Eddie Jones, the England head coach, is expected to be asked to take a pay cut of at least 25 per cent along with senior executives at the Rugby Football Union after the coronavirus left the governing body facing losses of up to £50 million over the next 18 months.
The RFU on Wednesday began consultations with its 500-strong workforce over staggered pay cuts, with the highest earners expected to bear the biggest brunt. Jones is the highest paid coach in world rugby on a salary of around £750,000 per year.
The RFU executive team, including chief executive Bill Sweeney, led the way on Wednesday by agreeing to cuts of at least 25 per cent for the year ahead, following a virtual board meeting.
The cuts come as the RFU agreed a financial support package for its grassroots clubs, including a cash injection of up to £400,000 to those constituent bodies who match the amount from their own reserves to ease the financial pain of grassroots clubs.
The RFU board also agreed to ringfence funding to the clubs despite the financial challenges, including an early release of £800,000 cash due to clubs through the ticketing fund, as well as final funding payments (£600,000) to constituent bodies, enabling them to utilise this to provide “immediate support grants” to clubs most in need.
There was also a suspension of the quarterly loan repayments for clubs with outstanding loans due in April (£335,000) and the creation of a £5 million support loans programme, offering loans of £2,000-£10,000 to clubs, with deferred repayments for six months and repayable over three years.
The relief package comes after the Scottish, Welsh and Irish unions all established financial hardship funds to help their grass-roots clubs.
Sweeney, in a letter to clubs, said that the RFU were “managing in the unknown” because of crisis but had a firm plan in place to mitigate against the expected unprecedented losses.
“We have modelled three potential scenarios and are working on an assumption based on a medium-term impact with a view to a return to rugby in the autumn,” said Sweeney.
“The RFU had budgeted for a loss-making year within a four-year cycle due to the costs of the 2019 Rugby World Cup campaign and hosting only two home Six Nations games. The loss will now be considerably more as we face challenges similar to businesses across the country.
“The RFU’s biggest asset is also a major cost and the closure of Twickenham Stadium has a significant impact on the revenues we can generate to reinvest in the game. In that sense, we are like every other club in the union: when we do not stage matches and events we do not generate revenue.
“We estimate RFU revenue losses over the next 18 months to be approximately £45-£50 million and have a firm plan in place to mitigate this.”