by MICHAEL OTTO
Caritas Aotearoa New Zealand is budgeting for financial deficits for several years after having a deficit of $700,000 in the year ended December, 2014.
Caritas Aotearoa New Zealand is the New Zealand Catholic bishops’ agency for Justice, Peace and Development and incorporates Mahitahi–Catholic Overseas Volunteers.
Caritas director Julianne Hickey told NZ Catholic that over the past few years, Caritas “has received significant donations, which has led to a surplus”.
“Caritas does not wish to hold reserves,” she said.
“The board has approved a budget deficit, and will do so for the next two years.”
Mrs Hickey said Caritas, being an agency of the bishops, does not seek to make a profit or hold reserves.
“When there are funds more thanare needed for reserves, it will budget a deficit so that it has only what it needs.”
The major reason for the 2014 deficit was a drop in funding from the Ministry of Foreign Affairs and Trade. In 2013, Caritas received $1.99 million from the New Zealand Aid Programme, managed by the Ministry of Foreign Affairs and Trade.
In 2014, the funding from MFAT fell to $1.19 million. MFAT funding made up about 23 per cent of Caritas funding in 2014. In 2013 the percentage was 34 per cent.
Other sources of Caritas funding include the Lent Appeal and other appeals, other donations and bequests.
In the 2013 financial year, Caritas had an overall surplus of $470,000.
Mrs Hickey said MFAT funding mechanisms have changed significantly over the past five years.
“There will be variations from year to year,” she said.
“Last year we received no funding for emergencies, as funding was only made available for one emergency situation.”
In 2013, MFAT Disaster Response Funding to Caritas was $530,00. In 2014, that dropped to $27,047.
Caritas was able to sustain the 2014 deficit by using reserve funds.
In 2013, the total of accumulated funds and reserve funds was $2.9 million. Closing funds for 2014 dropped to $2.2 million.
Caritas expenditure covered advocacy and research, community engagement, operations and development and humanitarian programmes.
Expenditure increased from $5.36 million in 2013 to $5.85 million in 2014.
The major component of expenditure was development and humanitarian programmes, with spending in this category rising from $3.95 million in 2013 to $4.25 million in 2014.
Operational expenditure made up about 10 per cent of total spending in each of 2013 and 2014.