This year, the financial position of Auckland Pride Festival Inc showed quite the reversal of fortune by running up a deficit of $80,000. At their annual general meeting in July, the treasurer Kyle Habershon assured everyone present that there was nothing to worry about, it was simply a change in funding rounds and the need to keep everyone safe during these pandemic times that had caused a temporary ‘deficit’. This echoed the words printed in the official documentation supplied to attendees – nothing to see here folks, we’ve got everything covered. Habershon pointed out that they’d applied for an $85,000 grant from Foundation North, and hoped to hear in August whether they were successful. The report also stated they’d secured a major sponsor for 2022 but the funds had been received after the 31 July accounting period.
But what was missing from this narrative was the glaringly obvious fact that the books showed the society was technically insolvent. The bank account was overdrawn, creditors were owed money, and the society had negative equity.
On the 6th August 2021, I interviewed the society’s co-chairs Kaan Hiini and Robyn Vella. They repeated the narrative. The problem they assured me was down to covid, and their main funder, Foundation North, had changed the funding round from May to August. Hiini also insisted they were not insolvent and that there was now money in the bank.
The problem with this explanation, as I pointed out in the interview, is that Foundation North did not change any funding rounds. In fact, in an email to me, they stated they had ensured that funding processes were made easier for applicants during the pandemic.
In the interview, the explanation then changed to one of a ‘miscommunication’ between Foundation North and staff at Auckland Pride.
In terms of the deficit, a large part of that was the result of expenses rising $110,000. There was no detailed explanation as to what that amount relates to – either in the accounts or notes, and certainly not in the interview. Instead a vague explanation of costs related to the provision of goods and services, and keeping people safe.
When I put it to the co-chairs that it was perhaps unwise to run such a large festival in a pandemic where the risk of lockdowns was high, Robyn Vella responded with the words “potentially, but hindsight is 20/20.”
Yes, it sure is, but there were plenty of reasons why the board and staff of Auckland Pride should have actually developed foresight around this.
The biggest one is that the covid pandemic had been spreading around the globe since late 2019.
In the interview, Kaan Hiini acknowledged the board had discussed the impact of covid as far back as August 2020, a full seven months before the festival began. What’s more, New Zealand had already had lockdowns prior to those discussions, and indeed Auckland was put into lockdown again in August 2020, at the very time the board was said to be working through these issues.
This being the case, why was the festival not scaled back?
The board must have had some idea of the costs involved well before the festival began. What’s more, they were heavily reliant on funding from Foundation North, but this was never guaranteed.
Also, by their own admission, Auckland Pride was going to originally apply to Foundation North in May, which is well after the festival was over. To rack up debt and expenses without first getting secured funding seems reckless.
So where are things at now?
This week, Auckland Pride put out a job advert for a paid Events Producer – the idea behind it is to make the Pride March bigger and better than ever before. AP now has arrangements with other event organisers to keep the brand running all year round.
So the ambition to be bigger and bigger is still there. The easy presumption is that the society has the money to do all of this, and/or they are relying on partnerships to expand the brand. Perhaps they are again relying on the goodwill of institutions such as Auckland Council which provides a lot of resources.
I am assuming that the 2022 sponsor they claim to have signed has given enough money to both plug the deficit, and cover new expenses.
Hopefully, the society is now solvent, but if I was a funding organisation or a partner, I would have grave concerns about an organisation that ran up such a large deficit relative to its operating budget in a pandemic.
It is my view that having a dynamic and truly diverse, welcoming pride brand that keeps our rainbow communities at the forefront of civic life is a positive thing.
I applaud an organisation that has such lofty goals and that wants to grow. I believe in ‘pride’ as a concept, and I truly hope the vision Auckland Pride has, can work.
I say this to the board:
It is a difficult job to run an incorporated society, particularly one that is connected to a community as diverse and as rambunctious as the LGTBQI community. Yes, you work as volunteers, but if you step up, you must be willing to put your own personal issues aside and do what is right. You need to take governance and fiduciary responsibilities seriously. You must be open and honest and most importantly you must have the courage to acknowledge mistakes and fix them.
Your ambition to create a larger festival and events that go on all year is admirable, but you must be transparent in terms of your operations, and any growth must be sustainable. Don’t spend your money till it’s in the bank.
You can listen to my interview with Kaan Hiini and Robyn Vella below:
