ECF Finance Council Meeting April 2017

[Andrew Zigmond]

Firstly I agree that it is deeply disappointing that Platinum and Gold representatives will not be at the meeting and, in some cases, appear not to have even bothered to consult those they were elected to speak for.

It is a total disgrace and an affront to democracy but no doubt the "block voters" who have spent years and years accumulating votes and thus power to themselves will block any meaningful change next Saturday

Chris

Dare I suggest that we haven't actually had the meeting yet? From memory the last time electoral reform went before Council the motion did pass, although it wasn't taken further at that time.

It occurred to me that the `agitation` Chris suggests could be quite easily managed. League and county associations all elect an ECF delegate at their AGM so surely all players need to do is turn up and vote for a committee that will support reform. Congress votes are trickier but a simple boycott would probably do the trick; no congress equals no votes at council (and it is easy enough to restart a congress under new ownership). It's the absence of this agitation I find telling, not the obstacles supposedly preventing it.

[NickFaulks]

Slightly more seriously, Paul is complaining that the expenditure plans are not detailed enough. I'm asking him what more detail he wants about spending plans.

Let's start with the International budget, which represents, after administration, by far the biggest net recipient of ECF funds.

The 5 year plan showed to Council six months ago included net expenditure of £40,495 in 2015/16, rising to £50,623 in 2016/17, £65,623 in 2017/18 and £70,623 thereafter. For comparison, the figure in 2014/15, under the previous leadership, was a mere £4,727.

Council members, notably those who had engaged in consultation with their own constituents, who questioned this meteoric rise were brushed aside by the Board, although the Finance Director did say that the numbers could perhaps be rejigged.

The numbers in the latest version of the Budget, added to the Council Papers on 11th April, do indeed tell a different story.
The net expenditures from 2017/8 are now shown at a flat annual rate of £33,500. This appears to result largely from £25,500 pa of income, not previously shown, but there is no clue as to where this comes from. Is it sponsorship this is expected to be found, or already in the bag? Furthermore, is there also sponsorship which is not shown at all, being kept off balance sheet?

You can argue, as the Board has and probably will again, that this is none of Council's business. If we were told that it will not be necessary for membership fees to be used to support the national team, because sufficient sponsorship would be found, I might agree with that. Some of us, perhaps erroneously, believed that we were told that in 2015. However, for such time as membership fees continue to be required to augment sponsorship of the national team that the Board deems insufficient, I think we have a right to know more about that sponsorship.

[LawrenceCooper]

For comparison, the figure in 2014/15, under the previous leadership, was a mere £4,727.

I think that was due to there being no Olympiad/European in that financial year.

[NickFaulks]

I think that was due to there being no Olympiad/European in that financial year.

Good point. 2013/14, containing both, presumably took a double hit.

[Roger de Coverly]

The ECF requested opinions on a much more restricted scheme of qualification for the 2018 British. They didn't see fit to publish the responses, so no one is the wiser as to whether it had 100% support, 100% rejection or somewhere between.

The Directors, quoting Operational Rights, may have made a decision. It's entirely likely, that with the potential changes not on the Agenda for the April Council meeting, that the decision will not be announced until after the meeting.

This heads off the possibility that the Congresses deprived of their rights to offer Qualification places will kick up a fuss. Voting reform is on the Agenda, so if Congresses don't raise this issue, this could justify removal of their votes.

I've seen Congress entry forms for the 2017-18 season which assume the continuation of the existing rules.

[Roger de Coverly]

Congress votes are trickier but a simple boycott would probably do the trick; no congress equals no votes at council (and it is easy enough to restart a congress under new ownership). It's the absence of this agitation I find telling, not the obstacles supposedly preventing it.

You don't boycott a popular Congress because of an objection to their chosen representative at ECF Council meetings.

It's a flaw in the logic that says that the current system is acceptable because players are represented through counties and leagues. When Congress organisers started screaming and shouting about having to finance the ECF from a levy on their entry fees was when their votes should have been removed.

[Angus French]

Concerning the budget for International chess (raised by Nick above): I was assuming, from the way the figures are presented, that net expenditure would be *capped* at £33,500 for 2017/18 (with the intention, also, to cap it at the same amount in subsequent years). I think this needs to be confirmed. I would be a lot happier with net spend of £33,500 since previously it was, as Nick says, £65,623 and rising. That said, £33,500 is a lot higher than the (adjusted) annual spend of £20,000-£25,000 in the years 2006/7 to 2014/15.

I wonder if anyone has had the chance to read what I wrote in my message to Bronze members about the Budget for 2017/18? There are two budget issues (or three if the situation with the national chess library is included) about which I am particularly concerned:

1. Receipt of funding from the John Robinson Youth Trust. The Five-year Plan presented at the AGM last October was predicated on substantially increased contributions from the chess trusts, the bulk of them coming from the JRYT. It was assumed the JRYT would contribute almost £150,000 over five years. However, according to the Finance Director's report: "The trustees of the JRYT have at the time of writing refused any larger amounts above their normal support. This means the Board will have to reconsider its financial plans if these funds are not forthcoming".

2. Funding of the ECF Academy. Previously net expenditure for 2017/18 - after a contribution of £18,000 from the JRYT and sponsors - was projected at £13,669. Now, according to the detailed budget spreadsheet, it seems the figure might be only £4,000 - a substantial improvement. But this contrasts with the February Board Meeting minutes which painted a less-than-sunny outlook ("No sponsor has been found so far. We are considering reducing this programme if sponsorship or trust funding is not available… The international programme is funded by parents at £400 per annum. We are considering increasing the contribution")... and there's the situation (described above) with funding from the JRYT, on which the Academy is reliant... and, to be frank, the presentation of the Junior Directorate section in the budget spreadsheet is a mess.

