England fans at Twickenham – PA

“The RFU’s cumulative losses since 2012 have been £73m, reserves have disappeared, and total net debt has risen to £265m whilst the Community share of rugby investment has fallen from 46 per cent to 29 per cent resulting in male adult participation in the Community game, the base of the rugby pyramid, falling fast. PRL’s financial woes have been all too apparent in the events of recent weeks.

“A radical new approach is needed post-COVID to address the material issues and dangers facing both the professional and Community games in England. To do this I believe a new approach is needed by both the RFU & PRL. As far as the RFU is concerned a necessary and fundamental rethink of recent RFU priorities and policy direction is required

“With Wasps in administration, Worcester facing liquidation and at least two other PRL clubs reportedly ‘up for sale’, one third of PRL clubs are in various degrees of financial difficulty. It is difficult not to conclude that the current PRL business model is no longer working, viable or attractive to investors.”

Baron is scathing in his verdict on the union he used to run and added: “The actual policy followed by the RFU Board since 2012 appears to have been to run the RFU at a loss each year and use reserves to cover these losses and normal everyday expenditure, in order to maintain rugby investment at a headline ‘PR spin’ figure of £100m although most of this was to fund the Andy Cosslett’s ‘costly’ PGA agreement.

“It is therefore difficult not to conclude that the PRL business and financial model has failed, and a fundamental rethink is required. Not only are all PRL clubs to a greater or lesser extent in serious financial difficulty but the current RFU/PRL agreement, which the then RFU chairman belatedly and euphemistically called ‘costly’, has materially contributed to the RFU’s own serious financial difficulties which have resulted in the cutbacks in support of the Community Game leading to the sharp decline in adult male participation.”

Baron’s figures show that :

Over the period 2012 to 2019 the RFU made a cumulative net loss of £73.4m (excluding the one-off ‘ring fenced’ £26m RWC2015 profit). This compares on a like-for-like basis with cumulative net profits being made over the same period by the WRU of £9.6m, SRU of £7.7m and the IRFU of €53.4m.

The total net debt (debentures plus bank loans less cash balances) of the RFU over the same period increased from £131m to £250m, a rise of £119m. In comparison the WRU’s total net debt fell by £19.8m, that of the SRU fell by £14.3m and that of the IRFU fell by €83.1m.

The investment in professional rugby by the RFU between 2012 and 2019 has totalled £417m. The comparative figure for the WRU is £190m, the SRU is £195m and the IRFU £250m. Has the large RFU excess funding been well spent? The  https://www.rugbypass.com/teams/england/" rel="nofollow - He continued: “What is embarrassingly absent from any CEO statement or statements in the RFU Annual Reports is the appointment of any Task Group to review and recommend on the RFU’s failing financial performance with recommendations about how to address this.

“Championship funding from the RFU to be restored and augmented from the current £1m to c£4m p.a. for facilities investment to prepare clubs for possible promotion to the Premiership. This amounts to an additional c£25m phased in over the 8 years”