The Roar Rugby Project aims to document the challenges and opportunities facing rugby at all levels across the nation in the following articles.
We are looking to Roarers’ experience as players, officials and supporters to find new solutions for the problems that have dogged the game over the last twenty-five years.
1. Introductory launch – an overview of the challenges facing the game.
2. Financing rugby- revenue challenges all community and professional rugby.
3. Debt, Windfalls, Lessons Learned, and Other Myths – Refinancing RA losses.
4. Governance – The need for constitutional change.
5. Supporting community rugby.
6. Delivering elite professional rugby.
7. Improving refereeing.
RA has a constitutional obligation to act as keeper of the code, and foster, promote, and arrange community rugby. Effectively a custodian, each director of RA should strive to ensure that at the end of their tenure, community rugby is healthier then when they joined the RA board.
There is a commercial corollary in that, without the support of the rugby community, RA is unlikely to conduct elite professional rugby successfully and profitably.
I do want to acknowledge the enormous amount of work done voluntarily, including those paid to do a job, but passionately contributing above reasonable expectation, to enable the game to continue thriving across the country.
RA must build an expert resource to serve community rugby across the country at all levels. Effective and committed engagement from Rugby Australia would free significant resources from planning, negotiation, and delegation, for hands-on, on-the-ground action in the community.
All club committees need external support, even where it is the hard work of maintaining high performance. More obvious is the need to assist clubs to turnaround from poor performance indicated by things like undermanned committees, poor coaching, poor results, player churn, inadequate recruitment and falling revenues.
The Arbib report
In response to a question last week, I revisited the Arbib report briefly. Three statements in the first page or two stood out:
“Club Rugby remains the heart of Australian Rugby, and the sense of community that Rugby fosters through local club competitions around Australia is stronger than ever. It is still the code’s greatest asset.
“Improving ARU’s governance will have positive implications for all of Australian Rugby, including the community Game. The importance of a healthy community Game cannot be overestimated, and the current structure could be said to be delivering mixed results at best.
“It is at the local community level that most players, parents and volunteers interact with Rugby and a reformed governance structure will enable the leaders and administrators of Australian Rugby to provide these individuals with the support they deserve.”
All three statements remain true today, although the subsequently revised Constitution, and RA management over the last decade have diminished community rugby, and consequently its support for elite professional rugby.
Community rugby clubs
My personal philosophy would be that a community rugby club would aspire to contribute to the community in a meaningful way, providing an opportunity for players of all ages to grow as individuals and teammates, reaching their potential as human beings, members of the community, and rugby players.
Equally I presume that many community rugby club members and supporters seek to provide for current generations, the many advantages of participating in rugby that they have benefited from themselves.
Do you have a different view of the aims of your community rugby club?
It’s not about the money
RA has grossly neglected community rugby, disclaiming responsibility on the basis that there is insufficient money. I do not accept this, the losses incurred running professional rugby are, at least significantly in part, due to the lack of engagement with, and support for, community rugby.
An often-repeated refrain in promoting private equity investment as a solution, is that money will be available for investment in grassroots. It is notable that absolutely no detail has been ever provided as to the RA view on what grassroots is, or what the money will be spent on, and the benefits that will flow from that investment.
I have already expressed strong disagreement with borrowing money using the proposed structured sale of commercial rights to private equity. Obviously should that proceed, there will be no financial constraints over investing sufficient funds into community rugby to secure its future.
At a minimum, the amounts invested should be substantial, with detailed commitments especially about costs, timing, expected benefits, milestones, and outcomes together with how they will be monitored, reported, and their success judged.
Most of my suggestions below do not involve large amounts of recurrent expenditure. Rugby clubs understand that their income must exceed expenditure. RA needs to think like a rugby club, not like a business which expects to pay the full cost of goods and services. There should be many ways to reduce the initial cost or recoup it from outside the rugby community.
Investment into community rugby should benefit all clubs equally, and direct payment of monies to clubs should be avoided. We do not want to import the culture of government grants and subsidies, where being seen to act by writing a cheque, is a substitute for ensuring funds are used for valuable purpose, and there is rigorous control over the expenditure and outcomes.
