They might be the first but I'm pretty sure will not be the last.

You look at Leeds who cannot get a side out this week v Hull and are pretty open about it.

My friend told me that at a recent NCA meeting the Canterbury chairman said, if they cannot afford to travel, they will not and are happy give away the points and then you look at some of the debit clubs are carrying, Blackheath's last set of accounts show them close to £1/2 mil in the red, that cannot carry on year in year out.

As said they may be the first but I am pretty sure they will not be the last!

Very sad news indeed.

It is with great regret that Old Elthamians 1st XV has had to withdraw from National 1 rugby for the forthcoming 2021/22 campaign. Having worked closely with the RFU Financial Viability Group during the last month, the decision was reached on Wednesday, 4th August to pull out of the 21/22 campaign.    The club has worked tirelessly during the last 18 months to overcome the financial fallout resulting from the pandemic and the non-payment of sponsorship monies owed to the club. Although this is a very sad day for OERFC, the decision will not affect any sides below the 1st XV and the junior section, which will continue to grow and flourish.   However, it was deemed necessary by both parties to take this decision now before the season was underway.    Further announcements will be made in due course as the club continues to work with the RFU and Kent RFU.

1) Will all scheduled matches against OE's now become byes, with it being rather late to replan the season?

2) Will they now be automatically relegated?

Though to be honest, they did seem not to be a sustainable operation once their benefactor had passed on 

We have passed all the deadlines for the leagues to be shuffled, so OEs matches become byes.

The club continues with its other sections.

I am not sure if they are withdrawing the Extra 1st XV from the Shield. Can someone confirm?

It is hard for everyone at the moment as rent and services have to be paid and essential works need to continue if you consider fertiliser costs 30k per year so that’s 60k with no income it all adds up I’m sure we are under control at Blackheath

Incidentally, I heard at our AGM last night that the RFU were due to confirm 'in the first week of August' the proposed number of promotion places from each league to reach the new structure for 2022-23 - although announcements like this (and like others, I fear there will be more to come) means that there are going to be plenty of variations come May.

They have other teams, and I assume they will keep their places in the Kent structure - which may be being merged with the main pyramid next season in the coming shake-up.

As Moseley Mauler says, we will probably lose more from the loss of the home fixture that the cost of visiting OEs, and the fixed costs - like fertilizer - are not reduced by having fewer matches.

Really good point. There is no rules that says you need to pay players in this league so shouldn't be able to opt out just because they don't feel they can recruit a competitive team (Leeds completed their fixtures in Championship through loan players from Uni etc) So must be not enough finances to support travel/operational costs, which probably is not such an issue in Shield games.

While I have sympathy for supporters or players of the club I think waiting until 4 weeks before the new season to do this smacks of disrespect by the management for other clubs who will now suffer losses themselves through losing a home fixture when they have established income & expenditure budgets (for Moseley this takes out our only fixture in December, a month that usually gives largest gates due to Christmas run up). Also had they been realistic back in June then quite probably Rotherham would not now be playing National 2 rugby.

Surely that would make a mockery of the whole league structure? Leading the way for many more clubs to decide not to fulfil a season and just jump down a level? Massive legal issues I would suggest 

As said O.E. were Birmingham Moseley's home fixture. Certainly probably the biggest income fixture - up to 250 Xmas dining for instance. Whats a double whammy for Mose is that the income from recent/upcoming sell out guest speaker nights profits are nulified in having to meet  overheads that are always in place match or no match. As usual BMRC will face the problem and overcome 

With what's happened in the last year and previous decisions made within the rugby pyramid/administation i'm no longer suprised by anything.

With 4 teams potentially going up next season to L2, i think the RFU could look kindly on the OE's position. 

Knowing a player there personally, who now weeks away from his season is out of a club - i just feel sorry for those who have invested their time & effort/committed to the club to now be left out in the wilderness....

Whilst agreeing pulling out at this late stage is disgraceful I think it is a bit of a push to suggest this was inevitable a year ago.

1) Yes it WAS inevitable a year ago

2) If you rely on 1 sugar-daddy then the end is inevitable - just a matter of time

3) Sounds like a fantastic club who should never have taken the path it did in the first place

Live and learn perhaps is the message here

Good luck OE's on starting afresh and rebuilding a club that is proud of itself and a shining light for the local community - hope it doesn't take too long

Haywards Heath did it once the Thursday before the season started a few years ago. But any club that holds out this long knowing they cannot complete the season, thus blocking teams from being reprieved, is disgraceful 

I thought clubs had to submit a business plan for the season before the deadline for being replaced?

If this has gone by the wayside, perhaps it should be brought back.

The cut-off is June 1st.

The statement said they had been working with the RFU finance for the past  month.

Which would mean, starting in July.

I do think that all clubs should submit in May, a simple declaration that there is no reason why the club cannot complete the following season, signed by the officers.

Agreed some clubs may have purchased train tickets etc, however if they have done so on a non-refundable basis taking into account the last year. I must say I think this is again poor management and would only say it is their own fault. 

It seemed on the face of it OE's were a community/family club and from their website it seems this decision as much as it has had the above effect will not effect the community rugby element of the club. I think we should all be able to have some credit towards OE's for this as ultimately the number one outcome should be always be the rugby; if kids, juniors, colts etc are being looked after, despite the sacrifice of the first team I am all for it. 

However I am still of the opinion they should start from the bottom of the pyramid from next year. 

It wasn't inevitable a year ago. Likely maybe but not inevitable. An awful lot can happen in a year as we have all seen.

