Editorial: Charity begins at home, with a hefty rebate

Paula Bennett. Photo / Brett Phibbs

Paula Bennett should not need to spend five weeks away from her Beehive desk to find the "piece missing in the middle" of the corporate social responsibility jigsaw.

The answer lies squarely in the incentives offered to the business world to help the less well-off by supporting the work of non-government organisations. The generosity of the government carrots in the United States has sponsored a culture of giving that has only the glimmer of an echo in this country.

Work associated with the Social Development Minister's Eisenhower Fellowship will merely confirm how much it will take to bridge the gap.

It is unsurprising, however, that the Prime Minister has approved the trip. While working in the US, he came to admire Americans' benevolence, in terms of personal donations to charity, endowments to alma mater, and in corporate philanthropy.

As much was emphasised in his first major speech on becoming the leader of the National Party in 2007, when he challenged businesses to help provide food and sports equipment to schoolchildren in deprived neighbourhoods. The response was heartening.

At the heart of John Key's approach are the concepts that the Government should not be providing everything in social welfare, that, indeed, it may not be the best judge of what is needed, and that charity is a good thing. He has sought to further these ideas by building on work done by the previous Government, most notably in abolishing the $1890 cap on rebates for charitable donations.

Most recently, legislation has provided for that rebate to be received automatically by wage and salary earners who donate directly to an approved charity from their pay cheque.

Yet such measures amount only to tinkering when compared with the extremely enticing tax breaks that underpin the strong tradition of private charity in the US. Auckland businessman Tony Falkenstein has probably come as close as any New Zealander to emulating the approach of the American corporate sector.

He has given millions of dollars towards local education, including the setting up of Onehunga High School's business academy. Three years ago, he suggested more businesspeople would be encouraged to give back to the community if the Government improved the tax laws covering donations.

It seems unlikely that his view would have been transformed by the incentives offered since then.

The American approach has embedded a culture of private charity and less reliance on the state. In New Zealand, there has always been a greater focus on social security, and a somewhat suspicious attitude towards charity.

That attitude is unwarranted, and Mr Key is right to encourage wealthy individuals and corporates to be doing more in the community. Paula Bennett's spot of research will reinforce how much more is to be done if more businesses are to think wider than one or two favoured charities and encouraging volunteering by their staff. An obvious starting point would be the level of rebate.

Ideally, Paula Bennett's study leave should have been paid for out of the Government's coffers. It is instructive that she has chosen, instead, to take the unusual step of accepting a fellowship.

Clearly, the Government considers this an exercise that taxpayers would be loath to fund. For that, ministers and MPs can blame their own flaunting of travel and other perks.

Parliamentarians have discovered that the culture of giving to them goes only so far. Entrenching the same culture in the corporate world will, likewise, butt up against a roadblock until strong incentives are offered.