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Board Report: March 2016

Hi Everyone,

It is amazing to see the summer weather continuing on, and now it has just gone into May it really is challenging the concept of what our 'summer' season really is, and indeed how long we need to be providing services!

The April Board meeting was held in Wellington on Monday 18th, the first time in many years we have had a midweek meeting.   

From a financial perspective the results for the nine months to 31st March are a Net Operating Surplus of $0.865 million, which is $177,000 ahead of budget.  This positive variance is all due to timing variations and the latest forecast the full year Net Operating Surplus has stayed very similar to last month at $3k (i.e. at a breakeven level).  The full explanation of the variances is in the Financial Summary Dashboard report. 

The forecast is $350k less than budget, driven by the NZLGB grant being $200,000 less than budgeted, a short term sponsorship contract of $100,000 not being renewed and two gaming trust grants being a combined $160,000 less than budgeted, with a few wins along the way offsetting this.  With depreciation being close to $0.5m this year a breakeven Net Operating Surplus result still leaves (after paying for capital expenditure) with a good level of positive cashflow for the year and in line with last year.  We will however need to closely monitor the run-out to the end of the year as there is a lot less 'fat' left to deal with any unexpected events. 

As I noted last month, the targets set for this year were deliberately very aggressive, knowing that we would be starting to see the loss of State Insurance sponsorship income, so the Board is comfortable with the likely outcome for the year.

Looking ahead to 2016/17, there has been a lot of noise in the media about Lotto not generating as much money as in previous years.  With a large amount of our funding coming from the NZ Lottery Grants Board (NZLGB) it is a serious issue and will most likely impact all of us.  The Outdoor Safety Committee of NZLGB will not be able to advise us until the end of September how much money we will receive, which is a month later than normal.  However, as we all have to do our budgeting well before that it will be prudent to anticipate less money - possibly as much as 20%.  This is speculative, but we can be very sure we won't be getting more money than last year and with clear warning signals being given out by the Government and Lotto, we would do well to listen to them.  We will do everything we can to absorb as much of any reduction in NZLGB funding as possible.  However we are unlikely to be able to absorb the full impact of the reduction.   So, if you are doing your budgeting it would be worthwhile factoring in a reduction of up to 20% in the Club Support Payments and the subsidy for insurance dropping from 70% to 50%.  Fingers crossed the final outcome won't be as bad as that.  We will let clubs know the actual figures as soon as we find out in late September.  SLSNZ also has work to do in terms of identifying where any funding cuts will come from our own expenditure.

In terms of the items of note from the meeting:

  • This meeting was the first since our Planning Workshop in February, so we spent quite a bit of time going over the feedback from that session and the revised Strategic Plan.  This is now ready for circulation and is attached to this email and also available on the SLSNZ website.  While we do recognise most clubs don't have a lot of interest in the SLSNZ Strategic Plan, we do welcome any feedback that you may have.  In that context, we would also welcome clubs to send us your Strategic Plans - we have a specific action to look at those to make sure the Strategic Plan for the SLS Movement that we drafted in 2015 is aligned to club individual plans, so the more club plans we get the more robust that process will be.  Please send your plans to our CEO, at paul.dalton@surflifesaving.org.nz
  • Another topic of conversation was around the followup from the 400m Swim Time proposals of last year.  Since the survey of club views was completed last year, the Board has asked the National Lifesaving Committee to look at a broader project around assessing our Lifeguard capability, including what we are doing well, and if there are any areas where we need to be or can be better.  From the 400m swim time discussion we have taken the message that while there may be areas where we can improve lifeguard capability, the 400m swim time alone is probably not the best lever to pull to do that, and a more holistic approach will better suit.  As such, this will start with a feedback process from clubs via Local Lifesaving Committees and other stakeholders to double check our lifeguards continue to be safe and effective now, and in the future.  Following this feedback stage the plan is to use part of the time at the AGM Club Chairs workshop to discuss the findings and any ideas that have come up. There is no agenda behind this and if nothing is broken we won't try to fix it. 
  • Brent Warner updated the Board on Water Safety NZ activities, including their progress in appointing a new CEO and some Board vacancies.  WSNZ also gets its core funding from NZLGB (via Sport NZ) so we were warned it too will be impacted by the Lotto funding reduction in 2016/17 which may then flow back to us in terms of the grant we get to support Beach Education and Surf to School programmes.
  • In looking at Health & Safety, the number of serious injuries to members is running below last year, which is great but it is still premature to draw any conclusions from this until all the incident data has been entered into the PAM system.  A better indication is expected at the end of May.  Once finalised this information will again be shared with clubs, and clubs are encouraged to review their own information from PAM to see what their injury profile has been for the year and if there are actions that can be taken to reduce this next season.  In terms of sport, feedback was noted from the recent Nationals that a small number of clubs did need to review the 'fitness for purpose' of the high visibility vests their athletes are wearing.  This responsibility currently rests with clubs, but will only remain that way if everyone is taking this responsibility seriously.
  • The Board finalised a 'Memorandum of Understanding' between SLSNZ and the soon to be created Surf Life Saving Foundation - setting out the administrative support that SLSNZ will provide the Foundation.  While the workload will be small in the first few years, this is still an important step in the process of bringing the Foundation back to life.
  • The appointment of Moore Stephens Markhams as the new SLSNZ auditors was ratified.  They are taking over from Munro Benge who have done a great job over many years but have recently pulled out of auditing work in Wellington.
  • The Board noted the latest Terms of References for the National Lifesaving Committee and the National Sport Committee (and its sub-committees).  These are two vital groups for the organisation and the Board really appreciates the work these volunteers do.  The NLC Workplan and the Blue Sky Review progress were also noted and underlined how much activity is going on in these areas.
  • Also noted was the process of selecting people to be nominated for the International Lifesaving Federation Commissions, for which a number of positions are available at the General Assembly being held in September. To do this the Board appointed a small panel to review the applications currently being received.
  • The Board also noted progress on the Coastal Public Safety project and was pleased to see the first reports from this are finally getting out to clubs in some parts of the country.  A strong focus remains on getting these reports done as quickly as possible, subject to the funding we have available to do it.

The next Board meeting will be held in Wellington on Sunday 26th June.  So that's it from me - although I will add one reminder - that nominations for National Service Awards on 30th June - please take advantage of these opportunities to reward the longstanding contributors to your clubs and the movement.

So until my next update……

Yours in surf,

Geoff Hamilton
Chairman
Surf Life Saving New Zealand