A new enviroment for giving
Up until a decade ago, the Australian regulatory environment did not provide tax efficient philanthropic structures comparable with those available in the USA and UK. The introduction of a new kind of vehicle in 2001 changed this, providing wealthy individuals and families, as well as businesses, the ability to tax effectively donate to a trust of their own, and then disburse funds from the trust to a range of eligible not-for-profit organisations over a time frame of their choice.
Whilst the introduction of this structure was welcomed by all, there was initially limited take up within the Australian philanthropic community. Fortunately further improvements were legislated by the Australian Government in October 2009 and the private ancillary fund structure was launched.
Social Ventures Australia (SVA’s) Chris Cuffe and Michael Traill were both early adopters of this new kind of giving structure for their own family foundations, finding private ancillary funds to be both simple and rewarding to operate. Delighted with the experience, and with how rewarding it could be but frustrated by the lack of awareness of private ancillary funds amongst wealthy Australians, Chris decided to take steps to inspire and support more individuals and families to use these structures to manage their giving. He felt motivated to inspire and support others to do the same.
Establishing a Private Ancillary Fund service
SVA’s Private Ancillary Fund (PAF) Service was launched in September 2010. The service offered to set up and mange private ancillary funds for individuals and families, and to support wealth advisers to help their clients do the same. It also provided a grantmaking and evaluation service to assist clients plan their giving more effectively.
Since then, the PAF service within SVA has grown and more importantly so has the take-up of PAFs as a vehicle for giving. Today across Australia, around $2 billion are invested through these structures, contributing over $150 million annually to the not-for-profit sector and making an enormous difference to Australian society.
Restructuring for better giving
In April 2012 the SVA PAF service and team rebranded to Australian Philanthropic Services (APS), to provide greater focus and accelerate growth plans. Dedicated to inspiring and supporting philanthropy and effective grantmaking, APS has a unique model, operating as a not-for-profit business and being completely independent.
APS doesn’t manage the investments held in our clients’ private ancillary funds, instead we’re focused on ensuring that our clients’ giving has a lasting impact. We have also partnered with a professional administration group PortfolioGuardian (PG), to streamline administration and reporting, and provide state-of-the-art online access for clients.
The result is that at APS we’re able to administer many private ancillary funds using a very efficient and low cost model. We want to ensure that for our clients, the experience of having a private ancillary fund is simple, effective, and rewarding.
“I believe the private ancillary fund is an ideal structure to engage people in philanthropy, provide vital funds for the sector and deliver real impact and sustainability to many not- for-profit organisations. Importantly, the PAF structure will facilitate the engagement of the next generation of philanthropists.”
Chris Cuffe, Chairman and founder.
Chairman and founder