For those of you that just want the headline ...... the proposed capitation fee for 2016 is £14.50
After you've finished harrumphing and spluttering into your beer, you may want to read my report to the AGM, below, which explains how each budget line is calculated. You will also find details of how the Governance Review will affect the budget, assuming the recommendations are approved.
2016 Budget Report
Apparently there has been some criticism of my budget presentation at the AGM, particularly the capitation calculation, which is of course simply the budgeted expenditure divided by the estimated number of members who pay their subs (rounded to the nearest 50p). Some members think this implies there is little thought put to the budget, however I can assure you that each budget line has been considered, adjusted where necessary for known spending plans, either up or down, and agreed by the National Board and Council. This report therefore details how each figure has been arrived at.
As the new governance proposals will have an effect on the budget, I have taken the unusual step of preparing two budgets. Version 1 reflects the new arrangements, and is the budget I am proposing to the AGM. Version 2 represents the existing governance, which I would suggest is adopted should the AGM vote against the new governance model.
Where there is a difference, I have indicated this it in the notes below.
- Administration (Marchesi House) - no change from 2015
This budget reflects the contract we have with Round Table, which is based on 16 hours per week. It is renewed annually, with a CPI increase based on the previous November’s rate (as published by ONS). The contract is monitored by the National Secretary, and measured against a set of KPI’s which are agreed between him and Cait Allen Chief Executive RTBI.
- Printing & Stationery – no change from 2015
This has decreased significantly over recent years, but there remains a very few number of clubs who have no means of electronic communication. This budget also covers occasional printing / photocopying charges for Board and Council meetings
- IT systems – £3k reduction from 2015
This covers maintenance of CAS, the new website, Office 365 (used by Board / Council), domain name registrations, cloud storage, backups and our mass emailing system. The reduction reflects a proposed cut down version of Office 365 and other small savings. Note that this budget does not cover any capital expenditure on major IT projects.
- AGM Costs - £2k reduction from 2015
This is the cost of running the AGM, including venue hire, AV requirements where not provided by the venue, printing of order papers and in the past any theming costs (fireworks / decoration etc). The latter I have stripped out from the AGM budget, these will be charged direct to the Presidents expenses, as they are not necessary to run the Association. The choice of venue can give a large fluctuation in the actual cost, and at the time of preparing this budget we do not know where the 2016 AGM will be.
- AGM Webcast – budget removed
This was put into the 2015 budget on the assumption that the electronic voting proposal would be approved. It wasn’t, so the budget is no longer needed.
- President’s expenses (home) - £3k increase from 2015
This includes the Presidents travel, accommodation and function costs. I have reduced this element from the 2015 budget, but also included the cost of the Presidents car and its insurance plus any AGM theme costs. This results in an increase on this line, but an overall saving.
- President & VP expenses (international) - £1k reduction from 2015
This budget covers the travel and package costs for the President and his partner to the International AGM and half yearly meeting (HYM). It also includes the travel and package costs for the VP and his partner to the International AGM, which was agreed by the board so that the incoming President doesn’t turn up at his first International function as Billy No-mates. The spend on this budget is very volatile, as by its nature the location could be anywhere (in 2014 they were in Denmark & New Zealand, 2015 they are in Cyprus & Birmingham). At the time of preparing this budget, we know the 2016 AGM will be in Germany, but the location of the HYM is still to be decided.
- International Officer Expenses – £500 increase from 2015
Covers the travel and package costs for the international officer and his partner to the international AGM and HYM. Also covers the international officers (only) travel and package cost to other associations AGM’s he attends.
- 41 International expenses - £1k increase on 2015
The cost of 41 Club belonging to the International organisation, i.e. our subs as an association. Currently we pay a much lower per capita figure than any other association, the increase reflects a gradually move towards parity with other countries as agreed with the 41 International Treasurer.
- Fellowship Officer expenses – £1k reduction from 2015
Covers the Officers attendance at conference meetings, plus four of the big regional events each year. Savings are due to less physical attendance at conference meetings, this being achieved using ICT instead.
- Cost of conference - £2k reduction from 2015
This covers the additional costs relating to conference over and above the AGM, such as package costs for guests of the Association (Round Table, Tangent & International Presidents and their partners, sponsors, charity reps), conference jewels for committees, venue charges for sales / charity stands, Association banners etc. It does not include décor or other costs benefiting conference attendees, these are covered within the package price paid by delegates. The reduction reflects the average cost, once cross subsidies have been eliminated.
