The Generous Country

Donald Horne coined this phrase in his 1964 book of the same name, which ironically critiqued Australia’s reliance on natural endowments and geography while being led by complacent, mediocre leaders “riding on the sheep’s back”. Today, the phrase’s original intent is lost, and it is used as a badge of pride, but Horne’s warning remains pertinent—luck is fleeting, and prosperity will not endure without bold economic and societal innovation.

Australia has indeed overseen a fortuitous confluence of history, granting our island nation a level of prosperity that many countries envy. But the cracks in our good fortunes are becoming increasingly visible, because wealth in resources alone has never guaranteed lasting prosperity without diversification and deliberate investment.

Persistent stagnation in Australian productivity suggests that the economy is not evolving to capture and create value at the pace once seen here and abroad. While migration has boosted aggregate GDP, GDP per capita has remained largely static. And while we’ve benefited from the United States’ security umbrella and China's demand for resources, our reliance on external actors exposes Australia to forces far beyond our control.

The future of Australia’s prosperity will not be secured by luck. But in what might come as a surprise, there is an argument to be made that it can be secured by generosity—in our strategic, economic, social, and institutional theatres.

A generous nation invests early and faithfully in its citizens, its communities, and its future, creating resilience that compounds over generations. If luck made Australia wealthy, then generosity is what will keep us so. Philanthropic reform is essential to achieving that vision.

Generosity is most commonly understood through giving: in the 2022–23 financial year, individual taxpayers claimed $9.1 billion in tax-deductible donations. Around 4.25 million people—just 28 per cent of taxpayers—made a claim.

The distribution of that giving tells an important story. Taxpayers earning more than $1 million donated close to 20 per cent of their taxable income and accounted for over 60 per cent of the total value of gifts. At the same time, professions such as police officers and school principals recorded the highest participation rates, reinforcing that generosity in Australia is driven as much by civic commitment as by wealth. Who gives, how much, and how often is shaped not only by capacity, but by culture.

Giving, however, is deeply sensitive to context. When households feel confident about their finances, they tend to give more across all income brackets. When conditions tighten, generosity becomes more cautious. Rising inflation, mounting cost-of-living pressures, and rising interest rates will always place pressure on household budgets. For charities, this creates a familiar tension: growing demand for services at precisely the moment that donor confidence is under strain.

This is a central lesson for a future generous country: generosity cannot rely on moments of surplus or crisis alone. It must be both embedded and supported by systems that allow giving to endure through economic cycles.

The scale of Australia’s intergenerational wealth transfer now underway—estimated at a staggering $5.4 trillion—underscores the opportunity. If channelled well, this wealth could fund enduring institutions, back innovation, and strengthen community infrastructure. Without trusted vehicles, clear norms, and cultural expectations, this wealth may go to waste.

Australian giving lags other countries: we give less than our Anglosphere peers, on both an individual and institutional level. This is because, compared to other Western nations, Australia lacks the depth of giving vehicles and the cultural expectation of lifetime philanthropy that normalises generosity as part of civic life.

Our challenge is to develop a generosity with a distinct Australian accent. One that builds on mateship, fairness, and collective effort. One where generosity is not exceptional but expected, not episodic but habitual, not concentrated at the top but woven through everyday life. Moving from a lucky country to a generous one means widening who gives, strengthening how they give, and designing systems that allow generosity to compound over time. That is how generosity becomes a national capability.

We’ve started to piece together some of the ways to achieve this. The Productivity Commission’s 2024 inquiry, Future Foundations for Giving, laid out a detailed blueprint for Deductible Gift Recipient (DGR) reform and regulatory modernisation. The 2025 changes and recent 2026 updates to community foundation DGR eligibility have begun to open new pathways. And the government’s “double giving” agenda, led by Minister Andrew Leigh’s long-standing commitment to and interest in the charitable sector, has signalled political intent.

But none of these efforts has been pursued as part of a unified national vision. But they should be. Translating generosity from aspiration to strategy requires wholesale changes across giving policy.

First, it requires us to expand who can participate in organised giving. This is the only way we have a chance of meeting the Government’s goal to double philanthropic giving.

Second, we must broaden our conceptions of giving to expand a generous national spirit.

