S17A – implementation observations p2 / Council elections p2 / Connecting the dots in
sport and recreation p3 / The burgeoning evolution of eSport p4
Connecting
the dots
Local Government and
Infrastructure Matters
Issue 6
July 2016
pwc.co.nz
Editorial
In June, we welcomed specialist sport and
recreation advisers O’Connor Sinclair into the
Local Government team. This comes hard on the
heels of other service additions to broaden our
advisory capability. These have included the Tax
Team, who we welcomed in May, and specialist
property advisors Wareham Cameron.
Tapping into our much larger resource base,
Brendon O’Connor and his team are looking
forward to complementing their strategic sport
and recreation expertise to enhance overall
service delivery to local Government. This
means clients will have access to a team that
‘can connect the dots’ in the complex area of
sport and recreation strategy and planning.
1 PwC
Optimising S17A
Service Reviews
The enactment of S17A Local Government Act 2002 is beginning to
generate activity around the sector. This has been accentuated by the
introduction of a further Bill1, which is proposing to add a subsection 4A
to S17 of the Act, dealing with subsequent transfer of responsibilities to
any change proposed.
We have been receiving many enquiries from
local government clients and are currently
assisting a number of Councils to implement
reviews. In doing so, there are several matters
that Councils could usefully consider to
maximise value and minimise cost, including:
• Reconfirming what activity reviews have
been completed in recent years
• Where activity reviews have been
completed, exploring possibilities of
refreshing or updating with a S17A lens
Council elections
• For activity reviews already underway at
the time of enactment, consider whether
additional steps are required to make
them compliant
• If additional resource is required to
complement internal capacity, consider
how best external resource could be
leveraged, e.g. reviews of specialist
activities such as economic development
agencies
• Continue to build and seek to leverage
existing partnering arrangements with
neighbouring councils.
Taking on board what has been done in
combination with how the reviews will be
undertaken will assist Councils to leverage
better results from their S17A endeavours.
With local Government elections
occurring later in the year we will
no doubt see a number of new
elected members. In this regard, we
are currently working with LGNZ
to produce an updated “Tax Guide
for Elected Members” as well as
an update to the tax section of the
“Elected Members’ Governance
Handbook”. Both of these provide
valuable information to elected
members on their tax obligations,
including how their remuneration is
taxed at source.
1
Local Government Act 2002 Amendment Bill (No. 2)
Connecting the dots
2
Connecting the dots
in sport and recreation
Successfully leveraging New Zealand’s
sport and recreation investment for
genuine impact will be based on three
key building blocks.
1. Embracing the fact that consumer expectations
and needs in sport and recreation are
rapidly changing: future provision is not an
extrapolation of past provision.
2. Improving the capacity of providers of sport
assets, services and experiences, including
Councils, to apply a consumer centric
‘horizontal and vertical’ lens on strategic
problems and solutions.
3. Demonstrating the insight and courage to
differentiate between consumer needs and
provider wants. They are not always the same
thing!
Challenges include:
• Sport, recreation, health and education are
impacted by fundamental sector
and cross-sector megatrends and
related forces; anticipation and agility
is increasingly critical to success.
• Rapid societal change, including technologybased innovation and disruption, will impact
the sport and recreation value chains (see our
eSports section).
• We strive to have ‘more people active more
often’. The capacity for more asset, services
and experience providers to design solutions
around the consumer needs of today and
tomorrow is a complex and ongoing challenge
when so much is invested in the past.
• For local government, adopting a genuine
consumer led approach, applying an integrated
cross sector lens and delivering to future needs
are critical to achieving better outcomes from
sports and recreation investment.
“The rise of social media, live streaming, and expanded
distribution options for broadcasts of top level competition have
enabled eSports to break down geographical barriers in a way
that many traditional sports have struggled with”.
Mike Sepso
Senior Vice President of Activision Blizzard Media Networks
3 PwC
Connecting the dots
4
The burgeoning
evolution of eSport
Do you know what
eSports are?
What does it mean for
traditional sports?
Competitive gaming has been around almost
as long as video games themselves. Initially,
much of the competition centred around friends
challenging each other in a game of Pinball. But
this quickly transitioned to organised tournaments
beyond just arcade games. The Space Invaders
Championship held by Atari in 1980 was the first
large-scale video game competition, attracting
more than 10,000 participants across the United
States2. This tournament, and the others that have
followed, set the stage for what would ultimately
become eSports.
Through our ongoing global consumer intelligence
research, the March 2016 survey of eSports trends
highlighted the growing awareness of eSports. In
fact, 15% of survey respondents were aware of the
activity and awareness was significantly higher
amongst millennials.
A new world: growing up
gaming
Today, kids are being born into a world where
playing video games can be as strategic as
a quantitative math problem. As organised
competitions continue to attract more attention
and money, it is moving out of the shadows,
landing squarely front and centre for new
generations of enthusiasts.
Growing pains: Are
eSports really sports?
Although the eSports community would like to
be legitimised in the sports world, it’s possible
that acceptance won’t be based on general public
education. Rather, it may be whether the money
available for participants in eSports reaches par
with traditional sports.
Considering how easy it is to undertake this
activity within the home, traditional sport and
recreation activities will be ‘disrupted’
- if in fact they are not already being impacted.
The instant impact of Pokémon Go from its launch
on 6 July 2016 (est 7.5 million downloads in the
first 10 days) highlights the potential for rapid
consumer impact in the eSport space.
This means that traditional approaches to sport
and recreation will need to be re-thought if it
is to continue to attract significant numbers of
participants.
Considering the health benefits of physical activity
available through sports and recreation, this is
a challenge for those overseeing public sports
facilities and recreation programmes.
Total eSports players
12%
Both at home
18%
70%
At home only
In person at
a live event
and in person
at a live event
Base: Total eSports players (n=170); Q33. Have you participated in eSports gaming
competitions at home, in person at a live event, or both?
Do you know what eSports are?
Unaided, 15% of our survey respondents were aware of eSports.
57%
34%
25%
15%
Total
respondents
Digital Spy, “Gaming Like a Pro: An Overview
of the eSports Scene”, February 5, 2012
2
5 PwC
7%
P18-24 P25-34 P35+
14%
14%
Caucasian/ African
White
American
18%
Asian
23%
Hispanic/
Latino
Hardcore
gamer
Base: Total respondents when accounting for full sample before quota terminations
(n=2105); Q11. Are you aware of/have you heard of the term “eSports”?
“A decade from now
eSports will be on
par with today’s
traditional sports.”
CEO of eSports arcade
machine maker, GameCo, Inc.
Connecting the dots
6
Get in touch
Craig Rice
Partner - Strategy & Markets Leader
T: +64 9 355 8641
E: [email protected]
David Walker
Director
T: +64 9 355 8033
E: [email protected]
Brendon O’Connor
Director
T: +64 9 355 8608
E: [email protected]
Janelle George
Manager
T: +64 9 355 8196
E: [email protected]
Janine Grainger
Manager
T: +64 9 355 8423
E: [email protected]
Murray Harrington
Partner
T: +64 3 374 3094
E: [email protected]
Nathan Jones
Partner
T: +64 3 374 3001
E: [email protected]
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