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Snouts so far in the trough

11/27/2019

I attended an Annual General Meeting earlier this week of a charitable board that I am on. It was a good, very formal meeting where we went through achievements this year and racked our brains on how to ensure the long term sustainability of the service in an environment of a chasm between best practice service provision and unsatisfactory government contracts, and a tired and increasingly more cynical giving market. We then headed off to lunch which we, as individuals, paid for.

So, you can imagine the head scratching I have had with the recent news of the Hepatitis Foundation. Check out the story here, but the upshot is they have been investigated for some expenditures, hundreds of thousands of dollars of those charitable dollars on travel and entertainment.

The ex CEO of the charity has just been on the radio talking about issues with the board where he was basically told to mind his own business. He talked of salaries to the board members, international junkets and top flight board dinners. Direct quote: I think some people just had their snouts so far in the trough they couldn't see the daylight. This is a truely wonderful sentence!

There are a couple of things with this.

A complaint was made to Charities Services by a member of the public. While I don’t know, I would suspect that that complaint may well have come from the ex CEO. This is because no-one has any incentive to look in depth at the financials of this organisation: it’s 100% funded by the taxpayer under (I assume) a Ministry of Health services agreement.
The investigation has taken two years to complete, and then was not published at the time as the regulator believed the charity would take some action. The report has been made public thanks to an OIA, four years after the member of the public raised the complaint, and goodness knows how many taxpayer dollars spent investigating.
There has been no change to the Board. Indeed, the same board has been in place since 2011 (as at 27 November 2019 – this could well change). I would have expected someone to take the hit acknowledge a mea culpa and stand down. Once again, my expectations are not met.

There is also another interesting snippet in the financial reports, one that has not been covered by the media yet. This is a screen shot of page 19 of the 2019 financial statement. Yes, you are reading this correctly. The charity has stated they have 2 Full Time Equivalents, paid an annual amount in 2019 of $452,537. That’s $226k per annum per FTE. I acknowledge that this is over several staff and governance: the accounts define key management personnel as Board of Trustees, the Chief Executive Officer, the Nurse Manager and the Financial Controller, however they themselves have identified the effort as 2 FTEs. It’s a bit difficult to understand what’s actually achieved by the charity as no statement of service provision is provided: whilst most do give this information these days: operations get more transparent in 2021 when all charities will need to provide this data. Often its hard to separate the good work that a charity does from the money spent doing it, which is where the service provision statement helps.

Now, I don’t know how those salaries sit with other health NGOs. I do know that a salary like this in most third sector organisations would be … unusual.

There is no acknowledgement that the taxpayer is actually a stakeholder here. The charity is 100% government funded. I know that I have been arguing for 100% government funding for more charities, but if this level of what I perceive to be largesse is a consequence, then perhaps not. After all, its taken a number of years for the Charities Services to review the organisation, and the result of that review was a report which had no real consequences for the charity.

I suspect the whistle blower on this is a bit peeved given the lack of consequence given the hit over the wrist with a limp bus ticket response from the regulator. Organisations who benefit from public monies and an accommodating legal structure to achieve their charitable purpose do have to be open and transparent. It should not take two years to look at an organisation to see if its acting in accordance with the spirit of the law.

There is also considerable onus with the organisation providing the funds: the Ministry of Health. They are about to write a letter to the charity to express their “concern and disappointment”. Four years after the complaint was made. I also hope other charities don’t shrug their shoulders and wonder what they could get away with. I also hope our donors don’t shrug their shoulders and view all charities through this lens of entitlement.

If I were in charge, I’d look to beef up the investigations of charities. We need a bigger, faster stick. We need to support members of the public who see things happening in the communities that are a bit whiffy and enable them to do something about it. We need to keep an eye on things like costs both within organsiations and across different ones: benchmarking perhaps. I’d ensure that those funding organisations under review were part of that process.

But what can WE do as citizens? I have written before about a need for vigilant eyes. And what I wrote then still stands: its good to be more curious about the organisations that serve our communities. Its good to understand how and why they operate, separate the spin from reality, and how money spent in the name of community is spent. In the meantime, our Board will continue to do the right thing, and look to make our wee piece of the world a better place, following principles and values of integrity, trust and compassion.

I write about this stuff as I believe that as need to understand where funding comes from, where it goes, and how it gets there. As a citizenry we allow both those supplying money and those asking for money to operate, and as a community we need to ensure we have oversight over the organisations they choose to fund. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more then happy to do so. Check out my website http://www.delfi.co.nz/

Apologies to the swine for the photo. A much maligned animal.

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Rata Update 2019

10/21/2019

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One of the things I like to do is sit on the couch and cut and classify data from various funders. I know, it’s weird. But I’m a bit fascinated by the dynamics of grant funding, power imbalances and how decisions are made. Indeed, I have seen this as both a grant maker and a third sector organisation (TSO) seeking funding and reckon there’s a wealth of unexamined stuff that happen here.

I last had a good look at Rata a good eighteen months ago. What I found there was some increases in the amounts given, to fewer groups. I had noted a change of Trustees given the change of government (Trustees are appointed by the Minister of Finance) and wondered if there would be material changes in where the money goes. Since then, we have had two more funding years published, so I’ve taken a deep breath and jumped on in. I’ve found a few pretty interesting things:

Top of the South (Nelson and Marlborough regions) got 30% of 2019 grants, whilst having 23% of the population
Rugby is still the number one sport getting funding from Rata.
They are giving fewer, bigger grants.
The cost per grant has shot up by over $1500. This is driven by both rising costs and fewer grants.

