[Theme music starts]

RUBY:

From Schwartz Media, I’m Ruby Jones, this is 7am, a daily news podcast from the The Monthly and The Saturday Paper.

With the Red Cross receiving more than a hundred million dollars in donations to assist people affected by the bushfires, staff at the organisation are criticising its capacity to handle the money and get help to where it's needed

In this episode, Rick Morton asks what happens when a country turns to a charity and expects it to manage a national crisis.

[Theme music ends]

RUBY:

Rick, you’re reporting on the Red Cross and the bushfires, but where does this story actually start?

RICK:

Well, we actually have to go back to the Bali bombings

That moment sparked such a flood of grief and support from both the Australian public and around the world.

Archival Tape -- Unidentified Man #1:

“On October 12th, 2002, blasts ripped through two nightclubs in Bali, Indonesia…”

Archival Tape -- Unidentified Woman #1:

“88 Australians were among 202 people killed after bombs were detonated in the Sari Club and Paddy's Bar at Kuta.”

RICK:

And the Australian Red Cross kind of stepped into this gap and raised millions of dollars for them. In the end, they raised about 14 million dollars.

Archival Tape -- Unidentified Man #2:

“24 hours after they arrive for treatment, it was still a scene of managed chaos. The walking wounded, and those still fighting to hang on.”

RICK:

It's kind of a bit nuancey, but essentially what happens when they do that, they set up these funds for a very particular event, a particular disaster. In this case, it was the Bali Bombings Relief Fund.

RUBY:

Rick Morton is a senior reporter for The Saturday Paper.

RICK:

And there are a whole set of rules that go with the setting up of such an appeal. And that includes a statement of appeal intent. And that's something that tells the Red Cross and the public where that money is going to be spent, how it's going to be spent and how it's gonna be divided up.

After promising all these things, and perhaps over-promising about what they could do and when, some of the survivors and the families of the victims and people who perished in those blasts started issuing scathing reviews of the Red Cross in their handling of the situation. You know, money hadn't arrived when they said it would, it was less than they said it was going to be for some people. At one point they said that three ambulances that they had bought for Indonesia had already arrived in this community and they hadn't arrived.

RUBY:

And so what was the underlying problem there? What was the reason that it wasn't working the way it was supposed to?

RICK:

Essentially, they struggled to get it all out the door because they were overwhelmed with responses. And so they raised far more money than they thought they would. And when you've got a very specific set of rules governing how that money is spent, it then becomes quite difficult to be seen to be acting quickly.

And that was kind of the key ingredient in a lot of the ferment and a lot of the scathing criticisms from the survivors and their families who thought they had been misled.

In 2003, the then-vice chair of Red Cross, Brian Ward, said the charity was cleared by auditors PricewaterhouseCoopers of any wrongdoing over the Bali bombings fund. But he did concede that they could have been able to do more, and sooner.

RUBY:

So what has the Red Cross done since the fallout from the Bali bombings?

RICK:

Things changed in the last couple of years.

So, since the Bali bombings, the Red Cross has kind of been doing a bit of trial and error with the way they fundraise. Internally, they haven't always wanted to do these specific appeals. They were a lot of work to set up and they've kind of tried to find ways around that.

And one of the ways they do that is to set up a disaster relief and recovery fund, which is a very generic fund that is used to fund the kind of ongoing work on the ground throughout the Australian summer. And they did that in July last year, which is in itself not out of the ordinary, except that when the bushfires finally struck, they began quite viciously from the beginning in September. There was no new appeal set up specifically for the bushfire victims.

RUBY:

So why is that important now?

RICK:

It's important now because there is no set of wording on this very general disaster relief and recovery fund that says legally the Australian Red Cross has to spend that money on the Australian bushfire victims. And no one's been deliberately misled, but it just so happens that there isn't that narrow specific appeal fund like there used to be.

And so that's significant because that is, that kind of underpins a lot of the confusion now from people who kept donating to that fund because obviously, as the bushfires took off, The Australian Red Cross language changed and they said help support the bushfire victims. And that was always their intent. But to do it from this general fund, which gives them a lot more flexibility in where that money will be used.

RUBY:

And so they’re facing some pretty major criticism now, most significantly from the former NSW treasurer Andrew Constance…

RICK:

Yeah. So last week, all of this kind of boiled over. And we've got Andrew Constance in Bega, who kind of stands up at a press conference. He says people are suffering right now in really quite extreme ways.

Archival Tape -- Andrew Constance:

“You can see their despair and the destruction this bomb brought, this firebomb brought...”

RICK:

Psychologically, physically when they've been burned and they've survived. Emotionally, that they've lost family members, the whole kit and caboodle.

Archival Tape -- Andrew Constance:

“You know, the money's needed now, not to sit in a Red Cross bank account earning interest so that they can map out their next three years and do their marketing plans…”

RICK:

Things got a little bit dicey.

Archival Tape -- Andrew Constance:

"Meet me in Batemans Bay at 8 o’clock on Saturday, and I'll drive you the 300 kilometres of devastation on the far south coast. I'll show you the people, you can look them in the eyes…”

RUBY:

So Rick, were you surprised by this criticism being levelled at the Red Cross?

RICK:

No, I wasn't surprised at all, actually, because over the past couple of weeks, I've actually been in touch with some current and former staff members at Australian Red Cross, and they started sharing some things with me which I hadn't heard until that point.

But they were fairly alarming.

