Parramatta fans should welcome the penalties issued by the NRL for the Eels breaching the salary cap, if only because it will prompt thorough examination of the way the club operates.
I’m obviously talking about the NRL forcing Parramatta to undertake an independent review of its governance and organisational capability more than the $525,000 fine, which is significant but which wouldn’t automatically promote change.
If the club doesn’t undertake the review and implement changes recommended by that review it will be docked four competition points at the start of next season.
Expect the Eels to proceed with the review, however begrudgingly.
Parramatta, in its media release that followed the NRL release announcing the penalties, had a different spin on things to the league.
In an awesome display of mismanagement, the Eels managed to overspend in all four salary cap categories for 2014 – NRL top 25 ($101,718), NRL second tier ($233,036), NYC top 20 ($60,915) and NYC second tier ($8277).
Benefits provided to Parramatta players by Parramatta Leagues Club in 2013 also represented a cap breach, the league said.
The NRL said the breaches “were significant and were the product of inadequate oversight and governance at the club, largely by previous administrations”.
Importantly, the NRL said it had “worked proactively to try to help the club avoid breaching the caps. The club had been given multiple warnings that it was in danger of breaching the caps but did not take sufficient steps to address the non-compliance.”
Normally, the league imposes cap fines that are equal to the cap breach, but in this instance it said Parramatta “would be fined an additional penalty, taking the total to $525,000, for failing to take action to rectify its salary cap problems despite being warned to do so.”
The league made it clear Parramatta’s governance had failed, whilst acknowledging that “steps were now being taken to improve the systems at Parramatta.”
The Eels, in their statement, said the NRL had acknowledged that “the primary contributing factor was consistent mismanagement of the NRL and NYC playing squad and salary cap compliance between 2010 and mid-2013.”
The release went on to say that in 2013 “the newly-elected board of the Parramatta Leagues Club initiated an extensive internal investigation, which by late 2013 had raised significant concerns regarding player contracts and squad management.”
It continued: “Eels senior management alerted the NRL of its concerns, and it was determined that the club would continue to advise the NRL of all subsequent issues to be considered as part of the NRL’s regular 2014 mid-season salary cap audit.”
The statement said what had happened was “symptomatic of wider failures in the previous administrations of the club” and Eels chairman Steve Sharp was quoted as saying the findings “again highlight that dark period for our club between 2010 and 2013.”
But there was no reference to the league’s statement that it had “worked proactively to try to help the club avoid breaching the caps. The club had been given multiple warnings that it was in danger of breaching the caps but did not take sufficient steps to address the non-compliance.”
What isn’t under question is that the Parramatta management has been dysfunctional in the past and while the club argues that it has significantly improved its practices, the way the club operates is now set to go under the microscope.
That is how the NRL operates these days. It seizes every opportunity to force governance changes at clubs.
It has already done that with several clubs in exchange for providing financial assistance and now it has taken the opportunity to force change at Parramatta.
That can only be a good thing.
One thing I’d really like to know, but which we may never find out, is exactly what the so-called “political turmoil” clause in the contract of Parramatta’s big signing for next year – Kieran Foran – says.
Fairfax Media reported earlier this month that current Manly star Foran has a clause in his Eels contract which allows him to exit his four-year deal at any stage if the sort of political turmoil for which the club has become known in recent years results in further upheaval at the club.
In terms of unusual contract clauses, that would have to be one of the greats.
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