What's it all about then RFU?

By Paul Shaddick
October 12 2005

The club v country row in English rugby has been revived, with the RFU apparently considering buying a 51% share of the Guinness Premiership clubs in order to exercise greater control over the elite squad players.

 

While the 'leaking' of this information to the press may have been a deliberate ploy to outrage supporters and thus make them more amenable to watered-down proposals, such as central contracts, could such a plan actually work?

 

How much would it cost?

While some clubs have little in the way of tangible assets such as stadia, they all have an identifiable and valuable brand image, a very loyal group of customers, and the inherent value of the remaining portions of players' contracts.

Some clubs, however, (such as Saints, Tigers, Gloucester) own their stadia, and have flourishing and profitable businesses on and off the pitch, and would be fiendishly, possibly prohibitively, expensive. I would estimate the value of 51 per cent of all 12 GP clubs to be somewhere in the range of £50m - £100m.

 

Who would sell?

Even if the RFU had the funds and the will to buy a majority holding in all 12 clubs, would the people who own them want to sell? It may be that one or two of the individual owners would welcome a way to offload an expensive drain on their personal fortunes while still saving face (it wasn't the money - I did it for the good of English rugby), there is an increasing number of sides in the GP moving into profit. Again, the triumvirate of Northampton, Leicester and Gloucester will prove difficult, the two East Midlands sides topping the list of money-spinners and also having the most obdurate of chairmen. The fact that Saints do not have a single owner, but a large number of small shareholders makes life even more difficult for the RFU. To my knowledge, only a couple of hundred out the tens of thousands of shares held by supporters have ever been traded on the Forex exchange. I don't believe the RFU could find sufficient shareholders to sell to them.

While Wasps might be an obvious target for the RFU, having no ground of their own and not yet making money, they are currently very successful and bring an awful lot of kudos to their owner.

Of the 12 Guinness Premiership clubs, I believe there are no more than six that would both be willing to sell and fall within the RFU's budget.

 

Player control?

If the RFU did own a majority stake in, say, six of the GP clubs, that would not immediately give them control of all the elite squad players. They would either need to offer sufficient compensation to the clubs outside their grasp to get early termination of contracts, or wait up to three years for those contracts to end. Money and time is one thing - but they would still have to persuade players to change clubs, which many may be reluctant to do.

There would also be the problem of bringing new players into the elite squad. Injury or a lack of form in key positions often lead to youngsters getting their chance in the national side, but if that player is at a non-RFU club, what then? The only way for the RFU to ensure the availability of England-qualified players would to have them all playing at their clubs.

 

Ringfencing

The GP would have to ringfence the GP - as they could not afford to have one of their sides relegated, leaving one-sixth of the elite squad in ND1. The ultimate act of ringfencing would be a completely separate league, with only the RFU-owned clubs taking part. This would allow a reduction in the number of games for the England players. But fewer games for the clubs would lead to less income, and gates could well fall if supporters are asked to watch their side play a smaller range of opponents. Bearing in mind that the clubs most likely to fall into the RFU's hands are already operating at a loss, how long could they all survive financially? In order to cut costs there would necessarily have to be a reduction in the wage budget, making it nigh on impossible to recruit talented foreign players, who are able to pass on their skills to their English team-mates and are also big crowd-pullers.

Would Sky want to show the same six clubs playing every week, when the non-RFU premiership had the bigger crowds and all the international stars? Probably not. I can only see these problems leading to the rich, non-RFU clubs becoming increasingly well off, while those saddled with RFU ownership sink deeper into financial difficulty.

 

Ultimately, the RFU claims that it's only motive is to improve England's chances on the international stage. I believe that the idea of the RFU owning clubs would lead to the opposite, and is merely a thinly-veiled threat to the club owners. What the RFU seems to be forgetting is that we have just seen the end of the most successful period in England's rugby history - all of which happened under the current player release system.

England are struggling at the moment, but not because players are getting too much rugby or not spending enough time with Andy Robinson.