National Forum

Covenanting - Lessons from a long journey
Jan Stewart, Chief Executive Officer
Lotteries Commission

Thank you for the honour of asking me to speak at this conference, which has such an important theme. My brief today, given by two of the conference organizers, was to talk about the vision that Lotteries has for its role in the community, and in particular to describe how we see ourselves encouraging others to provide support for conservation, particularly on private land, in Western Australia.

Let me begin by the usual disclaimer about my credentials to speak on this topic.

While I have had the privilege of working for the Lotteries Commission and with the community for nearly 12 years, and have learned a great deal in that time about all sorts of aspects of life and science about which I previously knew nothing, I don't want to present myself in this forum of experts in any way as anything other than an enthusiastic, but very much a lay supporter of the conservation movement.

Although after more than a decade with the Commission, I do have a few ideas about how we can play our part in contributing to the quality of life in Western Australia.

What I thought I could contribute to this conference, was a reflection about the road on which the Lotteries Commission has been travelling for a very long time, to say a few words about the overall context in which we are conducting our business, and then to talk more specifically about the covenanting initiative - and what we can learn from this experience that may take us on the next part of the road.

I do this knowing that many in the audience are old friends and colleagues who well know us and this story. But there are also many visitors from interstate who may not know much about us.

So let me just do a very quick summary about us and our particular and somewhat unusual role in Western Australia.

The Lotteries Commission was first set up in Western Australia in 1933. This was at the height of the depression. Its role was to control the illegal gambling which was rife at the time, through both licensing raffles, and through the conduct of the old fashioned raffle style lottery, to raise money itself to help the needy of the community.

The Commission was set up as and remains a government instrumentality, with a Board of Commissioners who are responsible for the oversight of the Commission's lottery business and for distribution of a percentage of our profits to the community, with the approval of the Minister for Racing and Gaming.

So for many years, in fact from 1933 until 1979, the Commission ran a draw lottery commonly known as a charity ticket, and the proceeds were given effectively as donations during those years to a very wide range of community groups, but primarily the more traditional charitable sector - such as nursing homes for the elderly; orphanages [when we had such things]; institutions for people with disabilities when institutional care was still regarded as appropriate.

But the winds of change hit the Commission in 1979 when Lotto was first introduced into Western Australia. Initially, the impact on the business was not great because it was a manual system. The real change occurred in 1986 when the Commission introduced the now very familiar and extremely successful online Lotto system.

In July 1987 our sales turnover was $137.5 million and the total value of the grants made by the Board in that year was $5 million.

In that time, we have grown to a business that will turn over more than $450 million this year and will return a total of $130 million to the community, of which $45 million will be in direct grants.

And again, just quickly for our out of State visitors, or even locals who might not really understand this, the way that Lotteries Commission profit is distributed, it by a formula in the legislation - 16% of sale turnover goes directly to our State Health services; 2% goes directly to the Ministry of Sport and Recreation to support sporting groups; another 2% goes to the Ministry for Culture and the Arts; and the balance is what the Lotteries Commission distributes itself.

This includes the funding we make to support the Perth International Arts Festival, which is nominated specifically in our Act as a beneficiary, and to the Commercial Film Industry.

So when those two statutory grants are taken out of the equation, what we have left is around $41 million that is given back to a very wide range of community groups. Just as an aside before I talk about our funding role, it is important to understand that although the Lotteries Commission is a public sector instrumentality, we operate a very successful and soft form of gambling. We are part of a large and growing market which is increasingly competitive.

Our capacity to continue to provide funds to the community is driven by exactly the same factors which drive any business - the economic and competitive environment in which we sell our products, and we face the same challenges of maintaining a positive public image, of attracting and retaining good people, of finding the resources to invest in the ever increasing technological demands placed on us, and of finding ways to be good corporate citizens.

So we are in fact a very odd structure. We are a government instrumentality; we conduct a very commercial business; and although our Board's funding recommendations must be approved by our Minister, so need at least not to be in significant conflict with government policies, in some ways our role is not unlike any philanthropic trust - and in that role are quite unique in Australia. There is no other lottery set up quite like us so we've had to blaze our own trail.

So that's all by way of background!

How has all this led us to supporting conservation?

In 1990 we had a Board which was really coming to grips with what it saw as both its privilege and responsibility in having considerable resources that could be used for community benefit.

So we began to put in place a funding process that not only gave donations to organizations serving the needy, but recognized that a rich community life has many elements - that support for the arts, for festivals, special celebrations, and for the preservation of our heritage, whether that was man made or natural - all had a legitimate claim on the money held as we saw it, and still see it, as a trust for the community.

