The Pulverisation of Australian Rugby

[Braveheart81]

I think people underestimate the damage that would happen to the game in Australia if the ARU went into voluntary administration for any length of time at all.

Forget about 28k for each Shute Shield club. Funding to each state union would reduce to zero immediately and they wouldn't see another cent until things were in a dramatically better situation.

 

[Muglair]

That is an interesting observation BH. Why would it be so much more damaging? Perpetuating the current limping along ineffectively just with the head above water has the same result in the long run.

However there would be a case for believing that most of the really destructive consequences of insolvency would be avoided by the context of the organisation and the sport. The reality might be that actual insolvency (appointment of VA or Receiver) would be avoided but concrete action would then be required in any event to secure the financial stakeholders' support.

There may well be some pain but it would really force the game to make rapid change which otherwise could occur over ten years, if ever.

 

[I like to watch]

I disagree BH
Administrators work out which activities generate profit,and continue with these parts of the business.
Payments to the State Unions are not gifts,they are payments to provide Soup Teams,those payments would continue,to preserve the ARU's TV money.

Administrators would look to immediately cut development on juniors and Schoolkids,but they would find they they are now too late.
So, unless administration triggers nasty clauses in commercial agreements,I see no difference.

 

[Braveheart81]

I disagree BH
Administrators work out which activities generate profit,and continue with these parts of the business.
Payments to the State Unions are not gifts,they are payments to provide Soup Teams,those payments would continue,to preserve the ARU's TV money.

Administrators would look to immediately cut development on juniors and Schoolkids,but they would find they they are now too late.
So, unless administration triggers nasty clauses in commercial agreements,I see no difference.

My opinion (and I'm not a liquidator/administrator, but I am in the industry) is that the two things that would remain are Super Rugby and test rugby. There are separate distributions to the Super Rugby franchises and the state unions. The state union distribution would cease.

 

[Strewthcobber]

Payments to the State Unions are not gifts,they are payments to provide Soup Teams,those payments would continue,to preserve the ARU's TV money.

Administrators would look to immediately cut development on juniors and Schoolkids,but they would find they they are now too late.
So, unless administration triggers nasty clauses in commercial agreements,I see no difference.

Super Rugby Grants ($18m) are separate from the Community Rugby and Member Union Allocations ($10m). Away from the pro teams, there's also the age group and high performance teams which don't generate any revenue ($7.5m). Marketing budget may also get a trim ($7m)

Corporate costs ($19m) would surely be protected by the Shore School educated Administrator

 

[Train Without a Station]

So the ARU still has provided grants of $17.5M in total to grass roots through member union allocations which I assume is $2M per state and $7.5M for age group representative teams (would this be the junior gold cup?)

It's good to see they are spending almost as much on junior rugby themselves as they are giving to the states. I'd like to see them target the youngest though. The more 6 year olds you get into rugby, the more adult fans you will have in the long run.

 

[Quick Hands]

Interestingly their Chairman takes home $72,000NZ which is around $65,000 today compared to Hawker with $20,000. Perhaps I missed it but I can't find Tew's remuneration.
.

Yes but the NZRU is going significantly better than the ARU. I think that the NZRU makes a healthy profit, but we're told that the ARU is on the brink of insolvency.

 

[Quick Hands]

The more 6 year olds you get into rugby, the more adult fans you will have in the long run.

$200 levies you will able to rake in.

Fixed.

 

[Quick Hands]

From my understanding, the NZRU does not pay any grants towards their clubs directly.

And SS were funded by NSWRU until 2012, when the ARU decided to take over funding themselves. Why we don't know.

It seems very strange corporate behaviour to do so, then have a review of that funding and then cancel the funding in 2014.

Does the ARU's right hand know what the left is doing?

 

[Dave Beat]

$200 levies you will able to rake in. Fixed.

7 on the paddock / 3 reserves - $200, if they play through to grade down at the Marlins we'll all be happy.
Any juniors on the beaches - PM me - Allambie Jets will welcome you and wont complain about the $200

 

[Strewthcobber]

And SS were funded by NSWRU until 2012, when the ARU decided to take over funding themselves. Why we don't know.

It seems very strange corporate behaviour to do so, then have a review of that funding and then cancel the funding in 2014.

Does the ARU's right hand know what the left is doing?

Different board, different Chairman, different CEO, different financial circumstances QH.

