By David,

Swimming New Zealand has made much of the constitutional changes adopted by Surf Lifesaving New Zealand. A couple of years ago Surf decided to accept a structure very similar to the one being pushed by the Coulter gang at Swimming New Zealand. I coach quite a few surf swimmers. Most of them compete for Auckland’s Piha Surf Club. A couple of weeks ago I was at the beach in Mt. Manganui and had the opportunity to discuss Swimming New Zealand’s Project Vanguard with the parent of one of the surf swimmers. There was no misunderstanding her advice to the New Zealand pool swimming community – avoid Project Vanguard at all costs.

I’d be the first to accept that her opinion is largely anecdotal. However she is an intelligent observer and has been a member of the surf world for the best part of forty years. She reckons the change to so called “professionalism” is causing increasing problems. It has taken time for the failings of the change to appear, but after two or three years serious cracks are beginning to show. Most certainly, she says, the problems created by the new Services Delivery Model are far greater than the old shortcomings that the change was expected to solve.

“So what are some of these new difficulties,” I asked? “Money, membership and events,” she replied.

1 Timothy 6:10 tells us “For the love of money is the root of all evil” It appears that problem is not only biblical. My Piha friend tells me the introduction of “professionalism” has changed the volunteer base of the sport. Parents once automatically volunteered their time to raise money, maintain accounts, transport lifeguards, clean and tidy the Club rooms and maintain boats and quad bikes. But now that the sport employs paid Regional services delivery staff, the number of volunteers is in decline. Unpaid workers are now quite happy to leave this work to those paid to care for the sport. Worse than that, parent and others who once cheerfully volunteered their time are now mightily annoyed at requests for volunteer help. Their natural reaction is to ask, “Why should we help? What’s the matter with those buggers we pay to do that stuff? Why should we work and pay them as well?” Work that was once well taken care of by a huge volunteer base is now being neglected. The future of “professional” Surf Lifesaving looks like it will be characterized by a declining number of volunteers and mistreated assets. And that’s where the Coulter gang wants to take swimming.

Closely related to the arrival of “professionalism” and a decline in the number of volunteers is a small but steady fall in membership. One thing amateur volunteers are best at is recruiting other amateur volunteers. It’s pretty obvious when you think about it. Students involved in surf talk to their mates at school. Parents talk to other parents at work, at the pub, at the pool, in the supermarket, wherever they meet. And the things they talk about are the comradeship, the esprit de corps, and the fun. I’ve never heard of anyone recruited to anything because it’s really, really professional. The appeal of surf lifesaving, as a warm and welcoming sport, has declined. It is no longer the fun place it once was. They may be paying the hired help, but in the process the sport is losing its heart. And that’s where the Coulter gang wants to take swimming.

The Head Office of both Surf Lifesaving and Swimming constantly spread the message that they are ‘professional”. They know about business. That is really ironic when 60% of their funding comes in the form of SPARC government welfare checks. They can’t even generate enough real business to cover half their expenses; nothing much private enterprise capitalism in that. In the sport of swimming, however, the sixteen Regions still stand on their own two commercial feet. These “amateurs” are not on the sporting dole. They manage successful commercial operations. They run swim meets, apply for commercial grants, run sausage sizzles and car washes and sell caps and t-shirts. Their commercially generated income has to meet 100% of their expenses; and it does.

The problem in eliminating the Regions, like Surf has done, is that the one section of the sport that pays its way disappears. The whole sport goes on the dole. It becomes government welfare dependant. The number of raffles, sausage sizzles, meets and grant applications gradually declines as the membership decides to just leave it to the professionals. A whole section of self supporting income disappears. Financially the sport is in a very much poorer place. And that’s where the Coulter gang wants to take swimming.
Coulter and Byrne have made much of the fact that Surf and the Girl Guides have adopted a professional services delivery constitution. Both organizations have centralized power in their Wellington Head Office. However the adulation of the Coulter gang is premature. In both organizations there has not been time for the negatives to appear – until now. Gradually the cracks are beginning to show. Volunteers, membership and fund raising are all in decline.

