Time for more action from school Boards.... Time for more concerted action from school Boards on using DGR vehicles. Fundraising revenue represents an important value-add opportunity for non-government schools. In the current economic environment where many families are experiencing flat wage growth and rising school fees, fundraising is all the more important. Add to this the increasing competition between non-government schools and some significant movement of student enrolments back to government schools and it all adds up to an opportunity to re- examine fundraising options. The reality of non-government schools is that even though they are non-profit entities, they must still operate a viable business in order to provide a good quality service. Many non-government schools could do much more with the fundraising vehicles at their disposal in the form of building funds, scholarships funds and library funds. Additional revenue can obviously be put to good use for capital projects, learning resources, and maintaining a strong enrolment base. These funds offer donors the value of tax deductibility. This donor benefit may not necessarily be a primary driver of giving behaviour, yet, it is, nonetheless attractive for most people. The loss of a single enrolment can represent a significant cost to a non-government school budget. That loss could be anywhere from $15,000 to well over $20,000. The loss of 10 enrolments in a year can represent a very large amount of lost incomethatcansendanannualschoolbudgetintoseriousdistress. With ongoing changes and controversy around government education funding models and policies, the reality is that the growth trajectory of all forms of government funding of non- government schools will slow down or go backwards. The chief financial executives (Business Managers, Bursars) I talk to, or work with, tell me the same things, such as: . . Moregrandparentsthaneverbeforearepayingschoolfees; . . More families are struggling to pay fees on time; . . The budget line they have for fee relief is increasing; . . More families than ever before are making contact to seek relief due to their own financial distress; . . There is very small growth (if any) in their government funding and in some cases are more likely to lose some funding; . . There is growing nervousness in Board rooms around the annual task of setting operating budgets and explaining the resulting fee rises to current families; . . There is growing interest in fundraising to augment both operational and capital needs. Since their introduction in the ‘90s, scholarship funds with deductible gift recipient status (DGR) have arguably been the fastest growing fundraising stream across 2,700+ non- government schools. At the same time, many schools continue to make use of building funds (also with DGR status) with varying degrees of success. Some clever schools are also using other DGR vehicles such as library funds and the Australian Sporting Foundation to raise funds for all kinds of other projects earmarked for their current budget year. There are a few schools that enjoy the fortunate position of having built (or are continuing to build) substantial endowment funds through bequest programs or other activities. These schools are using their increasing endowment fund returns to support families in financial distress and retain the valuable government funding that accompanies enrolments. Data sourced from the Australian Business Number (ABN) register in the table below shows the number of the respective DGRfundsthathavebeenestablishedbyschoolsoverthelast18years. The data clearly shows that scholarship funds have some way to go as their total number and rate of establishment remains substantially behind that of building funds and library funds. If your Board and executive management are not currently pursuing a conversation about maximising every possible avenue to retain current enrolments and maintain a strong pipeline of new enrolments, then it is time to start that conversation. JEFF BUCHANAN SENIOR CONSULTANT ASKRIGHT WWW.ASKRIGHT.COM 1 2