A $26 million increase in cash giving during 2019/20 was a welcome reprieve for the arts sector, but a new report shows other support fell significantly.

Private sector support for Australian arts and culture declined by 11% from $608 million to $540 million between 2018 and 2020 according to new research.  

The decrease was experienced across bequests, volunteering, and in-kind and pro bono support. The silver lining is that the impact of the fall was softened by increases in cash giving.  

From 2018 to 2020, the value of in-kind sponsorships fell from $65 million to $25 million, volunteer and pro bono support dropped from $180 million to $124 million, and bequests declined from $49 million to $17 million.  

Conversely, cash contributions from donations and sponsorships grew from $351 million to over $377 million. 

About the research 

The Giving Attitude report is a biennial survey undertaken by Creative Partnerships Australia that examines private sector support for arts and culture. The survey includes both quantitative data and a reflection on fundraising activity in the sector. 

The latest report was published in December 2021 using financial data from the 2019 calendar year and 2019/20 financial year and survey responses from 380 organisations. The findings unearthed by this analysis paint a picture of the sudden and immediate impact of COVID-19 towards the end of the reporting period, a sector that needs to spend more to make more, and a growing awareness of the critical role of fundraising.  

How COVID-19 made its mark  

The final four months of the 2019/20 financial year were impacted by the COVID-19 pandemic. This time of significant challenge was reflected in 55% of arts and cultural organisations participating in the survey reporting an average 45% decline in overall revenue.  

A fall in private sector support was felt most strongly by smaller arts and cultural organisations, with a 41% decline for organisations with turnover of less than $50,000, and a 47% decline for organisations with turnover of between $50,000 and $250,000.  

Conversely, the results found an 18% increase for organisations with annual turnover of $5 million or more and 55% growth for organisations with a turnover between $1 and $5 million. This may be linked to greater use of calendar year reporting for larger organisations (and thus, the use of figures unaffected by COVID-19), but it is also a reflection of the employment of dedicated fundraising staff who were able to continue raising funds during the pandemic.  

While the sector continues to earn most income through box office sales (37% of all funding), this income stream experienced a 40% decline from the 2018 report as COVID-19 restrictions closed face-to-face operations between March 2020 and June 2020 (and beyond).  

The study shows that the sector remains reliant on private and government support for over 50% of all funding, especially during times of crisis. The estimated share of private sector support of overall revenue dropped from 25% to 23% while government support increased from 27% to 33% in the reporting period. 

Expenses went up  

The total costs incurred in raising private sector support increased 14% from $175 million in 2018 to $199 million in 2020. This was driven by higher salaries (+$22.4 million), marketing (+$6.3 million), consulting (+$2.4 million), and event expenses (+$4.1 million). 

The report shows that arts and cultural organisations are spending more to raise funds with the return on investment for every $1 spent raising $2.72, compared to $3.50 raised for every $1 spent in 2018.   

Insights into successful arts and culture fundraising  

Since the last study, belief in the importance of private sector support has risen, with an improved level of knowledge of, and experience in, seeking private sector support. This is demonstrated in a higher level of perceived success in these activities compared to the previous report. At the same time, belief in the importance of government funding also strengthened, indicating that the sector sees this income stream as a crucial component of future revenue. 

However, the broad acknowledgement that private sector and government support is critical to arts and culture does not mean that everyone is well equipped to secure funds. Less than a quarter of organisations surveyed had a dedicated fundraiser on their staff, indicating a gap in fundraising capacity within the sector. 

In a nutshell, the size of an organisation continued to be the most influential factor in terms of fundraising skills, knowledge, resources, and confidence in securing private sector support. Though organisations with a turnover of more than $1 million spent more on fundraising, they raised more funds and therefore achieved a higher return on investment on fundraising activity than smaller organisations. 

The involvement of boards in fundraising remains a live issue, with senior staff reporting low levels of board engagement in fundraising activities and indicating the need to improve in this area.  

Directly approaching individuals for donations remains the most common fundraising activity (77%) for securing private sector support. The COVID-19 experience resulted in a change in other kinds of fundraising activities, as evidenced by a rise in social media campaigns (64% compared to 49% in 2018) and fewer direct-to-business activities, raffles, and entertainment events.  

How to use this report to help your arts and culture organisation  

Fiona Menzies, CEO of Creative Partnerships Australia, explains that the report is designed to track trends as well as provide arts organisations with a reference point against which to measure their own achievements in attracting and maintaining private sector support. 

Creative Partnerships will undertake another survey in early 2022, which will provide a comprehensive picture of the impact of the pandemic on private sector support for the arts. If you are a nonprofit in the arts and culture space, we strongly recommend you follow this ongoing report.  

To read the 2020 report in full, click here.  

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