More Financial Trouble?

[Wombles]

There are lessons learnt and then there is setting a precedent. IF another club is on the verge the only fair reply from the RFU and PRL should mirror that of what ourselves and Worcester received. It cannot be approached any other way, to do otherwise would - I imagine - only create a massive legal challenge from Worcester and Wasps who would rightly and not without merit claim their cases were unfairly treated. It would be a reputational and financial error.

If more clubs go to the wall then it is their fault as it was ours and Worcesters.  They were working within the rules as they were at the time and thus must face the same punishments if our sport has any integrity at all.

[NellyWellyWaspy]

In my mind, four possible:

Newcastle
Leicester
Exeter
Irish

Thing is, if one or more go under, and they are forced down the same route, how many will be in the same mess as WW. At this stage, could a club be back up and running for next season? I seriously doubt Wasps will manage it even now, so going under soon there is no chance.

I am thinking 3 of the above 4 will go under. Two will go the way of WW, one might re-emerge.

[Rossm]

And of course, the more clubs that vanish from the Prem, means that there will be fewer  home fixtures and less income for the remainder. Then the TV broadcasters will start to lose interest and monies will reduce even further. And so it will go on..............

[westwaleswasp]

As it should.
Whilst we have the cancer of cap cheating effectively unpunished- still the biggest issue with the club game, then anything to destroy that is welcome. We all start again, no problem.
When restart top players need to be on 150k, end of.

[andermt]

And of course, the more clubs that vanish from the Prem, means that there will be fewer  home fixtures and less income for the remainder. Then the TV broadcasters will start to lose interest and monies will reduce even further. And so it will go on..............

I've been saying the same thing since the comments about a 10 team prem were 1st muted, it makes zero sense to me that the clubs want less games, yes for player welfare but for revenue it doesn't make sense.

I think this has been proven out by the feedback from Tigers around their financial situation and can't remember if it was them or Saints who mentioned they would arrange 'additional games' which can only mean friendlies to make up the shortfall, that is going to annoy STH, I know it would me, that they have to pay for the matches with no meaning, plus when do they add them in as I would guess their are no fallow weeks in a 10 team league. Then for the casual fan who picks and chooses matches, who is going to go watch a friendly unless they play an international team, can't imagine the BaaBaas will step up like this year as there potentially won't be a big pool of players looking for something to do next year.

[Bloke in North Dorset]

It was Exeter who very arranged a friendly match. So much for player safety.

https://www.devonlive.com/sport/rugby/rugby-news/exeter-chiefs-confirm-contingency-plans-7695906

[backdoc]

And of course, the more clubs that vanish from the Prem, means that there will be fewer  home fixtures and less income for the remainder. Then the TV broadcasters will start to lose interest and monies will reduce even further. And so it will go on..............

I've been saying the same thing since the comments about a 10 team prem were 1st muted, it makes zero sense to me that the clubs want less games, yes for player welfare but for revenue it doesn't make sense.

I think this has been proven out by the feedback from Tigers around their financial situation and can't remember if it was them or Saints who mentioned they would arrange 'additional games' which can only mean friendlies to make up the shortfall, that is going to annoy STH, I know it would me, that they have to pay for the matches with no meaning, plus when do they add them in as I would guess their are no fallow weeks in a 10 team league. Then for the casual fan who picks and chooses matches, who is going to go watch a friendly unless they play an international team, can't imagine the BaaBaas will step up like this year as there potentially won't be a big pool of players looking for something to do next year.

Unfortunately the comments about a 10 team Premiership were mooted; much better if they had been muted !

[JF]

There's a scenario where "the great reset" happens.

Two more teams from the Prem go bust, the authorities declare a moratorium, the professional game is reset so that not only is there a properly-monitored salary cap but there is an additional limit on salaries being x% of turnover so that all clubs must be cash-positive at the end of the season, with an auditor's report confirming it.

Unlikely, though, isn't it?

[Shugs]

The simple fact is that while there are individuals willing to spaff millions up the wall to indulge their hobby the game has a problem. The English game is bust, as is the Welsh. The sugar daddy clubs have created a scenario where they can survive but will have no-one to play. One of the best things that came from new Wasps was that they were looking for institutional investment. We also tried to break the model with our Ricoh move. We?re trying to do the right things. The English game itself needs a fundamental reset as I don?t think a 4 team prem and a 20 team championship works!

[mike909]

The simple fact is that while there are individuals willing to spaff millions up the wall to indulge their hobby the game has a problem. The English game is bust, as is the Welsh. The sugar daddy clubs have created a scenario where they can survive but will have no-one to play. One of the best things that came from new Wasps was that they were looking for institutional investment. We also tried to break the model with our Ricoh move. We?re trying to do the right things. The English game itself needs a fundamental reset as I don?t think a 4 team prem and a 20 team championship works!

There are a variety of problems, but pro sport has always required either no rules (effectively) like Prem football - I support Fulham - it's where my family was from - and we have to compete against the Man City's that can afford one player the same value as our squad. All based on marketisation and vast sugar daddy funding. And filling grounds and TV rights. That means it's up to every club how it ends up.

