Declining participation and ARU plans for the future

[Quick Hands]

The numbers aren't right - or at least haven't been presented in context.

All they did was take the line item in the ARU accounts for "community Rugby" and divide it by the total.

Among other things, this ignores some of the most basic spend - the distribution to the member unions (eg where is the money distributed to the South Australian Rugby Union going if not to grass roots?)

You'll get better analysis on here than that article!

You know more about this stuff than most of us (certainaly more than I do).

From the ARU 2015 report:

Community Rugby: 2,368,000
Allocations to Member Unions 3,294,000

Let's assume for the sake of it that all of the allocations to member unions went to grass roots (unlikely, but let's put it in the most favourable light possible).

That's 5,662,000 - so something just over 5%.

Is this a reasonably accurate number?

Also couldn't help but notice a couple of things in the "participation" section on page 24.

Playing numbers in 15 a side rugby fell by 7.6%.

Playing numbers in club 7 a side grew by 8.1% (although if my experience is typical, then this is just double counting) e.g. Manly JRU ran club 7s at the start of the season in 10s-14s - all players involved also played club 15s for MJRU clubs.

***The ARU even acknowledges that it double and triple counts players on page 25***

Also interesting that the ARU has redefined participation into different categories and now talks of "rugby experiences".

https://issuu.com/australianrugbyunion/docs/aru_web?e=24291087/34741796

 

[Quick Hands]

The figures are correct but you ignore the differences. What does the WRU spend on wages? I'd best less than the $30M+ that the ARU does.

As the Welsh have a terrible record against Aus and no major trophies to show for it, clearly their system is not better than Aus.

Most importantly, their grassroots investment was based on a surplus.

When have the ARU had money left over and not invested it in the grassroots?

Or to look at it from a practical POV, how many financial years where you could pay your mortgage have you invested money in the stock market in hope of good future returns to expand you income base?

My household runs on a surplus.

I wouldn't invest in the stock market with your money let alone mine

The ARU could try the surplus strategy - I can recommend it.

 

[Train Without a Station]

Where are we cutting expenditure QH?

The ARU spread pays less per employee than other major codes she employees much less people. There has also been media criticisms of the jobs cuts made to reduce expenditure.

Super Rugby teams barely break even with current grants.

People complain that not enough is spent on grass roots.

Where exactly are we carving out cash to achieve this surplus?

 

[Quick Hands]

Or to put in another way. How long can we keep running at a loss?

Something has to give somewhere. We can't keep running at a loss indefinitely can we?

Pulver has actually done a good job cutting expenditure.

 

[Train Without a Station]

I don't agree with your comment.

But you ignore my comment you are responding to. Where are you cutting expenditure?

Head office is about as lean as it can be to function in any meaningful way.

Super Rugby teams are barely breaking even and we struggle to retain the best talent.

So unless we want to compromise the very little that we still have that leaves one spot...

The same place you complain about not enough being spent.

There are fixed expenses to maintain revenue. Grassroots is not one of those.

Grassroots is future investment. It's the best place a code can invest for the future but as I was getting to with my earlier analogy, you look after the present before you invest for the future.

I can guarantee if your income did not cover your mortgage for any reason, would would be throwing some of your income into future investments.

 

[Train Without a Station]

Sorry. DO agree I mean.

 

[Lindommer]

You're an argumentative bugger at the best of times, TWaS, but arguing with yourself really does take disagreement to another level.

 

[NTT]

The figures are correct but you ignore the differences. What does the WRU spend on wages? I'd best less than the $30M+ that the ARU does.

As the Welsh have a terrible record against Aus and no major trophies to show for it, clearly their system is not better than Aus.

Most importantly, their grassroots investment was based on a surplus.

When have the ARU had money left over and not invested it in the grassroots?

Or to look at it from a practical POV, how many financial years where you could pay your mortgage have you invested money in the stock market in hope of good future returns to expand you income base?

Either way we are still spending double the % of money on administration than the Welsh are to win the same amount of trophies. Based on that established logic, neither system is working yet one system is running the administration and investing more than 4 times the other in better ways.

 

[Strewthcobber]

Community Rugby: 2,368,000
Allocations to Member Unions 3,294,000

Let's assume for the sake of it that all of the allocations to member unions went to grass roots (unlikely, but let's put it in the most favourable light possible).

That's 5,662,000 - so something just over 5%.

The participation stuff is indeed a joke. I wish they still publish the senior Male player etc stats like they did prior to 2014. They have the stats.

The obvious excuse is that everybody else does it too, and funding is based on participation so we jump in the double/triple count train.

As for the $$$. We aren't comparing apples for apples with these, or at least we have no idea if we are or not.

Should age group rep teams and other high performance teams like the women's xv and junior gold cup be part of this spend?

Should the manager - indigenous rugby's salary be part of Corporate or community Rugby?

How do you categorise the playing and participation fees of which the ARU facilitates collection, but only appear in the state union accounts

Etc etc

There's hundreds of the accounting questions to be answered for each country to make sure it's a fair comparison, otherwise it's meaningless

 

[Dave Beat]

Where are we cutting expenditure QH?

The ARU spread pays less per employee than other major codes she employees much less people. There has also been media criticisms of the jobs cuts made to reduce expenditure.

Super Rugby teams barely break even with current grants.

People complain that not enough is spent on grass roots.

Where exactly are we carving out cash to achieve this surplus?

ARU takes a clip from grass roots registration. Invest in grass roots, grow the game, increases the turnover, and in the grass roots space the COGS are less given volunteers.

Done well could also increase the supporter base, and their spend.

Alot of upside.

