Premiership Rugby chief executive Simon Massie Taylor says “better visibility” of club finances” is needed as two clubs grapple with financial troubles and the uncertainty that comes with it.
Worcester Warriors will be suspended from competition if they do not meet requirements laid out by the Rugby Football Union on Monday at 5 pm, which include necessary insurance, the ability to pay staff and player, and a “credible” plan mapping out the way forward.
The club is struggling with over £25million in debt with more than £6 million in unpaid tax. Owners Colin Goldring and Jason Whittingham are under pressure after being accused of asset-stripping the club.
Two clubs in financial troubles
Wasps are also financially struggling and have filed a notice with the High Court to appoint an administrator as they navigate a wind-up order from HM Revenue and Customs.
The club are also finding difficulties paying their £35million bond used to fund a move from High Wycombe to Coventry eight years ago.
“Each club model is different, and I can’t stress that enough,” Massie-Taylor said.
“These two clubs are in a situation post-Covid, right now, where one is having to renegotiate a massive bond in a very difficult bond market.
“And with Worcester, they’ve got a unique model where they don’t have a benevolent owner and there is property in play which has made it a challenge to develop in the last few years.
“We need to get better visibility of club finances. It has always been a thing where Premiership Rugby hasn’t had full oversight.
“We can administer the salary cap, but beyond that we haven’t got a clear picture, so I am flying blind on a number of these things.
“We need a basic level of financial information. That shouldn’t be a problem, but it is not something we have had oversight of. Basic, I know, but it’s important if we are going to have that sustainability.
“The clubs are willing, and with that we can have a proper understanding of our eco-system and that will help find potential future investment at club level, it helps us on the commercial front and also sets an appropriate cost-base for everyone as we manage our way out of that.”
Premiership needs to be attractive to investors
Massie-Taylor wants to make the Premiership attractive to investors as the league pushes towards having 14 teams, a prospect threatened by the situations in the Warriors and Wasps camps.
“If you look at the challenges, we need to create a product where future investors want to come into our market,” he added.
“We get there through growth, clearly, and we have got a plan we’ve been working to on that, but we also need the right structure there to get the foundations and the confidence for investment.
“We are all very confident about the product here and what we are watching.
“We have a growth plan, we’ve made progress on it and there is an element of trading our way out of this as well.
“We are a 13-team league at the moment with aspirations for a 14-team league by the end of the season. That has been agreed. But having two teams in trouble at the moment puts everything on its axis a bit.
“The desire of everyone to focus on the rugby and support the rugby is my plea, but equally I can’t ignore the structural questions that people are asking.
“There are no quick fixes to each of these problems, but each club is different and we are witnessing a couple who are having their models really tested.
“We are going through a challenging few weeks here, it is going to be a really difficult couple of months and we really hope these clubs can pull through.”
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