“Where are we going, Wilbur?”

The digital ink (?) on my previous post about volunteers being worth far more than they weren’t paid had barely dried over the Christmas break when I read that Hawke’s Bay’s multi-million dollar equine extravaganza – “Horse of the Year” was looking for around 400 volunteers to assist with the 2016 edition of the event.

Nothing too unusual there – as previously stated such big events rely on volunteers to make them successful – although it pushes the limits of credibility to claim anything requiring dozens or even hundreds of people working for free as a “success” – from a financial perspective at least.

BUT…

400 sounded a rather excessive amount of people working for free – the Rugby and Cricket World Cup games Napier hosted in 2011 and 2015 respectively required only around 150-200 by comparison.

And the last time I had read something about Horse of the Year they were asking local councils for money – LOTS of money:

Last year chairwoman of Horse of the Year’s board of directors and HDC Deputy Mayor, Cynthia Bowers, went around local councils asking the event’s hosts, Hastings District Council – to increase their funding of the event to $150,000 – more than quadrupling the $35,000 they put forward last year, and $100,000 from the Napier City Council – TEN TIMES last year’s amount of $10,000!

In 2012 Councillor Bowers was appointed by Hastings District Council to a board investigating the formation of what would become “Horse of the Year (Hawke’s Bay) Limited” – she was quoted as saying:

“The working capital expected from the council was not likely to be more than $100,000 and the money would be repaid from projected profits from the 2013 show, which would be the first event run under the new company.”

These requests for more funding may be looking a bit shaky as they come not long after the event posted equally big losses in recent years:

In February last year, the month before its 2015 event, Horse of the Year reported a $297,000 half-year loss:

“The accounts show the company received income of $554,000 during the six months to the end of November, $297,000 below the $851,000 it budgeted for and $62,000 below what it received during the same period a year earlier.

However, in a report to the committee, the council’s acting chief financial officer, Bruce Allan, said: “Given the nature of this organisation and the event that it runs, the first half of the year financials provide limited insight into the potential full-year result.”

The show sends out invoices for deposits for booked trade sites during the half-year covered by the report, with the bulk of its income generated in the following six months.
The company said trade site sales for this year’s show had been strong “and indications are that virtually all sites will be sold”.

In October 2014 Horse of the Year had recorded a $108,000 full-year loss.

Horse of the Year were reported as expecting 2015’s event to be a “no growth” show in an attempt to make up for previous losses.

Hastings District Council said the lost revenue in 2014 was “due to problems with security fencing which allowed non-payers into the show.”

But it’s a bit hard to believe such significant losses were due to people sneaking in for free, considering even if tickets were $50 each, that would mean over 2,000 attendees got away without paying.

A more likely cause was the “Further development of relationships with Chinese equestrians, who were funded to attend last year’s (2014) show, had been “put on hold until 2016”.”

In other words “An international equestrian group were PAID to attend two years ago, but didn’t turn up and it doesn’t look like anyone asked for the money back.”

So what was the extra $205,000 Horse of the Year was requesting supposed to be going to?

Certainly not paying up to 400 workers…

Perhaps is going towards debt consolidation?

Perhaps they are paying for even more international equestrians to not attend?

Or perhaps they are looking at diversifying – Just how much are Pegacorns these days?

Horse of the Year is a great event for Hawke’s Bay that brings in hundreds of visitors and millions of dollars – and not just from the Range Rover / Multimillion dollar horse float crowd – Because for every futuristic horse-float-come-campervan there are dozens of regular horse loving attendees who stay in tents and motels, scrimping and saving where they can.

Investments and outcomes need to match up.

This is certainly one gift horse Hawke’s Bay cannot afford to look in the mouth!