Rugby Australia could be saved from Coronavirus disaster by World Rugby bailout
The wolves are at the door - with the Waratahs to be stood down after again failing to strike a pay cut deal - but Rugby Australia could be kept afloat by a multi-million dollar helping hand.
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Rugby Australia could be about to get a helping hand to save it from going broke after once again failing to strike a deal with players on pay cuts.
While the details are being kept a close secret, The Daily Telegraph understands the sport’s global governing body is preparing to offer RA a low-interest loan to ensure it isn’t declared insolvent.
The exact figure has not been decided or even discussed yet but would likely be millions of dollars after World Rugby generated a massive profit, believed to be in excess of $320 million, from last year’s hugely successful World Cup in Japan.
World Rugby normally distributes its vast cash reserves to member nations over a four-year span but the COVID-19 pandemic has left key countries in imminent financial strife.
The global governing body has already begun examining the books of its Tier 1 members as part of a wider action plan to ensure no union collapses so is up to speed with RA’s dire situation.
RA is not the only major federation in deep trouble so World Rugby’s contingency plans will not only look at offering possible financial support but also rearranging international matches once travel restrictions are lifted.
An announcement is expected within days and will be the first bit of good news RA has heard in a long time with under fire officials desperately trying to balance the books and keep the game afloat.
With less than $11 million in cash reserves, RA will run out of money in three months unless it can drastically slash costs until matches resume.
Hundreds of staff have already been stood down or placed on heavily reduced salaries at RA and Australia’s four Super Rugby teams but the country’s 192 professional players remain on full pay.
The players understand they will have to share the pain that everyone else in Australia is going through but the players’ union RUPA and RA still can’t agree on how deep the cuts should be.
Talks broke down on Saturday and have not resumed since although both parties have been communicating informally via email.
RA wants players to take a 65 per cent cut for six months – the same hefty reduction embattled chief executive Raelene Castle has agreed to – but RUPA has still not publicly stated its preferences.
The stand off has left the Waratahs in a major pickle with players due to be paid their monthly salaries on Wednesday.
That will come before any possible cash loan from World Rugby is announced, meaning the Waratahs will either have to pay out their players in full or take action themselves.
NSW officials will hold emergency talks on Tuesday to decide what to do but have already flagged the possibility that they may have to stand players down without pay.
Another option is that the players get paid but on the proviso that future payments will be backdated to square the ledger.
That’s what the Brumbies are planning to do after they forked out around $500,000 to their players when their monthly payments rolled around last week.
Both the Reds and the Rebels still have a little more time up their sleeves before they have to pay their players but are hoping a deal can be reached before they find themselves in the same quandary as the Waratahs, whose roster includes Australia’s highest paid player in Wallaby captain Michael Hooper and the RUPA President Damien Fitzpatrick.
Originally published as Rugby Australia could be saved from Coronavirus disaster by World Rugby bailout