Plenty of clubs rely on a "sugar-daddy" and continue to exist year after year some even changing sugar-daddies along the way. Of course it isn't ideal but it happens.

Other clubs move from a "sugar-daddy" to a more sustainable ownership model. Yes their results tend to suffer in the short-term but they continue in the league. Some clubs have even chosen to field a team based on lower league players to fulfill fixtures even though it meant losing every game.

Quite simply it wasn't inevitable no matter how many times you might say it was.

Had OEs withdrawn before 1st June, Rotherham would have been reinstated and so on down the pyramid.

As it is, National 1 carries on with 15 sides.

All clubs lose approximately one fifteenth of their revenue, possibly less, as OEs did not have a lot of travelling support - except Moseley, who were due to play them at home in the pre-Christmas match and so lose a very lucrative fixture. I was surprised they were not playing Blackheath for that one.

While this is offset somewhat by reduced match fees - the income from a home match should cover two sets of match fees, travel and make a contribution to fixed costs. So I expect all sides to be out of pocket, Moseley more so than most.

The players still expecting to play for OEs have not had a chance to find other clubs. Players at the other 15 clubs will lose two sets of match fees.

Obviously, I do not have visibility of the goings-on at OEs. It could be that on May 31st, they honestly thought they had a new sponsor lined up, and believed they could finance a season. Then by July 1 it fell through, and they started talking to RFU finance.

I wonder if it would be possible to arrange a Barbarians fixture for Moseley?

"It appears that the final nail in their coffin was an ultimatum from the RFU, who had been working with the club to try to salvage the situation. The club had consistently assured the RFU over a long period that they had another major sponsor in the offing. However, the RFU became increasingly concerned that the club would be unable to meet its financial commitments and imposed a deadline last week by which the club was required to provide a written assurance that they would be able to meet those commitments. It failed to do so."

Im sorry to say just a quick shirt through other clubs in National 1 don't paint a pretty picture.

I think the RFU needs to do some proper digging on the whole lot. OEs could just be the first of many I feel.

Blackheath's balance sheet reads  .. - £480 k. that's £60k worse off that Oes .. wonder if the RFU has a closer look at them?

Cambridge chairman posted on their web site this time last year they were £40 k away from being bust, yet they only pulled £20k of that in on their crowd funder

They also managed to sign 15 players ( 8 of which were for the 20/21 season that never happened)in the course of the last year and claimed Furlough for many.. how they got away with that?

Leeds had the £800k CVA reduced to £80k and wrote off £720 k of debit 

Chinnor have all their eggs in one basket, what happens if Rectory homes go?

There are many in National 1 that have problems, time for either the RFU to act now or start to filter some CVC money down. You cannot expect to play National 1 rugby as a club and get no funding. I seem to recall it was £125 k less than 5 years ago, its now nothing. In Div 1 football (level 3) in 19/20 season the average for each club was £1.35m...that was without TV money!

Reducing reliance on individual donors/sponsors is also key - unless they are Trailfinders’ owner with an enlightened long-term funding strategy, you are always focussed on the whims of one or two people and that is dangerous. 

As we move into a new season we are trying to find all sorts of indicators as to how income generation will change - will gates rise, will pre-match lunches sell out, will people stay in the Bar after matches, will they attend Events? Finding the answers to all of those questions will happen in the first few weeks of the season so by Christmas we will have a clearer idea of how our finances will change this season.

Let’s hope the 47 remaining NLR Clubs can get through this early period and continue to show the rest of the game how to run successful rugby clubs.

I note that Mr Paulsen (deceased) was declared bankrupt on the 13th August 2020 with the petition coming from a Dutch company, Semper Fortuna N.V.

On the other hand, he is still listed as having Active Significant Control over Old Elthamians Rugby XV Ltd.

I had to ask them the question, to be fair they were gutted but pretty open about it.

It turns out that this was all started by two ex players. Both who left the club on Jan 2020, when the money stopped. One started a wats ap group headed, " I'm going to war on OE's, who is owed what" and then sent it to every player that had left.

Both of these players, who's names are out there for doing this, are now plying their trade elsewhere at local clubs.

Mr Paulsen it seems was not totally the picture that was painted. We all know that Secure Trading went down in May 2019 owing the RFU several millions. He owes the club via Cyber1 (still active and nasdaq listed) a very large sum, although the club is taking legal action to reclaim this, the hearing date has been moved back 3 times due to COVID, the last date it was due to be heard was June but has been moved back to Oct they were saying, that is the "owed sponsorship" in the press announcement, he also owes and has outstanding many debits to many at OEs. That might explain the timing of things!

I wonder how you would feel if your employer did the same? This is the Clubs responsibility and again shows the danger of Sugardaddies!

I think this may have opened a can of worms that they are not happy with, and a lot of other clubs will be under the microscope in the very near future!

I read Scrumtime's post to mean the players, possibly with others,  instigated the action against Paulsen's estate - not they were at fault.

What do you do when a game is postponed?

There is RFU funding for clubs that suffer losses due to postponed matches.

So the same will apply

Rabbie, that may be, but for a game where Club had 2k plus people as a gate and are rumoured to have taken over £50k through lunch, bar, food stalls etc in the Dec 2019 game (last time clubs played), I thought the departure of OEs would have hurt Blackheath more than most, to turn away that amount of income and you will not be able to claim that back! 

May I suggest that this may have been very short sighted by some, or were they becoming a little more than a noisy neighbour and the loss of income was just a small price to pay?

Raider The insurance on tickets is taken out when purchased and the buyer needs to take a view at the time as to the likelihood of there being a problem with the game for example DMP in January pay the premium Leeds in October probably not but it is a gamble