Without a loan, none of us survive – Davies

OSPREYS chairman Robert Davies has welcomed the £20million loan to the regions, saying Welsh rugby would fail without it.

The arrangement has been agreed via the Welsh Rugby Union with NatWest bank, with the money to be distributed to Cardiff Blues, Dragons, Scarlets and Ospreys in amounts decided by the four regional chairmen.

The package is designed to tide the professional sides over as they seek to negotiate their way around the potentially ruinous effects of the coronavirus pandemic on rugby, with no crowds allowed into matches in Wales, denying the regions revenue from ticket sales and hospitality, with sponsorship also hit at a time when teams have barely taken the field in six months.

International rugby has also taken a heavy blow.

The result has been a shrinkage in planned income for the regions of £26m for 2020-21 to around £3m.

According to Davies, had the loan not come about, the consequences would have been calamitous.

“Without it, Welsh rugby would fail,” he said.

“It’s quite simple. We have a £26m hole for this season, so if we didn’t have this money we couldn’t survive. “That applies to all of us. “Funding for the community game is ring fenced, with the purpose being to secure the future of that sector. That’s quite right – I’m all for it – but it means the only people who suffer when money goes down are those in the professional game.

“Our money has dropped from £26m to less than £3m.

“By any standard that’s a significant hit and something had to be done. The regions themselves are losing money, because the current situation impacts on our season ticket revenue and sponsorship, while other revenue has dropped, too. “It’s a huge hole to fill.”

While welcoming news of the loan, Davies, who has injected millions of pounds into the Ospreys over the years and Swansea RFC before them, remains anxious about what the future could hold for sport in a coronavirus world.

“I’ve watched some of the football on TV and it’s not the same, while for all the high scores in English rugby since the game resumed there, the lack of feedback at grounds does impact on proceedings,” he said.

“It’s a big worry about how all this will pan out.

“People are going to be switched off with nothing to go and watch. We should all be concerned.”

WRU interim chief executive Steve Phillips said in an interview with the BBC: “I am delighted the loan has now come through.

“It’s been a long road, probably longer than I thought, but the point is we have got there.”

Explaining the details of the arrangement, he said: “NatWest lends to the WRU who onward lend to the four regions is how it works.

“The money is divided by consensus within the four regions to satisfy the individual needs.

“They have worked collectively and ended up with a split they are comfortable with between themselves. I am not going to tell you the share, but the four chairmen have been able to sit down and come to a conclusion on how the £20m was best (used) to serve Welsh rugby.”

The money will be repaid by the regions over five years.