IRFU single out Munster as they issue stark financial warnings
Munster's financial troubles were highlighted as the IRFU warned player's wages were "unsustainable"19:55 Friday 15 July 2016, 19:55 15 Jul 2016
The IRFU annual report for 2015/16 won't make pleasant reading for many of the provinces, in particular Munster, whose debt was highlighted by the organisation.
Munster's cash-flow shortfall was revealed at their AGM earlier this summer, and speaking about the report, the IRFU noted that the province were proving to be a financial strain.
In a statement, the IRFU said that an increase of almost €6m in player and management costs "arises, in large part, from the necessity to provide against operational amounts due from the Munster Branch, in light of their current financial difficulties."
Noting that player wages across the provinces have become an increasing burden for the IRFU, Chief Executive Philip Browne warned that they an no longer be the "lender of last resort" for the professional game, and they do not "have the capacity to absorb ever increasing player wage inflation."
Highlighting the role played by the Rugby World Cup in helping them to a cash surplus of about €5 million for the year, the IRFU noted that costs increased by almost the same amount, from €66.2m to €71m in that period.
An overwhelming majority of the IRFU's money is generated by the national team also, with the report noting that €61.7 million (81%) of their income was made thanks to the Boys in Green.
Tom Grace, honorary IRFU treasurer, highlighted that the offers coming from abroad for Irish players were part of the reason that wages had jumped well beyond expectations this season.
"It is no secret that the increased revenues available to French and English clubs are having a serious inflationary impact on player remuneration," said Grace. "The Union's response to this is to increase the player funding going forward for the provinces, but more significantly to invest greater amounts into our player development pathways from the grassroots game upwards."
Browne echoed that sentiment, stating "all is change in the European rugby environment with the growing dominance of those clubs in France and England with deep financial pockets. The size and quality of the playing squads that these clubs can assemble from around the world has changed the balance of power in Europe to the detriment of our Provinces and the IRFU who simply cannot match the playing budgets of these teams."
Browne also called for change to the Pro12 format in order to make it a more financially viable entity, noting that "the revenues generated by the tournament need to increase significantly if the participating clubs are to remain competitive with the clubs in the English and French leagues. Such an increase in values will require some radical change to the tournament and how it is structured."
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