The playing budgets of all four of Wales’ professional clubs are set to rise from £4.5m to between £6m and £6.5m for the 2025/26 season.
All four of Wales’ professional sides – Cardiff, Dragons, Ospreys and Scarlets – are currently operating from a salary cap as low as £4.5m, which means they will struggle to be competitive. This autumn the WRU are set to publish their full strategy for the game in Wales with the futures of all four professional clubs at the forefront of the planning.
According to official minutes from a meeting between the Joint Supporters’ Group (JSG), WRU CEO Abi Tierney, executive director of rugby Nigel Walker, head of communications Simon Rimmer and Professional Rugby Board (PRB) chair Malcolm Wall in June, the plan is for the playing budgets to go up to at least £6m per club. This has been agreed by the PRB and they are currently working on bridging the £29m five-year funding gap to the professional game.
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According to Tierney a paper outlining the future of the professional game will be taken to the WRU board by October to give the clubs a “degree of certainty for the contracting period 25/26”. PRB chair Wall admitted the status quo is not sustainable, but cutting down to three professional sides wasn’t necessarily the answer.
Currently there is a £1.45m funding gap per club per year, while there is also a £20m debt they are hoping to refinance this autumn with improved payment terms. According to the official minutes, Tierney claims the professional game is spending more money than they are bringing in annually, with there being a difference of circa £15m.
She says this has been covered by CVC money but this investment will stop in 2026. If this shortfall isn’t reduced the game will become unsustainable. When asked how this funding gap had been created Tierney said Covid took out their major income stream at an estimated cost of £30m, while TV income flatlined but costs continued to rise.
Tierney accepted the WRU didn’t respond quickly enough to this change. If they are successful in bridging the funding gap and bringing the playing budgets up to at least the £6m mark per club, Wall claimed it wouldn’t be at the level of the Irish provinces but it would give them a “fighting chance” of being competitive.
Wall said they will not spend as much as the Irish sides but the Irish Rugby Football Union want to keep all their best players in Ireland whereas the WRU accept this is not possible in Wales.
The five goals of the new strategy is to have both the men’s and women’s national side consistently ranked in the top five teams in the world, club teams challenging in play-offs, to retain and grow the number of active participants, financial sustainability at all levels of the game and to increase the percentage of the Welsh public positive about rugby.
In terms of raising additional income, Tierney claimed the Parkgate Hotel “is exceeding against forecast but there is a large mortgage which needs to be paid and the cash generated currently needs to be retained to maintain upkeep of the building.” She went on to claim the “hotel is an asset on the books and the cash it generates will be able to be used for rugby in the longer term”.
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