The Third Way

THE THIRD WAY

An alternative proposal for the future of Welsh Rugby

INTRODUCTION
In the light of the recently published 'Rugby Partnership Wales - a Vision Statement' and Sir Tasker Watkins' Report of the Re-organisation Working Party on Welsh Rugby, the following clubs met at Aberavon RFC on Thursday 3rd January 2002 to formulate a viable alternative to these proposals. Entitled 'The third way' this is a discussion document intended to provoke debate on the proposed changes to Welsh Rugby.

BACKGROUND
League Rugby was introduced into Wales by the WRU to strengthen the playing base by making it more competitive. Its implementation removed the 'closed shop' policy which had previously existed under the Merit Table system and its arrival heralded the start of a meritocrasy, which has rewarded the successful and penalised the unsuccessful ever since.
The League system rewards success. Success is achieved through skill, endeavour, ambition and good organisation. Competition hones these qualities and allows the deserving their rightful place in the game. For the vast majority of clubs, the advent of league rugby has been a success. Ray Williams said at the start, that it would revolutionise rugby in Wales and so it has.

THE NEW PROPOSALS
The Gang of Six seek, with the collusion of the WRU, to turn the clock back and recreate a system, which previously had been removed. Fuelled by greed and motivated by the consequences of financial recklessness, mismanagement and failure, they now seek refuge in an operating cartel, which would effectively deny entry to the rest of Welsh rugby. When the practicality of their play off suggestion is examined even briefly, it amounts to no more than a sap to other ambitions.
Sir Tasker Watkins' Working Party, has not provided an actual number for participation amongst Welsh rugby's elite. No doubt mindful of the legal consequences of the loyalty agreements signed in June 1997 by the Union and the top clubs, they have suggested that this number could be limited to eight clubs. Furthermore, they have recommended that rugby below the top level should revert to an amateur basis. This is contrary to the IRB edict of August 1995, declaring the game to be open. Whilst acknowledging the impossibility of enforcing amateurism, the Working Party have circumvented the position, by proposing the withdrawal of WRU funding for this purpose.
In this paper, we respectfully suggest , that neither the proposals put forward by the Gang of Six nor Sir Tasker Watkins' Working Party, have anything to do with improving the strength of Welsh Rugby. Rather they are two separate attempts to deal with the provision of more money to fund the top end of the game.
The Third Way.
An alternative set of proposals for the long term future of the game in Wales.
The game at the top level in Wales has been chronically mismanaged. It is now well documented that by the end of this season, the Premier Clubs will collectively have lost £15M. Their actions have effectively bankrupted Premier rugby in Wales. This is a staggering amount of money and a dumbfounding admission. The great and the good of Welsh rugby, successful entrepreneurs and captains of industry, have recklessly abandoned all good business practice. They have failed to guarantee a return on their investment, have allowed expenditure to exceed income and permitted their overheads to spiral out of control. After all of this they now want total control of our game in perpetuity.
Money is the most of all evil but both the Gang of Six and Sir Tasker's Working Party are correct in its importance. However, rather than there being too little money available, there is too much. Neither of these groups have addressed the most obvious and pressing issue. Elite rugby in Wales is in financial crisis because salaries have escalated out of control. An artificial market has been created in Wales where more and more money is being paid for poorer and poorer results. It is the law of diminishing returns.
In fairness, however, Sir Taskers' report does briefly deal with the monetary rewards of our international players. The report does list that a correction in line with or international rivals may be overdue. Our report seeks not to deny our domestic or international players the rewards they deserve. We have no qualms about our players being the best rewarded in the world, we merely seek to make them more accountable.
The following list of proposals is our alternative to both the Gang of Six and Sir Tasker Watkins' report. We believe it addresses the issue of money, the re-organisation of our domestic game, the Celtic League and European Cup, some issues relating to our International game and the management of it thereafter. It has been compiled not over many months but in a week and it's proposals are those of common sense. As with most things it is open to debate and amendment.