And third, we have a duty to be more pointed in the outcomes we choose to measure.

These three elements form the structure of a civic agenda to enable Australians to maximise the generosity that already resides within our collective spirit.

The Australian Government has committed to doubling philanthropic giving by 2030. The Productivity Commission estimates that total giving to registered charities will reach approximately $26.5 billion by 2029–30 if existing growth rates hold, roughly a 48 per cent real increase from 2021 levels.

To meet this quantitative goal, there are four targeted changes we must undertake.

1. Reform the Deductible Gift Recipient (DGR) system
2. Adopt globally common giving vehicles
3. Leverage intergenerational wealth transfers
4. Build absorptive capacity

The most consequential structural reform available to Australia in 2026 is a comprehensive overhaul of the DGR system. The DGR system determines which charities are eligible for tax deductible contributions; ostensibly, it exists to ensure that generosity is targeted where appropriate.

But the current system is not fit for purpose: there is no coherent policy rationale for why some charitable activities qualify and others do not, and the system’s complexity disproportionately burdens smaller charities. The upshot is this: more than half of Australia’s registered charities cannot receive tax-deductible donations. And only about one-third of charities wholly dependent on volunteers currently have DGR status.

The Productivity Commission proposed replacing the patchwork of endorsement categories with a principles-based framework, applying three criteria:

1. That the activity generates net community-wide benefits and would otherwise be undersupplied,
2. That there are net benefits from supporting it through subsidised philanthropy rather than direct government funding, and
3. That there is no real risk of converting donations into private benefit for donors.

Under this framework, DGR eligibility would expand from roughly 25,000 charities to between 30,000 and 40,000, at an estimated net fiscal cost of only around $70 million per year.

Critically, the reforms would bring in charities currently locked out by structural quirks rather than any lack of merit. Today, for example, charities focused on prevention rather than crisis relief face barriers to eligibility under the current system. Community foundations, which strengthen local accountability, are currently only able to access DGR through specific legislative listing. And multi-purpose organisations that serve women, young people, or Aboriginal and Torres Strait Islander communities often cannot fit neatly into a single endorsement category. A principles-based DGR framework, replacing the incoherent and arbitrary streams of the current system, would enable charities working across broad cause areas to receive tax deductible donations, and get on with their important work.   

Beyond charity registration, Australia’s philanthropic infrastructure is relatively narrow, which constrains how people can give and when. While many peer countries like the US make use of giving vehicles well suited to an ageing population, these mechanisms remain rare in Australia. Charitable gift annuities, for example, allow donors to receive a guaranteed income for life while securing a future gift to charity.

In the United States, charitable gift annuities are a mature and widely used vehicle; in Australia, regulatory and policy settings have simply not evolved to accommodate them. Unlocking these vehicles could significantly increase both the quantum and diversity of giving, particularly among retirees who are increasingly asset-rich but income-conscious.

Charitable gift annuities allow for donors to receive an annual source of income and charities a longer-term source of funding.

Credit:

Fidelity Charitible

On the other hand, accessible charitable bank account models could widen participation well beyond the current 28 per cent of taxpayers who claim deductions today. These vehicles allow everyday givers to build a giving habit with modest, regular contributions that they can direct to causes they support over the course of their lives.

Innovation in giving vehicles does not require inventing new tools; instead, we should adopt proven overseas models and enable them in the Australian context.

The $5.4 trillion intergenerational wealth transfer is as much a financial planning exercise as it is a relational and cultural one. For every bank transaction made from a parent to a child, there are even more discussions within families about how and when they should allocate their wealth. Encouraging families to discuss values, legacy, and community impact ensures that wealth transfers become opportunities for generosity.

Financial advisors play a central role in this dynamic, as an underleveraged channel for normalising planned giving. But many Australians – and many of their professional advisors – remain unaware of the tools available to align financial security with social impact. As older Australians transition out of the workforce and the tax system, philanthropy becomes one of the most powerful ways to contribute to the public good.

This will require a culture shift among financial advisors, but also the country at large. Australia must create and tell the stories that normalise generosity and remind us that giving is a deeply human—and deeply Australian—act that connects people, reinforces values, and strengthens communities across generations.