RUBY:

We’ll be back in a moment

[Advertisement]

RUBY:

So Rick, you've been speaking with current and former Red Cross staff. What's the state of the organization?

RICK:

There is some unhappiness. That’s fair to say. And, you know, there have been a series of large scale redundancies on offer at the Australian Red Cross as they've kind of restructured the way they do things over the last two years. And so people have lost jobs.

And also in May 2018, the Australian Red Cross disclosed, on its own accord to the Fair Work Australia, that they had been underpaying current and former staff. And that bill, which is still being repaid now, is about 20 million dollars.

So there is some angst and there is some kind of disappointment, I would say, more than anything else about the communication from the Australian Red Cross about working conditions and other issues.

RUBY:

And what could the staff that you spoke to tell you about the way that donations are spent?

RICK:

Not as much as they would have liked, I suspect. You know, one person I spoke to said that when they asked the Red Cross, and they were working in a fairly senior position and they asked the Red Cross, you know, where does this money actually go during a disaster. And they could never really get a decent answer. Nothing that kind of sated their curiosity.

Another person said to me it was difficult to get precise details about who had been helped and how. And that was troubling in and of itself.

The thing that I've had particular interesting was that three of the former employees independently raised concerns with me about the way the Red Cross would have launched a general appeal and why they would have done that in July last year, when what they should have been doing was launching a specific appeal for the bushfires when they happened. And, you know, I spoke to one of them who's very familiar with the processes involved in setting up these appeals, both the general and the specific ones. And they said to me, I've looked for the appeal wording and it's not there. You know, this is the wording that tells you what is the money for, where is it going, and puts the rules around that fundraising.

I ended up speaking to seven current and former staff members in my research for this piece and all of them to a tee said this is a massively bureaucratic organisation.

There are layers upon layers upon layers of sign-off and approval and involvement before anything happens. And so, ordinary Australians are donating money, thinking that it's going to go straight to the victims of these bushfires and these former staff members talking to me saying well, actually, it's gonna take a while. And that was what they were really concerned about.

RUBY:

But there's also the good that the Red Cross does as well.

RICK:

Oh, I mean, their whole organisation is to do good, and they do. As someone put it to me: ‘Saints,’ they have hearts of gold. And that stuff is kind of what the Red Cross is known for right? It's their public face, and they've been doing it since the wars. I mean, that's the reason they exist.

So nobody is disputing that. It's just kind of the direction of Head Office and also the ways that money sits around while decisions are made. You might ask, what's the difference between two days and ten days between getting assistance? Well, it's everything. It's your psychological well-being. It's your family's well-being. It might be the difference between you losing a job or not, or having to sleep in your car for a few nights. You know, every hour matters. And that's what troubling people, that such a large organisation that cannot move quickly is sitting on all of this cash.

RUBY:

And Rick, do you think that there is a better way for this kind of relief work to be handled?

RICK:

That's actually a really good question because, you know, almost everyone I spoke to, and this is beyond just the employees, but other people in the charity sector. They all said, you know, the Red Cross has an amazing brand. People recognise it. They respect it. And they give money to it for that reason.

There must be a way for the Red Cross, and there is a way for the Red Cross to get that money out into the communities, into other smaller, more nimble, for want of a better word, charity organisations who know what the local needs are. And those organisations can get it into the hands of people who need it right here, right now. And I actually raised that with Noel Clement, who is the director of Australian programs with the Australian Red Cross.

And he actually said to me, look, that is an option and that is something that is on the table. He said they don't have a current plan for how they would do that at this scale, but it is an option.

And you know, you've got scale at one hand which has benefits, and then you've got hyper locality at the other side.

RUBY:

And this huge outpouring of donations, is it to do work that the government should be doing?

RICK:

Well, in a way, yes. There's always been a question about how far back can government shrink and still expect civil society to step into the breach. You know, you can come back a little bit at the edges, and in some ways that's a good thing because you do want a strong civil society.

But if you pull back too far, then you've actually abdicated your responsibility as a government who collects taxpayer money for these very reasons to be there in times of disaster and war. That's kind of the very definition of a nation state. Why isn’t the government funding recovery? Why do we need a charity to be planning for a three, four, five year recovery period? Why does any charity need to be doing that?

We don't have the support or the resources we need to get back on our feet. And that's why we've got such a reliance on these hordes of charities, not just Red Cross or Salvos, but lots of little ones as well in response to the bushfires, who are having to step into a gap. Because we've lost a lot of the sinew from our own kind of society and the things that keep us together.

RUBY:

Rick, thanks so much for your reporting on this.

RICK:

Thanks, Ruby. Thanks for having me. And look forward to the next one.

[Advertisement]

[Theme music starts]

RUBY:

Elsewhere in the news:

Australians at risk of exposure to Coronavirus in China’s Hubei province are being evacuated by the federal government. Details of the operation are yet to be finalised, but there are more than six hundred Australians registered in Hubei. Evacuees will be taken to Christmas Island, where they’ll be quarantined for two weeks.

And it’s been revealed that the Australian Federal Police obtained six warrants last year in an attempt to try and track down journalist’s sources. The AFP also accessed the metadata of those journalists 20 times. It hasn’t been revealed which journalist’s phones were targeted, or why the AFP wanted the information.

New episodes of 7am are released every weekday. Subscribe in your favourite podcast app to make sure you don’t miss out.

I’m Ruby Jones, see you tomorrow.

[Theme music ends]