Some headlines last week have looked at kids in poverty who have been unable to access Saturday sport, almost a rite of a Kiwi childhood. Us parents spend hours driving kids to all parts of the region, encouraging our little darlings in their pursuits.

The press release seems to have been coordinated by Variety NZ. We’ll come back to that.

I reckon grant makers would have been a bit puzzled by reading the article. Grant request after grant request comes in talking the talk about enabling kids from poorer backgrounds with the same sporting opportunities as richer families. So why was this family left out?

The article looked at costs of subs, and found many to be around $150. So why are sports fees so high? I know when my husband ran a footie club we had junior fees pretty low, and there was a waiver if families could not afford it. Let’s face it – there are not a lot of expenses. Rate payers cough up for the grounds, parents are (generally) coaches, so all that’s needed is a bit of equipment and uniforms. And then there is the affiliation fee: that fee paid to the organising code. This overarching body is generally populated by people with a passion for the particular sport, and I reckon (based purely on personal experience) fail to take account that (usually) kids and parents want childhood to be full of many different experiences, be that sport, music, art and play.

I have written previously about football, where I suggested that money rolls up to the elite level. Indeed, our own team were recently asked to sell raffle tickets at $25 / book. The proceeds are going to “Canterbury United (the provincial team largely supported by grants), Women’s and Youth team (again - top level) and member clubs for their own use.” Looking through a few accounts, I see little evidence of “trickle down”: in fact it seems to be simply a player tax for the elite players placed on all players.

Now, I happen to believe that users should pay something: that if you financially commit to something then that provides some certainty that you will in fact show up. But at the end of the day, sport is a hobby, so why should everyone else subsidise the best players to participate in their hobby?

Leeston Rugby Club’s accounts can be found on the Societies office website. These show that the club is fairly small. They don’t get a lot of grants, but don’t really need them. Subs are fairly low as well: $80 for junior players. And in response to the article they stated on their Facebook page that “As a Club we do not turn away any players and we have policies in place to assist with financial issues. We are a Community Club and as such we support the community and all those in it.” Quite frankly, I reckon these guys have been painted unfairly in this article.

Variety is interesting however. Check out their annual accounts. They state that they helped 2,680 kids, and gave away $2.18m – an average then of $813 per child. They earned just over $3m last financial year, spent $1.3m on operating costs, and gave away just over $2m to their beneficiaries. There is no evidence provided that what they do makes a difference to lives of the kids.

I hate to say this, but am feeling a bit discomforted by the poverty porn element to this. Good on them for trying to do something to alleviate poverty in New Zealand. The idea that kids in New Zealand go without stuff goes against the grain. However, there are so many many many organisations set up to help such families. If you want an awesome view at this, check out Dame Diane Robertson’s TedX Chch talk where she presented the findings of the 100 Families programme. The outtake of this study for me was the sheer complexity of service agency relationships for those in poverty. The more I look at this stuff, the more I am not convinced that this organisation will help families break out of the poverty cycle. Families are where kids are raised: enabling the family with the cash and the skills they need to raise successful kids should be the main focus, and this is what I love about the new Social Investment thinking of Government. Fewer charities doing more with stronger relationships is, I dearly hope, a way to break intergenerational poverty and behaviours.

I confess I went into this blog thinking that sport was to blame for not doing what they say they do. However, I think there has been an unfair beat up by Variety to drive donations. And looking at subsequent articles, and the comments, they have achieved success in terms of new kids sponsored. So those donors will now feel they are making a difference, but actually – I think they have been played. 

To answer the question I posed myself: unlike summer holidays at the beach, Saturday sport can still be a rite for Kiwi kids.

Love to talk with you if you think this is at all interesting.
 

Interrupting our family’s viewing of The Bachelor recently were some TV ads for Z Energy’s Good in the Hood.

This is an annual campaign they do whereby four local charities for each service station are profiled and customers get to put their plastic disc into the bucket of the charity that resounds with them.  Each service station has around $4,000 to give away from a total pool of $1m.  You may recall last year I had a look at one of the recipient charities.

I have a bit of discomfort with the whole deal.  It’s really a popularity contest, where those groups with the best “brands” get the most tokens.  Not really taken into account is what the organisation actually will do with the money, nor if they actually need it in the first place.  For some of these charities, $1,000 (assuming each charity gets ¼ of the money) that’s a big help, for others, its hard to see how this makes any difference.

