The New Zealand Rugby Union today announced a new provincial union player payment and contracting model to support its new domestic competition.
The provincial union salary cap will now no longer include notional values, but discounts for All Blacks, veteran players and injuries will continue.
The level of the new salary cap will be set at the lesser of $1.35 million, or 36 percent of a province's commercial revenue based on prior years.
This is a reduction on the current cap of $2.2 million, which included notional values. The maximum a province can pay an individual player will be capped at $60,000, with the exception of two marquee players, who will be capped at $90,000.
Any existing provincial union contractual payments in excess of $60,000 will be added to that player's New Zealand rugby contract and become payable out of the player payment pool.
The revenue sharing model introduced in 2005 will continue, with the player payment pool to be used for player payments and initiatives agreed at 36 per cent of player generated revenue.
Player-generated revenue includes all NZRU broadcasting revenue, sponsorship and match-day revenue.
Franchise revenue above a total revenue level across the five New Zealand franchises of $24 million per annum will also added to the player payment pool from 2011.
Franchise contracting will be introduced from 2011, with Super 14 franchises able to directly contract 28 players on New Zealand rugby contracts and draft up to four further players for a total squad of between 30 and 32 players.
Franchises will be allocated a budget from within the player payment pool, with a maximum amount that a franchise will be able to pay a player to be agreed. The existing wider training group of a further eight players per franchise will remain.