We also had a new Act. Those who drafted it, one of whom is in this room today, had the foresight to include in relation to the definition of eligibility for funding the term benevolent as well as charitable. It is this word that has given us the authority to explore many new ways over the years of contributing to our community.

So we set about actively developing a number of new funding programs, all with the fundamental objective of contributing to the quality of life in our community; of supporting community participation in our community; of leveraging other funding wherever possible; and supporting ways which government and the private sector either had not the resources to do so, or were limited by virtue of their legislative mandates.

So that was the background in which we set about establishing what came to be called Gordon Reid Foundations. The Commission took a decision that it wanted to find a way that was manageable, to fund not only capital, but also innovative projects, and began to explore the notion of creating foundations. It determined that it would support five areas - Genetic Services, a program that was transferred for ongoing funding to the Health Department around two years after its inception; the other four of the original five are still going from strength to strength.

They include Access to the Performing Arts, which is primarily about funding to bring the arts to remote country regions in Western Australia; Recreation for People with Disabilities, recognizing the special needs of those with disabilities, for access to the kind of recreation that all of us enjoy; for Youth; and Conservation.

And just before I get onto talking about this particular foundation, and our vision for it, let me just explain the current status of the foundations.

Fortunately, or unfortunately, depending on the way you look at it, we found that the Commission did not have the power to set up independent foundations. Its legislation did not give it the authority to give its money to other people to give away.

So not to be deterred, we set up the foundations effectively as advisory committees to the Board and gave them a budget. In retrospect, this has been to the advantage of the foundations, in that had they been reliant on interest earned from the corpus as was originally planned, they would never had had the grants budget we have been able to allocate, and they also had the benefit of the Lotteries Commission infrastructure to manage the grants process.

Our present budget for conservation of the natural environment is $1.5 million per year.

Since 1990, 646 grants have been made totalling $6.2 million for a wide range of conservation purposes - revegetation and remnant bushland protection, research projects, awareness raising, and education.

So now let's talk about the Gordon Reid Foundation for Conservation, and more particularly, the covenanting initiative which has been the foundation's most significant achievement - at least in the area of the conservation of private land. I don't know whether it is something about conservation, but what is remarkable about this committee has been two things - the time that people have been prepared to devote to helping us determine how to spend our money most wisely; and the incredible range of skills and experience that they have brought to the committee.

In preparation for this presentation, I looked back on some of the minutes of those original meetings. The first meeting of the Gordon Reid Foundation is recorded as an informal dinner meeting, held on 30 May 1990, nearly eleven years ago.

At that meeting chaired by Bill Warnock, the number one item on the agenda was, and I quote "seeding grants to assist in the process of covenanting as is done by the Victorian Conservation Trust".

However, before the committee determined exactly what it would support, it commissioned a thorough review of what was actually happening in Western Australia with conservation, and how our funding could be used to best effect. This set the framework for the funding decisions that had been taken since that time.

This early preparation work - the decision to take a very careful and planned approach before starting to spend the grants budget, was one of the key factors in the success of the Lotteries conservation programs.

As I said, the very first issue the committee identified as crucial to conservation in Western Australia was how the foundation could encourage private land holders who owned land valuable for conservation purposes to set aside that land in trust for future generations, and for the well being of our environment.

Getting to the point of actually doing this has been a long and difficult journey. In the early 1990s, much homework was done, but one of the major challenges was finding an auspicing body who could take responsibility for the actual implementation of the covenanting project.

There was also the issue of whose responsibility it was to take a leadership role in this initiative. There were other government departments, Conservation and Land Management in particular, whose core mandate is conservation and land management.

As this initiative began to take shape, issues about demarcation began to arise. Was it indeed the Lotteries' responsibility to take such an initiative, or was it someone elses?

Frustratingly, on a number of occasions members of the Gordon Reid Foundation believed that they had come close to finding a solution for what they believed was one of the most important legacies that they could leave, only to find some kind of legal or bureaucratic impediment stopped them in their tracks.

But despite times of near despair, the committee never lost its belief that only through a non government mechanism would the covenanting of private land ever become a reality.

Finally, in 1997, seven years after we started working on the concept, we found a suitable body in the National Trust to take on the project, although even then there was by far from unanimous support from outside of the Commission at the time for the initiative.

This took some considerable leadership on behalf of the Board of the Commission to take a decision to proceed despite the lack of support from some areas, and on 19 November 1997 accepted the recommendation of the Gordon Reid committee, and with the then Minister's approval, committed $635,000 of its conservation funding budget over a three year period to the National Trust.

