At the May executive meeting held at Wellington the Financial situation of the NBA received considerable attention. The budget was reviewed in detail, and where savings could be made, or expenditure deferred till the 2000 year, changes were made. The March approved (Nelson) budget predicted total expenditure of $490,000. This figure has been reduced to $468,000 in the May adjusted budget.

The problem summarised

This budget predicts an overall deficit for the year ending 1999 of approximately 75K. It anticipates that the total remaining reserves that we had at the beginning of the year ($67,500) will be exhausted to fund the activities in the 1999 year. It predicts that we will have negative equity before the end of the year of approximately $6000. At the beginning of 1997 we had reserves of $180,691- dropped to $139,000 by the beginning of 1998 and $67,500 at the beginning of this year,

How will the NBA pay the bills late in the year?

Although the budget predicts negative equity before years end, there remains a $25,000 loan from the Industry Trust Fund that will keep the NBA with sufficient liquid reserves to pay the bills until the anticipated levy increase comes into force. It is anticipated that providing the budget is maintained, the NBA will stay within the $25,000 loan, and will not have to fund the activities of the association by way of overdraft or other borrowing.

Levy take for 1999

The budget has altered downwards the prediction for total levy take this year from $360,000 to $350,000 in line with the current information available. To determine the reasons behind the apparent significant under-collection of levy, the executive is in the process of commissioning an analysis of the NBA database and the Apiary register to give us a much better understanding of the situation so that we can find out the nature and extent of the problem. This information is absolutely essential before we can seek any solution in this area to assist with our finances.

Budget approved for the year 2000

The budget approved (recommended) for the year 2000 anticipates a levy increase of $6 per apiary. It is based on the assumption that our levy base is $350,000 and that for every $1 of levy increase the NBA income rises by $17,000. The total levy is predicted to be $452,000 as a result of this increase. The pie graph below indicates the apportionment of the levy money over the three areas of NBA expenditure, and the point needs to be made that the PMS accounts for approximately $2 of the $6 increase sought.

Levy increase to be decided at conference

The process for obtaining a levy increase will involve support from the members at 1999 Asburton conference , and to this end the executive is putting forward two Notices of Motion that clearly outline the two most obvious options.

Option 1 The ratification of the approved 2000 budget by the approval of a $6 per apiary increase. It is fair to say that this is the option that the executive favours and recommends.

Option 2 The complete abandonment of the marketing activities of the NBA and a significantly smaller levy increase. This would reduce the required levy increase from $6 to approximately $1.50 per apiary.

The NBA approved budget has been sent to all NBA branches so that the remit meetings held around the country can debate fully the ramifications of the proposed options. The abandonment of marketing to achieve the short term benefit of less levy may be detrimental to the long term best interests of the industry. If members do not choose to fund the current range of activities that the NBA provides, marketing is unfortunately the only major area of our expenditure that can realistically by terminated because of the responsibilities the NBA now has under legislative commitment.

This proposal is expected to prompt much vigorous debate throughout the industry but the end of this process we would hope for a result that sees marketing remain a primary activity of the National Beekeepers Association.

Copies of the NBA budget can be viewed and printed off from the NBA web site http://www.nba.org.nz, or obtained from your branch secretary.

Bruce Stevenson and Lin McKenzie
Prepared on behalf of the executive