Fireworks on the fifth: What the Saracens crisis means for the global game

By Nicholas Bishop / Expert

“That’s life, that’s what people say. You’re ridin’ high in April, shot down in May.” Those famous lyrics from an old Frank Sinatra song are an especially apt summary of global rugby events during the last week.

But it didn’t take one month, it only took three days for the euphoria surrounding South Africa’s World Cup victory to be shot down by a story which potentially has even bigger long-term implications for professional rugby.

On a momentous fifth of November – appropriately enough, given the anniversary of Guy Fawkes’ attempt to blow up the Houses of Parliament – Saracens were docked 35 points in their domestic league and fined a colossal £5.36 million for breaching salary cap regulations.

This was a ground-breaking sanction, the culmination of a seven-month probe by Premiership Rugby, reported in detail by Daily Mail journalist Laura Lambert in the UK.

Saracens have been found guilty (pending appeal) of breaking the rules of the cap by establishing ‘co-investments’ between owner Nigel Wray and some of their leading players as a principle of payment outside salary.

Players including Owen Farrell, Maro Itoje and the Vunipola brothers have all entered into business partnerships with Wray, and the financial dividends are substantial. For example, Vunprop (an investment property company co-owned by the brothers and Wray) has a published value of £1.54m in assets at the last round of accounting.

Owen Farrell. (Kaz Photography/Getty Images)

The extent of Saracens’ fine suggests that they were assessed to be a massive £1.78m over the current cap limit of £7m, even though that allows for two free marquee players and offers bonuses for the production of young, England-qualified talent.

The independent panel chaired by Lord Dyson found that, “Saracens Rugby club failed to disclose payments to players in each of the [three] seasons [201617, 2017-18 and 2018-19]. In addition, the club is found to have exceeded the ceiling for payments to senior players in each of the three seasons”.

Why is a salary cap so important? Typically, it been introduced in American and Australian sports in order to control the wage structure, ensure future financial sustainability, and guarantee equal opportunities for all of the teams participating in the competition.

In the NFL, the salary cap was introduced in 1994. In the 15 years before it came into force, the Super Bowl was shared among only six franchises. In the 15 years following, that total had already doubled to 12 different winning clubs.

In the NRL, the Melbourne Storm were stripped of two premierships, three minor premierships, and barred from earning any competition points in 2010 because of illegal payments to players.

Saracens have enjoyed a run of success similar to the Storm, winning four of the last five Premiership titles while adding a further three victories in the European Champions Cup. They have been able to hold on to their best players in the process, while adding quality depth and at the top end.

They can now boast more than half of a 2017 British and Irish Lions Test XV playing for them: the Vunipola brothers (although Billy had to withdraw from that tour due to injury), Jamie George, Maro Itoje and George Kruis up front; Owen Farrell, Liam Williams and, this season, Elliott Daly behind.

They have three tighthead props who all started for their country at the 2019 World Cup – Juan Figallo for Argentina, Vincent Koch for South Africa and Titi Lamositele for the USA. They can field no less than four players who have at various times played fullback at international level: Williams, Daly, Sean Maitland (Scotland) and Alex Goode (England).

Compare that to the Exeter Chiefs, who were forced to sell Pumas’ wing Santiago Cordero – a player they dearly wanted to keep – in order to accommodate the arrival of Scotland fullback Stuart Hogg in the off-season.

Stuart Hogg playing for Scotland in 2018. (Photo by Lynne Cameron/Getty Images)

Exeter have remained within their means and respected the intent behind the salary cap rules. They were the only English Premiership club to post a profit in the 2017-18 season. Saracens posted a loss of £2.8m and were carrying a huge £48m debt burden, at least until it was written off by their wealthy benefactors.

There are two very different professional models at work here. On the one hand, a club which wants to develop organically within the limits set by the league and by financial common sense. On the other, a club which wants to find ways to exceed those limits and speculate to accumulate silverware.

