A multi-million-pound financial lifeline for rugby could be announced by the 海角视频 Government later this month.
With no crowds at club, regional and international level, the Welsh Rugby Union, the RFU (English union) and the SRU (Scottish Union) are collectively in discussions with the Department for Culture, Media and Sport over a financial support package, mostly likely in the form of a grant, that could run into tens of millions of pounds.
Any funding allocation is expected to take into account their relative size and financial outgoings, so the RFU, with a bigger club membership, is expected to receive a larger slice of any funding provided.
The WRU has already confirmed that if its home games at the Principality Stadium in next year’s Six Nations have to played behind closed doors, it faces a loss of £35m in revenues in its current financial year.
Its rescheduled Six Nations game from March was played behind closed doors at Parc y Scarlets last week, with Wales also to play with no crowds for games in the forthcoming Autumn Cup Series.
The Irish rugby union ( IRFU), which also covers clubs in Northern Ireland, has received £16.2m funding from the Dublin-based government.
The WRU, which is not disclosing its ask, is understood to be seeking at least that provided to the IRFU.
The union is also in discussions with the Welsh Government, which could see it also receiving support from the Cardiff Bay government alongside any 海角视频 Government backing.
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What wouldn’t work from a WRU and SRU perspective, is if they received funding from their respective governments form a Barnett Formula consequential from the 海角视频 Government say providing a £100m funding package for the game in England.
This would see the Welsh Government, based on Barnett, getting around a £5m consequential, which even if passed on in full to the WRU would be out of tilter to its [union’s] size and financial challenges compared to the RFU. Besides all three unions are commercial businesses and devolved government departments.
WRU chief executive Steve Phillips said that, on funding discussions with the 海角视频 government, an announcement cold be made in the “next two to three weeks.”
It comes as the split of £20m in Coronavirus Large Interruption Loan Scheme (CLBILS) funding, secured by the WRU from NatWest for the four regions, has been agreed with the input of the Professional Rugby Board (PRB).
Cardiff Blues are set to receive £5m, the Dragons £4.5m, the Ospreys £5m and the Scarlets £5.5m.
The regions will be liable for the interest and capital. However, if they default or cannot meet the payments, the WRU will still be liable for repayment to NatWest.
The interest rate negotiated with the NatWest on the CLBILS funding, has not been disclosed, but is understood to be just less than 4%.
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Chair of the PRB, Amanda Blanc, said: “We are extremely grateful to NatWest Cymru for supporting professional rugby in Wales with this hugely significant contribution to our sustainability for the year ahead.
“PRB members have engaged in open discussions about the allocation of funds according to the individual and different needs of each entity.
“This is precisely what the PRB is here to do, to manage, facilitate and enable professional rugby in Wales and to sustain all five professional entities in accordance to the needs of each at a given time.
“For a region to accept and vote through a decision which gives themselves less funding than a neighbour, but for justifiable and entirely explicable reasons, shows the PRB working at its finest.”
CLBILS is one of the 海角视频 Government’s loan schemes in response to the economic fallout from the pandemic. The schemes are administered by the its economic development bank, the British Business Bank, which has also approved accredited lenders, which include banks. The 海角视频 Government has provided a 80% guarantee to lenders in the event of default.
Stuart Allison director with NatWest said:“In response to the immediate challenges of the pandemic we revisited that arrangement and crafted a structure that will provide additional funding and flexibility to further support the Welsh Rugby Union and, in turn, professional rugby in Wales with this loan.
“As the game’s governing body in Wales, the WRU is working to ensure it is in the strongest position possible to build stability and success in both the professional and the community game.
“We are confident that these funds will be utilised to maximum effect to help to mitigate the negative impact of the pandemic and are pleased to be able to offer our support.”
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WRU chief executive Steve Phillips said:“We have been engaged in healthy discussions with NatWest Cymru and ended up with a sensible solution which we are all very pleased about and very grateful to NatWest Cymru for.
“It has been the PRB’s role to establish a consensus amongst our regional sides concerning the allocation of the money.
“The easiest thing to do would have been to split £20m four ways, but it is to everyone’s credit that we have come up with a much more appropriate solution than that.
“The four regions are all at different stages and their needs differ accordingly.
“So, the PRB has done what it is set up to do and brokered a solution that suits all four entities. We have ended up with fair and sensible allocation.”
The WRU has a separate £40m funding facility with NatWest.