If you have restrictions - like that we've got and had for Prem rugby, that needs clubs to be cooperative and basically honest....Whilst as someone who audited public accounts as a trainee (I stopped asap!) that needed organisations to be basically honest - or they got sat on by masses of expensive people until reality was discovered - as far as possible.

But to audit a salary cap for a rugby club, determined to by pass controls - would be impossible. Easy to audit the salaries and expenses paid by the "club" - virtually impossible to do anything about side deals that aren't about sponsorship (i.e. a Red Bull scrum cap). And here we are....

So - fundamentally, rugby in England will need all participating clubs to be wanting to cooperate and commit to open books and not doing side deals. And I'm not sure that's likely.

[jamestaylor002]

Mike, you make some good points and I don't disagree with you.

But to audit a salary cap for a rugby club, determined to by pass controls - would be impossible. Easy to audit the salaries and expenses paid by the "club" - virtually impossible to do anything about side deals that aren't about sponsorship (i.e. a Red Bull scrum cap). And here we are....

I am by no means an accountant, and assuming audits is something that did happen, is there anything that would stop a salary cap regulation defining the terms? For example:

• A sponsorship (Red Bull scrum cap) is defined as an agreement between a player and a third-party company over an agreed time period. The player's club isn't involved in any way.
• Salaries and expenses defined as monies paid for a player's service and is paid directly by the player's club in line with the agreed contract between player and club.
• Other side deals being defined as an agreement between a player and a third-party company for a one-off service (such as after dinner speaking). The player's club isn't involved in any way.
• Benefits being defined as employment benefits that support rugby players to upskill and prepare for life outside of rugby. Financial support for training for both academic (college/university) and vocational (e.g. trades training at colleges or business training by independent training providers). For example, clubs will be allowed (and encouraged) to support the upskilling of a player wanting to go into business and supporting the business being set up. A club may provide further financial support, such as investing money into the player's business to help purchase equipment whilst starting up, but this should be declared under club expenses.

Therefore, if any sponsorship or side deal opportunity is made available to the player due to involvement of the player's club (including people who are outside, but connected, to the club), then it is deemed a club expense and contributes to the cap. This still allows players to have business interests and bring in extra income, and provide stability once their playing career comes to an end, but allows competition across the league as clubs with richer benefactors won't be able to scoop up the country's talent by offering benefits/side deals that relatively poorer clubs cannot without having to declare that expenditure and putting it towards the cap.

[NellyWellyWaspy]

There are a few problems with those suggestions.

Anything earned as a consequence of playing rugby should be deemed part of the cap. So, in your example, that sponsored scrum cap would count.

But, you simply can't rely on players, the clubs, or the financial supporters of a club, not to make side deals. A relative gets a job, a house overseas is gifted, a holiday paid for.

In effect, all benefits in kind as understood by HMRC.

Yes, a player might have a coffee business, or own a pub, or ... they have to be allowed to develop those businesses as a retirement plan if nothing else. But, that then opens the way for money to be laundered to them though that business.

There is not be a way to stop it. Look at all the tax avoidance legislation HMRC have at their disposal, and all the investigators they employ. Along comes an upright citizen like Nadhim Zahawi. Walks all over it all.

No amount of oversight by the RFU, no team of investigators, is ever going to uncover the naughty stuff as it happens. You will find out years after the event. And the punishment for the high and mighty is never enough. Nadhim should have gone to prison. Cheats should have been thrown out completely. All their trophies taken back.

Right now I guarantee that Cheats are still cheating, and that at least two other sides are to a similar extent. It makes me wonder. Is it worth watching/following/supporting professional sport at all? I think I would feel better if Wasps never went back to the Premiership, and operated more like the Championship clubs. Leave the dishonest cheats in the Premiership, walled away in their self righteous glory.

[Shugs]

Completely agree with that NWW. The original cheats are actually rubbing it in peoples faces by naming things like ?the W club?. I?m starting to feel the same way about the prem because it will be the sugar daddy clubs that last longest. In some sort of dystopian world I imagine Saracens slugging it out with Bristol 5 times a year and then contesting the final??..Bath would still be bottom.

[HDAWG]

I think it depends on which club is staring into the abyss.

If it's a "big" club, then all the stops will pulled out to ensure the survival of the club. The 10 club league will have to wait.

If it's anyone else, then I'd speculate that enough support will be given, probably as a PR exercise to show lessons have been learned, but it might not be enough to stop a club from winding up as it will be a convenient path to the coveted 10 club league.

I wonder if having a success with pushing Wasps over the edge by changing repayment conditions if HMRC are doing it again. If so the whole league will be scared sh1tless. Quite a pleasing thought.

Why do you like the thought of other clubs going under? I think it's likely to happen, but I take no joy in it.

[Neils]

I think it depends on which club is staring into the abyss.

If it's a "big" club, then all the stops will pulled out to ensure the survival of the club. The 10 club league will have to wait.

If it's anyone else, then I'd speculate that enough support will be given, probably as a PR exercise to show lessons have been learned, but it might not be enough to stop a club from winding up as it will be a convenient path to the coveted 10 club league.

I wonder if having a success with pushing Wasps over the edge by changing repayment conditions if HMRC are doing it again. If so the whole league will be scared sh1tless. Quite a pleasing thought.

Why do you like the thought of other clubs going under? I think it's likely to happen, but I take no joy in it.

Shame I do.