Charity gap stark as cost-of-living crisis keeps biting

Australian charities and not-for-profits received an extra $11 billion revenue in the 2022 reporting period, the latest Australian Charities Report reveals.

Total revenue soared past $200 billion for the first time, however those gains were far outstripped by expenses, which jumped $22 billion.

Extra large charities raked in 54 per cent of revenue, despite making up just 0.5 per cent of the sector.

That contrasted with extra small charities, which account for one third of the sector but operate on just 0.1 per cent of funding.

Australian Charities and Not-for-profits Commissioner Sue Woodward said the differences "could not be starker".

A five-year analysis of 51,536 charities revealed almost nine in 10 extra small charities operate with no paid staff and also experienced a 17 per cent drop in volunteer numbers during that time.

"The cost of operating and delivering services has increased but extra small charities haven't received sufficient revenue or donations to keep pace," Ms Woodward said.

"When we talk about charities or when policy is made, we must be mindful of the difference in resources and capacity - variation between the charity sector and the business sector but also within the charity sector itself."

Most charities use standard financial year reporting however some prepare reports for a calendar year, with both incorporated in the commission's analysis.

It also showed an additional 300,000 people took up volunteering in 2022, with some 3.5 million Australians donating time.

Actual donations to charity also increased 4.4 per cent, up to a total of $13.9 billion.

Overall, more than half of all charities had no paid staff but the sector does employ 10.5 per cent of the total workforce, with wages spending jumping more than 10.5 per cent in 12 months.

Australian Associated Press