Raelene Castle and RA execs take pay cut as rugby fights to survive

Raelene Castle will take a 50 per cent pay cut, but still earn more than $400,000, as rugby battles to survive beyond July.

Rugby Australia chief executive Raelene Castle: ‘Survival for the next three months is the most important piece, then we can sit down as a sport.’ Picture: AAP

Rugby Australia boss Raelene Castle will take a 50 per cent pay cut but still earn more than $400,000 a year, as the code ­battles to survive beyond July.

RA lost $9.4 million in 2019 and failed to provide audited accounts at their annual general meeting on Monday due to the coronavirus crisis.

Castle, who was understood to be earning $840,000 a year, will halve her pay immediately, while her entire executive team have accepted pay cuts of 30 per cent as rugby faces potential insolvency within three months.

“I’m taking a 50 per cent pay cut and the senior executives will be taking a 30 per cent pay cut,” Castle told reporters via a video conference after the AGM.

Asked if that was enough if she is still clearing more than $400,000, Castle replied: “I think all of these things will be discussed on a monthly basis but I think that’s a pretty good start point to set an example around how important I think this issue is. Like every line item across the business, they (salaries) will be analysed on a weekly basis.”

The dire financial situation for rugby was laid bare as Castle spoke about surviving the next three months. A number of jobs will be cut at RA and Super Rugby franchises over the next 24 hours, and players will be asked to take significant wage cuts when RA and the Rugby Union Players’ Association talk on Tuesday afternoon.

Castle could not even guarantee all four of Australia’s Super Rugby teams would survive.

“We’re just not at that stage at the moment. Survival for the next three months is the most important piece, then we can sit down as a sport,” Castle said.

Exactly how much of a salary cut Australia’s 192 professional players will be asked to take on Tuesday remains unknown, but Castle has been slammed by players’ union boss Justin Harrison over a lack of consultation and financial disclosure prior to the AGM.

“I’ve committed to RUPA that we wouldn’t come to the table as a fait accompli and it be presented to them as a ‘here it is, take it or leave it’,” Castle said.

“We will work through that scenario planning with RUPA, that’s the commitment I’ve made to Justin. I stand by that, and we’ll start those discussions tomorrow.

“Rugby Australia is very comfortable with where we are, we’ve had a good engagement with RUPA, we always have. They have expressed their frustration. I share their frustrations. I wish that we could get there quicker and I wish we could have all this nailed down.”

Given the lack of games being played, it’s understood broadcaster Fox Sports has asked for some of the money paid quarterly in advance to be returned. However, Castle would not be drawn on the matter.

“I’m not going to get into the commercial conversations and specifics of our Fox detail,” she said. “What I would say is we continue to be in positive dialogue with them, we have worked very hard alongside them to offer them additional content and new content that they otherwise haven’t previously had access to, to try and work through what is for them and us a really difficult time.”

She added: “We are having some conversations with Fox Sports around our broadcast payments, and we’ll be having those conversations this week.”

With no content to fulfil broadcaster obligations and nothing in the way of gate-­takings and corporate sales coming in, RA is walking a tightrope for survival and will desperately need whatever money is on offer from the government and World Rugby to keep going.

The uncertainty around time frames for resumption of games also means further cuts could be made down the track.

“There is no doubt that across our business, including staff, we are going to have some very difficult conversations,” Castle said.

“But we also know the government are trying to make some announcements around supporting staff so that they get supported through that job-keeper process.

“We’re in dialogue with the government to ensure we know what that allowance looks like and we can factor that into our ­decision-making.”

After the AGM on Monday, RA conceded there was “uncertainty surrounding the business into 2020 and beyond”.

The multi-million-dollar payout to Israel Folau and the un­predictability of the coronavirus restrictions — set to continue for up to six months and potentially cancel Super Rugby and Test matches this year — mean RA can’t give members a clear picture of their full losses for the remainder of 2020.

“One of the implications for Rugby Australia as a result of the pandemic was that it was not able to present a full set of audited financial accounts at the meeting, due to the uncertainty surrounding the business into 2020 and ­beyond while government restrictions remain in place preventing the delivery of rugby content to satisfy the needs of fans, members, broadcasters and corporate partners,” an RA statement said.

“While an update on Rugby Australia’s finances was provided to members at the meeting, the company’s annual report will not be issued until audited accounts can be delivered.

“As expected, in a Rugby World Cup year with reductions in broadcast and match day revenue from fewer domestic Test matches, Rugby AU operated at a loss in 2019.

“All revenue targets were met, however. Rugby AU’s operating expenditure increased by $6.6m in 2019 across community rugby (increased grants), high performance (player payments), marketing and corporate expenses (including legal costs and the substantial cost of the settlement of the Israel Folau dispute),” the statement said. “Rugby AU reported to its members a provisional $9.4m operating deficit for 2019 pending final audit.”

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