SWANSBEST
29th April 2003, 09:31 PM
PATRICK SMITH
--------------------------------------------------------------------------------
All things being equal, solution just what doctor ordered
April 29, 2003
GET a thick black pen. Put a line through the AFL's $5 million equalisation fund.
Put a line through the $11 million special assistance fund that is propping up the Bulldogs and the Kangaroos. They are both gone. That's equalisation and special assistance, not the clubs.
Put a big tick next to salary cap concessions for Sydney and Brisbane. They are staying. And a big tick to clubs forfeiting premiership points if they breach total player payments. That new rule was ratified by the AFL Commission yesterday.
And jot these names down. Ron Evans, Bob Hammond and Colin Carter. They are the three commissioners who will play the most significant part in finding a replacement for AFL chief executive, Wayne Jackson.
For what was just a monthly meeting of the league commission, there were critical decisions made and critical issues discussed at AFL House yesterday.
On April 11 The Australian revealed that the AFL, under Jackson's guidance, was putting together a revolutionary paper that would replace the old equalisation fund.
Jackson said it was so far-reaching that it had the ability to under-pin the long-term future of the 10 Victorian clubs and therefore reinvigorate the 16-team national competition.
Under the working title of the "Competitive Balance Fund", the document will be put to the clubs in the middle of next month. It received the final approval of the commission yesterday.
We have reported how the AFL needed to revamp the equalisation policy. The policy saw the AFL gather a small surcharge on gate receipts. It amounted to about $5 million a year and was distributed equally among the clubs.
However, it didn't really equalise club income at all. For example: Essendon last year earned $1.97 million from merchandising. Fremantle collected $55,286. From corporate boxes alone West Coast raised $3.8m and St Kilda just $82,000.
Jackson and his executive studied four models closely but whichever turn they took it appeared they would remove the incentive from one club or another to drive certain money streams. Hit memberships and there is less incentive for Collingwood to build its supporter base. Hit corporate sales and West Coast will be less enthused to drive that market.
So equalisation, or income sharing as it was more recently known, has been scrapped and replaced with the Competitive Balance Fund. The new protocol will take money from general revenue and distribute it to clubs according to a strictly monitored formula. It will make redundant the smaller special assistance fund ? also fed from general revenue ? that now serves the Kangaroos and the Bulldogs.
The distribution formula is based on two tenets. It will go to clubs on a needs basis. And only to clubs that have established suitable and sustainable business practices.
The commission has settled for this solution because it believes several AFL clubs have problems that remain endemic because of supporter base, history and environs. That assistance to these clubs needs to be significant and constant.
It is a solution that should appeal to the more powerful and financially stronger clubs because it does not impinge on their abilities to drive their own individual market strengths. Sydney's ability to raise sponsorship ($5.5m last year) and match-day dining ($2.2m) will be unaffected. Compare those figures to the Western Bulldog returns on similar items ? $2.1m and $295,613.
It also protects the middle-ranked clubs that struggle to break even and can least afford to have some of their limited income garnered to help the poorer clubs.
The AFL believes the competition will embrace the new scheme. When the commission initially suggested two years ago that it might set up a small special assistance fund, clubs rebelled at the thought that it might be sourced from their revenue streams. They voted unanimously for the scheme when it was suggested it come from general revenue.
The commission also accepted the executive's plan for continued salary cap relief for the northern clubs Brisbane and Sydney as indicated in The Australian earlier this month. The commission accepts that both clubs have unique problems because of their location in developing markets. A new formula for concessions is continuing to be fine-tuned.
Evans, Carter and Hammond will begin the process of finding Jackson's replacement immediately. First, they will appoint an independent personnel company to help refine the search. Two companies ? Amrop and Slade and Partners ? were used by the AFL when Jackson's predecessor Ross Oakley resigned in 1996.
AFL officials said yesterday that the earliest an appointment could be made would be late June.
In a way the commission has already set in place certain criteria for the job. They have all but harassed clubs that football is big business and that chief executives must firstly have a strong financial background. Wonder who that puts a big black line through?
http://www.theaustralian.news.com.au/common/story_page/0,5744,6351557%255E12270,00.html
--------------------------------------------------------------------------------
All things being equal, solution just what doctor ordered
April 29, 2003
GET a thick black pen. Put a line through the AFL's $5 million equalisation fund.
