Labor unveils charitable bequests push as $5 trillion passes between Australian generations
A push to get Australians more comfortable talking about death is aimed at boosting the number of donations to charities.
Andrew Leigh wants you to think about death.
Not only is it good for your family, it could also leave your community better off, the economist turned assistant charities minister says.
With more than $5 trillion expected to pass down the generations through wills and bequests over the next two decades, Dr Leigh hopes to make it easier to direct that money to charitable projects where it can make a real difference.
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By continuing you agree to our Terms and Privacy Policy.“Growing bequests requires culture, systems and trust,” he will tell the National Press Club on Wednesday.
“The cultural part begins with more Australians feeling able to talk about death, wills and legacy. Families do better when hard conversations happen early. Communities do better when planning replaces confusion.”
The Labor assistant minister - one of the party’s only MPs not aligned with a faction - will outline a plan to encourage more Australians to leave bequests to charities in their wills.
“After fires and floods, Australians are magnificent. We donate, cook, shovel and comfort. The question is how to carry some of that spirit into ordinary times,” he will say.
Dr Leigh will announce an extra $2 million to help the corporate register and the charities commission align their systems to reduce the number of duplicate forms non-profits need to fill out.
The move will solve a “paperwork problem” for charities, allowing them to focus more on helping communities, he will say.
He will also push for bequests to become a normal part of estate planning, urging lawyers, accountants, financial planners and wealth advisors to work with charities to encourage more Australians to leave a bequest in their will.
“The great wealth transfer should become a great trust transfer,” he will say, pointing to research from financial consultancy JBWere which estimates $5.4 trillion will change hands through estates in the next 20 years.
Dr Leigh will confirm the federal government’s plans to increase the amount so-called “giving funds” are required to pay out each year to six per cent of their total assets, which is expected to deliver charities an extra $60 million annually.
Such trusts, which receive special tax exemptions, are often used by wealthy donors to invest their money before gradually handing it over to charities.
Some philanthropists have argued the higher giving rate will run down their funds faster than the returns to replenish them, stopping them from running the financial vehicle in perpetuity.