The constitutional change ordered by Coulter and Byrne would see these two mercenaries asset strip the Regions of $1 million in cash and another $1 million in fixed assets. For 110 years those assets have been accumulated by the Regions. Honest stewards of the sport have provided swimming with $2 million of real wealth. Those people gifted that money to us in trust; to be managed with integrity and then passed on to the next generation. Those assets are not ours to give away. Certainly the Coulter gang has no title over the Region’s wealth and no mandate to assume its ownership.

The “Professional Services Delivery” structure proposed by the Coulter gang asset strips our past. It puts in place a structure that will not stand the test of time. It will not protect our future. The constitutional safeguards that provided swimming with a century of security will disappear and, as Surf Lifesaving is showing us now, the new ones are not up to the job. No wonder Coulter was kicked out of the Olympic movement after only one season. His decision making is deeply flawed.

By David

For many years I’ve consulted the same Wellington lawyer. He is a most disconcerting fellow. He’s forty-five years old but looks about seventeen. He deals knowledgably with a person like me, but I bet has never taken part in any organized sporting event. His voice is high pitched and squeaky but the words, when they need to be, are hard and mean and tough. I was talking to him on the phone recently and, to my surprise, he confessed to being a regular Swimwatch reader. He also said an accountant friend of his knew the Chairman of Swimming New Zealand, Murray Coulter. The accountant told my lawyer this amazing story.

Three years ago Swimming New Zealand was insolvent. It had just lost $331,000, it owed $522,000 and there was the grand sum of $221,000 in the bank to pay for it all. Any normal company would have long since called in the receivers. And if it hadn’t, the directors would be in the gun for trading a company known to be insolvent and could become personally liable. But, in the midst of all this financial chaos, Coulter had not a care in the world. Discussing his lack of concern with my lawyer’s accounting friend, Coulter said, all was well. If SNZ’s debtors demanded their money, the organization’s Regions would be required to dig into their reserves; to bail out the parent “company”. Just three years ago Coulter was blissfully plotting to use the “amateur” Region’s cash to pay for his organization’s “professional” profligacy. And now he’s hell bent on seeing the same Regions into oblivion. It is disgusting.

The story got me thinking. Coulter is a money-man. He works for a bank. Was there a financial motive to Project Vanguard? Perhaps this wasn’t about better communications or improved results. Perhaps this was just a good old fashioned Brierley asset stripping heist. Instead of looking on Project Vanguard as a swimming coach, what would happen if I put on my old corporate hat? Which Coulter was leading the charge towards Project Vanguard, the corporate raider, or the sport’s administrator? Were New Zealand’s swimming Regions a source of cash or providers of a swimming service? In the words of the Watergate whistleblower, what would happen if I just “followed the money”.

And here is what I found. Please excuse the non-accounting arrangement of the financial tables used in this report. I’ve had to modify their format to fit with the layout constraints of the Swimwatch blog.

First of all I consolidated all the Region’s Balance Sheets. These are shown in the table below. Very limited financial information was available from Counties, Eastern Districts, Wanganui or Wairarapa. The information I did find in respect of these Regions has been consolidated under “Other” in the table.

So what does this tell us? Are the Regions a succulent financial plum? Is it worth Coulter, Byrne and Cameron going through the whole Project Vanguard exercise in order to close the Region’s down; in order to secure a financial windfall. You just bet your life that’s their game. If Project Vanguard is approved Coulter and SNZ’s “hole in the wall gang” make a financial killing. Just take a look at the figures.

Pride of place goes to $1,083,277 of hard cash held in the bank accounts of the Regions. Accept Project Vanguard and all that money gets transferred to SNZ’s Wellington bank account. Coulter and Byrne can spend it as they like. These are the same guys who were insolvent three years ago; who relied on state emergency financial aid from SPARC to get themselves out of trouble. And now they want your million to spend on their own grand schemes and on Cameron’s bottomless Millennium pit. I spoke to a Regional administrator on the phone today. She said to me, “We spend all our money on the swimmers in our Region.” Under Project Vanguard that will be a thing of the past. The Regions have a million dollars. For the love of this sport, don’t give it to SNZ.

