Melbourne Rebels Super Rugby future further in doubt as debt climbs to $20m

The Melbourne rugby union franchise’s debt is understood to be double previous estimates, with the ACT Brumbies also heading for voluntary administration.

Rugby Australia is committed to the Rebels playing this season but has yet to guarantee the long-term future of the embattled Victorian franchise.

Melbourne Rebels are in $20 million debt with the ACT Brumbies also heading for voluntary administration as the Super Rugby competition staggers under the weight of debt.

Rugby Australia’s chief executive Phil Waugh did not respond to The Australian’s request for comment after revelations that the Rebels’ debt was more than double previous estimates, including, it is understood, $10 million in unpaid taxes.

The Australian understands big name Rebel players, such as Wallaby tighthead prop Taniela Tupou, are looking at their options in the UK, French and Japanese competitions with the Rebels franchise unlikely to exist next season.

RA has confirmed it will underwrite players’ wages this season, with Tupou’s deal alone this year understood to be around $500,000. Overseas clubs are set to offer the Wallabies star around $1.6 million a season.

While the Rebels players have been paid there are concerns about the payment to staff, of which there are 40, including coaches and administration team members.

RA has provided limited funding to pay those wages, but a deal on the remainder of the season has yet to be inked.

The Rebels’ future is in severe doubt due to financial pressure.

RA is committed to the Rebels playing this season but has yet to guarantee the long-term future of the embattled Victorian franchise.

On Monday the Herald Sun reported that the Melbourne Rebels’ debt is not only greater than first thought but revealed that Victorian taxpayers are paying $50,000 each time the franchise plays at AAMI Park.

After weeks of speculation, the Rebels officially went into voluntary administration last week and there is a creditors’ meeting on Thursday where details of the debt will be discussed.

The Herald Sun also stated the Australian Taxation Office (ATO) was owed at least $10 million, which included up to five years of unpaid tax on players’ and staff wages.

Board members were owed as much as $6 million from their investment in the club, while suppliers made up the bulk of the remaining debt.

The Rebels board was stood down when the club was put into the hands of administrators PwC last week.

The crisis at the Rebels comes as companies linked to former Rebels chair Paul Docherty went into administration with more than $70 million debt. Docherty stood aside last week.

The Australian is not suggesting that Docherty has done anything wrong.

Negotiations were deadlocked at an emergency meeting between Rugby Australia and the Victorian government last week. Sports Minister Steve Dimopoulos has said he “supported” the Rebels but no deal has been done to rescue the Super Rugby team.

The Victorian government is keen for the MCG to host the final of the Rugby World Cup in 2027

Waugh said he had constructive conversations with government officials last week.

“The Victorian government has always been very supportive of Australian rugby,” he said.

“Through our strong partnership – forged through decades of staging major events in Melbourne – our focus is to work with the Victorian government and its key agencies, including Melbourne and Olympic Parks Trust, to ensure the Rebels’ participation in the 2024 Super Rugby season and the continuation of professional Rugby in the state.”

The Melbourne Olympic Parks Trust, which runs AAMI Park, was owed at least $1 million by the Rebels.

The Trust told The Herald Sun: “Melbourne & Olympic Parks does not disclose financial details of its contractual relationships with its tenant clubs, including the Melbourne Rebels.”

The first Rebels game of the Super Rugby season is in 18 days, adding urgency for a new stadium deal. Rugby Australia is currently nursing a $80 million loan and is without a major Super Rugby sponsor.

Waugh has been privately meeting with wealthy business people, including last week approaching pub barons the Laundy family – who back the NRL club Canterbury Bulldogs – for financial support.

Waugh has previously said RA was committed to a five-team competition for 2024.

“RA is committed to ensuring the participation of the Melbourne Rebels in the 2024 Super Rugby Pacific and Super Rugby Women competitions,” Waugh told The Australian last week.

The Australian reported last month that the Brumbies, were considering handing back their licence to RA unless it received greater share of revenue from head office.

Australia’s most successful Super Rugby franchise was pinning its hopes for survival on private equity.