Welsh rugby left in the dark over funding help
SUFFICE to say ears were pricked in Welsh sporting circles when a £300m winter relief package for sport was announced by the UK Government this week.
Contacts among the Welsh rugby regions indicate that they were caught completely off guard by the announcement but the news was not, perhaps, what it seemed.
If the Government’s press release is to be believed, not a penny of the £300m has been allocated to sport outside of England.
The killer line at the end of the announcement read: “The devolved administrations have been provided with an upfront guarantee this year of £16bn above their Spring Budget 2020 funding to support their response to Covid-19.
“It is for the devolved administrations to decide how to use this funding irrespective of how UK Government provides support in England.”
In an interview earlier this month, interim Welsh Rugby Union CEO Steve Phillips spoke of his anticipation regarding an impending announcement from the Department for Digital, Culture, Media and Sport.
“The [Welsh] Government have remained supportive and I speak to them at least twice a week,” he said.
“The conversation then opens up into UK Government. We are working closely with the RFU and the SRU on this and we are somewhat optimistic that we will hear something positive from the Department for Digital, Culture, Media & Sport in the next two or three weeks.
“Hopefully they will find some way to help and then Welsh Government will see some part of that and we can talk to them and see how best to package that up.”
Things haven’t quite worked out that smoothly.
Out of the three organisations that were working together, the English are the only ones who are currently benefiting.
The package, designed to support sports that are suffering the biggest reductions in revenue due to the absence of fans, will see English rugby receive £135m to help the game at all levels but the sport in Wales and Scotland, at present, is receiving nothing.
The sport of football in England will receive £28m to support the nonleague game. Welsh football is receiving nothing. And other sports in Wales would also benefit greatly from any funding.
The Barnett Formula is used to ensure that devolved governments receive a proportionate change in their public spending allocation to reflect any change in spending levels in England.
If the UK Government’s own press release is to believed, that will not be applying in this instance.
But confusion reigns.
In questions on Thursday, Minister for Sport Nigel Huddleston confirmed there would in fact be a Barnett Consequential, in response to a question from a SNP MP on the subject.
“I can confirm there are Barnett Consequentials to this as there are for other support packages,” he said.
“The details I cannot provide at the moment. In terms of how money is spent, it is a decision for the devolved administrations, sport is a devolved matter.”
The Scottish Government, choosing to ignore the initial statement, is “seeking urgent clarification” on the funding they will receive and says it welcomes the UK Government’s announcement.
We have been told the Welsh Government don’t have any answers at this stage and have had no clarification from Westminster.
As for the WRU, CEO Phillips is seeking swift talks with First Minister Mark Drakeford and his advisers.
It is important to note that the majority of the £300m funding in England has come in the form of preferential loans, estimated to be around £250m, and grants. English rugby will have to pay back the money it has received and is yet to learn the terms of those loans.
If Wales were to receive some money, its distribution would be unlikely to work in the same way because the government’s support for sport in this country is all nonrepayable.
If the Barnett Formula does apply, Wales would be in line to receive an estimated £6.7m, which would put nothing more than a small dent in Welsh rugby’s financial challenges, let alone problems that football, cricket and other sports face.
That being said, the Welsh regions, for example, will take every penny they can get their hands on to survive this pandemic.
The WRU faces losses of £35m in its current financial year if next year’s Six Nations matches also have to be played behind closed doors and a £20m loan has been taken out to keep the four regions alive, which they are liable for.
Out of English rugby’s £135m, £59m is available to Gallagher Premiership clubs.
A Welsh Government spokesperson said: “In what has been a challenging year for sport we are working with governing bodies to assess what additional support may be required.
“We recently announced a £14m Sport and Leisure Recovery Fund to help the sector deal with the pandemic, helping to prepare for a safe and responsible return.”