Accepting Project Vanguard will also mean SNZ will inherit $397,399 worth of fixed assets. That’s all the computers, touch pads, score boards, desks, honours boards and chairs that the Regions have accumulated; bought not with state aid but with the proceeds of a thousand sausage sizzles, raffles and car wash mornings. This fixed asset value however is what is called the depreciated value. The purchase cost of the Regions collective fixed assets is $1,077,311. No wonder Coulter is pushing to get Project Vanguard accepted; forty-five votes at the AGM and he scores a million dollars worth of goodies and another million dollars in cash.

SNZ has a current value of $277,315 made up as shown in the table below.

The Regions have a combined value of $1,444,961. In one Project Vanguard heist Coulter plans to increase the value of his empire fivefold from $277,315 to $1,722,276. And he plans to do it at your expense.

The annual revenue windfall from Project Vanguard will not be as generous to Coulter and his cohorts; but it won’t be too bad either. The table below summarizes the Region’s consolidated revenue statements. Annual income to the Regions is $1,469,764; that includes income from membership fees, grants and donations, sausage sizzles, raffles, car washes and meet entry fees.

SNZ won’t be better off by the full $1.5 million. However acceptance of their Project Vanguard scheme will net them a tidy sum. Here is what I expect will happen.

1. SNZ’s income will increase by the amount of the membership fee currently paid to the Regions. That is $21 for 22,202 members or $466,242. So already Project Vanguard will benefit the Coulter gang by close to half a million dollars each year.
2. A Project Vanguard run SNZ will see the Regional income from local fund raising activities almost disappear. Clubs will still host raffles and sausage sizzles, but the incentive to run Regional fundraising events will be a thing of the past. Close to $200,000 raised by these events will be lost to the sport. Unfortunately the pain of that loss will be felt most by those who can afford it least – the sport’s grass roots. You see, that is the sector that benefits most by from the Region’s fundraising work.
3. Grant’s, donations and sponsorships of about $500,000 paid to the Regions will also disappear. That income also benefits young swimmers. Auckland’s Junior League is an example of a sponsored event providing benefits to a huge number of young swimmers; not in the Project Vanguard world it won’t.
4. In the Project Vanguard era most of the $300,000 in meet entry fees paid to the Regions for local swim meets will end up in SNZ’s bank account. I suppose SNZ will still hold Provincial Championships, for example. I think it is safe to assume SNZ will hold on to $250,000 from this source.

What all this means is that each year SNZ will receive $500,000 from membership fees and $250,000 from meet entry fees that is currently paid to the Regions; $750,000 in total. Money lost to the sport altogether will be $50,000 of meet entry fees, $500,000 of grants and donations and $200,000 raised by small fundraising events; also $750,000 in total. The Region’s work with the grass roots members of the organization will be worse off by three quarters of a million dollars. Your junior swimmers will be worse off under Project Vanguard. SNZ will not look after them the way you do.

So where has the Deep Throat Watergate advice of “follow the money” taken us? Is there a financial motive to the hand-wringing support of Project Vanguard that we see coming out of SNZ’s Wellington office. Of course there is. Coulter and Hemsworth have managed this as a straight forward assets stripping commercial venture. At no cost to themselves the table below shows what they will strip out of the Regions.

As near as it doesn’t make any difference, $3,000,000 stripped from the Regions for Coulter and Byrne and Cameron to spend or use as they like. And all they need to do is find 45 votes and they get the lot. I just really hope there are not 45 votes out there that are silly enough to fall for the deception. For about 110 years the real value in SNZ’s business has been built by the Regions. It is not ours to give away; certainly not to the likes of them.

And if by some chance there is still a small doubt in your mind – “just follow the money.”

Sixteen member Regions elect the Board of Swimming New Zealand. As a consequence, the most compelling duty confronting every Swimming New Zealand board member should be to honour their fiduciary duty to the Regions. Byrne has the same responsibility. Failure to meet their fiduciary duty could result in grave consequences, including jail time, for both the offending board members and the CEO. A breach of Swimming New Zealand’s fiduciary duty to the Regions occurs whenever a board member or Byrne abuse their power in such a way that causes harm to one or more of the Regions.