In the long term, the first model is content to work alongside the primacy of the international game, the second aspires to become strong enough to eventually replace it. The superannuated club game envisaged by Saracens enjoys a limitless, uncontrolled ability to purchase the best players from all around the world.

There, in a nutshell, lies the most dangerous threat to rugby in South Africa, Australia and New Zealand. It is the soccer future translated to rugby, dominated by a handful of elite clubs.

Exeter head coach Rob Baxter put it this way:

“Tony’s [Rowe, Exeter chairman] concern, and probably the rest of the Premiership’s concern, is that if that is the first response to what has happened [Saracens’ appeal], what they are saying is that they are not abiding by the fundamental basic principles of the salary cap.

“We’re supposed to be working within the salary cap to create a level of fairness and competition. That’s what we have signed up to and agreed to.

“If the first response is to say the payments, investments and inducements are outside the cap but are okay because the wording of the cap doesn’t catch them, the concern is they will move on by finding another way of doing it outside the wording of the salary cap.

“You shouldn’t be paying outside the salary cap and to dress it up in player welfare and developing the game sticks in the craw…

“There can’t be many people within rugby circles who don’t think this is just the elephant in the room finally coming out into the open instead of being in the corner.”

As both Rowe and Baxter have emphasised, this is in no way the fault of the Saracens’ players or coaching staff, who have done so much to create the ideal environment for player development – for both young home-grown talent, and salvage projects like Will Skelton.

Will Skelton is a markedly improved player since joining Saracens. (Photo by David Rogers/Getty Images)

Another of Saracens’ second-row stars, Maro Itoje, may not quite have fulfilled Eddie Jones’ prophecy that he would be the best lock in the world by the time the World Cup was played, but he came mighty close – particularly in England’s semi-final win over the All Blacks.

Itoje best represents Saracens’ cussed, indomitable spirit on the field. Nowhere does that manifest more than in his contribution on defence, the Sarries’ touchstone.

Against New Zealand, Itoje made more tackles than any other player bar number 7 Sam Underhill, and he had five turnovers in the game. He won one ball against the throw at lineout time, an area where England were touted to be weak. If he stayed on the ground, he was still a menace when the All Blacks tried to set up the drive:

In the first example, Itoje starts away from the throw, as part of the second layer of defence. His role is to select the right moment to commit to the fringe, rather than sticking his head in blindly. He patiently waits for his second-row partner, Courtney Lawes, to swim through onto the carrier, before spotting the right moment to attack the ball and rob Codie Taylor.

In the second instance, he starts much closer to the point of the drive. Here the defender with the widest wingspan will typically stay up top and try to swim through the blocking onto the ball-carrier at the back.

Itoje first reaches across with his right arm, trying to locate Taylor:

At the moment when the maul begins to compress and lose its depth, he seizes his chance to swing the left arm through, lock up the ball and boulder Aaron Smith out of the road for good measure.

Itoje’s knack of locating the ball proved equally effective on the kick-chase, one of Saracens’ primary methods of ‘offensive defence’:

He probably ranks alongside Joe Launchbury as one of two best big men in the English game in his work over the tackle ball, and there is no chance of Smith removing him one-on-one.

It is Itoje’s range in defence which truly marks him out as one of the most complete modern second-rowers in the game. One of the key performance indicators by which professional defence is measured is the ability of the tight five to make tackles on both other forwards and backs with equal proficiency.

In the game against New Zealand, England had two locks in that mould in the shape of Itoje and Lawes:

The All Blacks have just won prime turnover ball near their own 22, and despite the position deep in their own end, this is a scenario they would be expecting to turn into seven points:

When Jack Goodhue receives the ball, he has two backs outside him in space (Richie Mo’unga and George Bridge), with only two England forwards (Lawes and Sam Underhill) trying to cover that space from the inside.

