The stark financial outlook facing regional rugby in Wales can be revealed under a proposed new funding deal with the WRU, with benefactors having to provide £25m of fresh equity investment and a huge cut in rugby squad budgets.
With the union in turmoil with allegations of sexism, racism and misogyny, it has been in talks with the four regions - Cardiff, the Scarlets, Dragons and the Ospreys, for around 20 months , via the Professional Rugby Board (PRB), over a new six-year funding deal. If agreed it would be backed dated to the original intended commencement date of July, 2022 and run to summer of 2028.
A copy of the heads of terms document, obtained by BusinessLive Wales, shows that as well as a requirement for major benefactor investment, if the union has a retained profit deficit of more than £1m at year end, it could clawback the amount by reducing funding to the regions - although there is an upside distribution clause if the union’s retain profit exceeds £1m.