Writing cheques for an annual subsidy only breeds complacency and will most likely be wasted, or only reduce a club’s annual revenue target. While convenient for the club, it then discourages active engagement with the community for membership, sponsorship, and participation. The rugby equivalent of teaching a man to fish.
Where RA considers that it is necessary to make one-off grants, then it needs to satisfy itself that there is an overall benefit to rugby, not just an individual club, and establish necessary controls over how that money is expended.
There needs to be substantial initial, and continuing, investment into coaching and development pathways. While helpful for community clubs, this should be borne by RA it must secure a pipeline of appropriately skilled players for its elite professional competitions.
Surplus RA funds should be deployed only in verifiable revenue increasing activities, and coaching and development.
What concrete commitments from RA to community rugby are required from any new borrowed or private equity funds?
What RA must do
Its goals for community grassroots rugby should be simple:
1. Support the growth of the rugby community by maximising the effectiveness and efficiency of community rugby clubs
2. Ensuring that community rugby clubs are fully supported in developing the rugby skills and capability of each player to their potential to achieve its goals for elite professional rugby by:
3. Creating positive engagement with rugby club communities to encourage financial patronage and support of professional elite rugby, and
4. Maintaining development pathways from community rugby through third and second tier is to the Wallabies.
Supporting the operations of rugby clubs
I have listed a few initiatives below and am hopeful readers will contribute many more. RA needs to establish and monitor a platform for its 950 clubs to share ideas, problems, and solutions.
It requires a dedicated bureau with the necessary resources and expertise to fully support community rugby, and a budget to implement strategies and afford external expertise we are required.
Initiatives would fall under four categories:
1. Support recruitment of players, families, and volunteers
2. Increase revenue
3. Reduce expenses
4. Reduce costs and inefficiency of administration
What initiatives would help your club in 2022?
Defraying the cost?
One advantage of rugby being a sport is that there is an ongoing expectation that suppliers will provide goods and services free, or at a discount. Ideally the residual cost can then be negotiated as a sponsorship in lieu of financial payment.
Equally there is no confusion, in any rugby club or organisation, that favours are called in to support the rugby club, rather than favours repaid through the custom of the rugby club. Related party transactions are the bane of many committees, with a lack of transparency causing friction and resentment, and often increased costs and reduced utility.
How does your club minimise expenditure through sponsorship and contra arrangements?
I referred in Part 2 to the necessity of the club making a series of sales, whether it to be securing a members and sponsors, or selling merchandise, tickets or fundraising items.
Some recruitment such as new players will be organic, originating from development activities in schools and the community. Other recruitment such as attracting volunteer and community support, family members and new players requires a methodical and disciplined approach.
All 950 clubs require similar support regarding the importance of establishing club objectives and maintaining culture to build an organisation that will attract members and community support.
Similarly, proven concepts for organising functions or promotions also require sample checklists and project timetables. Like any sales organisation, scripts and collateral, or tips to start conversations are helpful, these things come naturally to some people, but need to be learnt by others.
Is recruitment something your club does well? What support from RA would assist?
With 950 clubs in Australia, some of them active for over 100 years, there cannot be that many new ideas in the world of procuring sponsorship and fundraising initiatives.
It is not just 950 clubs doing their own thing from scratch, new committee members will often, for better or worse, throw out the old and bring in the new. Old mistakes can be relearned, and reliable income sources compromised.
We need forums where clubs can exchange ideas, examples of what works, warning of problems, templates or approaching sponsors, and innovative membership ideas.
Most sports and community organisations desperately need assistance with monitoring the announcement of relevant government grants or assistance programs, efficient preparation of professional and compliant applications, lobbying, together with compliance and reporting obligations if successful.
A centralised RA resource should be an extremely cost-effective way of bringing additional funding into the game for both building facilities and long-term coaching and administrative development.
One issue that interests me is the admission to matches for non-members and it needs to be moved from the ‘too hard’ to the ‘very hard’ box. It costs money to run a rugby club and most other forms of entertainment are now paid for.
In major cities, where admission to grounds can be restricted, it is already happening, while the further away you get the less practical it is.
