NRL salary cap broken down by the numbers

By The Crowd / Roar Guru

Let me show you why I prefer the salary cap and draft with a simple, very simple, numbers game. Say you have 20 clubs generating $1200 million revenue profit. That’s $60 million per club.

But let’s also assume half of that is ploughed back into the game, leaving a salary cap per club of $30 million. Let’s say those 20 clubs each have 30 players.

That’s an even one million dollars per player. Obviously, there would be upper limits for better players. Say one or two on $2 million. Also, there’d be lower limits for inexperienced players, say half a dozen on $600,000.

Now that’s one million per year on average per player. The average salary for Australians is roughly $50,000 right now.

Actually, it’s a bit higher, but we leave it as is for the purpose of the exercise.

Now, one million is 20 times the average salary. It’s great work if you can get it. You would think any sport would be happy with that.

Or realistically, even the more likely average of about $200,000 as exists today.

Everyone’s happy, or should be happy. This is basically how it works with the big sports in the US.

Okay, maybe some individuals could get more. But hey, everyone’s benefitting big time, so let’s keep the excess greed in the closet.

But no! Some players, some agents, some clubs aren’t happy with a level playing field. They want more for themselves and less for everyone else .

Human greed! You can try and limit its excesses, but you can’t stop it. Some try to dress it up as restraint of trade, but it’s still greed. And so many people fall for this restraint of trade crap.

Now take the draft. if you’re a young, single guy and you want to play the big time. Then you have to be willing to go elsewhere for awhile.

Treat it as an adventure. Okay, you’re from Innisfail, and you get drafted to Sydney. Or you’re from Echuca, and you’re drafted to Perth.

Enjoy it, stay there for 3-4 years, learn your sporting trade. You can always move back home (or your state capital) after 3-4 years. It will pass in the blink of an eye. It’s not a life sentence.

Life is not about having it all.

“Everything in moderation”, as my grandmother used to say. The greedy don’t need to be, or shouldn’t be, listened to.


This is a promoted comment which was originally posted in response to this article: Memo David Gallop: it’s time to Scrap the Cap

The Crowd Says:

2011-02-20T03:39:07+00:00

Patrick

Guest


"The same goes for the systems at the Roosters, even though they dont have the best juniors, they develop players, not just buying superstars." With you until there buddy, they don't do squat, they poach players when they're young, but they are never the ones bringing them into first grade.

2011-02-18T06:18:03+00:00

billiris

Roar Rookie


When the NRl gets close to a billion dollars for the next TV Deal expect to see the salary cap increase to 6 million. 6 million divided by 25 is $240000. That will be the average base income for a player in the top 25 in each club. Top that up with sponorship third party deals and you have some pretty happy footballers.

2011-02-17T20:33:26+00:00

Crosscoder

Roar Guru


The game simply has to generate more funding via Tv deals/sponsorships and merchandising.The most successful footaball financially around is the NFL,which has the salary cap and a pretty even stevens comp.Yes there are huge sums available in the Yankee market,but despite this the powers that be,want a comp that for evry mach tends to be extra competitive. The salary cap intertiined with the NRL comp,has provided and has done so fo a while,one of the most competitive footabll comps going around.On any given day the lowest rung teams can give the top ones either a hell of a shake or actually beat them. What needs to be addressed is having a "Rep/elite players bonus fund"' that is used too top up these class players' salaries with a bonus after either a test or SOO.that is in addtion to the monies they earn playing those elite games. The grassroots in this country must get priority,but in a free market situation if a club sees a potential star from the Pacific islands or NZ , whether he be a ru junior or rl junior,they should not be restricted from securing the player's services.Never restrict your potwential playing pool.

2011-02-17T14:38:53+00:00

bilbo

Guest


Poorer teams such as the Tigers, the Sea Eagles and the Panthers have won competitions in the last ten years. Even the Dragons and bulldogs are not financially secure clubs. The Roosters, Broncos and Storm have also featured heavily, but they would have featured much more extensively if not for the cap. The cap, in some form, is a necessary evil. Of course there needs to be some form of restriction - removing it will not help the poorer teams any more than they are currently being helped. It just needs some tweaking. Clubs should be rewarded for identifying and developing junior talent - and that includes talent from other catchments. If they have been developed by a club, there should be benefits. Cooper Cronk, Matt King, Billy Slater, Cameron Smith would not be the players they are if not for the Storm system - so the Storm should benefit. A guy like Greg Inglis, who was seen as a superstar from his junior days, is a bit different, but even so he has benefited from the system that the Storm has in place. The same goes for the systems at the Roosters, even though they dont have the best juniors, they develop players, not just buying superstars. At the moment, too many teams are just signing good rugby juniors from NZ, while the Australian grassroots are neglected. If the salary cap included these concessions, and of course the cap was raised to allow star players to remain in the game, there would be very little cause for concern.

2011-02-17T06:35:14+00:00

mushi

Guest


The thought pattern only works if you think of the clubs as competing businesses rather than collaborating divisions of the same business.

