The AFL is planning to invest funds into Gold Coast FC and GWS; if the NRL expands to eighteen teams, the NRL won’t be supporting a cent; if an AFL is in financial trouble, the AFL will assist as it has done for Sydney and Brisbane, the AFL has a higher salary cap than the NRL, why because the NRL has nothing in cash reserve. Wait a minute, the NRL isn’t some Joe Blow (no offence Joe) struggling for money it’s a major sporting body of one of the country’s most prominent sports that turns over millions of dollars every year; how can they have no revenue? Keep reading, and I’ll explain that and more in the latest instalment of the now-infrequent Blog of Cheese.
mark
Late last year the Federal Government pledged $11.4 million as part of its stimulus package, the NRL planned to use this money and a loan to build a new headquarters for the game. Currently, the NRL is located at Fox Studios, with the ARL being located at the NSW Leagues Club in Phillip Street. There are three potential sites for the new headquarters of the game the SFS (currently the home base of the NSW Waratahs), Homebush Bay precinct and Australian Technology Park at Redfern. The NRL has always wanted to have all governing bodies in one building, but the current arrangement exists due to a lack of funding. One problem exists that no bank will loan the NRL money for the site’s building. The NRL’s banker, the Commonwealth Bank of Australia, expressed concerns over the failure to accumulate cash revenues. St George Bank, naming rights sponsors of the St George Illawarra Dragons (something that I’ve never been comfortable with), offered a loan at a high-interest rate, while the National Australia Bank prepared to discount St George’s offer by 1.1 per cent.
So how is the NRL in this position? Simple, the NRL earns $150 million and spends $149 million. David Gallop states, “Over the past 10 years, as we’ve generated additional revenue, our goal has been to increase our investment in junior development and close the gap between the players’ salary cap and the annual club grant”. “We could have stuck $5 million in the bank every year for the past 10 years and been sitting on $50million, but we could well have lost a club to bankruptcy and fallen behind in funding to junior development. “Where does the money go? Well, the money from the television deal is split evenly between the clubs as part of the grant; the rest goes to operating costs as well as News and the ARL, each taking their share as part of being 50% stakeholders. Hopefully, a new commission will come in and look at the way the NRL is spending money. also, they will not be paying News and the ARL as 50% stakeholders, adding that the commission will be a nonprofit organisation. Another reason we need an independent commission sooner rather than later
A couple of weeks ago, I had planned to write a blog post that included the salary cap, I had heard someone complain that there should be salary cap concessions for long-serving players/juniors who are now playing first grade in the same region as their first-grade club and it really annoyed me, this person like many who complain do not understand the salary cap at all and listen to the voices of a few idiots who shout the loudest, so their views are heard and therefore believed to be mainstream and correct. In the end, I decided not to write the post as I had already written one on the salary cap, and it basically served the same outcome that I wanted to achieve in this one. Then the whole Scott Prince/Cameron Smith salary cap issue reared its ugly head, and I realised that maybe I could make another post on the Salary Cap.
The main two gripes people have with the salary cap are it punishes clubs for being successful/and clubs lose players they’ve developed. The NRL Salary cap is set at the ability to pay off the lowest revenue-earning club –Cronulla. The base salary cap is currently $4.2 million, a figure that most clubs cannot meet, let alone the additional funding of for long-serving players/juniors. That is the main point people don’t understand the money for long-serving players/juniors may be exempt from the salary cap, but the money still needs to be paid on top of the salary cap. To explain what I mean, I am going to use the example of the Cronulla Sharks and two of their players, long-serving player; Paul Gallen and local junior; Scott Porter:
Paul Gallen: Paul debuted for Cronulla in 2001, meaning he qualifies as a long-serving player (7 years, suggested); Paul also had his contract extended for this year; let’s say, for argument’s sake, he signed for $ 1 million over two years and gets $500,000 over the two years as being a loyal player, meaning on top of the $4.2 million that Cronulla has to spend to meet the base cap they can spend an additional half a million plus another $500,000 over two years on Scott Porter as a local junior, that’s an extra million dollars that the club can spend. Now those figures are made up and rounded off to be easier to understand, the money may not be included in the Salary Cap, but the money is still added to the clubs’ bottom dollar. In a league where most clubs are struggling due to a combination of lack of leagues clubs grants and/or the financial crisis, it is ridiculous to say clubs should spend more money when they can hardly spend money to meet the basics if this was to happen many clubs would fall by the wayside which is what no one wants to happen.