Lawes not only overtakes Underhill to scrag Goodhue, he then gets up off the floor to tackle Bridge near touch too. That was not the end of the story, because New Zealand still had potential mismatches in midfield when the ball came back the other way:

Two tight forwards (Itoje and prop Mako Vunipola) have to defend two backs – the Kiwi duo of Beauden Barrett and Anton Lienert-Brown:

Somehow they manage it, with Itoje putting a good lick on the All Blacks centre as he surges through the line.

The Saracens’ second-rower is an 80-minute player too. As the match entered its final phase, he was still making his tackles, first filling from the inside out on Mo’unga:

… then leading the rush to nail Sam Whitelock two phases later:

Tackling forwards and backs, with equal proficiency, until the very end of the game. That is certainly the Saracens way on the field, even if it is far more oblique off it.

Summary
Four years ago, Saracens and Bath came to a private agreement with Premiership Rugby for alleged breaches of the salary cap. This time around, the multiple champions from north London may not be so lucky. This time, it appears Premiership Rugby may have the courage of its convictions.

If it can follow through on its decision to dock points and levy a hefty fine, it will have taken an important step for the game as a whole. It will build a rampart against those who would like to turn professional rugby into an undernourished version of soccer’s English Premier League or European Champions League: an unregulated mess which encourages modest clubs to overreach financially, and the elite few to replace the international game with their own league of mercenaries.

The salary cap, properly policed, can help control the wage structure in England, ensure financial sustainability in the future, and create equal competitions in which a wider spread of clubs can hope to achieve success.

The well-being of global brands like the Silver Fern, Springbok and Wallaby – and the primacy of the international game – can only be sustained by supporting the domestic football which fuels them, not by asset-stripping.

For that hope, we should look symbolically more towards Exeter than Saracens. If the good of the global game is to be the main priority, let it be the Chiefs who are going to change that tune, and be back on top in the Premiership final, next June.

The Crowd Says:

2019-11-20T22:12:29+00:00

Derm

Roar Guru


I see. So by Europe you meant France and England?

2019-11-20T02:17:22+00:00

Noodles

Roar Rookie


Essentially world rugby would distribute cash to the less rich from the the rich markets. A tax on squad payrolls in effect. The result: more players are available for weaker nations thru top up finding. More local players in Europe (France and England) get into the first division roles and develop in line with national team needs. Rugby has to manage the reality of global professionalism or allow the international contest to collapse. The way it’s done on AFL or NFL etc is required globally.

2019-11-17T19:37:58+00:00

Gonzo99

Roar Rookie


It has just been on the news here in the UK that Saracens are accepting the fine and the points deduction. Not going to appeal it. They're now on -22 points. Long season ahead ...

2019-11-15T08:39:30+00:00

Just Nuisance

Roar Rookie


Ha ha we have sangomas ( for our Aussie friends... Witchdoctors). NZ do not. Don't underestimate the bones.!

2019-11-15T02:50:46+00:00

zhenry

Guest


Ralph: If you play a game, teams need to abide by rules otherwise you dont have a game. We are told by the AU media (control AU and NZ) that the ABs try and get away with breaking the rules while the WBs and other teams try and play by the rules and make the odd mistake. Thats one assumption behind the propaganda of AU owned rugby coverage. If you own the media in both countries, mostly what you print will favour the AU owners, such as when the next AB coach is discussed there is usually a photo of Foster, the others of course will be mentioned but its 'the AU owned media that make Foster appear to be the front runner', that leaves Robertson, Rennie and Joseph for the WBs. Plaster that photo and write it often enough and the media networks know they have enormous influence. Fairness is not part of the business model, taking advantage over others is, but it always pays to give the appearance of fairness. You deceive as much as you can get away with to make more money, thieve as well and even kill if the stakes are higher enough. Ralph comments that business people are not more dishonest than everybody else, they just try and game the system, in other words deceive - but make it look like 'fair'. Thats the value system of business (including sport) and mostly how economics and politics currently operate. But like team games business must decide to abide by rules, otherwise there is 'no game' for sustainable life. Exxon did the most exacting research and found that fossil fuels are toxic for the human condition, instead of phasing over to renewable energy they decided to spend millions to make people doubt the science of climate change and make more money short term. To the point where a Swedish teenager is insulted, by a brought and smug corporate media for protesting 'the lack of action to prevent climate change', while a country's PM is bestowed a positive image for policies of mining and drilling for coal and oil. In other words our corporate business and media is corrupt and perverse enough to reward those who want to make the planet unlivable. The consequences of playing the deceiving card have totally destructive consequences. Govt. must regulate and give options for the democratic restructuring of business; a sustainable and science based policy for the majority.

