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- Australia’s wealth is growing faster than philanthropic giving, raising questions about whether NFPs will benefit from the nation’s largest wealth transfer.
- Despite reforms to increase Giving Fund distributions, cultural and structural barriers to giving remain.
- NFPs will need trusted, long-term partnerships with funders to create lasting impact.
Australia’s largest-ever transfer of wealth is already underway, sparking a quiet battle over who benefits and whether NFPs will see any meaningful share.
Two years after the Productivity Commission challenged the nation to double philanthropic giving by 2030, Australia’s not-for-profit leaders are still grappling with an uncomfortable reality – private wealth is rising far faster than charitable giving.
Liz Gillies, CEO of the Menzies Leadership Foundation, says the disconnect is not simply about tax settings or fundraising mechanics, but about how Australians think about wealth itself.
“Wealth growth does not automatically translate into giving,” says Gillies. “Many Australians still view philanthropy as something to consider later in life, rather than an active expression of values, purpose and responsibility in the present.”
Her comments come as governments, advisers and charities increasingly focus on how to unlock more philanthropic capital during a period expected to reshape the country’s economic landscape.
Earlier this year, the Albanese government moved to increase the minimum annual distribution rate for public and private Giving Funds to six per cent of net assets – up from four and five per cent, respectively, under the previous ancillary fund structure.
The reforms, stemming from the Productivity Commission’s Future foundations for giving inquiry, are designed to push more philanthropic money into charities sooner rather than allowing capital to accumulate indefinitely.
The move has exposed a growing divide in the philanthropy sector.
Supporters argue Australia is facing too many immediate pressures – housing affordability, cost-of-living strain, climate risk and rising inequality – to preserve charitable capital for future generations while demand surges today.
Critics counter that forcing higher distributions risks weakening the long-term growth of Giving Funds and undermining intergenerational philanthropy by reducing the capacity of funds to compound over time.
The broader debate, however, extends beyond payout rates and deductible gift recipient rules. It cuts to whether Australia has developed a culture where wealth creation and public contribution rise together.
Gillies says many Australians still lack confidence about where their giving can make a meaningful impact.
“There can be barriers around awareness, confidence and clarity about where giving can make the greatest difference,” she says.
But she rejects the notion that philanthropy belongs exclusively to the wealthy.
“At the same time, we should remember that giving is not elitist – generosity happens every day in communities through time, care, expertise and financial support at every level.”
The Productivity Commission’s review framed philanthropy as one of the country’s major untapped resources. Yet despite rising household wealth and rapid growth in structured giving vehicles, Australia’s culture of giving remains comparatively underdeveloped relative to the scale of private capital.
Gillies describes the challenge as “likely a combination of all three” – structural, cultural and leadership factors.
“Structurally, we can make giving simpler, more visible and more accessible,” she says.
“Culturally, we need to do more to cultivate a culture of giving in Australia – one that recognises contributions large and small, of both time and treasure.
“From a leadership perspective, there is an opportunity for individuals, families, boards, organisations and communities to model generosity as part of purpose, stewardship and our collective responsibility to each other.”
For NFPs, the stakes are growing. Giving Funds have expanded rapidly over recent years and are becoming an increasingly important source of long-term capital as organisations look to diversify revenue streams beyond government grants and traditional fundraising.
Gillies says NFPs chasing purely transactional donor relationships risk missing a much larger shift underway in philanthropy itself.
“NFPs should continue to focus on building trusted, long-term relationships rather than transactional fundraising,” she says.
“Philanthropy can do more by moving beyond one-way giving models towards genuine partnership, listening more deeply to communities, backing long-term solutions and sharing risk in pursuit of meaningful change.
“The greatest opportunities will come when funders and NFPs work together collaboratively to create enduring value.”
As more Australian wealth changes hands over the next two decades, the country faces a broader test – whether rising prosperity produces a stronger culture of contribution or simply larger private fortunes.
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