Hundreds of Australian charities must be dissolved or merged to stop not-for-profits cannibalising each other in the $105 billion a year industry, the sector’s peak body says.

Community Council for Australia (CCA) chief executive David Crosbie says charities are too often clambering for cash to tackle the same problems, creating unnecessary duplication.

Mr Crosbie said on Tuesday there were well in excess of 60,000 registered charities and 600,000 not-for-profits in Australia.

He said the number of new charities surged 10 per cent between 2011 and 2014 and continued to grow but government funding options had diminished and private donations were drying up.

“The more we compete within the sector, the more it highlights division and erodes public trust,” Mr Crosbie said.

“People want to see charities and not-for-profits working for their communities, not just trying to make the most money they can for their own organisations.”

Mr Crosbie was especially critical of federated charities, saying charitable cash was being wasted on duplicated management roles, infrastructure and back office systems.

He said smaller organisations should also consider drawing on the resources of other larger ones to provide back office and other support.

“This is money and effort that would be much better invested providing services at the coalface,” Mr Crosbie said.

The CCA will host a series of forums later this month to investigate folding scores of charities across the country.

CCA chairman Tim Costello, who chairs World Vision, said NGO’s needed to put self-interest aside to help reform the sector, which has an annual turnover of about $105 billion.

“Rather than playing the victim we need to take charge of our own futures and better collaborate and share,” Reverend Costello said.

“We’re not the charity police and this isn’t about big taking over small. But because we’re so fragmented our strength, voice and impact is being diluted.”

AAP.