2019-11-14T22:26:52+00:00

Charles Plowdog

Roar Rookie


In the real world ignorance of the law is no excuse, so perhaps the players do have some responsibility to make their own assessments (with their managers) rather than just by 'instinct' accepting some arrangement, which one suspects they might have had an inkling was too good to be true.

2019-11-14T22:21:17+00:00

Train Without A Station

Roar Guru


Also wouldn't accomodation have to be considered in the salary cap?

2019-11-14T22:20:47+00:00

Train Without A Station

Roar Guru


You act as though every comment is of equal merit. Two people make a comment and they should be considered the same. But the reality is you make a baseless statement. I make a detailed response which is informed by the facts. But you think your baseless statements deserve equal merit.

2019-11-14T22:17:59+00:00

Train Without A Station

Roar Guru


Really? PI players if anything are more likely to pursure rich contracts in Europe. Not for selfish reasons though. But because they generally have more of a need to provide for wider families. Where for many players from multiple generation Australian families, the playing career is more of a luxury, so they don't have to consider things like that. PI players aren't more greedy, but generally have more of a need to pursue every dollar in their rugby career. Both to provide more while they play for others, and also because they are less likely to be put into a cushy job with a family associate post rugby.

2019-11-14T14:46:32+00:00

sheek

Roar Guru


Nick, Your last para is correct. The League of Nations provides another opportunity. Lost opportunity. Islanders haven’t quite been tainted yet with the “greed is good” & “grab as much materialism as you can” that obsesses the remainder of the developed world. But I guess it will eventually happen. It inevitably does.

2019-11-14T12:05:02+00:00


Yep, pretty much how I see it. Makes sense from a certain point of view, but doesn’t make sense from a different point of view. But alas success is bought these days, granted you still have to put the work in.

AUTHOR

2019-11-14T11:38:39+00:00

Nicholas Bishop

Expert


Thanks JN for such sensible comment!

2019-11-14T11:31:05+00:00

Geoff Parkes

Expert


Hi Corne That's a common sense view that applies when we apply it to 'normal' businesses. For one, you can't knowingly continue to trade if insolvent, or if not insolvent, you can't feasibly continue to rack up trading losses year upon year without a cash injection from somewhere. But sports teams are different to 'normal' businesses, and the EPL provides some great examples of clubs who are millions of pounds in debt, and who accumulate further debt year on year. What tends to happen is, instead of being allowed to go bust, these clubs write off the debt as 'directors loans' (effectively the rich owner continuing to fund things as a vanity product) or else they are on-sold to a new rich owner or family or conglomerate, perhaps for a discount, and it is they who will trade the club for a few years, trading off making a loss for benefits of ownership, mixing with the star players, etc... whatever it is that they get off on. Sometimes too, financial assistance will be provided by the national body, as we've seen in Australia, where the SR franchises have all received support at various times, because it is not in the wider interest of the game to see them fall over (cue angry interjection from Western Force fans) So, it's common to hear that clubs like Saracens, Wasps etc. are in an unsustainable position, but the truth is, they do continue on. What also happens is that they can't help themselves when it comes to spending. Lets say a Prem Rugby club makes a loss of 5 million quid on the year, and by co-incidence, next year their share of the increased pool from TV rights and a new equity partner provides an extra 5million quid for each club, and the salary cap is also adjusted by that amount. Do you think they will say, 'great, now we can operate at break even?' No, what will happen is they will spend all of that extra 5 million on new/better players and still make the same huge loss. Apart from Exeter and a couple of others trying to run sustainable businesses, it's all so predictable. But even as the losses mount, it's a very rare case where those big spending clubs do actually fold.