I would love to know how much they are spending marketing this programme: images of the charities are all over their social media and website.  The annual accounts show that Z spent $36m on marketing in the 2017 financial year.  I am guessing that most of this went on other stuff, but it’s interesting to contemplate eh.  How much is spent actually giving and how much is spent telling people about it?  Is this perhaps Virtue Laundering?

That said, they did pay $99m in tax last financial year: probably more than either Mobil or BP did given transfer prices are often used to expatriate income and minimise taxation: I suspect paying the correct amount of local tax does far more Good in the Hood than the programme itself. 

Z of course are not alone here: McDonalds is worth a look. When you buy a Happy Meal, I believe 10 cents is given to the Ronald McDonald Houses.  This is of course Cause Related Marketing, and is really a marketing initiative.  I did my dissertation on this stuff back in the day, so have been looking at it for a while. 

There are two operational charities linked to Ronald McDonald House: a body running both Auckland and Wellington, and Christchurch (which also runs Invercargill). You can see all this information on the Charities Office website.

So – how much did McDonalds put into these facilities?  All up: around $170k ($99k from a Global Grant, and $70k from an RMHC Operating grant) and only to the North Island Ronald McDonald House Charities NZ Trust. 

Now, there is little publicly available information about all this.  South Island received zip from McDonalds, at least as I could see by looking at their accounts quite a few times.  The exception is the item called Money Boxes, which I assume is the change box at McDonalds – but that money comes from customers (I think).

If we assume that both the Global Grant and operating grant were covered by Happy Meals, then McDonalds sold 1.6m such meals last year.  That sounds a little off, so I am guessing that the Happy Meals Cause Related Marketing covered the operating grant (meaning they sold 700k Happy Meals) and the Global Grant came from the PR budget.

The annual reports (as reported in the Herald) show some $40m sent offshore for trademark and service fees, and total NZ taxes of $16.4m. 

Whatever way you cut it, it really does seem to be a good deal for McDonalds. Be interesting to see if some other entity wanted to buy naming rights: I reckon this is a good deal!

We are seeing blurred lines between charities, social enterprises, B Corps and for profit organisations, and it’s easy to get caught up in the hype of corporate responsibility.  As we consumers get more cynical about marketing efforts, organisations seem to be using the virtues of Not for Profits to launder a positive corporate brand to the world.  And that’s great – provided its on equal terms.  However, looking at the above I can’t help but think of a phrase from my drinking days: go hard or go home.  Really… the numbers above are rounding.

Love to talk with you if you think this is at all interesting.

My kid asked for some money the other day for mufti day.  “What’s the cause?” I asked.  “Some cancer thing” was the response. 

At the back of my mind were the articles I looked at in my last blog and the comments which were made on the Stuff website about the sheer number of cancer charities.  “Ah.  Well, let’s find out more shall we?”

The mufti day was for Leukaemia and Blood Cancer NZ.  They are also the ones which do the Shave for the Cure, which seems to very popular as a fundraiser.  I thought it might be interesting to put this charity through the GiveWell criteria – or rather, a more concise and desk top version thereof.  It’s a tricky one: our hearts tell us to do what we can, but what should our heads say?  I believe all information should be easily accessible, transparent and publicly available – and found this one a bit lacking on information.

What does the charity do?
According to their website, they are “the leading organisation in New Zealand dedicated to supporting patients and their families living with leukaemia, lymphoma, myeloma and related blood conditions.”

This sounds encouraging – although I would have thought the local DHB would be the leading organisation to achieve the above vision.  I have looked at their latest 2016 accounts on the Charities office website to see where their costs lie to get an understanding of what they actually do.