PROPOSALS
A. The Domestic Game - The Premiership
1. A strictly enforced salary cap for the elite clubs. This will take the heat out of the wages market and alleviate the financial crisis afflicting Welsh Rugby. Salary caps are in common use throughout the world of sport, are easy to implement and are effective when properly policed.
2. Increase the number of Welsh Clubs in the premier division to 10 at the end of the season, whilst excluding the two Scottish clubs. Presently we concluded, we are improving Scottish Rugby at the expense of our own game. Moreover, the Celtic League now provides the diversity of competition required against Scottish sides.
For a number of years our Premiership has been eroded. A variety if arguments have been made for cutting the number of clubs. We were told before the last World Cup that such a move was a prerequisite to our national side competing successfully. We duly cut but still didn't compete. It is our firm belief that we need to strengthen our playing base not weaken it. We have witnessed shambolic attempts to restructure our top division resulting in the mess we have before us today. It is now time to take affirmative action to develop our national game at the highest level (See appendix Note1).
3. Funding - In a league of 10, the top 3-4 teams would enter the European Cup. They would receive all of their entitlement from ERC which would include sponsorship money and their share of television money. In our opinion if they have won our domestic league competition on merit they deserve the rewards that the entry into the European Cup brings. Likewise the bottom 6-7 Clubs who compete in the European Shield also receive their full entitlement.
In addition, all 10 clubs should share the proceeds or the revenue generated by the Celtic league and the national domestic league. In relation to the latter, is must tantamount to disgrace the ability to attract sponsorship for this competition. We feel our proposal to increase the numbers and strengthen each side would assist with its marketability.
Income generated by the television rights of the Celtic League and the domestic league will be a contentious issue. The argument that every club suffers from televised games is well known and valid. However, to allow our elite clubs the opportunity to maximise their revenue streams must be paramount. To the victors must belong the spoils. Common ground may be found by allowing the Premier clubs and European and Celtic League rights but sharing the domestic league rights amongst the other clubs.
Thereafter income must be generated by normal business activities. There would be no share of international match revenue or television rights, say of compensation to the club for the loss of their club contracted players for international duty. The salary cap would be strictly enforced, audited and policed by the WRU.
B. The Domestic Game - Below the Premiership
1. That the concept of league rugby be enshrined.
2. Promotion and relegation must be guaranteed in all leagues.
3. Although guaranteed, promotion to each and every level should be dependent on certain criteria being met.
4. Funding from the WRU, generated from International TV rights, gate receipts, League Sponsorship be made progressively, in decreasing amounts, down through the leagues, for the purpose of improving facilities and player development in preparation for promotion.
5. That the 1st Division be maintained as a semi-professional league to ensure that any club, has the opportunity of ascending to the Premiership. Without a semi-professional league, the prospect of any side making the jump from amateur to full professional is too great.
C. International Rugby
1. Centrally contract the top players to the WRU. If this is not possible now, due to existing contracts, then attempts to contact them where existing contracts expire.
2. Identify all promising U19 players and centrally contract them to the WRU. During the first year of senior rugby utilise a draft system similar to that employed in American football, to place them with premiership clubs. By allowing the bottom placed/ newly promoted club, the first choice of the draft, would ensure that talent is spread throughout the division. As with their American counterparts clubs could, subject to their salary cap, buy trade or swap draftees. Any draftees whose services are not required, is free to play at the club of their choice. Non EEC players should be phased out completely from the domestic game thereby allowing these young players the opportunity to develop.
3. Review all international contracts and offer a performance related pay structure. Larger win bonuses should replace basic pay or guaranteed appearance money. Remove the comfort zone and encourage accountability.
4. Allow market forces to dictate where a player plays his rugby. Players who are not based in Wales should not be disbarred from international selection. Any departure from our domestic game should be viewed as an opportunity for young talent to emerge.
D. Management of the Game
If the game is to be divided between full time professional on one hand and semi pro and amateur on the other, then the management structure should reflect this. Consequently we propose the following.
1. The Council to be formulated along the lines of Sir Taskers' report with two additional members elected from the Divisional Management Board (See 3 below).
2. A tighter Executive Board of only 5 members, Chief Executive, Finance Director, Commercial Director, Director of Rugby plus elected representative from the Premiership.
3. A Divisional Management Board to administer to the game below the Premiership consisting of 17 elected members (one from each league) plus four international representative voted for by all the clubs.

CONCLUSION
This report has touched on a number of issues, fundamental to them all is the continuance of a strong and fair league system throughout Welsh rugby. We believe that is only through fierce competition that the skills and attitudes necessary for the re-emergence of Welsh rugby will be honed. Those who succeed must be rewarded, those who fail must be penalised. There is to be no play-offs and no golden parachutes. Competition will make up harder, learner and better. To this end, we advocate a policy of increasing our Premiership to 10 with a longer term view of taking it to 12 (See appendix note). Opportunities must exist for all clubs to strive to reach the top. It is the duty and function of our union to ensure that the means and support is there for them to do it. We feel that our proposals, if adopted, would fulfil 5 major objectives.
1. Provide an improved environment for our top players to compete in.
2. Provide improved playing environments throughout all of the leagues.
3. Provide opportunities for all clubs to improve.
4. Strengthen the base of Welsh Rugby not weaken it.
5. Ensure the restoration of financial viability to Welsh Rugby.