AUTHOR

2019-11-14T10:59:21+00:00

Nicholas Bishop

Expert


As per the article, the main problem is primacy of contract with the players Sheek. In England and France the clubs have it and the Unions cannot get it back off them, even if they wanted. That means an inbuilt resistance to the organization of the game via a Test match calendar like League of Nations. It wasn't a mistake, it was a nice idea foundering on economic reality. Most of the top PI's play in France because there is not the infra-structure or finance for the game back home, so you have it backwards - the 'perk' for them is Test rugby, club is their bread and butter!

2019-11-14T10:00:45+00:00

Just Nuisance

Roar Rookie


Hi Nicholas, a bit late to the party, but your article resonates. When Rassie Erasmus first took over as Director of Rugby ( strangely enough his primary role here. Coaching the Boks was secondary), one of the first things he introduced was a salary/contractual cap of local SA players. His reasoning, the major Franchises were spending up to 80% of their salary budget on 3 or 4 big name players. Obviously to keep them out of Europe or Japan which has had long term negative consequences for the pro game here. The knock on to this is that we not only can expect but are witnessing an exodus of the likes of Etsebeth, De Allende etc to Europe. But I agree with Rassie. The depth of talent is conveyer belt like here and it opens up opportunities for local player development. Also sheer economics, laws of diminishing returns, oversupply, market saturation etc will begin to reduce salaries in Europe. And of course….. Actions by England Rugby as discussed by you will move things forward into a more sustainable environment. Strength to them.

2019-11-14T09:47:11+00:00

sheek

Roar Guru


Thanks Corne.

2019-11-14T09:46:03+00:00

sheek

Roar Guru


Nick, I thought the two division league of nations, would have given countries like the 4 in the RC a much better opportunity to retain some/most of their stars with the proposed TV revenue. It would have also enormously assisted the Pacific Islands for similar reasons. Imagine how good it would be for Fiji, Samoa & Tonga to be guaranteed 11 quality tests every year. Because the PIs don't have this, their youth go elsewhere seeking a substantial test rugby calendar, while also enjoying the perks of provincial/club rugby. Ditto Japan, USA & Canada, among others, would have improved (hopefully) over time. But if England, France & Japan club rugby are the only 3 places to earn a substantial pay packet, the game will wither elsewhere. The world cup will become meaningless, & tests in non-RWC years substantially reduced in relevance. It's not rocket science that the collapse of the world league was a very, very bad mistake for the game.

2019-11-14T08:29:18+00:00


Sadly the social justice warrior thing has become a reality, and people now only want to listen to their own truths, anything contradictory to their believes brings about this over sensitive hysterical reactions.

AUTHOR

2019-11-14T08:23:51+00:00

Nicholas Bishop

Expert


So you'd continue to foresee the international game leading the way in Rugby via a league of nations?

2019-11-14T08:21:15+00:00

Train Without A Station

Roar Guru


Maybe that route was the right way. But it’s a massive risk. And if it starts turning against you there’s no way to stop it. The other consideration is keeping control ensured the tri nations were the strongest 3 teams for the first 15 years of professionalism. (Or 3 of the top 4 across that period). That’s changed since money has gutted the SH. But when you are competing with competition a full of teams that run at a loss, how can you compete sustainably? There’d be a limit to the financial clout of an independent run competition. And once Europe/Japan surpassed that we would have got the same result.

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