New Zealanders are as parochial about charity as they are about sport, with only a fraction of the money we donate leaving our shores or even going outside our local areas.
Less than 9% of private donations in New Zealand go to international charities because Kiwis prefer to give as close to home as possible.
That’s the finding of an Otago University researcher who has spent the last decade studying New Zealanders’ philanthropic habits.
“It’s not just people prefer money to be spent in New Zealand than overseas,” Professor Stephen Knowles says. “People in the South Island would choose a South Island charity 9 times out of 10 compared to a North Island charity, and the other way around.”
The reality is that $100 makes more of a difference in a developing nation than to a local cause, he says. For example a $25 donation to the Fred Hollows Foundation will restore the sight of one person, the charity says.
But few donors are bothered about that, and their most common reasoning is ‘charity begins at home’, Knowles told the New Zealand Association of Economists conference in Wellington earlier this month.
“If all people cared about was the efficiency or how much good their donation would do, obviously a lot more would go to international development.”
Knowles was inspired to test the theory after reading Doing Good Better by Cambridge University Research Fellow William MacAskill, who has developed the philosophy of ‘effective altruism’ – applying scientific reasoning to the normally sentimental world of doing good.
The Otago University team conducted an experiment. They asked 1200 New Zealanders what the most important consideration for them would be if they were to make a hypothetical $100 charitable donation – where the money would be used, the expected benefits of the donation, or the need of the recipients?
Nearly half said where the donation would be used was their top concern. The rest were broadly divided between the expected benefits and the need.
The survey participants were also asked where they thought the $100 would do the most good – in New Zealand, or overseas. The results were split, with 44% saying New Zealand, another 44% saying overseas, and the rest not sure.
Participants were then asked to vote on where a real $2000 donation should go. The choices were the local Salvation Army, or international development agency World Vision.
An overwhelming 70% selected the Sallies, while 18% said World Vision and 11% chose neither. (To stay true to the science the researchers deducted 11% off the amount and donated the remaining funds to the two charities as per the vote results.)
One of the key conclusions from the study was that a lot of people just aren’t aware that their money will achieve a lot more if it’s spent overseas, Knowles says. People wanted the money to go to the Salvation Army rather than World Vision because they’ve seen what the Sallies do locally.
“New Zealanders are not going to see firsthand the results of what World Vision are doing, unless they’re one of those very rare people who travel overseas to see their sponsored child, or something like that, and they may be someone who’s donating to World Vision already anyway.”
New Zealand is a relatively generous country overall, coming third on the most recent world giving index, and we are not alone in our preference for doing good locally. In the US just 5.7% of private donations go to international charities. In the UK during the 1980s and 1990s between 20% and 40% went overseas, but that was the era of Band Aid and Live Aid when international causes were top of mind and more recent data may tell a different story, Knowles suspects.
Charities are well aware of this preference for money to be spent in donors’ back yards and they tap into it, Knowles says. As part of its annual Daffodil Day fundraiser the Cancer Society says donations go towards research, support services and awareness campaigns “for people affected by cancer in your area”.
Major Pam Waugh from the Salvation Army’s social services central division says in the last 10 years there has been a heightened awareness about local issues such as child poverty and the housing crisis.
“With the raising of that through organisations such as KidsCan and the other groups we have really highlighted New Zealand’s need, and that has prompted people to think quite a lot more about what’s actually happening in our own community,” she says.
Also, increasingly people want to know exactly where their dollar is going. “When we put in an application for grants that’s very much a focus.
“That’s actually really good, because people do know what you’re doing with the money that they give, and we’re okay with that.
The international development charities know what they’re up against. Grant Bayldon, CEO of World Vision New Zealand, says with the awakening to our own homegrown poverty issues there has been a reduction in coverage of international problems.
It’s important for organisations like World Vision to establish a connection for its donors with the causes they’re giving to, he says. A good example of that is child sponsorship, where they connect with a specific child in a community even though the support also goes to the wider community.
“Or really practical things, like $10 to provide a mosquito net for a child or $45 to supply a lifetime of clean water for a child, those kinds of things where people can see the tangible results of what they’re giving.”
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A dollar given to World Vision also goes a long way, because its able to match donor funds with international funding that’s available such as through the World Food Programme or NZ Aid. “On average for $1 donated to World Vision we end up spending $1.46 in the field.”
Bayldon also says the concept of ‘charity begins at home’ has been misinterpreted over the years.
“We at World Vision really believe in the original meaning. It’s where you start, it doesn’t end there, in fact it was specifically about modelling charity at home so that you could do it beyond your own home.
“It’s totally possible to be both involved in your own community and giving to causes outside of that.”
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