Jobs to go at RA as auditors sign off books
Rugby Australia has staved off insolvency but it is set to come at a cost, with a significant number of staff to lose their jobs this week as part of a sweeping restructure.
There were fears RA may be forced to declare itself insolvent during the peak of the coronavirus pandemic, having been crippled by the loss of broadcast revenue and gate takings, along with Israel Folau’s multimillion payout.
But the game’s governing body on Sunday finally lodged its financial report with ASIC – with full financials to come later in the week – after the accounts were signed off by auditors KPMG, and the RA board.
It was the last day the accounts could be lodged, which demonstrated the fraught nature of Australian rugby’s financial picture.
A previously leaked summary of financial results for 2019 showed RA suffered a A$9.4 million loss consistent with previous World Cup years and a reduced test calendar, but was also exacerbated by the Folau saga, which cost the organisation on legal fees and a $3 million payout. With coronavirus shutting down nearly all revenue in the first half of 2020, a pay deal with players to cut wages and the standing down of staff allowed the game to limp on via cash reserves. The ability of interim CEO Rob Clarke to get sign-off from auditors required proof RA could be a going concern over the next year and, in the end, the provision of a $14.2m emergency loan from World Rugby went a long way.
Broadcast revenue from a new domestic competition beginning in July and possible gate takings from Bledisloe Cup tests at the end of the year would have also factored into RA’s plan, along with the painful reality of headoffice cost-cutting.
Sources have told the Sydney Morning Herald more than a quarter of the 200-plus staff, many of whom were stood down until July 1 due to coronavirus, will lose their roles under the company restructure. The cuts will be made across a wide variety of departments, including senior executives and managers.
Clarke forecast the cuts earlier this month when discussing the emergency World Rugby relief.
‘‘The financial implications of the virus have been significant for Rugby Australia and this emergency relief funding will provide us with certainty for the next 12 months and enable us to close off our 2019 accounts,’’ Clarke said.
‘‘The funding, in combination with the extensive cuts made across the business, provides us with the short-term impetus to see through the pandemic but does not solve all of the challenges.’’
RA staff have been stood down for months and have not yet returned to work at the game’s Moore Park headquarters.