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Monday, November 29, 2021

RFU reveals estimated lost revenue of £120m as impact of pandemic is laid bare

The Rugby Football Union has laid bare the impact of the Covid-19 pandemic on their finances after revealing estimated lost revenue of £120 million.

There was also a stark warning within English rugby’s governing body’s annual report that it will take “a number of years” to recover from the losses incurred in the financial year up to June 2021. The RFU depends on staging matches and events at Twickenham for 85 per cent of its revenues but matches were largely staged behind closed doors during that 12-month period. The RFU reported revenue was £97m, down from £167m in the previous year, with a further underlying loss to reserves of £21.3m – £30m worse than pre-pandemic forecasts.

The report also noted the “disappointing” performances of Eddie Jones’ England team during this year’s Six Nations in which they finished fifth. However, it claimed that the RFU was meeting its objective of producing a ‘winning England’ team by combining the men’s and women’s teams results.

Another guiding principle of being “financially strong” through the pandemic was met by employing cost-cutting measures including making 119 redundancies, using the Government’s emergency-finance scheme and a debenture donation scheme. However, in spite of the swingeing cuts, the RFU’s senior executive team were paid £2.63m, with chief executive Bill Sweeney earning £540,000 including consolidation of pension payments.

“This 150th year of the RFU has been an immensely challenging one for the union and our sport,” Sweeney said. “We have worked harder than ever before to support the professional and community game though the pandemic, with a clearly focused strategic plan to ensure we deliver real benefit and support to the game. As we emerge out of Covid, the RFU will continue to take a leadership role in reshaping and improving the game for the benefit of all involved.”

No area of the game was spared the effects of the pandemic. Funding to the men’s and women’s Premiership and Championship club game was slashed by nearly two thirds from £33m to £12.2m. This is partly because the agreement with the RFU and Premiership switched from a fixed sum to a share of the RFU’s profits last year. Cuts were also made to community and participation programmes while the investment in England sevens was effectively mothballed.

The RFU did secure funding of nearly £30m for community rugby clubs with 512 clubs benefiting from £18.2m of grants. A further 129 clubs have since applied for loans totalling £11.5m. While the RFU did receive £90m from CVC’s purchase of the Six Nations commercial rights, the report stressed this dividend will not be used to plug blackholes in their accounts.

Sue Day, the RFU’s Chief Operating Officer and a former England captain, also made plain that the effects of the pandemic on the finances will take a long a time to resolve. “It is important to understand that while some of this investment will resume in the coming years, some of it cannot,” Day said. “It will take us a number of years to recover from the significant underlying losses made in 2021.”

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