What the NRL plan to do instead of massively increasing the salary cap is to raise the grant they give each club. Currently, the grant is $3.5 million, so the clubs only need to spend 700,000 on the salary cap. Once the grant is equal to the salary cap, the clubs only need to spend money on the day-to-day running of the club. Yes people may cheat the salary cap but just because people are breaking laws is no reason to abandon laws; the proof is the salary cap works (even without a draft) eight different clubs winning the competition over the last twelve years proves that. People may point to Melbourne making four grand finals in a row to say the salary cap doesn’t work, but they have lost a number quality of players, including Dallas Johnson, Matt King, Israel Folau, Scott Hill, Steve Turner, Jeremy Smith, Nathan Friend, Clint Newton, Michael Crocker, Antonio Kaufusi and Will Chambers. The fact is Melbourne knows how to produce quality players who were cheap to buy and turn them into quality first graders.
A couple of weeks ago, David Gallop announced that since the next TV deal will be much larger than the last one, expansion is back on the NRL horizon, with the Western Australian Reds and the Central Coast Bears the two leading contenders for expansion. While this was met with a big positive reaction from the two previously mentioned clubs, it was not meant well by the Central Queensland-based consortium, who, upon hearing the news organised a meeting with David Gallop to let the NRL know about the bid. A PNG bid exists, but the stadium they want to play at won’t exist unto; 2015 for the Pacific Games (I have heard the team could be located in the NT and use the businesses of PNG for a combined PNG/NT bid, although nothing official has been mentioned). The Wellington Orcas bid in 2004, but nothing has been made official since their failed bid for the Super League competition in 2007.
This post has nothing to do with expansion but the fact that if two more teams are added, that gives the NRL nine games instead of eight so it will have to find one more game to fit into the schedule, I feel the best way to do this would be as follows: Friday: 1 game (7:30pm –live), Saturday 3 games (3pm, 5:30pm, 7:30pm all live), Sunday 4 games (two 2pm games both live, 4:00pm game live 6pm, game on TV either live or at 7:30), Monday 1 game (7pm live). Even if the NRL doesn’t expand, they have stated that they will drop the second Friday Night game For Saturday; the 3pm Saturday game seems popular among fans and the NRL seems keen to go back to the idea (despite it not working before, I don’t understand how it will work this time), the 5:30pm game remains intact, and only one 7:30pm game as families don’t like going to the 7:30 games. Sunday is traditionally a big day of Rugby League, so it gets the most games; I would shift Super Saturday to become Super Sunday adding a game at 2pm, and reading between the lines, the old 3pm game will move to 4pm live, I add a second new game at either 6pm live or 7:30pm delayed, this game would be similar to Monday night in that the crowd might not be large but would dominate on any network at 7:30pm. Monday Night Football has proven it works but must not be played in Suburban Ovals, with only the SFS/Homebush and Parramatta Stadium to be used in Sydney. Although saying all that, if the NRL adds a team from WA, there is a lot more flexibility in scheduling due to time differences.
While being interviewed on ABC Grandstand in Round one, St George Illawarra coach Wayne Bennett stated that he supported the game but had very little information about what the commission contained. Wayne also noteded that everyone should have more transparency to know what the plans are for the commission. Gold Coast CEO and head of the committee to find out if an independent commission was viable, Michael Searle, responded to Wayne’s comments by saying that they outlined to a meeting of the clubs on January 18th attended by all 16 NRL CEOs, captains and coaches how the commission would be put together, unfortunately, Wayne was not able to make the meeting. The commission would be a nonprofit identity as opposed to the current partnership where future profits if the game does see a significant increase in the TV rights, would leak out of the game into the ARL and News Limited. The commission is a while away from becoming a reality, but here is the list of people who I believe should be the first commissioners:
Katie Page (Managing Director of Harvey Norman, current NRL board member), Mark Coyne (CEO and Managing Director of Coal Services Pty Ltd, a current member of the NRL Judiciary, Chairman of the NRL & RLPA Education & Welfare Committee and assistant coach with the QLD State of Origin Team), Shane Webcke (Four-time premiership-winning prop with the Brisbane Broncos, public speaker and regarded as one of the best thinkers in the game today ), Geoff Dixon (Former Qantas CEO, former Wagga Wagga first grade player, his father was a founding member of the Wagga Magpies), John Mulcahy (Former CEO of Suncorp-Metway, Former executive of the Commonwealth Bank, and current board member for the Australian Government’s Future Fund), Michael Cleary (Former dual international, Triple Olympian and former NSW Sports Minister) and Rob Moodie (Former CEO of Victorian Health Promotion Foundation and current professor of Global Health at the Nossal Institute of Global Health and the University of Melbourne)
Chairman: Colin Love (Current chairman of the RLIF, ARL and NSWRL, was the lead ARL lawyer during “the war” he came up with the idea with the Rugby League World Sevens competition part of the ARL relinquishing power that Colin will be the inaugural chairman for two years)
CEO: David Gallop (Legal Affairs Manager for Super League during “the war”. CEO of the NRL since 2002, secretary of the RLIF since 2002 and chairman of the Australian Sports Commission since 2010, David will continue in his current role but will be made easier having to operate only to one board.
