The unprecedented size of the hole in rugby’s finances caused by the Covid-19 pandemic has forced the Rugby Football Union to announce that almost a quarter of its staff face imminent redundancy. A total of 139 jobs are at risk with the wide-ranging cuts set to be carried out by the end of next month.
On the same day a restart of Premiership rugby moved a step nearer with players able to resume close contact training this week, the RFU’s chief executive, Bill Sweeney, said he is now budgeting for losses of up to £107m and that the governing body would still be suffering from the effects of the crisis in five years’ time.
It is not yet clear which areas of the RFU will be most severely affected by the cuts as a consultation period will now take place but the biggest employee cull in the RFU’s history is clearly imminent. Less than two years ago, the RFU shed 64 staff under the previous chief executive Steve Brown and, in 1999, 30 of the union’s then-191 staff lost their jobs in a major cost-cutting exercise.
This, however, is set to be more swingeing than anything Twickenham has seen. Despite having furloughed 60% of their staff and making significant pay reductions, the shortfall in income is already having a catastrophic effect on the RFU’.
“Unfortunately, this is not enough to run a sustainable operation and safeguard our future,” said Sweeney. “Our detailed modelling shows there may be a short-term impact of £107m in lost revenues and we also know there will be a much longer-term effect. We are projecting a four- to five-year recovery with cumulative revenue reductions of around 20%. This is not a short-term cost reduction exercise … the RFU will still stand but the impact of Covid-19 will continue to affect us for many years to come.”
Sweeney has already revealed the RFU has had discussions with the Army about crisis planning, with the postponement of international matches threatening to cut off the financial assistance that keeps the professional and community games afloat in England. Funding to Premiership clubs is set to fall for the next four years and a reduction in England player match fees from the current £25,000 per game is also anticipated.
As things stand, however, there is still no firm agreement how many matches England will be able to stage at Twickenham this autumn, with the leading clubs not keen to release their players for additional Test dates. A second wave of Covid-19 infections could also yet scupper alternative plans to stage Tests in front of significant crowds at Twickenham, hence the desire of the home unions to finalise the long-mooted deal with the private equity company CVC to purchase a 14.5% stake in the Six Nations championship.
The French Rugby Federation’s president, Bernard Laporte, told his union’s AGM at the weekend that the deal is at the end of negotiations with the FFR set to benefit by £66.5m over five years. It is not clear, however, whether inviting in CVC to boost the Six Nations’ commercial rights will result in live coverage of the tournament disappearing from free-to-air television, with the current deal with BBC and ITV due to expire next year.
Premiership Rugby also has its fingers crossed that players who underwent Covid-19 tests on Monday will be able to resume contact training on Wednesday. It is understood test results will be available within 24 hours, with any failed tests to be publicly advised by the middle of this week.
Worcester, meanwhile, insist they remain committed to supporting Michael Fatialofa in his recovery from the serious spinal injuries he sustained against Saracens in January. Fatialofa has received hospital invoices for more than £100,000 after being transferred to a private hospital because no NHS bed was available at Stoke Mandeville. The player is no longer a Worcester employee but the club insist it “will continue to go over and above what is expected” to support Fatialofa and his wife, Tatiana.