Now, there are a couple of health checks on this. Firstly, they have introduced multi-region funding. Now this is a grand idea as it means that organisations who service the whole area, Canterbury, Marlborough and Nelson don’t need to faff around figuring out how much to apply for in each region. However, for me, who has decided to look at how the grants are allocated within region, it does complicate things a bit. So I have applied a wee calculation based on 2018 census data. Secondly, it looks like in 2018 they re-introduced multi-year funding. What I did was simply divide the amount by the number of years of funding (generally 3). A twist on this is that the 2019 grants have not actually been published in the same form as before (although it is stated in the financial statements that they are – oversight perhaps?). They have been included within the 2019 financial accounts however. But I have found that key information, such as whether or not the grant is a multi year one, isn’t actually there! So I have eyeballed each large amount and, based on history, tried to determine whether or not its multi year (2019 – 2021).

They have also changed the way their grants work into several different buckets: Support, Connect etc. This doesn’t actually tell us much: indeed the bucket any particular group is allocated to can vary year by year. So I have used their old classifications although of course with some of my own bias in classification.

Another wee quirk is the use of “Special Funds”. After the quakes the Foundation put aside a wedge of capital - $25m – to help with Canterbury recovery (although Top of the South did receive about 20% of this money). Similarly after the Kaikoura earthquakes, around $1.2m was allocated to recovery. For the sake of analysis these funds are excluded from the following numbers.

So this is a wee line which shows where the money is going. Top of the South getting a bit more than before. Looking at 2019 allocations, these regions got around 30% of the available money, despite having around 23% of the population (2018 census). I find this a little surprising: bigger cities tend to attract a bit more challenge in terms of social issues so I would have thought more funding would be directed to Canterbury. Although when I looked at where Trustees came from it made a bit more sense: those 2019 Trustees were 50% Canterbury based and 50% top of the south! And this will be something to keep an eye on this year as two Canterbury based ones have now gone, replaced by another Nelson based chap and a Cantab.

The next question is where the money went. Answer: the usual suspects. I was surprised again to see this: as any reader of mine knows, there are plenty for places for sports to get grants. Indeed, rugby has its own pokie! Community and Economic has grown a bit. I have tagged all the money given over to capacity building here: it’s the latest and greatest for grant makers to throw money at (although, as one lovely chap running a really innovative TSO told me the other day, I don’t need some kid coming in and telling me how to run my organisation!). We also have a couple of large chunks to one or two capital projects.

Sport has seen a jump in 2017 and 2018 with a fall again in 2019. Organisers of Sport, such as Sport Canterbury or Sport Tasman, have received the most at $437k. As far as codes go, rugby got the biggest chunk in the 2019 year totalling almost $400k, driven by a big $200k grant to the New Brighton Rugby Club (presumably capex). Cricket was second getting just shy of $250k, tennis received $221k, and basketball $203k.

Environment had a big jump in 2019 due to $1m going to a stoat eradication project on D’urville Island. Health and Wellbeing too has fluctuated, namely due to a couple of large capital donations in 2018. A few organisations who always did receive funding no longer do: as Rata doesn’t publish declines I don’t know whether they didn’t ask or they were turned down. Interestingly Social Services has dropped a bit too, from 15% of funds five years ago to 12% these days. While social services do have the highest average grant ($30k rather than the average of $22k) the actual quantum given has dropped by around $500k.

The trend I noticed previously has continued: namely the average amount of a grant increasing. This is up from an average grant of $15k in 2014 to $22k in 2019. The number of grants too has reduced, from 1240 in 2014 down to 841 in 2019. And this last figure is overstated what with my fudge for multi-regions.

The last question is how much it costs to get a dollar into the community. If we look at a simple figure of the staff costs divided by the total grants given, it now costs 9 cents for Rata to get $1 into the community. This is up from 6.4 cents in 2014. This is driven by staff costs increasing around 50% over this time period, which is rather interesting, especially given fewer grants are being made now. We can put this another way: looking at total costs, in 2014 the cost per grant was $2262, in 2019 this rose to $3962. Now we could argue that better decisions are being made: of course there is (at this stage) no way to measure this. However, the irony is not lost on me: sure as eggs if a TSO’s costs had risen so much you can be sure the funder would be asking some questions.

Then of course there is the other side: the time and cost for an organisation applying for a grant. Anecdotally I have heard some pretty outrageous numbers on this. The challenge is that Rata is the biggest funder in the area, putting around 30% of total grants into the region. The power imbalance is out of whack. Media publishes its good news stories (although there has only been one press release this financial year), academia isn’t interested in the ecosystem (I’ve asked!), government perhaps sees organisations such as Rata as a way create a diversion from actually funding TSO provided services sufficiently, and TSOs are obliged to fawn and laugh at all the funder’s jokes in order to keep a relationship, while privately grumbling. This organisation was set up for citizens of the area covered by the old Canterbury Savings Bank, and as such, us citizens do need to give a rats. Power corrupts after all, and, as The Tuesday Club weekly emails say (stolen themselves from The Washington Post), Democracy dies in darkness.