The QRL is opposed to the commission in its current form but was outvoted by the NSWRL delegates at an ARL meeting (NSW had the deciding votes as chairman Colin Love & CEO Geoff Carr support the commission in its current form); the QRL do not want to lose their power, their delegates are okay with their jobs and don’t want to lose them, a message for Rugby League fans from the QRL explaining their position features at the bottom of this post.
And Another Thing: There was a post in the Sunday Telegraph about Power Balance wristbands and the new hype in the NRL. Shaquille O’Neal was listed as one of the athletes who use the power balance, and it was then I realised these wristbands do nothing.
Quote of the Week: Timana Tahu on the mentoring he received in rugby compared with what he got in league: “In league I had Warren Ryan, Brian Smith, Michael Hagan and Phil Gould. With those blokes, when you went into a team, whatever a coach said was biblical. But coming over to the Waratahs, there were five or six other coaches – and five or six different opinions.”
The Queensland Rugby League has released to its supporters and volunteers the following letter and facts sheet regarding the Independent Commission.
Dear Parents, Guardians and Players,
The proposed establishment of an independent commission for rugby league has created a great deal of community interest and comment (mostly incorrect) and we would like to assist our rugby league community to understand the proposal and the Queensland Rugby League’s (QRL’s) position regarding the commission.
The QRL believes the current structure of the game could be improved to benefit rugby league’s long term development. Therefore, the QRL is committed in principle to the establishment of a single body to control the efficient administration of rugby league in Australia.
Any suggestion that the QRL is blocking the establishment of a new independent commission is incorrect.
What the QRL is doing is standing up for the Queensland rugby league community and its grass roots supporters to ensure the game’s long term future.
The changes proposed by the National Rugby League (NRL) clubs are far reaching and it is vital the implications of such a change, including protecting the game’s grassroots development programs and representative opportunities, are considered in detail.
Under the current proposal for the new structure, the Australian Rugby League (ARL) and News Ltd would hand over control to a new independent commission. Under their agreement, News Ltd is proposing to deliver its 50 per cent share of the game to the NRL clubs when they exit. The ARL has a 50 per cent ownership position and we believe it would not be in rugby league’s best interests to eventually hand full control to the NRL clubs – who represent the game’s elite. In other words, why would the ARL as custodians of the game walk away and place the game’s future in the hands of the Clubs, several which are privately owned.
Whilst the NRL clubs play an important role in the promotion and funding, the game has many stakeholders including senior, junior and school players, parents and supporters, volunteers and referees – all of who need to be protected and represented under this new structure.
The QRL believes the best way of ensuring the independent commission serves the interests of all the game’s stakeholders is for the QRL and New South Wales Rugby League (NSWRL), through the ARL, to jointly nominate four independent candidates to the proposed eight-member board of the commission with the NRL clubs doing the same. This structure proposed by the QRL, ensures equality and transparency.
The QRL has a proud tradition of fostering the game’s development for more than a century and we want to ensure the culture and heritage of rugby league remain intact.
As a not-for-profit organisation, the QRL ensures the game makes the necessary investment to maintain the revenue producing elite level of the sport such as State of Origin, while expanding the investment in the development of junior and amateur levels across the State. In 2010, QRL development officers will involve approximately 90,000 juniors (43,000 club players, 46,000 school players) in rugby league based physical activity in Queensland.
We appreciate that rugby league is a way of life for many Queensland people and we are indebted to the selfless contribution of the code’s estimated 18,000 volunteer workers each week, including coaches, managers, trainers, first aid officers, officials, canteen staff, groundsmen, registrars, jersey washers, timekeepers etc.
The QRL takes its role as the custodian of the game in Queensland seriously, which is why we will not compromise on our commitment to the grass roots of the game, nor are we prepared to gamble with its long term future.