This was the single biggest conservation project that the Commission had ever funded, and in fact, except for major building and other capital projects, the biggest project across all of our funding sectors.

It came about because of a number of factors - the perseverance; the commitment and the vision of the original members of the Gordon Reid Foundation; and the willingness of the National Trust to take on this role in partnership with private land owners who were willing to take the step of entering into a covenant to conserve their land for the future.

I can't tell you how much pride and pleasure we all felt at the signing of the first convenant in April 1999, when Clive and Michaela Stone were prepared to lead by example in covenanting land on their property "Ivanhoe" in Quairading.

And now there are 18 covenants signed, and I understand 130 more in the pipeline, which is a great testament to those who have served on the Gordon Reid Foundation, to the National Trust, and to the land owners who have taken this step.

So what have we at the Commission learned over these past ten years from this experience, and what does it suggest for the future?

Firstly, and most importantly, that persistence and patience and planning is everything. As someone famous [whose name is escaping me] said - and this might not be the most appropriate quote for this forum - "if you have eight hours to cut down a tree, you should spend the first seven sharpening the axe".

The committee spent considerable time doing their homework, finding out, especially from the Victorian Conservation Foundation, how similar schemes worked elsewhere.

Secondly, the recognition of the importance of partnership between government, the conservation movement, ourselves as this rather unusual public sector body, a community organization in the form in this instance of the National Trust and between private land owners.

It is still early days in this initiative. Much appears to have been achieved, but there is still much to do.

This covenanting initiative is just one example of what we see the Commission as doing - providing the encouragement and financial support to those who are committed in whatever sphere of life to the enhancement of our community.

But in saying this, I need to make clear that clearly we don't see ourselves as doing this alone. There are many, many people and organizations, government, business and private bodies, who are also striving to achieve the same goals, and taking care of the environment is one of the most important of those.

The way forward on this, as with all important initiatives, as I see it can only be through partnerships. None of us has all the means - financial or intellectual - to do it all, but together we can begin to make a difference.

We often these days find ourselves in funding partnerships, sometimes by accident or sometimes by design, with other funding bodies - State and Federal Government, local government, and most recently in partnership with the Potter Foundation.

We believe there are opportunities for us to be more strategic in working with our grant seekers to find other organizations who are looking to make a real difference in the community - to make these funding alliances less coincidental and far more planned.

In the last year or so we at Lotteries have been hosting small discussion groups, sometimes with a guest speaker, sometimes just a general forum for the business and community sector, to talk about their common goals.

These forums have demonstrated clearly the willingness to find ways to work in partnership. Much of the business sector is genuinely seeking ways to be "good corporate citizens", and in response, the community sector needs to find ways of delivering outcomes which not only meets their own goals, but also supports the business goals of their "benefactors" if I can use such an old fashioned term.

Increasingly, some of these "benefactors" may not even be local, or even national companies or philanthropic foundations. In this climate of globalization, there are many corporations and foundations which are taking a global view of their responsibilities for the environment.

A quick search of the world wide web quickly throws up many sites where such community/business partnerships are the theme.

The other initiative we have taken at the Commission is to establish a funding program open to all eligible organizations for organizational development. We recognized that there is practically no source of funding for not for profit organizations to improve their skills, to undertake the kind of fundamental planning that is essential if initiatives are to succeed, to develop the kind of business plan and marketing plan that will enable them to present a very clear case for support from potential sponsors and other funding bodies.

We believe that this kind of investment now $.5 million per annum in community sector development will be crucial to its long term success. We have also worked on developing our relationship with Philanthropy Australia - the umbrella body for many of Australia's most forward looking trusts and foundations - and have facilitated the visits of their senior staff to Western Australia, and supported them in their activities to change federal taxation laws to encourage philanthropic activity.

The final way that we see as important is in the encouragement and support of voluntary contribution to the community, not only in cash, but in time and expertise. This is the year of volunteers, which gives a great focus for encouraging voluntary community activity. So we have set up a special funding program of $.5 million through the Volunteer Centre of WA to provide a range of grants to encourage the roles of volunteers. This may be small or large initiatives, and could include pilot conservation initiatives. And of course the level of voluntary contribution is taken into account in all our funding decisions.

So in closing, while the actual financial contribution that Lotteries in Western Australia may make to conservation is relatively small in the face of the enormity of the need in this State, we remain committed to working on a range of strategies to do what we can in partnership with all like minded organizations and individuals to conserve our heritage, both for ourselves and the generations to come.

Like everyone here today, I look forward to hearing about the ideas that will emerge from this conference, and how we at Lotteries can work to support them. 16