Cardiff Blues: Up to £6m revenue reduction predicted because of coronavirus
- Published
Cardiff Blues facing Scarlets in the 2019-20 season
Cardiff Blues supporters have been told the region could expect revenue reductions of between £4m and £6m because of coronavirus.
The stark warning was issued at a recent meeting between Blues bosses and CF10 Supporters Trust.
A complicating factor also raised was the Welsh Rugby Union's income being affected and the resulting impact on the four regions.
The meeting was told the WRU were seeking support from Welsh Government.
The Blues fans were also told about the possibility of funding from World Rugby's emergency fund. There was no mention of remortgaging the Principality Stadium with chairman Gareth Davies insisting last week that had not been discussed at board level.
Minutes of the liaison meeting between the Blues and the CF10 Trust reveal it was initially thought professional rugby would be back to 80% normal by the start of 2021.
However, the minutes stated some of that positivity has now disappeared and it is likely games will be played behind closed doors until the end of the year, maybe longer.
A working group had been established to look at savings and income generation. Cardiff Blues say they had taken advantage of the furlough scheme, rent rebates and limited banking facilities.
Cardiff Blues could be looking at those revenue reductions of between £4m and £6m depending on how long the situation lasts.
Money matters
Welsh rugby faces a stark economic situation with WRU chairman Davies last week describing the coronavirus pandemic as catastrophic financially for the game in Wales.
Gareth Davies is a former Wales captain who played 21 times for his country between 1978 and 1985
The Professional Rugby Board (PRB), made up of representatives of Cardiff Blues, Dragons, Scarlets and Ospreys and the WRU, runs the professional game in Wales and issues funding.
The WRU's income in the 2019 annual report was £90.5m with more than half of that coming from international matches. Any cancelled Test matches would directly affect the amount of money issued to the four Welsh regions.
There were suggestions £26m going to the regions could even drop to £3m next year the loss of revenue continued and if the worst-case scenario becomes reality.
Meanwhile, Scarlets have moved to clarify reports in the Rugby Paper they were considering legal action after their bid for extra funding to the PRB and WRU failed following a mediation process.
A Scarlets statement said: "We can confirm the story is out of date and the mediation notice has been withdrawn and will not be taken further.
"We are continuing to work with WRU and PRB on solutions in these unprecedented challenges we face as a result of Covid-19."
The money split between the regions depends on a range of factors which includes sides being rewarded financially on and off the field.
This includes the number of players provided to Wales with the cost of internationals to each region.
Currently, Scarlets receive more than £8m with the Ospreys and Blues getting over £6m each and the Dragons more than £5m.
Wage cuts
In March, Wales coach Wayne Pivac and WRU chief executive Martyn Phillips were among the senior staff who took a 25% pay cut.
In April, Welsh players from the regions agreed a 25% pay cut over three months as the sport dealt with the financial impact of coronavirus.
That took them until 1 July and further reductions have been mooted but players have reacted strongly to what they see as mistakes in how the regional game has been historically managed.
They are now waiting to return to training ahead of any possible Pro14 resumption with return dates of 29 June and 6 July being touted.
The Guinness Pro14 is hoping to return to action on 22 August with two rounds of localised fixtures behind closed doors, with Parc y Scarlets and Liberty Stadium options to host those matches.
Some regions face a conundrum on where to train with venues acting as field hospitals or testing centres.
Cardiff Blues are looking for facilities with the Arms Park out of action as part of the Principality Stadium field hospital site, while Ospreys have plans to switch to St Helen's in Swansea with their usual Llandarcy training base out of action.