Without defending the cuts, the clubs have know this was coming for some time (or at least must have suspected) - it's not out of the blue. Google "Premier Rugby Taskforce Review" and you'll see reports going back a couple of years.

 

[Quick Hands]

7 on the paddock / 3 reserves - $200, if they play through to grade down at the Marlins we'll all be happy.
Any juniors on the beaches - PM me - Allambie Jets will welcome you and wont complain about the $200

Just heard that the $200 levy per team has been replaced by a National Participation Fee (NPF). The NPF is set at $11.50 for 6 and 7 year olds and $27.50 for all other junior players. (i.e. your team of 10 6 year olds will now cost $115, but your 10 8 years olds will now cost $275.

The way that we manage, administer and develop rugby is changing with Australian Rugby moving to a funding model where every player nationally will pay an individual registration fee and insurance levy.

All fees collected from the NPF in New South Wales will be utilised in New South Wales through the provision of Education, Player, Coach and Referee Development. This was previously funded by the ARU, but is once again the responsibility of NSWRU. NSWRU will not be charging a State Union Fee despite our funding being reduced by $1.5M plus in 2015. Surplus funding will be directed to our affiliates through administration resources or grants, as currently is the case.

 

[Quick Hands]

Different board, different Chairman, different CEO, different financial circumstances QH.

Without defending the cuts, the clubs have know this was coming for some time (or at least must have suspected) - it's not out of the blue. Google "Premier Rugby Taskforce Review" and you'll see reports going back a couple of years.

I wish I had your search engine, whenever I try to google this sort of stuff, I end up with out of date crap, which has nothing to do with what I'm looking for.

 

[Dave Beat]

Just heard that the $200 levy per team has been replaced by a National Participation Fee (NPF). The NPF is set at $11.50 for 6 and 7 year olds and $27.50 for all other junior players. (i.e. your team of 10 6 year olds will now cost $115, but your 10 8 years olds will now cost $275.

The way that we manage, administer and develop rugby is changing with Australian Rugby moving to a funding model where every player nationally will pay an individual registration fee and insurance levy.

All fees collected from the NPF in New South Wales will be utilised in New South Wales through the provision of Education, Player, Coach and Referee Development. This was previously funded by the ARU, but is once again the responsibility of NSWRU. NSWRU will not be charging a State Union Fee despite our funding being reduced by $1.5M plus in 2015. Surplus funding will be directed to our affiliates through administration resources or grants, as currently is the case.

Sweet U8s next year and hope NZ in a couple of years.

 

[I like to watch]

So the ARU still has provided grants of $17.5M in total to grass roots through member union allocations which I assume is $2M per state and $7.5M for age group representative teams (would this be the junior gold cup?)

It's good to see they are spending almost as much on junior rugby themselves as they are giving to the states. I'd like to see them target the youngest though. The more 6 year olds you get into rugby, the more adult fans you will have in the long run.

Where are you reading that?
What I see is the ARU spends less than 4% of their income on grass roots,whilst the Kiwi's spend 12% of theirs on game development.

 

[Train Without a Station]

Strewthcobber's post.

I wouldn't be surprised if the NZRU had lower outgoings per head too when you consider wages are lower, with less competition player salaries may be lower and many expenses are lower.

 

[I like to watch]

They would need to have lower overheads,their turnover is only $117M compared to ARU $145M.
Yet spend $10M more on game development than the ARU.
Surprisingly the ARU spends $10M more than the Kiwis on corporate.
It puzzles me that they are so much better run for 1/2 the cost in admin....

 

[Strewthcobber]

To be fair,

1. The Pulveriser has recognised that JON's corporate spending was unsustainable and ripped a lot of money out of the ARU admin in the last year (2014) and
2. The % calc is not really fair on the ARU for 2013 because they had a $23million one off Lions surplus on top of all the distributions.
3. For all the complaints about transparency, the ARU financial statement is much more descriptive about where the money is coming from and going to than the NZRU one

 

[Kenny Powers]

My opinion (and I'm not a liquidator/administrator, but I am in the industry) is that the two things that would remain are Super Rugby and test rugby. There are separate distributions to the Super Rugby franchises and the state unions. The state union distribution would cease.

If it goes down the tubes let's hope the liquidator / administrator is not a Shore Old Boy.

 

[Quick Hands]

If it goes down the tubes let's hope the liquidator / administrator is not a Shore Old Boy.

You could bank on it being so Surely there's someone from their year group involved in corporate insolvency?