The essence of Swimming New Zealand’s fiduciary relationship with the Regions is best described in a 1972 court decision which held that:

A fiduciary relationship is one founded on trust or confidence reposed by one person in the integrity and fidelity of another…A fiduciary relation exists when confidence is reposed on one side and there is resulting superiority and influence on the other…

Under the current constitution the Regions of New Zealand put their trust and confidence in the Swimming New Zealand Board – an obvious fiduciary relationship exists. And it has been betrayed. Potential criminal behaviour is in need of investigation. How do we know this? Well, today Swimming New Zealand published a paper called the “Operating Model Options Report – March 2011”. In it the SNZ Board identifies four recommended options for constitutional change. SNZ calls them Club Focused, the British Swimming Model, Super Regions and the Centralised Services and Governance option. The existing Regional structure doesn’t even make their final cut. The “shareholders” who elected these people are being eliminated with inexcusable contempt. In Swimming New Zealand’s rush for power, the Regions are unwanted. SNZ has abandoned its fiduciary duty.

This Board was not elected with a mandate to discard the Regions. When the Swimming New Zealand board was elected it entered into a relationship with the Regions “founded on trust”; based on “integrity and fidelity”. What a grave error that was. Project Vanguard is mutiny and here are the names of the nine mutineers – Murray Coulter, Ross Butler, Mark Berge, Humphrey Pullon, Dominic Toomey, Jane Wrightson, Jan Cameron, Mike Byrne and Cathy Hemsworth. If their intention is to get rid of those who elected them, they should resign in mass and stand again on a platform that makes it clear they no longer see any merit in having the Regions around.
The deception of Project Vanguard is probably dire enough to give SNZ board members serious legal difficulties. However, their problems are about to get much worse. You may recall that the definition of a breach of fiduciary duty includes the requirement that the abuse of power causes harm to one or more of the Regions. Well, eliminating the Regions is probably bad enough to satisfy that test. However, do you remember this recommendation from the Ineson Report?

The winding up of the regions will require a strategy to properly manage the change. An arrangement will be made with SNZ that all Regional funds and assets have a sunset clause (3-5 years) after which all remaining assets/funds to be forwarded to SNZ.

Swimming New Zealand is going to rape the Regions of their money, their equipment, their buildings, their cars; all their assets. Southland has a unique relationship with their licensing trust. Forget it – in three years that won’t exist or it will belong to greedy Mike in Wellington. Auckland owns the score board, the computers the chairs, the starting blocks; half a million dollars of equipment at the West Wave Pool. Not in three years it won’t. Jan Cameron will be the Queen of Auckland’s assets. Canterbury has reserves of $246,000, accumulated over 110 years; gone in three years to Wellington. Otago has $124,000 that the Hemsworth Report says Otago is as keen as mustard to transfer to the capital. In Swimming Northland’s February board minutes Helen, the Treasurer, wants to invest Northland’s reserves in a long term deposit. She had better make sure it’s less than three years. Murray Coulter is going to need that money. Did you think Swimming New Zealand was going to pay for the sporting carpetbaggers they are about to hire? Wrong. They are going to take your money and spend it on people like themselves. Project Vanguard is a Coulter and Byrne heist. And that just has to be a huge breach of their fiduciary duty.

The “Operating Model Options Report – March 2011” says Swimming New Zealand is an organisation that communicates poorly, it lacks consistency, it does not collaborate easily, it is not a performance-oriented organisation, it has a culture of ‘them’ and ‘us’, it sometimes finds it easier to lay blame than work together, it is an organisation of revered individuals rather than a team and it is not well positioned to reach out to the whole swimming community. I certainly agree with most of that. But those failings have nothing to do with the Regions. They are not their fault. Those problems are because Byrne and Cameron don’t know how to run the place. Giving them a Club Focused or a British Swimming Model or a Super Regions structure or a Centralised Services and Governance option won’t make any difference. The people need to change; not the structure. Mike Byrne says he is unable to make the existing structure work. Then he should move over and make way for executives who understand how to run the place. Good managers will thrive and prosper working inside the current Regional model – and it won’t cost a penny.

The “Operating Model Options Report – March 2011” highlights the waste we will all be buying into if the current structure of swimming in New Zealand is changed. Their Report is stacked full of the most outrageous double speak, marketing, trendy, vacant, rubbish I’ve read in a long time. Just imagine what Duncan Laing, Arthur Lydiard, Rusty Robertson, Fred Allan, Ross Anderson, Edmund Hillary and Colin Meads would make of this selection.