Put a line through the $11 million special assistance fund that is propping up the Bulldogs and the Kangaroos. They are both gone. That's equalisation and special assistance, not the clubs.
Put a big tick next to salary cap concessions for Sydney and Brisbane. They are staying. And a big tick to clubs forfeiting premiership points if they breach total player payments. That new rule was ratified by the AFL Commission yesterday.
And jot these names down. Ron Evans, Bob Hammond and Colin Carter. They are the three commissioners who will play the most significant part in finding a replacement for AFL chief executive, Wayne Jackson.
For what was just a monthly meeting of the league commission, there were critical decisions made and critical issues discussed at AFL House yesterday.
On April 11 The Australian revealed that the AFL, under Jackson's guidance, was putting together a revolutionary paper that would replace the old equalisation fund.
Jackson said it was so far-reaching that it had the ability to under-pin the long-term future of the 10 Victorian clubs and therefore reinvigorate the 16-team national competition.
Under the working title of the "Competitive Balance Fund", the document will be put to the clubs in the middle of next month. It received the final approval of the commission yesterday.
We have reported how the AFL needed to revamp the equalisation policy. The policy saw the AFL gather a small surcharge on gate receipts. It amounted to about $5 million a year and was distributed equally among the clubs.
However, it didn't really equalise club income at all. For example: Essendon last year earned $1.97 million from merchandising. Fremantle collected $55,286. From corporate boxes alone West Coast raised $3.8m and St Kilda just $82,000.
Jackson and his executive studied four models closely but whichever turn they took it appeared they would remove the incentive from one club or another to drive certain money streams. Hit memberships and there is less incentive for Collingwood to build its supporter base. Hit corporate sales and West Coast will be less enthused to drive that market.
So equalisation, or income sharing as it was more recently known, has been scrapped and replaced with the Competitive Balance Fund. The new protocol will take money from general revenue and distribute it to clubs according to a strictly monitored formula. It will make redundant the smaller special assistance fund ? also fed from general revenue ? that now serves the Kangaroos and the Bulldogs.
The distribution formula is based on two tenets. It will go to clubs on a needs basis. And only to clubs that have established suitable and sustainable business practices.
The commission has settled for this solution because it believes several AFL clubs have problems that remain endemic because of supporter base, history and environs. That assistance to these clubs needs to be significant and constant.
It is a solution that should appeal to the more powerful and financially stronger clubs because it does not impinge on their abilities to drive their own individual market strengths. Sydney's ability to raise sponsorship ($5.5m last year) and match-day dining ($2.2m) will be unaffected. Compare those figures to the Western Bulldog returns on similar items ? $2.1m and $295,613.
It also protects the middle-ranked clubs that struggle to break even and can least afford to have some of their limited income garnered to help the poorer clubs.
The AFL believes the competition will embrace the new scheme. When the commission initially suggested two years ago that it might set up a small special assistance fund, clubs rebelled at the thought that it might be sourced from their revenue streams. They voted unanimously for the scheme when it was suggested it come from general revenue.
The commission also accepted the executive's plan for continued salary cap relief for the northern clubs Brisbane and Sydney as indicated in The Australian earlier this month. The commission accepts that both clubs have unique problems because of their location in developing markets. A new formula for concessions is continuing to be fine-tuned.
Evans, Carter and Hammond will begin the process of finding Jackson's replacement immediately. First, they will appoint an independent personnel company to help refine the search. Two companies ? Amrop and Slade and Partners ? were used by the AFL when Jackson's predecessor Ross Oakley resigned in 1996.
AFL officials said yesterday that the earliest an appointment could be made would be late June.
In a way the commission has already set in place certain criteria for the job. They have all but harassed clubs that football is big business and that chief executives must firstly have a strong financial background. Wonder who that puts a big black line through?
http://www.theaustralian.news.com.au/common/story_page/0,5744,6351557%255E12270,00.html