- Magazine costs - £1k reduction from 2015
The costs of printing and distributing the magazine three times a year. Reduction based on lower membership numbers and increased uptake of electronic rather than physical copies. There is a possibility that by 2016 we will have an alternative publisher which may provide further savings, but at the time of preparation this is still being investigated by Ray Hill, Communications Officer, so I have not reduced the budget further.
- Council Meetings - V1 - £6k reduction from 2015 - V2 – no change
Covers the travel costs of National Council (NC – includes Board and Honoraries) plus their weekend allowance of up to £160 for the four meetings each year (AGM plus three others). It’s based on an average cost per NC of £900, which itself is based on current costs per NC and takes into account apologies and a reasonable spread of meeting locations. This budget is based on a National Council of 25 (12 Councillors, 9 Board Members, 4 Honorary posts). V2 is based on the current Council makeup.
- Board Meetings - V1 - £1k reduction from 2015 - V2 - £1k increase on 2015
As above, but this is only for Board Members and covers the additional meetings they attend – Forward Planning, Family Meetings, Admin Reviews for example. The average cost per Board Member is £600, and the budget is based on a Board of 9 (or 11 for V2).
- Club Visits - V1 - £2k increase on 2015 - V2 – no change from 2015
Covers the travel for Area Councillors (under the new governance) visiting clubs in their Region. Based on the assumption that there are 400 club visits per year by the 52 Councillors at an average distance of 100 miles x 25p.
- Insurance - £1k decrease from 2015
Pays for the Public Liability Insurance for the Association. Car insurance for the Presidents Car has been moved to President’s expenses.
- Gifts, Jewels & Presentations – no change from 2015
As it suggests, this pays for the jewels given to past presidents, board and council members, officers name badges, awards to clubs and individuals (such as Frank Bull’s last year).
- Honoraria to Officers - V1 - £500 decrease from 2015 - V2 - no change from 2015
This covers incidental expenses incurred by Board members (postage, stationery, telephone calls etc). It has remained constant over the last five years as far as I can tell. I am suggesting a small increase for most (Secretary & Treasurer to £200, from £180, other 6 Board members to £100 from £90), but reducing the budget slightly by cutting the Presidents from £1000 to £500. The rationale behind this is that many of the items formerly covered by the Presidents Honorarium are now claimed for against his expenses.
- Accountancy Fees – no change from 2015
This covers the independent examination of our accounts by Duncan & Toplis.
- Depreciation - £9k increase from 2015
Yes, that’s a 100% increase, but again it’s one of those simple calculations, which is based on expenditure previously capitalised. I have allowed for an additional £20k of capitalised expenditure during 2016, a ballpark estimate for any additional work which may be required following the Strategic Plan.
- Sundries – no change from 2015
This is exactly what it says on the tin, all those bits of expenditure I can’t find a home for. 2014 expenditure included some bank charges for bounced capitation cheques, wreaths for past president’s funerals and the remembrance service plus a £500 donation to Cinema City to help create the Louis Marchesi room in Norwich.
- Membership Promotion – no change from 2015
This budget encompasses a variety of spend. It includes our £5k platinum supporter’s contribution to Round Table, £1.2k for the Wider Wallet membership benefit scheme, plus spend on recruitment initiatives such as the ex-Tablers database.
- Archives – no change from 2015
Covers the hire of the archive room at Marchesi House plus a small amount for any additional scanning which is required.
- Capitation - £1 increase on 2015
As previously stated, this is the balancing figure obtained by dividing the net expenditure less other income by the expected number of members. Although our own forecasts indicate we will be just over 16,000 members at the start of 2016, I have reduced the base to 15,750 to appease the doomsayers.
- Bank Interest – no change on 2015
Interest gained on our reserves, after allowing for Corporation Tax. The actual amount earned has fallen in 2014 as reserves have been used to fund the capitalised expenditure.
- Sales – no change on 2015
Commission earned on the sale of regalia by our supplier, PS Graphics, plus profit made on the small stock carried by some of the National Councillors
- Advertising revenue – budget deleted
We rarely get any advertising revenue for the magazine, so I have deleted this budget rather than continue to report zero
National council expenses
These remain at the 2015 level, i.e. 25p per mile and up to £160 allowance for National Council weekends.
Both versions of the budget can be found on the relevant PDF below.