 

[Dave Beat]

Grassroots is future investment. It's the best place a code can invest for the future but as I was getting to with my earlier analogy, you look after the present before you invest for the future.
.

Grass roots is current investment.

And with that future players.

Take your eye off it our game will fall appart.

 

[Quick Hands]

The participation stuff is indeed a joke. I wish they still publish the senior Male player etc stats like they did prior to 2014. They have the stats.

The obvious excuse is that everybody else does it too, and funding is based on participation so we jump in the double/triple count train.

As for the $$$. We aren't comparing apples for apples with these, or at least we have no idea if we are or not.

Should age group rep teams and other high performance teams like the women's xv and junior gold cup be part of this spend?

Should the manager - indigenous rugby's salary be part of Corporate or community Rugby?

How do you categorise the playing and participation fees of which the ARU facilitates collection, but only appear in the state union accounts

Etc etc

There's hundreds of the accounting questions to be answered for each country to make sure it's a fair comparison, otherwise it's meaningless

One thing that I would like is to explain what the "corporate" expenditure is. It's hard to know if it's justified or not because it's such an all encompassing term for the second highest item in their expenditure.

 

[Quick Hands]

Grassroots is future investment. It's the best place a code can invest for the future but as I was getting to with my earlier analogy, you look after the present before you invest for the future.

I can guarantee if your income did not cover your mortgage for any reason, would would be throwing some of your income into future investments.

This is where we differ. You say that grass roots is an investment in the game, I say that it IS the game.

If we're on housing, a better analogy would be; you can buy all sorts of expensive furniture and lavishly decorate the inside and outside of your house - which is all wonderful, but if the foundations aren't sound then the house will fall down.

 

[Strewthcobber]

This is where we differ. You say that grass roots is an investment in the game, I say that it IS the game.

If we're on housing, a better analogy would be; you can buy all sorts of expensive furniture and lavishly decorate the inside and outside of your house - which is all wonderful, but if the foundations aren't sound then the house will fall down.

Nah QH, he is saying spending on grass roots is the investment.

After all, development officers aren't the game of rugby. But they are effictively what grass roots spending means

 

[barbarian]

One thing that I would like is to explain what the "corporate" expenditure is. It's hard to know if it's justified or not because it's such an all encompassing term for the second highest item in their expenditure.

Agree with this. It's in the ARU's interest to be a bit more specific, and at least flesh out what is included in that category. Because blokes like Brett Papworth look at that and assume the whole $17m is just spent on head office salaries, which I am sure is not the case.

I wonder how much they are spendiing on rent in St Leonards too, and how much they will save when they move to Moore Park.
.

 

[wamberal]

All the posts about the importance of the grass roots are kind of true. Without the grass roots there is no game.


Unfortunately, by definition, the grass roots must grow naturally. Yes, a bit of manure helps, but only marginally.


There is SFA the ARU can do to make people like the game. You either like it, and want to support it, and encourage and enable your kids to play it, or you don't. If enough people do like it and are prepared to work for it, the game will survive in this country. Just.


As I have said elsewhere there is a gap between what most people want in a game of "football" and what our game offers.


Soccer, the AFL and the NRL seem to tick far more boxes than our game does.


And the gap will widen, that is just the way it is. There is no magic bullet. I have been around long enough to see the game in its darkest days (and they were a lot darker than they are now), but even then rugby union was the winter sport of choice in all the GPS, CHS, CAS, schools, and there was nothing in second place. (Talking about NSW, by the way, but I assume that QLD was similar).

Now its not. The only apparent advantage our game has - the international factor - is wearing thin. So are the attractions of a ten month season. We are going back to the well far too often and for increasingly smaller returns. I wonder how the Eden Park Test will rate?

 

[NTT]

Regardless of how people try to spin the figures, the fact no one is disputing is that is costs a higher % of expenditure to run the ARU which is $100million a year business than its does to run the AFL or ARL, which are $250 million plus a year businesses.

For every $100 the ARU spends $20 goes on administration costs and wages.
For every $100 the AFL spend $10 goes on administration and wages.

This just doesn't add up to a competitive business model. If others can do it cheaper, why can't we?

 

[wamberal]

There is such a thing as "economies of scale".


If you are running a one man business out of your living room, guess what percentage of your overheads your salary is?


Close to 100%


That is an extreme example, but the point is valid. There is an essential core of management expense for a major sporting code like ours, or like the other two.


If our revenues increased overnight, because a few more major sponsors jumped on board, and spectator numbers increased, our management expenses would not increase in quantum, but of course they would be reduced as a percentage of revenue.


Another factor might be that our administration costs might include items that are not included in the other two. For example, the costs of coaching and paying our national team. The costs of supporting the struggling Soup franchises. And no doubt there are others.


The point is, no sweeping generalisations can be drawn that are at all meaningful. A lot more expertise and access to the books would be required to produce any kind of valuable analysis.

And it would probably be the job of a highly skilled forensic accountant!

 

[barbarian]

But you're not comparing apples with apples. The ARU own and run the biggest team in the sport - the Wallabies. The NRL and AFL have no such issues, they just oversee major competitions.

That's why the cost is so much greater.

I'm not saying the ARU shouldn't try and minimise these costs as much as humanly possible, and agree the grassroots needs to see more. But comparing them to the NRL and AFL isn't really fair.
.

 

[dru]

The numbers aren't right - or at least haven't been presented in context.

All they did was take the line item in the ARU accounts for "community Rugby" and divide it by the total.

Among other things, this ignores some of the most basic spend - the distribution to the member unions (eg where is the money distributed to the South Australian Rugby Union going if not to grass roots?)

You'll get better analysis on here than that article!

Yep. Utter (and probably deliberate) nonsense.