I am sure there are many grounds in Australia where spectators still pull up to the boundary in their cars. In between there will be thousands of variables including cooperation with other clubs and sharing of proceeds.
A significant cost to clubs and players is the various levies paid by the player on registration, and presumably the costs, and the method of their allocation, is detailed and transparent.
Is there an annual independent review of the expenses incurred, and the methodology of the calculation of levies?
One substantial benefit to clubs recently introduced is a centralised platform for players to register and pay club fees and RA levies. This is a huge time saver, and you would think several other initiatives would also have been implemented.
They have not, and and consequently I have concluded this was only driven by RA to increase its revenue and the efficiency of levying clubs and players.
The clubs share of the fees is paid within seven days, presumably because this is administratively easier for clubs than an automatic credit to their bank account at the time of registration.
Is there an independent and transparent review of the benefits, coverage, and costs of the insurance for players? Is the methodology and calculation of levies externally reviewed?
Obviously, the sale of rights to private equity will result in refunds for any 2022 levies paid and relief in future years. This will enable the reduction in costs of registration for each player and/or an increase of membership income for the club.
There would be significant financial and administration advantages if RA would establish a platform for the procurement of playing kit, equipment, merchandise and sponsorship collateral. This could include ordering, billing, warehousing, payment by individual credit card, and delivery to individuals or clubs.
Existing vendors could register and transact on the platform while individuals using the rugby ID, or clubs, register as customers. It would be a good opportunity for local suppliers to register on the platform and access a wider market.
Where a club wishes to deal with a specific supplier outside the system, committee members have easy access to compare quality and prices with the market.
RA should not immediately consider this is a business transaction, paying for example a Big Four consultant, but rather could defray its costs in a number of ways:
• Negotiating external costs into a sponsorship, offering branding rights on the platform
• Retaining ownership rights, and once established, earn a margin from making the system available to other sports
• Approaching an existing fulfilment platform like Amazon and establishing its own RA warehouse on their platform
• Approaching a rugby supporter owned third-party procurement/warehousing/fulfilment business
Increasing administrative efficiency
Club memberships include a range of professions, talents, and opinions. Committees inevitably include several members with no idea about some aspects of administration, and other members with different opinions on how things should be done. It is the luck of the draw which ones end up with which jobs.
RA must provide the resources to standardise and support club administration; a ‘club in a box’.
These are some common problems I have experienced firsthand:
• Poorly drafted, poorly understood, and out-of-date constitutions expose clubs and committees to risks of acting outside their protection
• When a treasurer leaves, there will often be a new external accountant, new reporting formats, new accounting policies and a break, for better or worse, with statutory and taxation compliance
• Inconsistent financial controls with variable quality procedures and external support
• Secretaries are no longer the custodian for all inward and outward correspondence, it does not take long to lose track of communications and numerous commitments made by committee members on their own email accounts.
It should be possible for RA to provide common solutions such as:
• Model constitutions and explanatory documentation
• Documented procedures, controls, timetables, reports and checklists to manage club finances
• Standard cloud-based website domains and email boxes for presidents, treasurers, secretaries and committee members
None of these services are significant in themselves and the major providers, for example Big Four accountants and lawyers, should be satisfied with the branding and promotional opportunities attaching.
RA should have provision for support to clubs, whether through a dedicated community service division, or outsourced to a suitably qualified provider.
Rugby development pathways in the community
Apart from its own promotions to families in the local area RA development officers should be active in the school and club community.
I would be concerned that cost restrictions result in development officers being young rugby players studying or working part time. Development officers should have teaching, coaching, and marketing skills, as well as being able to build rapport with children and their teachers or families.
I am sceptical whether any attempt is made to measure their performance, whether children and their families subsequently attending matches, or planned activities at local clubs.
Equally important is the continuing support for the club’s coaching and development of each player. Player satisfaction will come from increasing mastery of skills together with the knowledge and maturity to compete with opponents both individually and as a team.
Supporters get the satisfaction of watching the same player develop from promising, to accomplished first grader, and following the pathway to higher honours. Supporters need clarity on what pathway that is, and how it is possible for players from their own club to follow it.
What development and coaching support would benefit your club and its players?