The Government has stepped in to help try and find a new financially sustainable model for professional rugby in England with a third Premiership club teetering on the brink of collapse.
The Department for Culture, Media and Sport has announced former Rugby Football League CEO Ralph Rimmer and UK Sport’s Chris Pilling will support the Rugby Football Union and Premiership Rugby Limited in their efforts to reshape the game’s “future strategic financial and sporting direction”.
The move comes with London Irish facing suspension from the Gallagher Premiership unless a takeover has been completed or they can demonstrate they have the funding needed to operate for the entirety of the 2023-24 season by June 6, following the recent failures of Worcester and Wasps back in the Autumn.
A DCMS statement said: “The issues at Worcester, Wasps and London Irish have laid bare the challenges facing the sport of rugby union.
“The inability of rugby clubs to raise capital investment and the financial challenges at various levels within the game have contributed to the need for urgent work to help secure rugby union’s immediate future and advise on its future direction.”
The Government stepped in to support rugby at elite and grassroots levels during the Covid-19 pandemic with sizeable loans totalling £148m to Premiership clubs, but many clubs are still dealing with the impact as hefty repayments have kicked in to further squeeze finances at clubs, most of whom were making significant losses pre-pandemic anyway.
The Telegraph reports the repayment of the Covid loans could be examined, and perhaps renegotiated, as part of this collaboration however the statement also suggested that the Government would be “taking further action to further protect its investment on behalf of taxpayers” after providing “a financial lifeline to keep elite and grassroots rugby afloat during the pandemic”.
Sports Minister Stuart Andrew added: “This is a challenging time for rugby union and Ralph and Chris have agreed to utilise their experience to help the game develop a clear path for the future.
“We have seen several high-profile clubs and their fans left devastated in recent times and this additional independent advice will be of huge benefit to the RFU and PRL as they look to implement a new strategic direction for rugby.”
Premiership Rugby CEO Simon Massie-Taylor has outlined his vision of a 10-team Premiership being the best model moving forward with a professional division below, with movement from further below the rugby pyramid shut off and a potential franchise model introduced.
RFU CEO Bill Sweeney welcomed further Government backing and called upon those involved in the game to set aside “self-interest” in the quest for a sustainable future.
He said: “The restructuring of the Professional Game Agreement into a strategic partnership provides a great opportunity for all stakeholders to set aside self-interest and collaborate to reset and secure the future long-term sustainable growth of the professional game including developing the strongest possible second-tier.”
The Professional Game Agreement in part determines how much funding clubs will receive from the RFU in return for releasing and developing England players.
The next 12 months is a key time for securing rugby's financial income with the current TV deal with BT Sport running for one more season until the end of 2023/24 with the broadcaster undergoing a rebranding of its own this summer to TNT Sport following an acquisition of the channel by Warner Bros Discovery, which also owns Eurosport. Higher revenue from a TV deal is considered the 'golden goose.'
