New NRL funding model will force administrators to raise their games

The NRL’s radical new funding model for clubs is predicted to have the same impact at an administrative level as the salary cap has had on playing rosters.

The three-year agreement, which was outlined by Fairfax Media on Tuesday, will see each club receive an annual participation payment starting at $7.55 million and rising by $270,000 each year.

However, clubs could forfeit up to $1m if they don’t meet minimum standards in areas such as governance, financial reporting and business strategies. There will also be millions of dollars in incentives on offer across the clubs if they meet annual revenue targets for membership, crowds, merchandise and sponsorship.

Wests Tigers chief executive Grant Mayer said the joint venture would have to employ more staff to fulfil their ambitions, which are yet to be defined, but believes the model will ensure every club has a strong administration.

‘‘The salary cap created a level playing field from a playing point of view and I think this is the opportunity from an administrative structure to do exactly the same,’’ Mayer said. ‘‘Conceptionally and structurally, I think it is very innovative and very fair. I think the fact that every club has the opportunity to retain $7.55m base funding is great and the other stuff gives us all a chance to be better. I think it is going to make clubs much more consistent and much more professional in how they approach the business of running a football club.’’

Parramatta chief executive Scott Seward and Canterbury’s Raelene Castle also welcomed the dramatic shake-up, which will commence from November 1.

‘‘It gives every club an even chance to win a premiership – not only on the field but off the field too,’’ Seward said. ‘‘It creates a minimum standard that as a game we should be aiming for, or we should actually be aiming for better than that. Why can’t we be better than average.

‘‘There is nothing wrong with a bit of effort and reward. If we are going to be serious about growing the game we do need to stretch ourselves and we do need to aim higher and challenge the way that we have done business in the past.’’

The NRL acknowledges that the likes of Cronulla can not generate the same revenue as Brisbane, so will develop specific targets for each club. ‘‘We are not 16 clubs with equal ownership models so it does recognise that and it does appear that the NRL and the 16 clubs are all working together as one big unit to grow the game,’’ Castle said.

‘‘I think what it will do is give a level of professionalism so that corporate partners and sponsors will feel that no matter what club they deal with they will get the respect and the engagement and the delivery and return on investment that they deserve.’’

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