Twist in salary-cap row over ‘loans used to reduce wage bill’
Loophole in rules allows players to be called back Bath and Gloucester said to have ‘taken advantage’
More than half of top-tier English clubs are exploiting a Premiership Rugby loophole which allows them to potentially circumnavigate the salary-cap threshold, The Daily Telegraph understands.
Lord Myners, a City specialist overseeing a review of regulations following the Saracens scandal, will scrutinise a controversial clause allowing teams to write off wages by declaring “season-long” loans.
Critics claim the rule is open to manipulation as players can be recalled by clubs at no extra cost for minor competition matches so long as they are providing cover for an injured player. Players can then feature in the Premiership Rugby Cup or Shield without their salaries counting towards the cap. It appears clubs can face further costs over league appearances, however, initially on a pro-rata basis.
Bath and Gloucester are known to be among a handful taking advantage of the chance to trim their declared, salary-cap, wage bill. The rule came to light when Zimbabwean lock Mike Williams and Argentine prop Lucas Noguera were loaned out separately by Bath to Yorkshire Carnegie in the Championship in September. Williams played for a few minutes off the bench in Carnegie’s 83-0 defeat at
Nottingham, before returning to the West Country to feature in the Premiership. Loosehead Noguera was then sent out later the same month, coming off the bench for Carnegie in their 48-0 thrashing at the hands of Cornish Pirates, before returning to Bath days later.
Williams has since played five times for Bath, while Noguera has played just once, thanks, it would appear, to the clause set out in schedule one of the pay-cap regulations. Under the rule, loanees can replace long-term injured players so long as they are in broadly likefor-like positions. At Bath, back row Taulupe Faletau and prop Nathan Catt are on the injury list.
In some cases, up to three players can also be declared as “loaned out” even if they remain at the club. Such arrangements at Gloucester drew criticism from Brendan Venter, the former director of rugby at disgraced Saracens, after he signalled he found it “really hard” to believe the £7million limit had not been breached by other clubs.
When pressed for his thoughts on BBC podcast Rugby Union Weekly, Venter said centre Henry Trinder, wing Charlie Sharples and full-back Tom Hudson had all been declared as season-long loan players, to ensure Gloucester stayed within the cap.
“You just look at what happened at Gloucester,” said Venter. “Where these three young players, Trinder, Sharples and Hudson, went on loan before the season starts for the whole year, to get them outside of the cap. So how’s that possible? Somebody must have got the budgets unbelievably wrong.”
Gloucester declined to comment on Venter’s claims, but are understood to be confident they operated transparently and within the laws.
Trinder had suffered a torn Achilles tendon, while Sharples was recovering from surgery at the start of this season.
Bath also declined to comment last night, but had previously claimed the loan deals were part of a “mutual long-standing relationship with Carnegie”. A source defended the loan arrangement, saying several other clubs were utilising the clause, and said the law was crucial to allow clubs without the riches of teams such as Saracens to ensure they have access to talent.
However, Venter suggested the rule was an example that Saracens were not the only team using the system to their advantage. There is no suggestion that the loophole said to be utilised by more than half the clubs in the English top flight is comparable to pay-cap breaches employed by Saracens, who have accepted relegation after an investigation into business arrangements between outgoing chairman Nigel Wray and leading players, including Owen Farrell, Maro Itoje and the Vunipola brothers.
The “loan” rule, meanwhile, is certain to be scrutinised, a source said, when Lord Myners of Truro launches his review. The investigation will strengthen Premiership Rugby’s wider powers in time for the next campaign. According to the domestic league, all aspects of the salary-cap regulations will be strength-tested.
In relation to its current loans rule, a Premiership Rugby spokesman told The Daily Telegraph: “The provision for Premiership Rugby clubs to loan players is covered in the salary cap regulations which are published on our website.”