1. All up they generate some $6.5m in revenues, coming from various sources such as fundraising, bequests, grants and income from the Bone Marrow registry.  Expenses total some $5.6m, and net assets of $5.3m.
2. The biggest cost (at just over $2.1m in 2016) relates to the Bone Marrow Donor registry, the national register for bone marrow.This lists around 8,000 people who are willing to donate cells to patients worldwide.  The costs seem largely covered by income (I’m assuming) from the DHBs, so stands alone.
3. The second largest cost is Patient Support, which comes in at $1.3m in 2016 ($1.4m in 2015).These I am guessing will be largely staff related costs, who support patients and their families.
4. The third biggest lump of costs is Administration, made up (I think) of 7 FTEs, one CE and six senior managers.  The total cost of the 7 senior managers (as noted on page 14 of the accounts) looks to be just over $700k.
5. The fourth biggest cost is Awareness and Advocacy, at $580k. This is measured by hits and views on various social media platforms.  Part of the purpose of the advocacy is global best practice, working with other cancer NGOs and lobbying.
6. The fifth biggest expense is the costs related to the special events that they conduct to raise funds.
7. The sixth is grants and research, coming in at $139k.In 2015 the number was $184k, which they allocated to 21 recipients for research, travel and summer studentships.

 How cost effective is each programme area?

1. The Bone Marrow Donor registry has around 8,000 people on it who have registered as donors.  There is no data on how many donations are made per year – at least that I could find.  That is a cost of around $260 / donor, which seems ok, but without the data on how many matches are made, well, it’s hard to say this is cost effective.
2. Patient Support. Their Winter 2016 magazine has some metrics around what they did in 2015: 9 staff, 133 education and support groups, 38 family emergency assistance vouchers, ad daily contact with 130 patients or family members. So that’s quantitatively what they do: there is no reporting back on the website as to the quality of those services.
3. Salary costs of senior management are tagged that the roles have been independently sized and remunerated accordingly. Although I’m not sure how this compares with other organisations sector: would a business with revenues of $6m have such a salary bill for senior management?
4. Awareness and Advocacy. No comment
5. Event costs.  If we assume that the money tagged as “fundraising” income relates to events, then every dollar spent on an event raises $4.87.That’s pretty good – although may not include internal staff costs.
6. The average grant is $8,761 per grant.  I assume that the costs of making those grants is boxed into the administration expenses.Given what I have previously looked at with cost of grants (around $4k per grant administratively) this seems not cost effective.

How robust is the evidence behind the programme?
No evidence provided.  They are part of a cross industry group, and do participate in international forums.
How well is each programme implemented?
No evidence provided.
Does the charity need additional funds?
Probably not.  The balance sheet is pretty strong, although both the investments of $1m and term deposit of $264k reflect only about 4 months of operational funding (taking out the operations of the Bone Marrow registry). 
How does this group compare to others doing a similar thing?
Unable to tell as have not looked at any other cancer non profits.

The diagnosis of cancer is dreadful, and one where all affected by that diagnosis, be they family, friends, colleagues or neighbours, want to do something to help.  It’s likely that every family is affected by this scourge.  Indeed, bowel cancer killed my mother, and pancreatic almost got my dad.  But thanks to some great surgeons and world class research, he is still here, a modern medical miracle.  However, rather than shave off my hair, or give money to high profile charities, I think we should think more with our heads: if we want to cure cancer, then perhaps a direct donation to a cancer researcher, such as the Malaghan Centre will provide greater benefit.  Globally, billions and billions of dollars are spent on research every year by governments, pharmaceutical companies and NGOs.  And while we can’t discount those breakthroughs happening locally, we can perhaps afford to be realistic in what we can achieve. 

Furthermore, a charity should show that it is a learning organisation.  I do hope that the new Charities reporting standards will help with this, but given both the tax free status and the high regard society has for many not for profits, I believe it’s incumbent on them to show the good, the bad and the ugly. That means showing not just that they are busy, but that they are efficient, effective, and look to meet their charitable purposes.

But back to the charity.  I have broken down the expenses in the 2016 accounts.  We can see that the bone marrow registry looks after itself, so I have not included that expense.  If I wanted to give my kid $100 for mufti day to cure cancer, only $4 of that money would go to grants and research.  If I wanted it to fund advocacy and awareness, then $16 goes into that, while admin would get $40.  If I wanted it to support those with the cancer, that line of business gets $38.  But there is no evidence about the effectiveness of those programmes: there are plenty of stories, but as a very brainy man once said to me, “the plural of anecdotes is not data”. 

So my poor kid had to raid her own money box for mufti money.  We work hard for our money, and as such, want to make sure that we can achieve the most good we can out of that spend.  And with this organisation, there is not really enough information for me to make that call.

Would love to talk with you if you think this is at all interesting.