1. Accountabilities do not exist in any effective way to deliver outcomes demanded by all stakeholders.
2. The national office equally needs to rely on alignment of the organisation on major business deliverables.

Just think about it for a moment, do you want an organization that’s full of that sort of stuff or do you want the sort of tough, lean, practical achievement that is represented by the names of New Zealanders who do or did know how to win a sporting event.

And finally, and as usual, Swimming New Zealand lie like there is no tomorrow. All through this Report they claim that a majority of the membership support the abolition of the Regions. I’ve heard reports that the Project Vanguard committee is forever claiming they have a popular mandate for dismantling the regional structure. What else does this line in their Report mean? “And most importantly you, the members, have said “there is room for improvement so we cannot continue the way we are going.” Please, don’t lie to us Swimming New Zealand. The membership hasn’t said that at all. In fact Coulter is the guy who is too gutless to go to the membership and ask for a mandate to proceed to the next stage of the Project Vanguard process. Remember the AGM remit requiring him to do that? Eventually, though Swimming New Zealand are going to have to go to the Regions. Eventually they are going to have to find 45 votes. And do you know what, no matter what inducements and bribes Swimming New Zealand offer, no matter what lies they tell or contractual obligations they ignore – I don’t think they are going to get them.

By David

There has been a large and surprising response to the Swimwatch article discussing the selection of New Zealand swimming teams. The discussion has revealed a far more complex history than I ever imagined. For example in 2008 there were two cases heard before the Sports Tribunal. Both were brought by athletes who had missed selection for the Beijing Olympic Games – Kane Radford and Te Rina Taite (both links open PDF files). In both cases the Tribunal dismissed their appeals. Radford again met the wrong side of Swimming New Zealand’s selection processes for this year’s World Championships (although if he had been Australian, he’d have been on the team).

I have just finished reading the two Tribunal’s “Reasons for the Decision”. I am not surprised they found against the swimmers. A combination of dirty pool, confused rules and hard ball tactics by Swimming New Zealand left the Sports Tribunal with little option. Here are some examples of what I mean.

In both cases Swimming New Zealand disputed the jurisdiction of the Tribunal to hear the appeals. In the Radford case Byrne, the CEO of Swimming New Zealand, embarrassingly emailed the Tribunal confirming that SNZ did accept the Tribunal’s jurisdiction; leaving the SNZ’s lawyer desperately trying to find legal arguments as to why Byrne’s opinion didn’t matter. The best their lawyer could come up with was that there was no agreement because no consideration had been paid and Kane Radford had not acted to his determent as a result. Clearly the standard of Victoria University’s Legal Department and particularly the section that deals with ethics and the law is not what it once was. The moral of the story for any swimmer with a selection issue is “beware”. SNZ will make every effort to tie the case up in legal arguments about process to confuse and delay addressing the real issue – justice for a New Zealand swimmer.

In the Te Rina Taite case SNZ claim they offered the four relay swimmers the chance to swim a trial relay to see if they could swim the qualifying time. The Tribunal says it was told that “Ms Palmer and Ms Boyle chose not to swim”. Now, I’ve not spoken to either swimmer, however Hayley Palmer’s parents assure me Jan Cameron never asked Hayley if she wanted to swim. In fact her father felt so embarrassed by the story he called Te Rina Taite overseas to apologize for the SNZ deception. I do not believe SNZ either. I think they made it up. Even the Tribunal wasn’t convinced. Their Decision reports that it “seems odd to this Tribunal that the situation should have developed in this way”. That’s legal speak for “we don’t believe you”. The moral of the story for any swimmer with a selection issue is “beware”. SNZ will use their power to damage your case.