APPENDIX
Note 1.
It is our firm belief that the top playing base should be strengthened not depleted. We feel that the handling of our top division has been disastrous. The following example outlines the consequences to a fixture list in a typical league of 10 Premiership teams.
No: of domestic league fixtures (H or A) 18
No: of European games 6 (Max 9)
No: of games in Celtic League (H or A) 8
No: of games in domestic cup (Max) 4
TOTAL 36-39
The above fixture list would guarantee a minimum number of 16 home games per season. It is our proposition that normal domestic league and cup fixtures be played throughout the Autumn International Season. The Clubs deprived of their international players (who in time would be centrally contracted), should call upon their under 21 sides to bolster their 1st XV during their period, enabling invaluable playing to be provided to these players.
Consequences to the Celtic League
Note 2
The proposal to increase the number of Welsh teams to 10 would have little impact on the organisation of the Celtic League. The failure to promote last season's Division 1 champions to be Premiership had 3 consequences. Firstly, Wales lost 1 place in the European Shield (Parker Pen Trophy). Secondly, it produced the ridiculous situation of uneven number of teams in our Premiership (resulting in free Saturdays) and thirdly it resulted in 2 conferences in the Celtic League one with an even number of teams and one with an odd number. This year there were 15 teams in the Celtic League, 9 Welsh, 2 Scottish and 4 Irish. The teams in the 8 team conference played 7 games on a home or away basis.
The increase of Welsh Clubs to 10 would result in 17 teams competing in the Celtic League. There would still be 2 conferences, one of an odd number and one of an even number. The longest conference would consist of nine teams, resulting in eight games played home or away. The overall impact would therefore only be 1 extra game for each side which competes. The impact is therefore negligible.
Future Development within the League Structure
Note 3
There is scope in the league system for further development. Consider the prospect of a 12 team Premiership. At the end of Season 1, the top 3 clubs, having earned their right to compete on merit detach themselves from the Premiership. Their place in the premiership is taken by the top three from Division 1, which triggers an upwardly mobile spiral through all of the leagues.
The top 3 teams having detached themselves, compete in the European Cup, which instead of six groups of four becomes four groups of six. This would give 10 pool games on a home and away basis. Along with the 4 Irish Provinces and the newly proposed 3 Scottish Super clubs, they compete in the Celtic League, once again on a home and away basis. The Celtic League would thus generate an 18 game league. Allied to the European cup games, this would result in a 28 game season.
The club with the worst playing record, relinquishes their place for the following season to the winner of the Premiership. The side that wins the Celtic League could go into a challenge trophy against the English League winners, the French or even the European Cup winners. The prospect of intense and mouth watering rugby is vast. All of which is achieved through merit, fierce competition and fairness.

THE THIRD WAY - A SYNOPSIS
The game at the top level has been chronically mismanaged, resulting in a financial crisis which threatens to destroy the game in Wales.
That the 'Gang of 6' action's, are motivated by greed and the determination to extricate themselves from the consequences of their own financial recklessness.
That both the reports from the 'Gang of 6' and Sir Tasker Watkins Working Party, have little to do with strengthening the game in Wales and all to do with securing more money for an elite group of clubs, who wish to operate a cartel to the detriment of the game.
That there is a third way, a viable alternative for the future of Welsh Rugby.
PROPOSALS
That league rugby throughout the world offers the right environment for competitive sport.
That our league system at the top level, has been badly managed resulting in the present chaos.
That our Premiership should be increased to 10 teams with a view to extending this to 12. The objective being to strengthen our playing base.
That the principle of relegation and promotion be enshrined in all leagues.
That although enshrined, promotion is only guaranteed subject to satisfying qualifying criteria.
That league rugby includes no play-offs and no golden parachutes.
That the funding of our Premiership clubs be radically altered.
That the league system be split between professional and amateur, with a semi-professional league catering for the transition between the two.
That below the Premiership are funded by the WRU in conjunction with the relevant agencies, local authorities and government bodies, a radical overhaul of the clubs that constitute our national game take place.
That management of our game be radically altered to cater for the proposed changes.
That international playing contracts be altered to reflect a performance related remuneration.
That market forces dictate where a player should play.
That central contracts for our top players be instigated with all due haste.
That our top U19 players be centrally contracted and thereafter subsequently drafted throughout the Premiership clubs.
That non-EEC players be phased out entirely from our domestic game.