I write about this stuff as believe that as need to understand where funding comes from, where it goes, and how it gets there. As a citizenry we allow both those supplying money and those asking for money to operate, and as a community we need to ensure we have oversight over the organisations they choose to fund. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more than happy to do so. Check out my website http://www.delfi.co.nz/

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Cutting the Apron Strings

9/12/2019

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Early September there was a bit of media flurry with the announcement by Sport NZ, NZ Cricket, NZ Football, Hockey NZ, Netball NZ and NZ Rugby of a shake-up for youth sport. It stated:
Individually and collectively we commit to:

Ensuring all young people who play our sports receive a quality experience, irrespective of the level at which they compete.
Leading attitudinal and behavioural change among the sport leaders, coaches, administrators, parents and caregivers involved in youth sport.
Providing leadership to our sports in support of changes to competition structures and player development opportunities.
Working with our sports and schools to keep minds open while identifying talent throughout the teen years, including reviewing the role and nature of national and regional representative tournaments to ensure that skill development opportunities are offered to more young people.
Supporting young people to play multiple sports.
Raising awareness of the risks of overtraining and overloading.

The six organisations have also announced that they will be launching an integrated marketing campaign early next year, targeted at youth sport influencers such as parents, caregivers, coaches and administrators, to further raise awareness of the issues and help drive positive change.

Now, as the parent of 3 young girls who enjoy sport but not stars by any stretch (they don’t read my blog either) I am really pleased by this. The ages they are now are the ages they are likely to quit. My own love of netball was rudely halted when I didn’t make the Otatara Primary Standard Four netball squad. As a family, we have talked around the dinner table about all the amazing opportunities there are out there are for young people: sporting, cultural, academic and community, and how now is the time to sample stuff and find out what they like. But we also are guilty of extensive post-match analyses of the weekly footie game: when husband is the coach it’s hard not to.

When we think about the strategy it’s interesting to consider how these great objectives will be put into action. A marketing campaign is supposedly the answer. So we will see a bunch of famous sports stars talking fair play, playing for fun, supported by cute gifs and various pieces on social to help us ancients change our attitudes to winning, talent pathways and playing cool about winning and losing.

While I did a marketing degree way back when, I’m not convinced that this is enough to change the way we think. Let’s reflect on WHO is on these sports bodies and sports clubs. Generally a bunch of people who love playing the game. Over the last few years we have seen a rise in academies, intensive training and the like. This meets a market demand (parents and kids who want to excel at a given sport) and a market supply (people who love the sport and want to be paid for providing a service). Those then left behind, who perhaps haven’t the skills, the desire, the transport or the time can then get turned off. Or they just want to play with their mates, but when that doesn’t happen they quit.

We then have a grant ecosystem awash with money to spend on getting kids into sport. Each year in Canterbury alone Sport gets around $20m in grants from community funders and gaming trusts. Scale that up nationally then that’s $200m. In Canterbury the five specific codes mentioned received $22m in the three years 2015 – 2017. And of course some of that is good spend: for shiny new facilities which probably encourage people to get into and stay moving. But a significant amount will go on programmes which actually work against the strategic intent of the five codes.

So if I were in charge I would look to the grant making community for their support of the strategy, and provide the stick to the carrot of marketing. Cut off the money and change would happen. Sport NZ, or the local body (such as Sport Canterbury – or they could get a contractor in to do it (hint)), could run the ruler over the various clubs, see whether their programmes stacked up, and give them a tick (or not). There would be howls from the clubs as their staff wages were no longer funded, but imho this community money is not about jobs for the boys (or girls), or cheap drinks at the bar: it’s about making our communities better places. That grant money could then be used elsewhere rather than on activities that governing bodies – and communities – are no longer that keen on.

This could at least put some of the brakes on some of the thing happening within the club environment, and the spiral of spend that some seem to be in: spirals that many parents are not that happy about, but, given our relative antipathy about the whole palaver, don’t do much about except moan over our flat whites.

I write about this stuff as believe that as need to understand where funding comes from, where it goes, and how it gets there. Third Sector organisations are perfectly entitled to ask for money from grant makers. As a citizenry we allow both those supplying money and those asking for money to operate, and as a community we need to ensure we have oversight over the organisations they choose to fund. I reckon it’s a more informed conversation when we know more. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more than happy to do so. Check out my website http://www.delfi.co.nz/

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Air Rescue and Community Services Part Deux

8/13/2019

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US Poet James Whitcomb Riley may have coined the phrase “When I see a bird that walks like a duck and swims like a duck and quacks like a duck, I call that bird a duck. This phrase, according to Wikipedia, has been used to describe communists, terrorists, a health insurer and Fidel Castro. I first heard it on Beverley 90210.

That phrase has come to mind as I have been buried in the data on this gaming trust. There are, I reckon, some decisions which look, and quack, like ducks. But what species?

In my last blog I looked at where the Air Rescue and Community Service grants went at a macro level. I found a few things out about where their money goes, and the regions it comes from. You can read that here, but the snapshot is that in 2018 total grants had increased to just over $11m (up from $8.7m in the previous year), due in part to the switching of venues in Wellington region to this gaming trust. Over half of that money went to organisations within their “Authorised Purpose”, the Canterbury West Coast Rescue Helicopter (their only shareholder), and now the NZ Flying Doctors service (both owned by the same limited liability company).

Just as a reminder, in italics is the Authorised Purpose of this organisation. The second paragraph is pretty generalist, which is marvellous.

