July 17, 2017

Media Release: Lack of funds means WA charities struggle to measure outcomes

MEDIA RELEASE 17 July 2017

Lack of funds means WA charities struggle
to measure outcomes

Charities in Western Australia are struggling to measure their outcomes due to a lack of funding

That’s the conclusion from an Australian-first study on outcomes measurement released today by the Centre for Social Impact at The University of Western Australia (CSI UWA), funded by the Bankwest Foundation, which shows that only 68% of the state’s community sector charities are measuring their outcomes (down from last year’s 70%).

Outcomes Measurement in the Community Sector: Are we heading in the right direction? is the eighth report in the WA Social Impact Series and shows the extent to which charities are able to assess their impact in the communities in which they work.

“Australia’s charities exist to make a difference, yet our findings indicate that they do not have the resources or infrastructure to fully measure the difference they are making,” UWA Professor Paul Flatau, Director of CSI UWA and study lead.

The report shows the issue is most pronounced in WA’s small and medium sized organisations (annual turnover between $250,000 and $1million) with less than half (49%) able to measure their outcomes (compared to 87% of large organisations with an annual turnover of more than $1 million). This is of particular concern given that small and medium organisations comprise of three-quarters of Australian charities and not-for-profits Commission-registered charities operating in Western Australia.

Bankwest Head of Community Engagement Craig Spencer said today’s report by CSI UWA has identified both an ongoing issue for the sector and also the root cause of the issue.

“As is so often the case with the charity sector resources and funding appears to be the main barrier. Only a third of the charities polled say they have access to adequate resources for outcomes measurement and very few organisations have specialised data collection staff [6%] and/or research and evaluation staff [5%],” Mr Spencer said.

Despite these barriers, the research shows those people working in community sectors know there is a need to measure outcomes and are trying to do so. Over a third of small organisations (38%), two thirds of medium sized organisations (66%) and a similar proportion of large organisations (63%) report an increase in their effort in the last 12 months toward outcomes measurement.

“The report also identified something of a ‘catch 22’ situation. Funders are increasingly requiring these charities to report back on their outcomes. But the problem is that they’re not providing funding at a commensurate level, with a huge number of organisations having to fund outcomes measurement from general internal funds,” Mr Spencer said.

Professor Flatau said that until direct funding for outcomes measurement was improved, the community sector would be hamstrung on increasing its social impact. “Overwhelmingly, we hear that there is a recognised and urgent need to effectively measure outcomes, but until funds are secured to do so, there is little chance it will be done effectively and consistently. Without funding, organisations are resorting to diverting funds away from service delivery, which, as you would expect, goes against the core principal of many of these front-line workers.”

Compared to 2016, the organisations in 2017 that are measuring outcomes are spending a greater proportion of their budget on outcomes measurement. Nevertheless, two thirds of all organisations spend less than 3% of their budget on outcomes measurement.

Mr Spencer said the report pointed towards a breaking point in the community sector.

“If the charitable groups can’t measure their outcomes they’re going to lose access to a critical source of funding and will simply cease to exist. This presents a real risk to the communities in which these groups operate,” Mr Spencer said.

In response to the report’s findings, CSI UWA and the Bankwest Foundation produced a ten point action plan:

1. Full funding for outcomes measurement in contracts

Outcomes measurement is both important and resource-intensive, yet outcomes measurement is still overwhelmingly funded from general internal funds.

2. Capacity and infrastructure for data collection and reporting

Very low numbers of responding organisations report access to resources for outcomes measurement, such as training for staff and technology-assisted data collection. If outcomes measurement practice is to improve, human capital development is required.

3. Sharing best practice

The report’s findings indicate a continuing need for a space for community sector organisations to safely share best practice.

4. Guidance on using tools and methods

Small and medium-sized organisations in particular require more support in terms of guidance on using tools and resources.

5. Greater recognition of client/consumer outcomes in funding contracts

It is essential that client outcomes are balanced with funder needs in funding contracts.

6. Standard language and concepts

Different organisations and funders are measuring the same things in different ways or using particular jargon and lingo. There is a need for standardisation.

7. Eliminating differences in reporting between funders

Reporting requirements between funders (even within the same sector) differ greatly, creating substantial administrative burden and perpetuating the siloes that exist in the effort to create public benefit.

8. Collaborative projects with shared outcomes

The prevalence of shared measurement is still very low. Shared measurement represents an excellent opportunity to ensure funders and collaborating organisations can measure their collective impact and meaningfully measure the difference they’re making.

9. Open data from government

Openness around the nature and availability of government data would allow community organisations to consider existing data when designing outcomes measurement, and reduce the time burden of consulting with government departments individually about the data they hold.

10. Increase external reporting requirements of outcomes

Community sector charities should take the initiative to publicly report outcomes in organisation documents such as newsletters and annual reports or separate outcomes reports.

“We hope this initiatives and processes will assist the community sector organisations which do such vital work, to continue to do so, helping the communities they serve fulfil their true potential,” added Mr Spencer.

- ENDS –

For more information contact:

Russell Yeo

Bankwest Senior Manager, Media & Communications

0421 637028

russell.yeo@bankwest.com.au

Jess Reid

UWA Media and PR Adviser

+61 8 6488 6876

jess.reid@uwa.edu.au

Nicola Hanningan

CSI National Communications Manager

M +61 407 075 307

E n.hannigan@unsw.edu.au

 

 

 

 

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