One story that has captured the imagination of Australia was that of the late James Harrison, known as “the man with the golden arm”. Harrison’s blood carried Anti-D, a rare antibody required to deliver life-saving treatments for women at risk of Rhesus disease. Over six decades, he gave blood and plasma almost every fortnight.

James Harrison donated plasma over 1,100 times. His plasma was used to create medication which has helped protect an estimated 2.4m babies from illness.

Of course, most older Australians don’t have golden arms—but they do have golden superannuation balances. Making them aware of their unique opportunity to do good with a lifetime of wealth is the challenge we now face. And our political and social leaders should rise to the task.

There is a quiet, counter-intuitive truth in the not-for-profit sector rarely seen by people outside it: of the approximately 11,000 ‘extra small’ charities in Australia—those with less than $50,000 in annual revenue—many could not responsibly absorb a million-dollar donation. Gifts of that scale can overwhelm a small charity if it is not set up to manage funds at that level. Large gifts often come with reporting requirements and timelines that exceed the organisation’s capacity, exposing volunteer boards to risk and pushing charities into complex compliance obligations.

Without the ability to stage funding, build capacity gradually, or access shared infrastructure, a large gift can destabilise the very organisation it is meant to help. This is why effective generosity requires not only willing donors and reformed tax settings, but shared intermediaries—such as shared back-office services and staged funding mechanisms—that would allow smaller organisations to receive and deploy larger grants without being overwhelmed. The intergenerational wealth transfer will only be transformative if the organisations meant to benefit from it are ready to absorb it. The Government should work to establish or enable this intermediary infrastructure that will be required to translate wealth into a national programme of generosity that doubles Australia’s giving.

Generosity extends beyond just money. Those without great amounts of wealth often express generosity through their time, skills, advocacy, and civic engagement. Social acts like volunteering, giving mutual aid, and maintaining informal support networks are part of the unseen architecture of social capital that underpins national resilience. First Nations giving traditions, community sport clubs, faith groups, and disaster response networks all reflect a culture of care and reciprocity that exists alongside formal philanthropy.

To invest in Australia’s future is to recognise and resource these invisible forms of generosity, building systems that can translate them into sustainable outcomes. To do this, we must transform both culture and institutions.

Australia often tells a story about itself as fair, egalitarian, and generous. It is a comforting narrative that aligns with our national identity, and like many national myths, it is both true and incomplete. The generosity that shapes lives is not always captured in tax data or charitable registries. It lives in unpaid hours, cultural obligations, reciprocal care, and informal systems of support. Too often, our policies, metrics, and institutions fail to see or value this reality. As Myles McGregor-Lowndes noted in The Conversation, Australians remain generous, but increasingly in ways that do not appear on a tax return.

Indigenous Australians offer lessons about how generosity forms part of our national story. Long before modern philanthropy, systems of generosity were embedded in care, obligation, kinship, and cultural responsibility. Western funding and policy frameworks struggle to recognise these models because they privilege linear, measurable transactions over relational and cultural value. A genuinely generous nation must expand its understanding of value and redesign institutions to support (and celebrate) these systems rather than marginalise them.

The Productivity Commission recommended the establishment of a new organisation, provisionally called Indigenous Philanthropy Connections, to strengthen the capacity of Aboriginal and Torres Strait Islander organisations to access philanthropic networks and funding where this aligns with their values and interests. This recommendation responds directly to documented barriers. As research by the Centre for Social Impact and the Jumbunna Institute found, the existing charitable sector can function as an exclusive space that makes it difficult for people without established connections to enter. To build a truly egalitarian future, the future of philanthropy must be inclusive of all Australians.

The Productivity Commission also found that philanthropy’s distinctive value lies in its capacity to provide “patient capital” and “risk capital” to seemingly intractable challenges. This long-term, untied, flexible funding enables innovation, pilot programs, and tolerance for failure that government grant cycles structurally cannot support.

Emerging partnership models point to how cross‑sector governance mechanisms can bring shared vision and long‑term commitment to social outcomes. The Investment Dialogue for Australia’s Children (IDAC), a decade‑long government‑philanthropy collaboration focused on coordinated place‑based investment and reducing disadvantage, bringing together seven government agencies and over two dozen philanthropic partners to improve Australian childhood.

