NOT WORKING: IRFU CEO, Kevin Potts said the Rugby Workd Cup is “not working” after the national governing body recorded a deficit of €18.4 million for the year including the 2023 tournament.
IRFU chief executive Kevin Potts said the Rugby World Cup is “not working” after the national governing body recorded a deficit of €18.4 million for the year including the 2023 tournament.
With no prize money on offer at World Cup, Ireland did not miss out on revenues from a run beyond the quarter-finals, where they eliminated by New Zealand in Paris 13 months ago. Yet the staging of the global tournament in the autumn every four years denies the Six Nations Unions valuable gate receipts with the cancellation of the Autmn Nations Series and that was reflected when the IRFU published its annual accounts to July 31, 2024 at its Continuation AGM in Dublin on Thursday.
The deficit, Potts said, was €1.4m less than originally forecast and while the CEO said his debt-free organisation was budgeting to return a break-even cash position in its next set of accounts, the blame for the deficit was placed squarely on the impact of the 2023 World Cup.
The tournament, including the cost of financing the team’s campaign and the loss of Autumn Nations Series revenues had a net negative impact to the IRFU of €12.1m.
“It’s a fact that there’s no prize money in the World Cup for success. So things like player bonuses and those types of things are a cost for the relevant participating unions. There’s no prize money.”
“It is a value transfer from the unions to the tournament. We get some funding over the following years out of World Rugby but it doesn’t match what it costs us. It’s also being used to develop the game globally.
“It’s not working and World Rugby are aware that we and other unions are challenge by this and we need to look, is there a better way. We certainly can’t continue to have World Cups every four years that are having such a major impact in that year on our finances.
“But World Rugby are aware of that, to be fair, and that’s one of the reasons they’ve been working with us and we will hopefully, collaboratively, find some solutions.”
Potts insisted the IRFU would not compromise its participation and professional programmes to absorb the cost of participating in the World Cup every four years and said: “When you lose the income of the Autumn Nations Series, which is significant, we’re not cutting our programmes.
“We are continuing to do all the activities we normally do over the course of the four years. So we have to manage that impact across four years otherwise every four years we’d have to be pulling programmes and then restarting them the following year. That’s why the loss occurs.
“You could easily challenge us, ‘why don’t you just cut your costs in that year?’ but we won’t do that. We’ve got to keep our schools, clubs, or professional game going so that’s the impact.
“This year’s Autumn Nations Series games have generated significant funds in order to compensate for that.”
The IRFU’s income for the accounting year was down from €92m the previous year to €79m but the governing body’s balance sheet has remained robust, with no debt, cash and cash investments of €69m and net assets of €87m.
The accounts also show an increase of the IRFU’s investment in the women’s game of €2.6m to €8.3m and while that will increase in the current year as Scott Bemand’s side prepare for a World Cup campaign in 2025, chief financial officer Thelma O’Driscoll wanred of “significant challenges ahead”.
“We’re coming to the broadcasting renewal so we’re always thinking about revenue challenges so that’s one thing we’re concerned about. We’re constantly, you know, financial sustainability is my brief and we’re constantly looking at revenue and making sure that will stack up.
“There’s a lot of cost challenges and like every business we’re facing all the same challenges around travel, accommodation, food and beverage, salary inflation and all those kind of costs. So we just need to be continually reviewing our cost base.
“We can’t do everything we want to do and we need to make sure we’re reviewing costs and that every cent we’re spending is invested wisely and in line with our strategic ambitions.”
In a published statement accompany the release of accounts, Potts added: “Without further revenue streams we won’t be able to maintain current levels of investment” and in a press conference at Aviva Stadium on Thursday explained: “Yeah, there’s a real challenge in our game globally at the moment. All of the top High Performance Unions are challenged with rising costs but the revenues are not increasing at the same rate.
“The next round of TV broadcasting cycle commences in 2026 and the Nations Cup is probably the next big initiative to try and generate more fans and more revenues. It’s a challenge for all unions.
“World Rugby initiated a working group a number of weeks ago which we welcome, where the top 12 unions, the CEOs, chairs and treasurers are sitting with World rugby and, are there things we can do together to help us with costs or help us with revenue generation and there a number of initiatives that are about to kick off in the new year.
“So collaboratively we need to work together in the game to generate more revenue and I guess if we don’t we will have to review our programmes while at all times protect the three priority areas which is our men’s national teams, given they generate 80% of our revenue, and the pathways that feed them including our provinces; the need to accelerate our women’s programme and of course building our clubs.
“Those three priorities can’t be compromised so yes, like any business we can only afford to spend what we have or what we receive and it’s a challenge for the sport.”
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