Coronavirus: Welsh Rugby Union seeks loan to recover from pandemic
- Published
WRU chief Martyn Phillips (R) appointed Wayne Pivac to replace Warren Gatland as Wales coach in 2019
Welsh Rugby Union chief executive Martyn Phillips admits the governing body needs a loan to help it through the financial effects of coronavirus.
Phillips did not reveal who would be asked or how much is required but said there are several options.
The Welsh Government could help out, while World Rugby has provided an £80m contingency fund.
"Given the financial shock of this pandemic the only solution is to increase our borrowing," said Phillips.
"We are working hard to secure a loan and, importantly, on terms that allow for repayment over a number of years.
"We are in discussions with a range of institutions to assess our options.
"While the current financial hit is extreme and focused, we will look to smooth and dampen its ongoing impact through a manageable repayment profile and interest rate."
WRU chairman Gareth Davies said last week that remortgaging the Principality Stadium had not been discussed at board level.
The WRU is facing a significant funding shortfall, as more than half of the £90m of annual group income coming through international matches and events at the Principality Stadium.
Phillips insisted most of the borrowed money would go to the four Welsh regional sides, Cardiff Blues, Scarlets, Ospreys and Dragons with the professional sides responsible for paying the loan back.
"Much of the loan will be onward lent, to Welsh rugby's four professional regions," Phillips wrote in a letter to the Welsh clubs.
"This is only right, as the international and professional game is the financial powerhouse of Welsh rugby. Without it we would have little income or funding to reinvest.
"The professional game will bear the responsibility for servicing the loan, but will also benefit from any bounce back of any financial revenue over performance in future years.
"The professional game bears both the risk and the reward. Our goal, like with our semi-professional and community clubs, is to ensure all four regions survive this crisis.
"There are opportunities to combine our efforts and we need to be thoughtful in how we do this.
"Some things make sense to do together while other things need to be done independently, particularly to preserve identity, culture and competition on the pitch."
Phillips confirmed the £11.8m to community clubs remained ring-fenced as he hoped all sides would survive this crisis and the long-term future of Welsh rugby could be safeguarded.
WRU chief hopes community rugby will resume in October
Continued cuts
Phillips also stated other short-term plans included further 25% pay cuts for himself and the WRU executive, which includes head coach Wayne Pivac.
"We are at an advanced stage of planning for how we manage our costs over the next two years in particular," said Phillips.
"I would like to thank the staff within the WRU group for their understanding, as we have extended salary reductions for a further three months to the end of September, which is when we will review the situation again."
Phillips also said discussions were ongoing about further player wage reductions after a three-month agreement of 25% pay cuts ends at the end of June.
"There has been a lot of commentary about players' wages," said Phillips.
"Back in April the players agreed to temporary wage cuts to help us through the crisis, again for which we are grateful.
"We are now in further discussion, the first step of which is a responsibility of the Professional Rugby Board to set out the financial situation and then work together with the players to find options that safeguard the game and also deliver to the players' personal situations.
"There is a requirement for continued dialogue over the next few weeks to explore options and land on a way forward that works for all parties. I'm sure we can achieve this together."
Global talks
South Africa's 2019 World Cup triumph added to their global wins in 1995 and 2007
Following a World Rugby meeting on Monday, Phillips said discussions were ongoing about the global calendar and the rest of the 2020 schedule - with another meeting planned on 30 June.
Wales' summer tour to Japan and New Zealand was postponed, while the 2020 Six Nations game in March against Scotland also might be rescheduled.
These games are in addition to the November home programme against New Zealand, South Africa, Argentina and Fiji.
Phillips confirmed he was part of a World Rugby working group looking at the global calendar.
"It was a frank exchange, nobody will get everything that they want, but the opportunity is there for everyone to have a season structure which is better going forwards," said Phillips.
"When you consult as widely as we have, the challenge can be that you create a situation where people interpret consultation as an indication that they will get exactly what they want.
"Clearly, that is rarely the case but I very much hope that, whilst at individual level there will be compromises required, the end result will be infinitely better for rugby as a sport."
Phillips says he hopes rugby was recovering from the pandemic.
"The optimist in me hopes we have seen the worst of this crisis and that any future spikes can be dealt with quickly and locally where possible," added Phillips.
"We have a plan, we can see the other side and we will calmly go about our business to ensure the game is better coming out of this crisis than it was going in."