Please find below a fact sheet containing some frequently asked questions regarding the proposed independent commission. Thank you for your continued support of the QRL and our great game.
If you have any views or further questions regarding the independent commission, please contact the QRL via email rugbyleague@qrl.com.au or phone (07) 3367 6000.
THE REAL FACTS ON THE INDEPENDENT COMMISSION AND THE ANSWERS YOU NEED TO KNOW
Rugby League’s Independent Commission Explained
The following contains frequently asked questions relating to the independent commission. If you have any additional questions, please contact the Queensland Rugby League (QRL) via email at rugbyleague@qrl.com.au or (07) 3367 6000.
Who presently administers the game of rugby league in Australia?
At present the game is run by a partnership committee, comprising three representatives each from News Ltd and the Australian Rugby League (ARL). This was formed in 1997 when the game was unified following the Super League split.
What is the independent commission for rugby league?
Under proposed changes as a result of the establishment of an independent commission, News Ltd would exit the game and the partnership between News Ltd and the ARL would be disbanded. In the place of the partnership would be a new board of eight independent commissioners.
Who will be responsible for the development of the game under the independent commission?
The ARL and its affiliate state bodies such as the QRL and New South Wales Rugby League (NSWRL) along with the NRL clubs presently provide funding for the development of the game. The proposed independent commission would ultimately become responsible for development funding and control.
Is the QRL trying to block an independent commission?
No. The QRL believes the current structure of the game could be improved to benefit rugby league’s long term development.
The QRL is committed in principle to the establishment of a single body to control the efficient administration of rugby league in Australia. The continued suggestion that the QRL is a stumbling block to the establishment of a new independent commission is incorrect.
The changes proposed by the independent commission are far reaching and it is imperative that we consider the implications of such a change, including how the game’s grassroots development programs and representative opportunities will be protected.
The QRL has taken a leadership role in investigating the implications of an independent commission through convening an intensive workshop to explore its impacts. We have also taken all steps available to advance discussions on the independent commission with the ARL.
We have more work to do but the QRL will not compromise on its commitment to protect the game’s grass roots and representative football.
What changes are proposed to the administration of the game under the independent commission?
Under the agreement with News Ltd, the NRL clubs will get its 50% of the game if News Ltd exits. The ARL must retain its 50% ownership and not allow the clubs to elect all commission members and take 100% ownership and control of the game as they have proposed.
The QRL does not believe it is in rugby league’s best interests to eventually hand full control to the NRL clubs who represent the game’s elite and a number of which are privately owned.
The QRL is the custodian of the game in Queensland which has a broad base including seniors, juniors, schools, parents, development, education, volunteers and referees.
Why would the ARL as overall custodians walk away and place the game’s future in the hands of 16 Clubs each controlled by different boards.
How does the QRL believe the independent commission should be structured?
The QRL believes the best way of ensuring the independent commission serves the interests of all stakeholders is for the QRL and NSWRL, through the ARL, to jointly nominate four independent candidates for the proposed eight-member board of the commission. The same procedure should apply to the candidates nominated by the Clubs.
The structure the QRL proposes before these members could be elected ensures equality and transparency in the establishment of the commission.
Does the QRL believe all commissioners for the new body should be independent?
Yes. Furthermore, the QRL has proposed that candidates put forward by the ARL must first achieve 75% acceptance by the ARL and then they must achieve 75% acceptance by the NRL clubs. This approach would also apply to NRL club nominations for commissioner positions.
Why are we only now being told about the independent commission?
The clubs have been driving this campaign for an independent commission for some time but QRL members of the ARL only had their first opportunity to view details of the proposal when a four page document containing 29 points was tabled at an ARL Board meeting on December 8th 2009. A proposal of this magnitude needs analysis and informed debate and not just a media campaign in an endeavour to discredit people and force a decision favourable to the NRL clubs.
This commission structure as outlined was not acceptable and the ARL advised News Limited of its views.
We have requested further information from the ARL on the progress of the proposal as part of our campaign to ensure the grassroots of the game and representative football are protected.
The QRL takes its role as the custodian of the game in Queensland seriously, which is why we are standing up for the Queensland rugby league community, its grassroots supporters and the game’s long term future.
We will endeavour to keep all stakeholders informed of any further developments relating to the independent commission. In the meantime, should you have any views or further questions, please contact the QRL by email – rugbyleague@qrl.com.au or Ph: (07) 3367 6000.
Till Next Time Cheese