suggests that there is a growing trend for the owners of foundations to decide to “spend down” not only the earnings from their capital, but the capital itself.
Nearly a quarter of the collective assets of the country’s 50 biggest foundations were held by “spend-downs” in 2010, compared to 5 per cent 50 years ago, according to the Bridgespan Group, a philanthropy consulting firm.
The article suggests that this may be happening because owners feel that their contributions are not having enough impact, and that they want to see results within their lifetimes. Another factor could be a lack of interest in younger generations to carry on the projects of their forebears.
Philanthropy.com also reports a surge in large bequests among living donors, which could be resulting from the recent surge in stock markets, as well as from a possible inter-generational transfer of assets.
In all, it suggests that some charities will become big winners over the next few years.