In the Te Rina Taite case SNZ made every effort to get the case thrown out, without a hearing, by claiming Te Rina never submitted her appeal on time. You see, SNZ have a rule that says any complaint about selection has to be submitted within forty-eight hours. Te Rina Taite politely expressed her concern to SNZ within forty-eight hours. Here is what she said, “Hi, I realise you are probably quite busy at the moment, but could you maybe just explain why the women’s 4 x 100 freestyle relay didn’t qualify?” It took her another couple of days to formally complain. SNZ used Te Rina’s courtesy and good manners to kill her appeal. SNZ don’t care what’s right and wrong. To them it’s all about winning; at any price. In this case a good person was treated shamefully. What the forty-eight hour rule effectively means is that every swimmer going into the New Zealand selection trials needs to have a lawyer briefed and ready. This year’s trials end on a Friday night. If something goes wrong, there is no point in waiting until Monday to call your lawyer. You will already be out of time. The moral of the story for any swimmer with a selection issue is “beware”. SNZ will use their rules to deny you justice.

The concluding paragraph of the Te Rina Taite report is worth every person associated with the selection of a New Zealand team reading in full. Here is what it says.

The appeal is dismissed, but not without the matters raised by the Appellant having troubled the Tribunal. The complex mix of documents which are to be read by an athlete to understand the entirety of the nomination and selection process could be improved upon, in the Tribunal’s view. Selection Updates as late as occurred here may be warranted by particular circumstances, but in general carry risk of late notice and thus challenge. While the appeal is dismissed, the Tribunal considers that whilst she may not have achieved anything for herself, Ms Taite was entirely justified in bringing the appeal to proper scrutiny of the nomination process adopted by SNZ; and for the purpose of future nomination and selection policy processes, and documentation.

In other words SNZ’s selection process stinks. And, sadly, it has not got any better. Why? Because, the same people are making the rules. At every turn they use the rules to cover themselves. I don’t know why Cameron doesn’t just order Sky Sport to broadcast a news item saying she’ll pick whoever she wants. Just take a look at what her current “rules” say.

A swimmer must “Record a time equal to or better than the FINA A time” except “Swimming New Zealand may amend these selection criteria at any time in its sole discretion” and “In the event that a swimmer has in the 12 months prior to the Selection Event met the Performance Requirement, and is unable to compete at the Selection Event due to extenuating circumstances, the previous performance will be considered by the SNZ Selectors.”

Without question the confusion and contradictions commented upon by the Sports Tribunal in 2008 are alive and well in Swimming New Zealand’s selection policies today. Cameron likes it that way. Only the rule of her law is a priority in the Cameron world. Certainly if I were Kane Radford or Philip Ryan I’d be looking at turning SNZ’s confusion to my advantage. Both those swimmers should be on their way to the World Championship’s open water race in Shanghai – even if they have to go to their lawyers and the Sports Tribunal to prove it. And you pool swimmers out there, brief your lawyers well before you set off for the West Wave Pool in two weeks. You may well need them.

In response to my call asking Hayley Palmer’s parents about the Te Rina Taite case I have received the following email.

“At the time in which this case was heard we were not aware it was happening. When we read the case we felt physically ill.

We had always been puzzled by the decision not to try and send a (women’s 4 x 100m freestyle) relay team when a qualification slot was available to New Zealand and the invitation had already been received, especially when so much effort was being placed into getting a belated qualification for the Men’s team which did not hold a pre-qualified slot. Te Rina’s case was brought to our attention last year (2010) purely by chance and we were mortified when we learned of it, to the point where I personally called Te Rina Taite overseas to apologise for what she must have assumed was a betrayal by her fellow swimmers. I explained to her that we had been completely unaware of her action.

The claim is made in the case to which you refer and the whole decision hinged on the statement that Mr. Rushton had personally spoken to the other swimmers (by implication our daughter) asking if she wished to swim again and also that Jan Cameron had spoken to our daughters coach and that she had been offered that opportunity which she had rejected. I can categorically assure you that no such approach or offer had been made to my daughter by either Mr. Rushton or my daughters coach. I cannot comment as to whether or not Jan Cameron had spoken with my daughters coach as she claims but I can assure you that no such offer to swim again was made to my daughter. Had it have been made then she absolutely would have swum as offered as she was desperate to obtain selection to the vacant relay slot. Attending the Olympics was her dream as it would have been Te Rina Taite’s dream and she would have taken any opportunity offered to help the team qualify. We feel very sorry for Te Rina especially given the efforts (which we applaud) that were made to allow the men’s team to qualify and the three month time window that was offered to them after the trials were completed.