Premiership rugby in ‘disarray’ thanks to ‘inert leadership’
MPs have concluded that it was poor oversight from the sport’s governing bodies that contributed to the demise of Worcester Warriors and Wasps.
A scathing report has been released by the Digital, Culture, Media and Sport Committee (DCMS), criticising a “lack of safeguards in place at the highest levels of the game”.
The DCMS said that when Worcester Warriors collapsed, accounts had not been filed for more than a year, with reports of player salaries being paid late from May alongside its “unscrupulous owners” mismanaging club finances while “attempting to strip the club of its assets”.
The report concludes that at Wasps, debt from a “disastrous and ill-though-through relocation to Coventry crippled the club financially”.
It’s acting chair Damian Green MP said the “inert leadership” from the RFU and PRL did not intervene during circumstances such as when Colin Goldring was barred from working for any legal firm without the explicit permission of the Solicitors Regulation Authority.
DCMS Committee Acting Chair Damian Green MP said: “Club rugby at the top of the game is in disarray. Inert leadership from the RFU and PRL has allowed mismanagement to collapse two of English rugby’s top teams. Thousands of loyal fans have been deprived of their clubs and hundreds of jobs have been lost.
“We welcome the raft of changes announced by the PRL and RFU. Better safeguards and a stronger owners’ and directors’ test are desperately needed. But it’s incredibly disappointing that two clubs had to collapse for the rugby governing bodies to act.
“More worryingly, the root of the problem remains. Rugby clubs are still spiralling into debt and the RFU and PRL’s current revenue boosting plans haven’t done enough in the past and are unlikely to make a difference going forward. With its upcoming annual report, the RFU must demonstrate to the Committee how it will protect the rest of the league from financial ruin.”
The Committee now says whilst it does welcome reforms aimed at preventing problems for clubs in the future, it has serious concerns about the future of Premiership finances.
It warns that the financial situation of Premiership teams is “clearly unsustainable” with annual losses averaging about £4m per club.
MPs are critical of the RFU and PRL’s “complacent belief” that their plans to increase revenues and improve collaboration will solve rugby’s financial problems.
Ag Worcester Warriors, a consortium named Atlas, fronted by Jim O’Toole and James Sandford has now submitted an improved offer to take over the club and are waiting to hear where they stand.
The initial bid was rejected by the RFU who were not satisfied with the “financial position of the buyer and their ability to continue to fund the club and to deliver on the business plan”.
