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Wales Online
Wales Online
Sport
Steffan Thomas

Welsh rugby is in a race against time and it needs to find ways of rebuilding fast

The bells have tolled and the white smoke has emanated from the chimneys of the Principality Stadium to signal peace between the Welsh Rugby Union and its four professional sides.

A six-year agreement has been signed, ending months of uncertainty for players, coaches and supporters, while the WRU member clubs voted heavily in favour of radical changes to the governing body's governance structure at an extraordinary general meeting in Port Talbot a fortnight ago.

One thing Welsh rugby isn't is boring but the past six months have been nothing short of ludicrous, and some of the storylines wouldn't have looked out of place in WWE wrestling.

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We've had the players threatening to strike ahead of the biggest game of the season, a long drawn out freeze on offering contracts, a region linked with an outrageous merger with English Championship outfit Ealing Trailfinders, and not least of all a taskforce has been set up to determine if there is a culture of misogyny and sexism within the WRU.

On the face of it, a significant step forward has been taken but the plan to get professional rugby in Wales back on its feet is a risky one.

They'll say the uncertainty has been removed with the signing of a six-year financial framework but rugby in this country is anything but stable.

This week, I have interviewed both Professional Rugby Board chair Malcolm Wall and Scarlets general manager of rugby Jon Daniels, two men who have played key roles in creating the new framework for Welsh rugby.

READ MORE: Malcolm Wall outlines his vision for Welsh rugby

READ MORE: Jon Daniels reveals 'very difficult' conversations with players and issues warning over further cutbacks

To cut a long story short, playing budgets will get down to £4.5million for the 2024/25 season with player wages being aggressively pushed down in a bid to make Welsh rugby more sustainable.

Acting WRU chief executive Nigel Walker has dubbed it a "correction", while Cardiff director of rugby Dai Young admitted the regions have been paying too much on player wages for a number of years.

The plan is to strip everything back and start again in order to make professional rugby in Wales more sustainable to avoid the catastrophe of one side going bust.

Wall's analogy was "we are at base camp and are now about to begin climbing the mountain."

There is no doubt Welsh rugby has to cut its cloth accordingly, and it's worth pointing out the game of rugby worldwide is in a parlous financial state with English clubs Wasps and Worcester Warriors having recently gone to the wall.

It's a slippery slope for obvious reasons; a lower playing budget more often than not results in more defeats which leads to fewer supporters through the turnstiles.

Both Wall and Walker are absolutely correct in attempting to bring wages into line but as far as I'm concerned Welsh rugby hasn't got years to rebuild and faces a race against time.

Potential young fans don't want to see the Ospreys or the Scarlets getting stuffed week in week out which could well happen if the playing budgets drop as low as £4.5m.

As Scarlets boss Daniels told me, every effort needs to go into finding a way to keep the playing budgets above £5m.

The biggest victory

The biggest victory for Welsh rugby was the EGM result, and it is vitally important the right candidates are appointed to both the independent chair and chief executive positions.

The new CEO must go in the opposite direction to his or her predecessors by having a growth mindset. The next CEO needs to focus on growing the commercial monies of the WRU, perhaps cut their overheads, potentially sell their non-core assets, while also managing the debt smartly.

As austerity has shown us, growing again after such major cutbacks is extremely difficult.

The key thing within the context of the new framework is if the WRU grows revenues, more money will flow into the game while debt as a whole needs to be refactored.

There needs to be more investment into all areas of the game, and it's worth remembering the whole thing is a pyramid. Increased participation in the community game and in schools should result in more players for the professional game.

If the professional game thrives, more money should then flow down into the community game.

Yes, Welsh rugby needs to avoid paying over the odds for players but now is also the time to invest in the future.

One of the biggest problems is the WRU are asking the clubs to deliver as much as they always have with regards developing players but are paying them less to do so.

The WRU have released 75% of CVC funding to the regions but those are forward payments for reduced future media revenues while at the same time they have reduced their commercial contribution to net the effect down to zero.

As Wall inferred in our interview this week, the new framework and the EGM result is just the beginning, and Welsh rugby needs to find ways of rebuilding effectively.

  • This weekly bulletin was first sent to subscribers of WalesOnline's rugby newsletter. To be among the first to receive Steffan Thomas' weekly briefings, sign up for free here.

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