To assist in the provision and development of rescue and medical equipment operated by the Canterbury West Coast Air Rescue Trust. Includes, but not limited to, the provision of winch training and helicopter expenses.
also,
Donations to bona fide charitable, educational, sport, cultural and community organisations within the local community. Excludes payments to professional sports people

Sport gets an awful lot of the funds from this gaming trust. In 2018, there were seven Third Sector Organisations (TSOs) who received over $100k from this grant maker.

Canterbury Regional Basketball Foundation requested $274k, got $185k from 11 applications, 2 of which were declined
Cashmere Technical Requested $230k, received $149k from 6 applications, one of which was declined
Mainland Football Requested $284k, received $129k, from 10 applications, 2 declined
Ole Academy Requested 146k, received $123k, from 14 applications (3 of which were declined)
Ferrymead Bays Requested $128k received $117k, from 12 applications, 1 declined
Coastal Spirit Requested $152k, received $107k, from 6 successful applications
Theatre Royal Requested $377k, received $100k from 2 applications, one of which was successful.

Let’s have a look at this. In the list we have two sports organisers, Mainland Football and the Basketball Foundation, and four sports clubs. Why so much for the clubs? I get it. They are popular sports. But why the money? Is it player payments? Who knows. Annoyingly, the three clubs I looked at did not explain in any detail how this grant money was applied in their financials. Gaming trusts funds are not supposed to be used for professional sports fees according to the DIA – and of course it's excluded within the authorised purposes of this grant maker. However, how do we know how the money is actually applied?

I have looked at the club financials on the Societies and Charities office website and wrote a fair bit of pretty boring stuff on this, which I’ve now cut. Suffice to say:
·         Grants go to things like Admin, coaching and training, playing strip and tournaments
·         There are a number of people employed by some clubs.
·         Grants are given year round
·         Costs tend to be higher for adults

Now, how clubs run themselves is up to the members. But the narrative we, the community, are sold, that these pokie funds are used to support kids to play sport. That assertion is not really supported by the numbers.

You may think this money is great, and the benefits to our community are enormous. Look at the successes internationally of our sports teams. Our juniors are getting more and more competitive on the world stage. That needs money. Much of this money (from my observations of my own club) goes to help our talented players pay their rent. Fair enough. However, the outcome will be that other clubs look to increase their cost base as well, which then leads to more pressure on grant money, and so the ecosystem evolves.

You could also be thinking so what. Surely its up the venues where the machines are located to determine where their funds go to. Actually no. In the rules set out by the DIA about how money is allocated:

Formerly 'Sites', these are the pubs and other venues where gaming machines are located. They do not own the machines and must not be involved in decisions about who can apply for grants, who receives them or how much the grant should be.

We rely on the process and the rules that there is no undue influence from the venues – although I can’t help but wonder WHY those four Wellington venues decided to move to this gaming trust. Over half of the proceeds from those machines will end up with the Canterbury West Coast Rescue Helicopter, which is great for us Cantabs, and possibly those Wellingtonians driving round the South Island. 38% of the money staying in Wellington goes to football. 11% to rugby and 9% to golf. It would be interesting to understand the value proposition of one gaming trust over another to venues.

What gets me about this is the lack of transparency in the process. We have a group on the net proceeds committee allocating $6m to one charity with limited transparency, and then determining how an additional $5m of community funding is allocated, making fairly crucial judgements about what we, as a community value. They have placed the needs of four regional football teams over other TSOs that were declined, who had grant requests reduced, or who didn’t even bother applying. You will have your own view of the species of duck you see.

Solutions? Perhaps the funds should instead go to the sport organising body who can distribute it evenly. Perhaps the community could be required to have representative on the resource allocation bodies of these funding groups. Or perhaps we just suck it up as a cost of doing better in a sport on the world stage. If we do ignore it, the outcome then will be more money going to football each year as clubs seek to compete on an equal footing– and indeed I have just cut in the Jan – June 2019 data and am seeing a 33% increase in money going into football between the same period 2018 and 2019. And lets not forget we could equally ask questions about other groups receiving this money: Miramar Golf Club for example, currently negotiating a $31m sale deal and the $240k given to racing in 2018.

I write about this stuff as believe that as need to understand where funding comes from, where it goes, and how it gets there. These organisations are legal. Third Sector organisations are perfectly entitled to ask for money from them. As a citizenry we allow both those supplying money and those asking for money to operate, and as a community we need to ensure we have oversight over the organisations they choose to fund. I reckon it’s a more informed conversation when we know more. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more than happy to do so. Check out my website http://www.delfi.co.nz/

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Air Rescue and Community Services Update

7/17/2019

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I last looked in any detail at the Air Rescue and Community Services grants a year ago as part of my mega update for One Voice, which culminated in a presentation on three years of grant funding (all this one the website). Before that was in October 2017 where I looked at where the money goes… turns out not much has changed. But as a glutton for punishment I still am keen to act as a vigilant eye for the community in analysing where these grant making bodies put their community money. I've also figured out that my work might be more interesting to more people if I look beyond Canterbury in the data, so I'm looking at some different stuff.

Now, once I had updated the spreadsheet there was something which stood out: namely the increase in giving between 2017 and 2018. The chart below looks at three full financial years, and half of the 2019 financial year (they have published data up until 31 December 2018, which is in the June 2019 financial year).

