Sport Union Coronavirus fallout: Rugby Australia cuts staff in bid to avoid insolvency
Updated:

Coronavirus fallout: Rugby Australia cuts staff in bid to avoid insolvency

Disappointed Australian players reflect after losing in the quarter-finals of the 2019 Rugby World Cup. Photo: AAP
Share
Tweet Share Reddit Pin Email

Rugby Australia has axed more than 40 per cent of staff, citing financial woes, including the COVID-19 crisis, in a successful bid to stave off insolvency.

Interim Rugby Australia CEO Rob Clarke told ABC’s 7.30 that staff cuts at the national governing body for rugby union were expected to be concluded today by telephone.

“We will be reducing our full-time headcount by 47 people,” he said.

“We will be reducing our contractors and casuals by over 30 people and taking $5.5 million out of the annual salary bill of Rugby Australia.

It’s over 30 per cent of the full-time staff. If you include the contractors and casuals, it’s well over 40 per cent.

“I take it very seriously because it’s impacting people’s lives and family’s lives. So, it’s something that we must do very responsibly, but I did think it was necessary, and the board supported that.”

Mr Clarke still thinks rugby union in Australia has a bright future.

“It’s a challenging future right now, as most businesses, and certainly sports, are going through COVID,” he said.

“That said, I think that provides a nice opportunity.

“‘Why waste a crisis’ is a common phrase, and I think it actually relates to what we have in front of us now.”

The job losses come after KPMG signed off on Rugby Australia’s books for the past financial year, with the help of a $6.9 million loan from HSBC Bank.

“We are working with a coalition of major professional participation sports to secure some form of [government] relief, along with NRL, AFL, cricket, tennis, netball, but otherwise our books are clean and I feel that the future is bright,” Mr Clarke said.

Criticism from ex-captains

The governing body’s fortunes of late have included the exit of former CEO Raelene Castle, an out-of-court settlement with Israel Folau, a declining audience, board leaks and allegations of mismanagement from former players.

Former Wallabies captain Nick Farr-Jones was part of a group of ex-captains who wrote an open letter to Rugby Australia’s board seeking sweeping changes.

“Look, I think it’s going to escalate in the next few months,” he told 7.30 before the cuts were announced.

“I wish the interim chief executive Rob Clarke and the new incoming chairman all the very best for the sake of rugby.

Warnings: Nick Farr-Jones.

“There’s absolutely no doubt I think we made a grave mistake knocking back the Foxtel broadcasting deal.”

Rugby Australia walked away from a $57 million broadcasting deal with Foxtel and is now looking for a new broadcast partner.

“I can’t understand how a couple of guys were paid a million dollars to consult for Rugby Australia [on the Foxtel deal] when you look at spending $320,000 a day in rugby, having over 200 staff, having corporate costs of nearly $20 million a year.

“I just cannot understand it. There’s going to have to be a significant reset.”

Rugby Australia spent more than $1.8 billion over the past two decades, only to see the national team’s world ranking slump from second to around seventh and a 42 per cent decline in Super Rugby viewership.

“It’s just that we’re behind the eight ball in Australia at the moment. I think there’s been a lot of mismanagement in the last few years,” Farr-Jones said.

‘It’s not where we want to be’

Mr Clarke denied there had been any “mismanagement”.

“As to decisions made from past administrations, they are questions you can ask them. I’m sure they had reasons why they made the decision they did,” he said.

“My job is to secure the future of the game while I’m in this chair.”

Mr Clarke admitted the Wallabies’ on-field performance was lacking.

“I agree. We have been No.1 in the past and where we sit today is not where we want to be.

“So that is a focus of our high-performance team under Scott Johnson and new coach Dave Rennie.”

However, former Wallaby and president of the Eastwood Rugby Club, Brett Papworth, said there had been too much focus on elite forms of the game, citing reports that RA spent $19 million on corporate costs and only $4.3 million on community rugby.

“[Rugby Australia has] chopped all the trees down and been a fantastic logging business and they’ve built massive timber mills, but they’ve forgotten to plant any new trees,” he told 7.30.

“They’ve invested nothing in the future of the kids playing the game.”

ABC