Edmund Van Esbeck talks to the Honorary Treasurer of the IRFU – John Lyons about the finances of the IRFU and where it is directed to fund the game in Ireland.
Prudence has always been a notable characteristic of those who have presided over the financial affairs of the Irish Rugby Football Union. This is very evident from even a cursory glance at the balance sheets through the years. Waste not, want not was the philosophy and certainly there was no waste and the reserves were built up. Shrewd investment helped to build up the funds.
As the last century was drawing to a close, it was evident that the old aristocrat of rugby grounds, Lansdowne Road was showing the wear of over a century of service. Stands had been built and improvements were made. Such improvements met the short term needs. But things were changing. As the game prospered under the guidance of the parent body, a stadium to meet the ever growing demands for increased accommodation and modern facilities was a necessity. The point was not lost on the administrators who sought to secure the financial position and provide for impending expenditure.
Then in 1995, came radical change when the game went open and that altered the scene dramatically and imposed financial demands of an unprecedented nature. The man who sat in the honorary treasurer9s chair at Lansdowne Road was John Lyons, the latest in a long line of distinguished accountants and shrewd men who had filled the office. None of his predecessors had ever faced so daunting a challenge, and the same applied for those who ran the union9s affairs. Here was a situation without precedent and it is important that this is realised. Here was a new ball game as rugby moved from the old amateur era to a game that was now a business, big business.
The early days of the new professional era were fraught with difficulty, a point that John Lyons readily acknowledges. It was all a learning process, albeit a costly one. The top players were no longer playing for leisure, now it was their livelihood. Promises of huge financial rewards saw many lured to England. In addition to the international scene, the Heineken European Cup and Shield were on the agenda. Strong and professional provincial teams were now a necessity. It is essential that this is recognised and that we may appreciate more readily the problems that existed.
The IRFU showed wisdom in contracting their top players to the Union, thus avoiding one major mistake made by some of the other unions. Then Ireland failed to qualify for the knock-out stages of the 1999 World Cup, meaning Ireland had to qualify for the 2003 finals with all the attendant costs. “That was a major blow”, said John Lyons. “We changed the structure of the game at that time, we brought our players back to Ireland and all the teams national and provincial were fully resourced”.Then came the outbreak of foot and mouth disease in Britain in 2001. “We had all the expense but no income because matches were postponed”, said John.
The days when the accounts showed a significant profit are long gone, now of necessity the IRFU must budget for a deficit in the current year.
“The strategic Review and Strategic plan now lay out the goals for Irish Rugby”, said the Treasurer. “The deficit is currently running at 3.4 million a year. But we must sustain an adequate professional structure and eliminate the deficit. We have a commitment to the AIB League and our performances in the ERC competitions and Six-Nations Championship are crucial factors. It must be borne in mind that the revenue we get is very significantly performance related, that must be appreciated.”
“The current season revenue generated by the professional game come to E31 million. Other income including government funding of 3.5 million comes to 6 million. The cost of the professional game is 23 million. Financing the domestic game, administrative and other costs and expenditure comes to 17 million. Thus we have a deficit in excess of 3 million which must be eliminated and that is a core issue.”
“We cannot be accused of not having our operations reviewed by external consultants. These indicated that, in financial and performance terms, we punch above our weight. Compare that to other unions who are experiencing greater difficulties in relation to their game and their stadia.”
“The global season is now under review and compromise sought to suit everybody. In order to deliver the necessary surplus every avenue of revenue is being and must, of absolute necessity, be explored. The IRFU is exceedingly grateful to all our brand sponsors who are listed in the match programme. Organisations such as Permanent TSB, Guinness, AIB, O2, Ford and AON offer invaluable support. We have a difficult task given our numbers and position in the market place and in Irish sport9s pecking order.”
“We are constantly looking at new initiatives to widen our base, such as the formation of an Irish Supporters Club, increasing the relevance of our Web Site and expanding the marketing of merchandise.”
“Of course we support our clubs and as a priority we seek to see participation in the game grow. In order to maintain our level of support for the club scene it is necessary all revenue and costs are kept under constant review.”
Direct support for
the clubs of Ireland: 1.6m
on the YDO scheme: 0.9m
Insurance subsidy: 0.7m
AIB League support: 0.7m
Provision of equipment 0.1m
“The above table summarises our current direct support to clubs and schools amounting to 4.3m.”
“In addition to the above costs, Branch support, coaching courses et al amounts to 3.7 million.The figures speak for themselves as the honorary treasurer has clearly demonstrated. And it is hard to disagree with his overall assessment when he said, “There is just not enough money to go round. As in all imbalances compromise must be found and choices must be made. As things stand it is currently a case of trying to put a quart into a pint pot.”