So what’s this showing? Total grants have gone to just over $11m in 2018, up from about $8.7m in 2017. Donations to Air Helicopter have gone up from $4.2m in 2016 to $5.97m in 2018. This is largely driven by the re-registration of NZ Flying Doctor Service in 2018, which was deregistered as a charity by the same trustees in 2014 (and hasn’t had a website update for several years). This organisation, like the Canterbury West Coast Air Rescue Trust, is a related organisation to this gaming trust. The charities themselves are just fundraising bodies who then provide money to Garden City Helicopters who operate both the services. Quite why two charities are required to fund the same commercial organisation to do this is a bit beyond me, and perhaps it relates to how the Government contracts work. But without the transparency (which I have written at length before so won’t bore anyone again) of the underlying operations it’s hard to tell anything.

The other sector to get a bit more is Sport: football amounts have gone up considerably over the past few years, as has basketball. I’ve then looked at WHO received the funding. The average grant is just over $8k (excluding the Air Rescue grants), but in 2018 seven Third Sector Organisations received over $100k from this grant maker. Canterbury Regional Basketball Foundation got $185k, Cashmere Technical $149k, Mainland Football $129k, Ole Academy $123k, Ferrymead Bays $117k, Coastal Spirit $107k, and Theatre Royal $100k. What I have not done is look to see how that money has been applied: it’s not disclosed in this grant maker’s publications. A little head scratching for me is the $77,500 to Manakau Indian Association, which is Auckland based. This grant maker has no Auckland machines.

The total number of successful applicants leapt from 534 in 2017 to 650 in 2018. There is another big change in the data for this gaming trust: geographic spread.

I then went to the DIA website to look at changes in the management of gaming machines. There is lots of information there looking at pubs, location, pokie operator and numbers of machines. The data tells me that in two years the number of machines under this group’s control has increased by an astonishing 46! Over that same time, the national number machines REDUCED by over 860, driven in part by local government policies. This growth has largely come from the Wellington region (four new sites, two each lost by Pelorus and Infinity). So those organisations applying to Infinity or Pelorus could well have been left out in the cold this last year.

There has then been a growth in grants into Wellington: football got around 38% of the Wellington grants given, and rugby 11% and golf just under 10%. Indeed, if we EXCLUDE the Air Rescue grants from analysis, Wellington based organisations received 24% of the grants, with 15% of the machines. Who is missing out? Canterbury and Horowhenua. At least that’s if we assume, as Air Rescue does, that the Air Rescue has benefits over the whole country: however I personally think that, given the business is based in Canterbury, and there are different providers in other parts of the country, I suspect the main beneficiaries are those in Canterbury and the West Coast.

Air Rescue now publish their declines and partial approvals, and reasons for that. So, in the financial year 2018 they gave away $11.1m. They were asked for $21.8m. On the face of it, that a reasonable strike rate… however if we back out the Air Rescue requests and donations (as being a For Purpose Class 4 organisation, they are really set up to fund those organisations) we can see they were asked for $14.2m and gave $5.5m… so just over 38% of money given versus requested. Break this down by sector and it’s a different story: if you are in the Health and Wellbeing game, then that’s a 13% grant to request ratio. Community and Economic Development was pretty good at 41%, and Sport was a 39% ratio. The most common reason for declining, either in full or in part, was due to No Funds Available. No surprise here, but to my mind that means those round the table making those decisions decided other groups were more worthy.

I write about this stuff as believe that as need to understand where funding comes from, where it goes, and how it gets there. These organisations are legal. Third Sector organisations are perfectly entitled to ask for money from them. However, the potential for conflict of interest is reasonably high when we are talking money. As a citizenry we allow both those supplying money and those asking for money to operate, and as a community we need to ensure we have oversight over the organisations they choose to fund. There is an awful lot of spin in this game: a recent piece on Radio NZ talked about how pokies are funding kindies. However, when you look at the data, in 2017 gaming trusts gave $239k to preschools – less than 1% of the total given to all organisations. I reckon it’s a more informed conversation when we know more. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more then happy to do so. Check out my website http://www.delfi.co.nz/

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Looking at the pokies in Canterbury

5/26/2019

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I was working through my list of 18 grant makers into Canterbury the other day, and saw that it was time to look at The Trust Community Trust Foundation.

Now, this proved a bit interesting. As I am sure everyone who applies for money has discovered, TTCF no longer has any machines in Christchurch City. A gander at the DIA’s website shows movements in Class 4 gaming trust affiliation. It looks like in Q3 last year the one venue TTCF did have has moved over to Pub Charity. We also have Trust Aoraki losing a venue last year, to Youthtown, and a wee bit of swapping amongst the larger ones.

So this explains a lot. I had done a bit of a calculation of how much each gaming trust gives to
Canterbury groups (based on my database, over three years 2015 to 2017), and then looked at the number of gaming trusts (publicly available 2018 data from the DIA’s website), and got some interesting numbers.

The three gaming trusts who are “for purpose” Class 4 gaming trusts, Air Rescue and Community Services, and Mainland Foundation, put more than their machine share into the Canterbury region. This of course isn’t surprising, given they are set up to benefit Canterbury Rescue Helicopter and regional rugby.

The third, Youthtown, is a bit of a mental exercise for me too, and in fact something I just twigged to when challenged last week. They have their own gaming trust, which, according to their annual report, in 2017 contributed $6.1m to their national operations. This is not then allocated back down to local operations.

