The Welsh Rugby Union are in the process of securing a loan that will go some way to ensuring the survival of themselves and the four professional teams in Wales through the COVID-19 pandemic.
Last week it was revealed that Cardiff Blues are looking down the barrel of a £6m black hole in this year’s finances with the Arms Park set to be unavailable for the rest of the year and the majority of other revenue streams being impacted by games being played behind closed doors.
With the WRU facing a significant reduction of revenue themselves, along with the other professional sides, it was believed that funding for the professional game would be cut from £26m to as low as £3m at one point. The community game’s funding is ring-fenced at just over £11m.
However in the most recent WRU status update, CEO Martyn Phillips confirmed that the governing body of rugby in Wales was searching for additional finance to secure the future of the four professional teams and the continued success of the national team.
“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,” Phillips wrote for the WRU official website. “We are working hard to secure a loan and, importantly, on terms that allows for repayment over a number of years.
“So, whilst 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.
“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.
“We are also exploring synergies with our regions to find cost benefits. In reality, between the WRU and each region, we have five of many things. Sometimes that is wholly appropriate and sometimes it isn’t. There are opportunities to combine our efforts and we need to be thoughtful in how we do this. Some things make sense to do together, whilst other things need to be done independently particularly to preserve identity, culture and competition on the pitch.
“There has been a lot of commentary about players wages. 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.”