Does anyone else have views on the above?

[Nick Grey]

Angus - thank you. Even though seen nothing on Gold membership it is good to see others canvassing their views an votes.
The plans need to be reasonable.

Just about every public sector or voluntary organisation is planning for substantial cuts in income but also increases in costs. So I am having a problem with the overall budget & your points above are very much to the point.

[David Sedgwick]

There are two budget issues (or three if the situation with the national chess library is included) about which I am particularly concerned:

...

1. Receipt of funding from the John Robinson Youth Trust. The Five-year Plan presented at the AGM last October was predicated on substantially increased contributions from the chess trusts, the bulk of them coming from the JRYT. It was assumed the JRYT would contribute almost £150,000 over five years. However, according to the Finance Director's report: "The trustees of the JRYT have at the time of writing refused any larger amounts above their normal support. This means the Board will have to reconsider its financial plans if these funds are not forthcoming."

...

Does anyone else have views on the above?

Whilst the Trustees have a duty to act independently, they report to the BCF Council. It seems to me that this is a matter which might properly be raised at the BCF Council Meeting preceding the ECF Council Meeting.

If no mutually acceptable resolution can be found, it may be appropriate for someone to submit a motion to a future BCF Council Meeting.

[Angus French]

There are two budget issues (or three if the situation with the national chess library is included) about which I am particularly concerned:

...

1. Receipt of funding from the John Robinson Youth Trust. The Five-year Plan presented at the AGM last October was predicated on substantially increased contributions from the chess trusts, the bulk of them coming from the JRYT. It was assumed the JRYT would contribute almost £150,000 over five years. However, according to the Finance Director's report: "The trustees of the JRYT have at the time of writing refused any larger amounts above their normal support. This means the Board will have to reconsider its financial plans if these funds are not forthcoming."

...

Does anyone else have views on the above?

Whilst the Trustees have a duty to act independently, they report to the BCF Council. It seems to me that this is a matter which might properly be raised at the BCF Council Meeting preceding the ECF Council Meeting.

If no mutually acceptable resolution can be found, it may be appropriate for someone to submit a motion to a future BCF Council Meeting.

That sounds appropriate and sensible.

If I could just add something which I had in the message to Bronze members. It concerns use of the trust’s capital (which the Board had assumed to be available) ...

The JRYT’s policy on investments states (with my emboldening): “The return objective of the Charity is to receive income, after fees, of £20,000 per annum whilst maintaining the real value of the assets. The income generated (net of fees) is to be distributed quarterly. The risk tolerance is formally "lower risk" but, given the long investment time horizon and the desire to maintain the real value of the assets, there is scope for an allocation to equities. Constraints: The Charity is to be managed with a long time horizon in mind as there is currently no intention to distribute more than the annual income. Given that there is little chance of cash distributions beyond the quarterly distributions of dividends, there are little or no liquidity constraints for the Charity…”

[Peter Turner]

I was about to reply when I saw the comment above from Angus French. My understanding was that apart from something in the region of £10,000 a year supporting the British Championships (and I think there are some conditions to this relating to junior chess) any other expenditure was on income received. The capital to remain intact.

[Mick Norris]

Is there a copy of the JRYT deed available? It would be useful to see this before commenting

[Roger de Coverly]

Is there a copy of the JRYT deed available?

Predating the JRYT deed, here's the background as recorded by Richard Haddrell.

http://www.sccu-chess.com/archive/0506/bcf.htm

BCF EXTRAORDINARY COUNCIL MEETING
in London, Saturday 24th June 2006 at 1 pm. About 28 attended.
The BCF has remained in existence largely for financial reasons and will rarely, we imagine, have need for a General meeting between AGMs. This one arose from a bequest to the Federation from the late John Robinson. It is substantial - around �650,000 - and represents the bulk of John's estate. He was a bachelor and died without issue. Inheritance tax on such a sum would cost the Federation something like �300,000. But apparently it is possible to vary the terms of the will so that the biggest part of the bequest goes into a charitable trust, avoiding liability to inheritance tax. Setting up such a trust requires a resolution of Council.
The proposed John Robinson Trust would receive about �520,000 while �130,000 would go to the BCF itself. But the charitable trust has to be a Junior one. John's expressed wish is that his bequest will provide �10,000 annually to support the British Championships. There is a considerable youth element in the Championships which can properly be supported by a junior trust, and the two sources together could achieve the �10,000.
We said, when we saw the papers of the meeting, that we had no doubt the setting up of the Trust would go through on the nod. The grapevine wasn't so sure. It seems there was opposition to a scheme which would benefit mostly juniors when there were other ways of doing it. We have no information on the other ways. In the event one Director did express reservations along those lines at the meeting, but the proposals all went through with the odd abstention here and there but, we think, no votes against.
The Trustees will be Gerry Walsh, David Welch, Cynthia Gurney and David Anderton.
rjh 1.7.06

[Carl Hibbard]

Is there any information on what international funding has been raised?

[Roger de Coverly]

Is there any information on what international funding has been raised?

There's been support from the Jupiter asset management group which paid for additional training and coaching support before and during the last Olympiad. I don't know that I've seen a formal announcement of the amounts and minimum future duration involved.

http://www.englishchess.org.uk/sponsors/