Their authorised purposes are:

Development and operation of Youthtown programmes and facilities
Encouragement and development of amateur youth sport and facilities in established and legally constituted sporting organizations
Financial support for community based organisations that provide direct or indirect benefit to youth

I could fudge a Canterbury contribution based on the percentage of Youthtown gaming machines in Canterbury (which makes Canterbury’s allocation to local operations around 20% of $6.1m = $1.27m), but that seems a little high: in 2017 all funders gave $3.6m to organisations in the Youth sector, so that would then suggest that Youthtown receive around 25% of all Youth funding. Any suggestions gratefully received, but my comment on this is that transparency is fairly low on this one: I had to look fairly hard in the annual accounts to find this stuff out! I also note that the local operation doesn’t get grant support – except for a fairly generous whack of CCC money for a youth festival they help organise.

I can also see that I have a bit of a hole in my data, in that I don’t have anything for Four Winds. Ooops. I thought I could get away with it, but I see their reporting is pretty difficult to analyse, and it won’t be a five minute job! That said, they are fairly small, and their data will not change the narrative that pokies contribute over 50% of grant funding into Canterbury. I’ll fix that up in a bit.
Pub Charity looks interesting: as at the end of 2018 they had 18% of the machines, but in 2017 were only responsible for 9.3% of the gaming trust money into the region. Of course there could be many reasons for this: that they have picked up two venues of competitors (which they have and not lost any), that the machines they manage are not as profitable as the others (and there is no way to check out this hypothesis), that they give more to national causes or that Canterbury money leaks to other regions. I’ll look at these last two when I next review them, which should be sometime in Q4 as their financial year end is 30 September.

So this has proved to not look at TTCT at all – which to be honest won’t actually take that long when I get to it as not much has been approved! I will get to it, but this view of pokie machines, is I think, something just a wee bit different from what I’ve looked at before.

I write about this stuff as believe that as need to understand where funding comes from, where it goes, and how it gets there. These organisations are legal. However the potential for conflict of interest is reasonably high when we are talking money. As a community we allow these organisations to operate, and as a community we need to ensure we have oversight over the organisations they choose to fund. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more then happy to do so. Check out my website http://www.delfi.co.nz/

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Six years of grants from CERT

4/9/2019

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CERT started up in 2011 as a response to the Canterbury earthquakes. The name in fact comes from “Canterbury Earthquake Recovery Trust”. Over time the authorised purposes of the gaming trust have changed, and the organisation grown. From their website:

CERT may make grants for authorised purposes as

any charitable purpose;
any non-commercial purpose that is beneficial to the whole or a section of the community; and
promoting, controlling, and conducting race meetings under the Racing Act 2003, including the payment of stakes.

The above authorised purpose includes, but is not limited to grants for:

recognised appeal funds for the purpose of assisting with the recovery from the Christchurch earthquakes;
general public education;
education scholarships (provided the students are selected in a fair and open manner after public advertising, and are overseen by a recognised educational authority or school board, and provided that they are limited to primary and secondary level);
the promotion of public amenities such as parks or museums;
supporting non-commercial emergency rescue services;
public sports facilities (e.g. a stadium) provided that the facilities are not used primarily for professional sport;
amateur sport; and
ground maintenance for amateur sporting facilities.

Thanks to CERT’s great disclosure, we can look at their funding history funding fairly rapidly after financial year end. I’ve copied their disclosure from their website, put through my top secret categorisation, run some pivot tables and whipped up some charts.

This Gaming Trust is, quite possibly, the simplest grant maker I have ever applied to. The forms are easy, the documentation is pretty simple (although all paper based), and the decisions are made quickly. And they are fairly generous in terms of amounts given, I suspect because those seeking funds still have not quite caught onto the fact they are operating.

Unlike many gaming trusts, they do provide funding for organisations across the range of the Third Sector. However, like most within the gaming trust space the majority goes into Sport – over 50% in all years under review). We can see some good amounts going into education (although, to be fair, that’s often to support sports within school).

So which sports are getting the money? Top five over the last six years are the Usual Suspects: rugby ($1.2m), bowls ($719k), golf ($679k), cricket (548k) and football ($532k). That accounts for just over 50% of the total sports spend of $7.2m.

In 2019 they gave away 427 grants, averaging just under $6,300 each. The biggest single grant went to the Bone Marrow Cancer Trust for $35,741, and the smallest to the National Railway Museum for $425.

However, multiple grants per year do go to the same organisation. The Canterbury Regional Basketball Foundation got 8 grants last year (totalling $66k), and five each to Coringa Golf Club ($42k) and Marist Albion Rugby Club ($56k). The lucky recipients of four grants were Belfast Sports and Community Centre ($52k), Tennis Otago ($13k), Christchurch Football Club ($24k), and Kaiapoi Rugby Football Club ($25.7k). Now, of course, a Gaming Trust doesn’t know how much it has to give away until the numbers are in, which could well explain why multiple grants are made.

Another interesting element is around where the grants go location-wise. Now CERT has machines in Waimakariri, Dunedin and Christchurch City. There are five venues in Christchurch, two venues in Waimakariri, and one venue with 18 machines in Dunedin. Third sector organisations in Christchurch got just over 80% of the money, Waimakariri 10%, and Dunedin snuck in with almost 6% of funding. The heavy Christchurch skew is possibly driven by the fact many Canterbury organisations are based in the city and service the region. However, to be honest Otago looks light.

