The Rugby Football Union is to make more than 40 members of staff redundant, just weeks after selling the Twickenham naming rights to Allianz in a lucrative deal worth about £100m.
Staff were informed on Monday afternoon that as a result of a major restructure 64 roles are at risk, with 22 new jobs to be created. The cuts are expected to affect all departments except for elite performance. Last week the RFU unveiled its new Professional Game Partnership with Premiership Rugby which will cost the union about £264m over eight years.
While the union’s coffers were boosted by the Allianz deal, the RFU is facing mounting costs as a result of the PGP, which enables the England head coach, Steve Borthwick, to hand out up to 25 enhanced contracts worth £160,000 a man. The RFU is also braced for significant outlay on modernising Twickenham from 2027 and said it has been hit by “rising utilities, travel, and operating costs”.
The union also cited inflation, a decline in broadcast revenues – the most recent accounts show a loss of £16m in annual television and sponsorship revenues – and consumer confidence as reasons behind the cuts. In 2021 the Six Nations agreed a £365m deal to sell a share of its commercial revenues to CVC Capital Partners. The deal is worth £19m a year to the RFU but has not brought about the uplift in broadcast revenues that was anticipated.
The RFU’s most recent accounts, published last December, painted a stark picture as the union continues its post-Covid recovery. It reported a loss to reserves of £6.3m for the year ending June 2023 with the union’s outgoing chief financial officer Sue Day warning “we are currently forecasting a circa £5m ongoing deficit in our underlying profit/loss to reserves position”.
Day wrote: “Given our strong cash position, we can cope with this in the short term to safeguard levels of rugby investment, but it is unsustainable in the long term. This is a focus for the year ahead as we work with other key organisations in the system to redress the deficit at an RFU level and across the entire ecosystem of English rugby.”
The RFU made more than 100 redundancies in July 2020 amid lost revenue of £145m because of the pandemic. Before that, more than 60 jobs were cut in 2018. Stephen Brown, chief executive at the time, blamed the £220m Professional Game Agreement – the previous incarnation of the deal agreed last week – while the £30m overspend on the revamped East Stand was also a significant contributing factor.
Of the latest round of cuts, an RFU spokesperson said: “The RFU has started a collective consultation over proposals to reshape and resize the organisation to maintain investment in rugby. The reorganisation comes as the RFU moves forward with significant transformational projects including the Men’s Professional Game Partnership, the Community Game Future programme, Digital Transformation and investment in Women and Girls and the Stadium Masterplan.
“Alongside a need to restructure to support transformation, inflation and the overall economic outlook has led to utilities, travel, and the operating costs of running a business to increase significantly, while a decline in broadcast revenues and consumer confidence is expected to impact future revenues.
“The RFU will protect headcount and investment in community rugby and the proposals will not have a direct impact on England Men, Red Roses or pathway performance teams. It is anticipated that the number of roles in the RFU will be reduced by 42, with 64 roles at risk, and 22 new roles created.
“The proposed changes will mainly affect head office functions with changes to a centralised leadership for digital and technology, integrating customer service functions and streamlining business operations. The proposals are expected to be finalised at the end of October.”
London, meanwhile, has emerged as the leading contender to host the inaugural finals of the first Nations Championship in 2026 after rugby’s global power brokers decided to shun a lucrative offer from Qatar.
The Six Nations and their Sanzaar counterparts were engaged in exclusive talks with the Gulf state over hosting the first four instalments of the biennial competition in Doha in a deal that would have guaranteed the unions £800m.
“You could have three matches [at Twickenham], two somewhere else, one somewhere else in London,” Bill Sweeney, the RFU’s chief executive, said. “That would be a natural destination and conversations are happening and have been ongoing since the Qatar decision to do that. There are other possibilities of other European venues but London is a strong possibility.”