2011-02-16T09:46:34+00:00

Parkridge Panther

Guest


My comment is only on the defination of a salary cap. The NRL states that the salary cap it is to allow for a level playing field so that the rich do not plunder the poor. In other words create a scene where the rich will look at other avenues to obtain what they want. Melbourne was forced to create a system, that came undone in 2010, so they could retain players that they had developed. The rich are still rich: The poor still are poor. Nothing has changed. In a letter to the the NRL during the Melbourne fiasco I stated to them that the salary cap, which cannot be policed, does exactly the opposite. It attempts to bring the rich clubs down to the same level as the poor clubs and then creates a system that cannot be policed adequatley. In isolation the salary cap does not work, IMO. We then, as has been debated and highlighted through the media, require other measures as well: Increased salary cap, Increased third party deals, Transfer fee (payable to the losing club), Discounts for length of service, Junior development exemptions etc etc. Again the rich will benefit the most. How are the poor clubs ever going to become fiancially viable when the problem is revenue based. The inability to produce income mainly from sponsorship and membership. Brisbane generate over $12 million in sponsorship alone. The proposed new Brisbane club has, allegedly, $10 million lined up. Newcastle have a new owner at $10 million a year. The salary cap does nothing to address the actual problem besetting the poor clubs. Cronulla is no better off under the present system, as an example. It is still a bottom of the rung finacially hamstrung NRL club that has few supporters and even fewer sponsors. The present setup of the salary cap has failed miserably IMO. In all other business it is the strong who prosper the weak wither and die. All we are doing at the moment is proping up fiancially failed clubs.

2011-02-16T06:47:55+00:00

amazonfan

Roar Guru


Or to take the whole family to a football game, buy food there, and not get into debt.

2011-02-16T06:20:40+00:00

Roberto Bettega

Roar Rookie


I would describe a greedy salary as one that is sufficient to take the whole family to the Easter show without going into debt

2011-02-16T06:17:47+00:00

sheek

Guest


LT80 - envy's not in my make-up. I don't care how other people live (as long as they don't trash a shared environment), how much money they make or how self-important they think they are, just as long as they don't try to 'lean' on me.....

2011-02-16T06:11:41+00:00

LT80

Roar Pro


What a strange article. Firstly, what is a "greedy" salary? 25% more than the average? 2 times? 25 times? It is completely arbitrary. And who should be entrusted with determining what that level is? Comrade Sheek, the Minister for Salary Equality? And why are you so concerned with "greedy" sportsmen? Very few sportsmen are truly earning huge amounts in Australia. Most senior doctors, lawyers, accountants, bankers and so on would be earning just as much or more than the top football players of any code in this country. Are you also concerned about their "greed"? No-one regulates and seeks to restrain their income. Mate, we live in a free country. And part of being a free country is the fact that some people will earn more than others. Just accept it. Ultimately, sportsmen get paid roughly what they are worth. Maybe it's not what you or your granny "feels" they're worth, according to your homespun philosophy, but they are paid broadly in accordance with how much income they can generate for their employer. Just like everyone else in society. They can generate this sort of money because they are hugely popular, and what they do is watched and enjoyed by millions of people. They can get people watching and talking. People like you and me sit around on internet boards talking about them. Your article comes across as petty and seems primarily motivated by feelings of envy about other people earning "too much". I'm not trying to attack you personally, because I enjoy your rugby union and league analysis, but I can't agree with this article.

2011-02-16T05:40:22+00:00

lopati

Guest


I thought your numbers were spot on - that is to what the "stars" are asking for - and so it both answers how reasonable the cap is not only to the players accros an entire team as well as keeping the league overall financially viable. We have to admit, we just don't have as much money as the Poms in our Australian league.

2011-02-16T05:29:35+00:00

mushi

Guest


How isn't it specifically NRL and what do the numbers illustrate? How can we comment on greed etc when where using made up numbers to support the case?

2011-02-16T05:25:15+00:00

Mark Young

Roar Guru


Nice work Sheek. I like the idea of the draft, but the key step to implementing one in the NRL is to remove all links from the NRL teams to the Toyota Cup, NSW Cup, SG Ball etc etc etc. As long as the clubs are developing their own players, they are entitled to keep them as Seniors. If the lower grade where entirely funded by the NRL or ARLC then it is fair enough to have eligible players thrown into a pot and drafted.

2011-02-16T05:17:51+00:00

Football United

Guest


i hate drafts because it discourages teams from investing into their juniors when they can just be pinched by another team. as well as that their is no choice on the players part on where to go as well. imagine if the storm finally got a melbourne born and bred junior to be ready to hit the senior ranks and "WHOOSH", Cronulla pick him in the draft and he is forced to move to Sydney where he has no allegance or loyalty to the team.

2011-02-16T04:41:24+00:00

Stevo

Guest


Biggest problem with a draft is that it disadvantages clubs that have big junior areas. It also lowers the amount of money a club would be willing to invest in its local junior system. For clubs like Newcastle, Canberra and North Queensland in the NRL, who couldn't hope to raise the money of the Broncos or East, their juniors are about all they have. For these clubs, the support of junior bush footy in their region is one of their main functions, both financially and as a presence in the community. Having a cap means just taking the best from these regions and distributing them according to finishing positions for a single year. Salary cap however is fine.

2011-02-16T03:18:19+00:00

sheek

Guest


Geez Ant, get a life - as described, it's a simple numbers exercise to illustrate a point. And I was using an example that deliberately wasn't either AFL, NRL or any other specific comp.

2011-02-16T02:42:58+00:00

Andrew

Guest


Don't throw the baby out with the dishwater. Really all he is saying is that we should have a draft. Though I don't think the NRL has the right pathways for this sort of thing. It would mean that all NRL clubs wouldn't want to be as involved in NSW Cup/QLD cup etc as much as they are now, even Toyota Cup would be impacted, unless of course you could manipulate the draft somehow to be able to nominate 2 players each year who you would get for your own club before the rest going into a draft type situation. But that then seems to defeat the purpose of the draft in the first place.

2011-02-16T02:34:07+00:00

Ant

Guest


You seriously think 20 clubs could generate $1200 million? That's absurd, and throws everything else you say out the window.

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