NZR has word to Govt on rising costs

Steve Tew
Steve Tew
New Zealand Rugby is spending up to $7million more than it earns every year and with player costs rising, the pressure on the national union's balance sheet is increasing all the time.

New Zealand Rugby chief executive Steve Tew said yesterday it would be useful to sit down with Government and have a discussion about funding issues.

Prime Minister Jacinda Ardern and Minister of Sport Grant Robertson met the All Blacks after their Bledisloe Cup victory in Auckland on Saturday night. Coach Steve Hansen told the pair about the financial pressures the national union is facing.

Tew said the overseas player market was going up all the time and Hansen simply outlined what the union was dealing with when talking to Ardern and Robertson on Saturday night.

``Steve took the opportunity, like you do when you have the Minister of Finance around and the Prime Minister around, to mention some of the pressures we are under,'' Tew said

``We have just been doing our long-term financial projections and we continue to spend on average somewhere between $5million and $7million more than we earn.

``Of that, 36% of our costs are fixed and goes to our professional players. If that 36% is under pressure because the price of players continues to escalate and these very wealthy club owners want the best players, then the pressure is going to escalate.

``You look at a performance on Saturday night. You look at Beauden [Barrett] as an example. He played one of those games that people will remember for a long period of time ... If our team and our talent is important to New Zealand then sitting down with the Government and what we might do together is useful.''

Nothing formal had been talked about with the Government, Tew said.

The national union already had partnerships with government agencies such as High Performance New Zealand and Tourism New Zealand, so there were links there already.

The player market was showing no sign of slowing down but New Zealand Rugby was not sitting on its hands, he said.

Some players, such as TJ Perenara and Codie Taylor, had already signed lengthy deals past the next World Cup and the union was continuing to talk to agents regularly.

There would be ``a big bunch'' finishing in 2019. It would be inevitable there would be some players NZR would not keep.

Tew did not fear a clean-out of players after the next World Cup.

``Everyone was very worried at the end of 2015 ... that was a pretty scary moment. There are some players coming to the end of their careers either here or just full stop. Will we keep all of the players we want to keep? Probably not, but hopefully the majority we will - the pressure, though, is the cost of it.

``We have live conversations with their agents. One of the benefits of being in a small country is we see them regularly.

``We are very fortunate the system we have developed in New Zealand in a long period of time continues to produce this depth of talent that gives this team the opportunity to be successful as they are and want to be.

``New Zealand is a great country to live in. A lot of players go away and come back and make that point to their mates. We have good competitions to play in. All the bits we put together make for a compelling point to stay here.

``There has been some real success stories for those guys who have gone overseas and some who have come back pretty quickly.''


 

Comments

Even if you believe that 36% of their costs go to players and are untouchable, then there is still 64% of costs which could be managed. And if Mr Tew can't manage the business within budget then maybe they need to find a new CEO.
The other side of this is just what proportion of the total spend is $7 million? If NZR is a $100 million a year business then 7% is totally manageable with the right mind set. A few less lunches, fly economy for all the hangers on even if not the players. All sorts of options.
NZR need a reality check.