I have had a gander at those organisations that were declined, as CERT publish who they have declined, and why. Very few Otago group fail to get funding from this organisation. If I were a third sector Dunedin based group looking for support, I’d have a look at this. Another tip: in January this year only one organisation was declined. If I was doing funding applications I do think I’d throw it in the mail just before Christmas – although the amounts given in January can be lighter than in other months.

Now, I was about to post this blog when this story came out. Christchurch Casino has to give $250,000 or 2.5% of net profit (whichever is greater) as their license to operate. I think this suggests that in 2017 they would have given $402k off a net profit of $16.1m (plus another $100k which they have chose to do). In 2018 CERT’s surplus before grants was $2.6m. 2.5% of that profit is just over TEN average grants. Clearly, they give a bit more than this. This is of course mandated by the NZ Government. Now, I’m steering well clear of debates about the morality of gambling, but if I actually enjoyed playing the pokies, then perhaps I’d pick a provider whose profits are directed back into the community.

I write about this stuff as believe that as need to understand where Third Sector funding comes from, where it goes, and how it gets there. This money is gathered to be spent on behalf of the community, but we have little oversight into where it goes. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more then happy to do so. Check out my website http://www.delfi.co.nz/

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Virtue Laundering in 2019

3/5/2019

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Thinking about the Earthquake Symposium

1/30/2019

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Late last year I managed to acquire an invitation to the Government’s Canterbury Earthquake Symposium, which had the goal of sharing the lessons from the Canterbury experiences. Now there is a bunch of controversy about this event (mainly around who got invited), but it’s great that it happened, and great that some speakers who may have been somewhat controversial were heard.

One of the challenges in “lessons learned” is that failures, which we learn the most from, tend to become something else as those lessons move up the chain. I am reminded of The Plan which I recall from my corporate days (when we used to fax jokes to each other) …

But I have a few reflections of my own following the symposium and other things I’ve been thinking about.

One of the biggest points pounded home during the two days was the need to put people at the centre of the recovery. This point was well made by one speaker, who spoke of one family they were helping. There was an issue with plumbing: the neighbour’s pipes would overflow into the family’s section. There were three or four entities who needed to work together to resolve the issue: resolution still pending.

Now, I had the Social Investment Agency’s “Findings of the “Your voice, your data, your say” engagement on Social Wellbeing” document show up in the mail box last month. On page 24 of the report is something that resounds with me: “Putting people at the centre. You support a person-centred approach that puts people at the heart of everything government and providers do”.

So, there is a theme! People at the centre of Business as Usual and at the centre of Disaster Recovery. Who would have thought? But … there are a bunch of barriers in place to what is essentially a common-sense option: namely a system which treats people as policyholders, as patients, as students, as victims, as cases. We have budgets, education systems, careers and entities structured around these specific facets of people. How do we change this? Well, there will be far smarter people than me looking at this, and I am vaguely heartened by the Prime Minister being Minister of Child Poverty Reduction…. And some hope at the Whanau Ora review which puts families at the centre of things. However, at my age I’m getting a bit cynical and suspect that these systemic issues won’t be addressed and my kids will still be dealing with many of the complicated issues around intergenerational poverty.

Back to the symposium. Ryan Reynold’s discussion had a couple of points which struck me as interesting. Firstly, innovation.

Those in Christchurch will undoubtedly recall that Gap Filler was one of the post earthquake groups who made us smile through initiatives like the Pallet Pavilion. They received a lot of media, and a lot of love from locals and of course politicians. Indeed, at the symposium Gap Filler was mentioned many times: if they had $1 for every mention, I reckon that would cover monthly operational costs. And that brings me to funding. They have been told by one funder that Gap Filler’s job is done, so they don’t need to be funded any more. And when I look at my beautiful database I can see funding to post earthquake organisations has dropped by more than a third since 2015. A recent trip to Auckland showed the importance of transitional projects in cities that aren’t completely broken.

JB Were released a report in 2017 called “The New Zealand Cause Report”. This is super interesting, and I would recommend anyone with an interest in the sector to have a gander. The writer looks at Innovation, and summarises “While there have been some large changes in growth rates between different charity sectors over time, there hasn’t been much change in the names of the large organisations dominating the sector suggesting the ability for new and smaller organisations to innovate and grow is limited. Almost 80% of the 40 largest New Zealand charities have existed for over 20 years. This is in contrast to the for-profit sector where dramatic change in ranking order is common, availability of risk capital is higher and the financial rewards for success are greater.” And in the summary the point is rammed home with this comment: “The Facebooks of the charity sector are rare”.

We can see this happening in real time, with the demise of funding support for organisations such as Gap Filler. The funding moves back to the incumbents with decisions made by risk averse committees. But this stifles innovation, and arguably the innovative solutions our communities need. Changing models, such as those by social enterprises, may enable greater innovation, but without decent coherent conjoint meaty funding opportunities (and not endless capacity building programmes!) many are doomed to limp along.

Secondly opportunity.

I had a wee chat with Ryan a bit later. At the time of the earthquakes the founders were footloose. Fast forward 8 years and now there is a mortgage and kids to consider: this organisation probably would not have done what it did if these personal financial obligations had been in place at the time. Again, how can we create an environment where people can take risks, follow passions and be the best they can be… Universal Basic Income perhaps??

The symposium was a worthy attempt to talk about what happened. However, there is still a lot of anger at people and institutions, and clearly many people feel not listened to. Props to those politicians from both sides who listened and heard. However, I think all of us who both experienced the quakes and arrived later have things that we learnt, and would like to share with others. Perhaps a mooted Community event could incorporate something along the lines of “share an idea” to ensure those invisible get a chance to speak.

