The essential difference between
Sponsorships and Government Grants

Grants, whether they are from government or non-government sources, are considerably different in nature to sponsorship. The methods involved in pursuing money from organisations that provide grants are also quite different from sponsorship.

The essential differences are as follows:

Sponsorship

Sponsorship is a business deal between two parties. The deal usually involves a commercial enterprise that is seeking to expand their business, generate more sales, increase their profile and standing in the community. The desired result is increased profit on the part of the enterprise.

The difficulty with sponsorship is providing an acceptable return for the investment. For example, if the enterprise provides a sponsorship to a recreation organisation of $20,000 how will they get this money back in the form of increased profits. It may be necessary for the sponsorship to generate an extra $100,000 in sales to reach an increased profit of $20,000.

Grants

Organisations that provide grants also want a return on their investment but for entirely different reasons. If a government agency provides a grant to a sport and recreation organisation it is not seeking to increase profit. The goal is to provide a benefit to the community in some form. Typical goals might include:

 

i.

Improvement in the quality of life of citizens

Grants for improving the environment, recreation opportunities, the arts and education.

ii.

Reduction in public expenditure

Grants for research into cures for disease, road safety, community self-help groups and crime reduction

iii.

Increasing economic outcomes for citizens

Grants for job creation, training, technology development and small business development

Grants can also be obtained from non-government agencies. Some organisations exist for philanthropic or humanitarian reasons such as The Sidney Myer Fund. Other organisations such as the Jupiter's Casino Benefit Fund provide funds for the community benefit largely because law requires them under section 52 of the Casino Control Act, 1982.

Competitive Nature of Grants

Obtaining funding from agencies and organisations that award grants is very competitive process. Such organisations usually receive and must assess a large number of written submissions. Generally, funding agencies provide comprehensive guidelines for applicant organisations that determine who can apply, what types of projects can be funded and how much funding can be obtained.