The Rebels are victims of a long-overdue austerity drive in Australian rugby

At first glance, it’d be easy to look at 2024 and already call it another annus horribilis for Australian rugby.

Just seven months in, the team of Australia’s biggest market, the Waratahs, has won the Super Rugby wooden spoon and on Thursday, Rugby Australia announced it was shutting down the Melbourne Rebels after 14 seasons – on the eve of their first-ever finals appearance.

Given the last ten years of Australian rugby, however, which has included (but is not limited to) the Western Force axing, a Senate inquiry, the Israel Folau saga, two failed World Cups, the Eddie Jones disaster and the ill-fated Hamish McLennan era, it’s probably at the point where all the anni horribiles need to be collated. Call it a decennium horribilis.

Depending on where you stand, however, the Rebels decision is either just another example of Rugby Australia’s penchant for bone-headed calamity, or a necessary act of leadership to ensure the next decade is not a repeat of the last. Or possibly even the last decade, full-stop.

When the going was good for Australian rugby back in the mid-2000s, there was so much money in the game that Wallabies players were one day informed that under the terms of their CBA, Rugby Australia actually owed them more pay.

It was in this environment that expansion from three Super Rugby teams began, firstly with the Western Force in 2006 and then the Melbourne Rebels in 2011. But despite the backing of several private investors, the Rebels would struggle through the decade, on and off the field.

Rugby Australia CEO Phil Waugh and Rugby Australia Chair Daniel Herbert speak to the media in Mebourne on Thursday.Credit: Getty

In the mid-2010s, the Rebels had to draw a crowd of 9000 at AAMI Park just to break even, but crowds were usually a few thousand off. RA were often asked to help plug the gaps and informed sources, who spoke on the condition of anonymity, say RA has poured over $20m of extra funding into bailing the Rebels since 2011.

Performance-wise, expansion to five teams has not helped Australian rugby, either: the Wallabies’ annual winning percentage has fallen steadily since 2006.

By 2016, Rugby Australia determined it could no longer afford five Super Rugby teams. But after the Victorian government struck an eight-year, $20m content deal with the governing body to help secure the Rebels, the Force got the chop.

With the backing of billionaire Andrew Forrest, the Force stayed alive, however, and returned as a fifth Super Rugby side through the COVID period. The Rebels’ struggles never stopped, though, and by the end of 2023, their debts had reached extraordinary levels. The club entered voluntary administration and RA stripped the licence. A rescue plan was pitched by a consortium of private investors, but RA declined to support it.

The Rebels take on Queensland in their inaugural season in 2011.Credit: Sebastian Costanzo

Why did Rugby Australia shoot down the Rebels’ hopes of survival?

Put simply, it couldn’t afford not to. The consortium pledged $18m to fund a revived Rebels club, but in today’s world, that’s nowhere near enough. For the Rebels to survive in the long term, RA would also have had to keep funding the club well in the future. And based on the Rebels having been “financially unsustainable” for 14 years and no evidence of it changing, RA decided to cauterise the wound.

Surviving on a $29m-a-year broadcast deal that is comparative pocket change for the AFL and NRL (and with no prospect of a pay rise in the near future), Rugby Australia is a code under major cost-of-living pressure. It took out an $80m loan last year, and after paying down previous debt, has $45m left in the piggy bank.

Since Waugh and Herbert took over last year, the former Wallabies have been at pains to break the financially flawed model of Australian rugby, where it routinely spends more than it earns.

Filipo Daugunu scores for the Rebels in a win over the Waratahs in March.Credit: Getty

In a stroke of fortune, RA has two massive revenue events around the corner: the British and Irish Lions series in 2025, and a home Rugby World Cup in 2027. The windfall for the governing body could be $150m or more.

The Waugh-Herbert plan, in a nutshell, is to pay down RA’s debt with the Lions cash, and bank the World Cup money to safeguard the national game’s future. To continue the current level of spending on five Super Rugby teams, the profits of the World Cup could be burned through by 2030, and at that point, the future would look bleak.

Shouldering the brunt of a long-overdue austerity drive is undoubtedly harsh on the Rebels players and staff, and their families. They have been living under enormous stress all year.

But there is confidence most of the squad will find new homes at other Australian clubs, and that the Rebels’ women’s team will likely survive in Melbourne.

Ahead of their first finals appearance, the Rebels players have made a pact to go out on their shields.

After Waugh and Herbert left the room at AAMI Stadium on Thursday, players and staff had “genuine discussions” about not getting on the plane to Fiji later in the day. But that was quickly dismissed.

“What we can leave this club with is history around performance,” Rebels general manager Nick Stiles said.

“We have made the finals for the first time in the club’s history. We are the greatest Rebels team ever, and we aren’t finished yet.”

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