WRU CEO Martyn Phillips has revealed that his administration are seeking a bank loan and exploring further salary cuts in an attempt to safeguard the future of rugby in Wales where the sport has been on hold since March due to the coronavirus pandemic.
Shorn of revenue streams due to the postponement of matches at Test and club level, Phillips and his fellow administrators in Wales have already taken cost-cutting measures to protect the WRU’s bottom line.
However, they have now admitted that what they have done so far is insufficient to safely guide them through a crisis that has no end yet in sight as postponed Test matches have still not been rescheduled and the PRO14 season remains suspended.
Addressing the worrying financial position in a WRU statement, Phillips explained: “Given the financial shock of this pandemic the only solution is to increase our borrowing. We are in discussions with a range of institutions to assess our options.
“We are working hard to secure a loan and, importantly, on terms that allow for repayment over a number of years. So, while the current financial hit is extreme and focused, we will look to smooth and dampen its ongoing impact through a manageable repayment profile and interest rate.
CEO Martyn Phillips focusses on solutions, addressing the main issues affecting Welsh rugby in turn in the lastest WRU Status Update – plus clubs hear from the Return to Rugby Working Group, learn about the National Council Member candidates and more…
— Welsh Rugby Union ? (@WelshRugbyUnion) June 17, 2020
“In terms of specifics, funding for our community game is ringfenced which means that we hope all of our clubs will survive this crisis. I would also point out that the professional rugby board (PRB) is rightly united in its support of this approach to the community game, to safeguard the long-term future of Welsh rugby.
“Much of the loan will be onward lent to Welsh rugby’s four professional regions. Again, this is only right, as the international and professional game is the financial powerhouse of Welsh rugby. Without it, we would have little income or funding to re-invest.
“The professional game will bear the responsibility for servicing the loan, but will also benefit from any bounce back of any financial revenue over performance in future years. Meaning, in that regard, the professional game bears both the risk and the reward. Our goal, like with our semi-professional and community clubs, is to ensure all four regions survive this crisis.
“There has been a lot of commentary about players wages,” he added. “Back in April, the players agreed to temporary wage cuts to help us through the crisis, again for which we are grateful.
“We are now in further discussion, the first step of which is a responsibility of the PRB to, as transparently as possible, set out the financial situation and then work together with the players to find options that both safeguard the game and also deliver to the players’ personal situations.
“There is a requirement for continued dialogue over the next few weeks to explore options and land on a way forward that works for all parties. I’m sure we can achieve this together.”
“June 4 marks the 25th anniversary of the last Wales team to play in the old amateur era, a 1995 defeat to Ireland at the World Cup”
— RugbyPass (@RugbyPass) June 4, 2020
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