How will sport and recreation be funded in the future? 

What are we seeing?  

• The sport and recreation sector receives about $4 billion in funding annually, with the largest sources being membership/participation fees ($1.3B) and local government spending ($1.1B). 
• Funding has decreased by 14% since 2018, driven by reductions in revenue from membership, sponsorship, and commercial activities, leading to greater reliance on government and gaming funding sources. 
• Trends include a shift away from organised sport towards pay-for-play activities, declining alcohol sponsorship, and reduced household spending on sport and recreation. 

What can we expect?  

• Government funding may face constraints, but health and social benefits could open new support. Pokies and online gambling regulation may impact funding sources, both positively and negatively. 
• Pay-for-play will increase the divide between those who can afford to participate and those that cannot but may be offset by targeted funding. 
• Emerging technologies like 5G and blockchain could enable new commercial opportunities and more efficient sport and recreation options. 

What might this mean for sport and recreation?  

• Sport and recreation funding models will likely change, requiring the sector to adapt by understanding evolving participant demands, demonstrating return on investment to sponsors using data, and differentiating offerings based on socioeconomic status. 
• Reducing costs and improving efficiencies through new technologies, collaborations, and innovative use of facilities will be as important as securing new funds. 
• Aligning the value proposition with government priorities beyond sport, conveying a compelling narrative around social cohesion, health benefits, and exploring novel revenue streams will be essential for the sector's future success. 

What questions should we be asking ourselves today?  

• How can we diversify funding sources, explore new commercial opportunities, grow philanthropic and crowdfunding models, and develop social enterprise initiatives to reduce reliance on government funds and gambling proceeds? 
• How can we prepare for potential changes in the funding model supporting sport and recreation in New Zealand, explore alternative funding sources to mitigate risks, and ensure a sustainable funding system? 
• How can we better understand and cater to evolving participant demands and shifting societal values to attract and retain participants, and what changes or innovations are needed in offerings, delivery models and messaging?