This model recognised that duplicated efforts would not be enough to address childhood disadvantage. And so leading organisations like the Fogarty Foundation, the Ian Potter Foundation and Tim Fairfax Family Foundation were given access to leading thinking from Treasury and the Departments of Education and Social Services, to ensure that charitable impact was maximised.

The IDAC model is distinctive in that it operates on a decade-long timeframe with coordinated place-based investment. This model is fundamentally different from the short-cycle competitive grants that dominate government and philanthropic funding alike.

If Australia is serious about using generosity as a national strategy, the IDAC model should be replicated across additional domains—housing, climate adaptation, skills development—with the same commitment to long-term coordination.

The myth of generosity is seductive because it allows us to feel good about ourselves. But feeling good fails to deliver systems that actually sustain care, equity, or resilience. To move beyond myth, we must be clear-eyed about where generosity genuinely thrives in Australia, and where it fractures under scrutiny.

Generosity is shaped less by innate human kindness than by the incentives we create. Tax policy encourages donations to some organisations over others. Grant structures favour professionalised charities in urban centres while excluding smaller, community-led initiatives. Eligibility criteria, reporting requirements, and risk frameworks quietly determine who can access resources and who is left out.

With this in mind, we need to make changes to data transparency and impact evaluation to support the broader measurement of generosity.

The Productivity Commission recommended that the Australian Government create more value from existing data on charities and giving. Specifically, the ATO should publish aggregate information on corporate giving – currently invisible in public data – and listed companies should be required to be more transparent to stakeholders about their giving. These are implementable, low-cost reforms that would immediately improve the evidence base for policy and public debate.

The case for investing in impact evaluation is overwhelming. Evidence from international research suggests the most effective charitable interventions can be ten or even a hundred times more impactful than typical interventions addressing the same problem. Without systematic evaluation, donors, governments, and the public have few ways of distinguishing between interventions within a given cause area. The Effective Altruism Australia submission to the NFP Blueprint Expert Reference Group made the case for a government investment of a few million dollars to support and promote impact evaluation, which could return billions in improved outcomes.

This could be done in three different ways. The first would be through expanding the Australian Centre for Evaluation to support not-for-profit organisations by offering voluntary templates, toolkits, and best-practice guidance to charities that see the value of evaluation.

A second option would be to pilot an Australian organisation modelled on GiveWell—a US-based charity evaluator that undertakes high-quality impact evaluation—to assess Australian charities on an opt-in basis, and publish their findings.

The third, more distributed option would be to provide grants aimed at building out the nascent ecosystem of charity evaluation in Australia, supporting organisations already conducting impact assessments to widen their scope and share findings.

Australia’s generosity is substantial, but structurally fragile. It is highly concentrated, episodic, and poorly integrated into our economic and civic systems. Households, volunteers, and communities contribute extraordinary amounts of time, care, and resources, yet these efforts largely are largely informal.

A civic agenda demands a reframing. Fundraising is often treated as a necessary evil, obscuring its broader function as a participation-mobilising system within civil society. In truth, fundraising is a democratic capability that connects citizens to public purpose, translates values into collective action, and sustains institutional legitimacy. But the dominant funding model in Australian philanthropy and government grants alike – competitive, short-cycle, project-based – is structurally hostile to the kind of sustained capacity-building that civic infrastructure requires.

Shifting funding norms from one-to-two-year project grants toward minimum three-to-five-year operational funding—with the IDAC model discussed earlier as a proof of concept for decade-long commitment—could help transform smaller and regional organisations that currently spend disproportionate time and resources on perpetual fundraising cycles. Better funding norms will enable these organisations to achieve their core purpose: to make Australian society a better place to live.

If the first era of Australia’s modern economic history was defined by the luck of resources, the next should be defined by a generosity of vision and of action. By seeding solutions locally, replicating them regionally, and scaling them globally, Australia can become a laboratory for the future of philanthropy, finance, and civic innovation - shaping the world while building enduring national prosperity.

To be generous is to choose resilience over chance. The “Lucky Country” was a story of circumstance. The “Generous Country” is a story of choice, one of deliberate investment in people, institutions, industries, and values that multiply over time. Luck is passive; generosity is active. One fades; the other builds nations. The country we build by choice, rather than chance, is the country we will be proud to hand to the next generation.