I write about this stuff as believe that as need to understand where funding comes from, where it goes, and how it gets there. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more then happy to do so. Check out my website www.delfi.co.nz.

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Musings on kids and sport

11/19/2018

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I’ve just come from coffee with the girls. The topic of conversation was kid related: the sports tournaments over the holidays, the upcoming cricket season, and the politics around team selection.

Now, it almost seems a universal truth that, despite code, sports organisations are intent upon ensuring that their sport is the Most Important Thing in the lives of children. We now have certain codes (looking at you football) offering year round programmes. We have some sports requiring practices four or five times a week. We have some codes with high cost development programmes. We have codes, coaches and administrators focused on developing great rugby players / gymnastics / cricketers / ballerinas who just forget that, as parents, we are trying to develop great humans within a family dynamic.

Now, I would hazard a guess that this is just peachy for some kids and some families. Some kids have huge talent, to be amazing at whatever sport takes their fancy. These are the kids who will become Olympians, represent NZ, or be the next Steven Adams. Some parents revel in their child’s success or are That Parent manipulating the team channelling Machiavelli. However, most of us parents want to grow individuals who can charge forward in their own lives as independent adults. Interestingly, I found some 2016 US stats: for those kids playing high school ice hockey they have the best chance at 1:598 chance, the worst chance is for women’s basketball at 1:13,015. Incidentally, the odds of being killed in a car crash were 1:113. So… the chances of actually making an income out of playing sport are fairly low.

Well, why do we do it? Well, there are some great benefits sport offers for kids who are not destined to star in the back pages of the paper. These include things like making friends, learning to win and lose with grace, resilience, persistence, leadership, teamwork and the health benefits. But there are a bunch of other things that we as parents want our kids to do too: talk to any middle class parent and it’s a game of “how busy I am” with after school activities for each child.

Our family had our first ever sports tournament over the holidays for two of our kids as part of a club side. Our objective for going was to have some fun and be competitive. And that’s what was served up in spades. The kids experienced some independence as we stayed at the campground, and they ran wild over the grounds nearby. They came together as a group, showed real heart when they were thumped, and great sportsmanship when they won. We were so proud of our wee team, some of whom have been playing the sport together for six or seven years. And the experience has created some memories of sporting magnificence that will last their lifetime. Glory days indeed.

Playing sports with your mates is a huge motivator for kids. Yet, when kids get to a certain age, the sports codes separate the kids out to build teams that can win. And then they tap a few of those one the shoulder and ask them to join development… Those kids who are tapped are in. They are focused 100% on their sport. But the ones left behind… not so much. They have been told they are not good enough for their mates and are then jumbled in with another bunch of kids. They then believe they are no good. So they leave that sport, hopefully to another sport (which is fine) but more often to nothing.

I see that the NZ government has recently handed out $10m to Sport NZ to help keep girls and young women active. The underlying issues document, which can be found on SNZ website, is pretty on the money. However, the challenge (I think) is getting the right sort of change within codes.

From what I have observed, those employed by the codes tend to love the game they represent. Their boards set targets around numbers and results. Some schools do the same too (and then provide loads of counselling for the kids to deal with the downstream effects of those expectations). As a result, actions are focused on winning. One woman in grants laughingly told me that a code had asked them for funding to get top performing kids from another code into theirs. “No”, she said. And rightly so. However, sure as eggs some other funder said YES.

And our wee sports club has just employed someone as a development officer. He is from the provincial team, and, given the club is a junior one, I assume it’s his role to help do something…. To be honest it’s a bit hard to see what the role is. Perhaps coaching? Now, this is all well and good for the new person as a job has been created which plays to his strengths. However, I doubt its being done for love. So, who pays? We shall see next year when the fees hit, but some clubs which employ people have fees $100 higher per annum than our club with no employees. Or, grants will kick in. And who can say no to support for helping kids get into football. But hang on – those kids are already playing the game! Could it be a jobs for the boys paid for using community money? And the money that’s spent on this role will not be spent saving women from violence, diagnosing children with learning issues, or whoever else misses out on those charitable dollars. And so the NFP ecosystem evolves.

How many jobs are there out there like this? I suspect quite a few, be they employed by clubs, codes, or schools.

So what’s the answer? Chatting with the girls one solution is to start a new family oriented sports club with lots of sports on offer, where the focus goes on the positives. But this is a pipe dream: those who go into governance roles on these sorts of organisations tend to be the aforementioned aficionados. I guess, to me anyway, the answer is to support our little darlings in whatever they want to do, give them opportunities to try new stuff, and try to keep them active despite the systemic challenges that continue to exist. And perhaps walk away from clubs where this is not being fostered.

I write about this stuff as believe that as need to understand where funding comes from, where it goes, and how it gets there. Love to talk with you if you think this is at all interesting, and if you want to dive into the data a bit more then happy to do so. Check out my website www.delfi.co.nz.

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Some musings on things

Snouts so far in the trough

Rata Update 2019

Cutting the Apron Strings

Air Rescue and Community Services Part Deux

Air Rescue and Community Services Update

Looking at the pokies in Canterbury

Six years of grants from CERT

Virtue Laundering in 2019

Thinking about the Earthquake Symposium

Musings on kids and sport

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