Annual Subscriptions & The Financial Implications of the COVID-19 Pandemic

Posted on: 17 June


Every year, at this time, the Board sets the annual subscriptions as part of the budget process. This year’s process has certainly been more challenging given the impact of the closure, the uncertainty about the return to ‘normal’ operations and very importantly, the impact that the COVID-19 pandemic has had on members individually! While further detail follows, the key matters resolved through the process are –

  • the increase in subscriptions for the year commencing 1 July 2020 is 2.7%.
  • we are providing a benefit for members who can pay their account in full and offering the alternative of an instalment payment plan for members who prefer to spread their payments.
  • the 2020-2021 budget sets a cautious and conservative approach considering the uncertainty about the full impact of the COVID-19 pandemic.

The Board during the deliberations has tried to balance the needs of the Club (reducing debt, securing necessary revenue, etc.) and the worthy needs of the individual members. The rules allow for an increase of the CPI plus an additional amount of up to 5%. This year the CPI (Melbourne All Groups Index) was 2.7%, and the Board has limited the increase to this amount. Given the significant investment in the Club over recent years and the commitment to extinguish debt, the Board, before the pandemic, had the inclination of a total increase of around 5%, but in the circumstances has tempered that intention. The increase of 2.7% is consistent with the general increase in subscriptions of peer clubs and represents an increase in total subscription revenue of $108,000 based on the Club maintaining its current number of members in each category. This is obviously an uncertain assumption while the full impact of the pandemic is unclear.

The pandemic has had an impact on the financial situation of members, and there are two initiatives this year that are intended to provide members with some support in this regard. Firstly, the Club’s main source of income is member subscriptions and with negligible non-subscription revenue expected until club operations return to normal, it would be greatly appreciated if those members who are able to pay their subscriptions in full do so as soon as practical. To acknowledge the support, members who choose to pay their accounts in full by 31 July 2020 are entitled to complimentary Visitors Green fee passes. More details are provided later in this document. Secondly, the Board earlier in the year announced a new system allowing the payment of subscriptions by monthly instalments. In acknowledgment of the difficulties that members may be facing, the administration charge that was to be applied will be waived for this year. Again, full details are provided later in the document. Both initiatives act to support members, moderating the impact of the subscription increase. Any member who has a financial challenge paying their account is encouraged to contact the office.

The economic climate has never been more uncertain. From the closure of the course on 25 March 2020, a very significant amount of income ceased immediately. The ensuing months are traditionally very lucrative for the important external income streams of corporate golf, houseguests, and international and interstate visitor fees. The 2019-2020 year had seen a very pleasing increase in these streams following the GRP, and the Club was anticipating even further revenue growth following the Club’s endeavours to increase its profile. As an example, the budget for Visitor Fees for 2019-2020 was $496,000, and before the pandemic the year’s result was expected to be more than $600,000, primarily driven by an increase in interstate and international visitors. The budget for the upcoming 2020-2021 year, given the uncertainty, is just $200,000 – a reduction of $400,000! The government support in the form of the JobKeeper stimulus is a welcomed initiative noting this is legislated to cease in September. The Board intends to return to more normal club operations gradually and very carefully as regulations permit to ensure that funds are preserved in case of further impacts that may eventuate. Rest assured, the budget for the year has been set considering the uncertainty and reflects the severe circumstances that exist.

The Board has spent time considering the impact of the recent shutdown and as to whether any compensation may be appropriate. While we await the finalisation of the accounts for the last quarter of the financial year, which will show the actual impact, the Board’s initial assessment is that the financial circumstances do not allow for compensation. We also have uncertainty as to what the short-term future holds with respect to the operation of the course and the clubhouse, so the ongoing impact remains unknown. As previously mentioned, the next year sees a very cautious and prudent strategy. The Board will consider the matter further as the COVID-19 impacts become clearer and will provide members with an update when practical.

In the medium term, the Club’s financial position remains sound. The investment in recent years has positioned the Club exceptionally well with an enhanced external profile coupled with an improvement in the important course rankings. There continues to be a strong interest in joining the Club with the waiting list continuing to grow. The existing membership is vibrant, engaged, and incredibly supportive of the Club. These key indicators provide the Board with comfort that despite the immediate challenges that the Club collectively, and members individually may face, the wonderful enjoyment that members have derived for so many years will continue!

The Directors look forward to the continued support of members in these difficult times.  

Payment in Full – Complimentary Visitor Fee Passes.

The Club would appreciate that members, if possible, settle the annual subscription account in full which is due and payable on 1 July 2020. If the account is paid by 31 July, the following will apply –

  • Full, Ordinary, Restricted, and Veteran members will receive two complimentary visitor fee passes.
  • All other categories will receive one complimentary visitor fee pass.
  • The conditions for social membership prohibit play on the course but in this instance, those members will be permitted to use their voucher to play on the course. While it is acknowledged that some members in this category cannot play, it is not practical to have an alternative arrangement that isn’t available to other categories. Accordingly, the incremental subscription increase will not be added to the Social membership charge this year.
  • The normal arrangements for introducing visitors applies and the passes are non-transferable.
  • The passes will expire on 30 June 2021.

Payment by Instalments.

As previously advised, the following system will operate for the payment of accounts by instalments –

  • Ten monthly payments commencing in July and finishing in April.
  • The charge ($140 – most categories, $100 – Veterans and $70 – Non-Playing and Juniors) will be waived for the 2020-2021 year.
  • The annual subscription and the Capital Works levy (payable in January) will be included in the calculation and
  • A direct debit agreement will be required to be completed.

In order to facilitate the paperwork, members are requested to advise the office as soon as possible, but no later than 30 June 2020 should they wish to use this facility.

The subscription accounts will be sent in early June and are payable on 1 July.

On behalf of the Board of Directors.

David Brophy
Captain.

 

SCHEDULE OF CHARGES.

 

CATEGORY

Subscription     

Full Member

5,340

Full Veteran Member

3,705

Ordinary Member

4,816

Ordinary Veteran Member

3,345

Restricted Member

4,292

Junior Over 21 Full Member

2,305

Junior Over 21 Ordinary Member

2,085

Junior Under 21 Full Member

1,259

Junior Under 21 Ordinary Member

1,140

Country Full Member

1,678

Country Ordinary Member

1,520

Interstate Full Member

1,154

Interstate Ordinary Member

1,050

Overseas Full Member

631

Overseas Ordinary Member

579

Non-Playing Member

1,154

Non-Playing Ordinary Member

1,050

Social Member

731

House Member

731

OTHER CHARGES

Total      

Locker

108

Golf Club Storage

426

Electric Buggy Storage

647

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