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WA Community Foundation Forced to Close


Tuesday, 3rd August 2010 at 12:34 pm
Staff Reporter
A lack of operational funding despite an increase in philanthropy has forced the Western Australian Community Foundation to close its doors.

Tuesday, 3rd August 2010
at 12:34 pm
Staff Reporter


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WA Community Foundation Forced to Close
Tuesday, 3rd August 2010 at 12:34 pm

The Western Australian Community Foundation has been forced to close its doors, citing a lack of operational funding.

The Foundation says while it is continuing to see an increase in the financial contributions being made by the corporate sector to establish funds, the Foundation has not been able to secure funding for their own administrative costs.

Chairman of the Western Australian Community Foundation, Michael Anderson says the rapid growth in regional and indigenous philanthropy over the last twelve months has increased the need for the governance and support that the WACF provides to communities across the State.

Anderson says the knock-on effect has been that the level of demand for their services has significantly impacted their operational resources.

He says that despite the best efforts of the Board and management, the Foundation has not been able to meet the challenge of securing funding to support the operating costs of their business, whilst also servicing community funds in a post-GFC environment.

Anderson says it is a sad day for community philanthropy in Western Australia.

The Foundation has had a significant impact across Western Australia since 2004, with trusts and donation accounts currently covering 43 communities across WA.

The need for the Foundation’s philanthropic governance and services is highlighted by the growth of community funds under management of the organisation, with an increase from $1 million to over $7 million over three years. Since its inception, 268 grants have been distributed to WA communities.  

WACF's manager of Corporate and Community Partnerships, Claire Paddison says the organisation could have been saved with an injection of $1.5 million dollars over three years to assist with a newly initiated and more sustainable business model.

Paddison says the forty separate funds under the WACF umbrella are separate from the operational funding. 

The separate funds have an accumulated $7 million dollars under management.

She says all the funds have been asked to decide if they want to transfer to another Trustee or if they want to grant-out. However she says there are complex issues around Trust Law that also need to be worked through.

Earlier this year LotteryWest provided operational funding for six months for WACF and continuing funding was reliant on a new fund coming on board.

Paddison says this new fund did not eventuate and the Board had to make the hard decision to close at the end of July.

It's believed that the four staff currently employed will lose their jobs as the result of the closure.

The WA Premier, Colin Barnett is the vice-patron of the organisation along with the Opposition leader.
 
A spokeswoman for the Premier says WACF received 11 grants totalling around $950,000 from Lotterywest since its establishment. 

The spokeswoman says Lotterywest approved a further grant to WACF in 2010 when it was advised by the Board of WACF that they were unable to meet their ongoing costs and needed urgent assistance.

She says the grant included an amount to allow the WACF to explore alternative business models. The Board of WACF subsequently advised Lotterywest that they had determined that the responsible course of action was for them to wind down the organisation and so they did not take up the balance of the approved grant.

The spokeswoman says the WA Government respects the endeavours of the WACF and their efforts to introduce this innovative approach to Western Australia.

When the WACF was started in 2004 it received a starter grant from the then Department of Local Government as well as a $25,000 grant from the Myer Foundation to cover the first year of operational costs.



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One Comment

  • John Croft John Croft says:

    The closure of the Western Australian Community Foundation in 2010 reflects a lack of creativity on the part of its board. In early documentation regarding the Foundation, I made the suggestion that the WACF investigate the use of a local currency system to leverage grants to local communities. This was given no consideration. Such an approach with community currencies have proved highly successful in Brazil, with the Banco Palmas system of Palmieras in a city of Fortaleza (see https://en.wikipedia.org/wiki/Banco_Palmas). As a result in Brazil there is now a confederation of 53 such community banks that are bringing social benefits to millions of people. Using such an approach would not only have given those seeking grants a new and more flexible line of credit, it would also have enabled the organisation to find innovative ways of paying staff and keeping its doors open.

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