English Rugby Union: Governance

Edward Morello Excerpts

Tuesday 11th March 2025 Westminster Hall

[Edward Morello (West Dorset) (LD)]

It is a pleasure to serve under your chairship, Sir Desmond. I thank the hon. Member for Camborne and Redruth (Perran Moon) and Hayle for securing this important debate. He speaks with great passion and knowledge, and I commend his recommendations.

Nothing can beat rugby as a gladiatorial spectacle, from the high-scoring, ping-pong, side-to-side and end-to-end champagne rugby played in the sunshine, to the grinding, no-tries, mud-fest battles for the purists only. The genius playmaker, able to see and exploit a gap for a game-changing individual try. The 16 phases of pick-and-go forwards grinding out the inches—or doing the hard yards, as I would describe it. The last-minute drop goal that wins or loses a match. Rugby is a game of wonder and joy. It is a sport built on discipline, respect and unity, which defines the game at every level, from local grassroots clubs to the highest of international competitions.

While I would love to spend some time lauding my own playing abilities, I am afraid there is too much evidence to the contrary. As a lifelong fan, I watch as many matches as my new schedule allows. And every weekend I take my son to play at one of our brilliant clubs in West Dorset, because it is not just a game but a community, and it is enjoyed by thousands up and down the country every weekend.

Rugby union, which according to legend was born in 1823 when William Webb Ellis picked up a ball at Rugby school, is one of Britain’s finest exports, and it is important to so many, not just in the UK but around the world. In the English premiership, we have one of the best and most competitive leagues in the world, and if the Chair will allow me a moment of self-indulgence, it is great to see my club, Bath, back at the top of the league, where it belongs. If the Chair will allow me a further moment of indulgence, I will annoy my political researcher by saying it is great to see Northampton so far down the league.

This year, we are proud to host the women’s rugby world cup, which will be a fantastic celebration of sport and an opportunity to see the Red Roses hopefully triumph. The growth of the women’s game is an extraordinary success story, with record-breaking attendance and a surge of participation. The Red Roses’ domination on the international stage, with their groundbreaking winning streak, has inspired a new generation of players and showcased the strength of women’s rugby. The Liberal Democrats welcome the Impact ’25 funds from the Government, with £28 million of investment to support England hosting the 2025 rugby world cup, including £14 million of legacy funding, which is needed to grow the women’s grassroots game.

However, while there is much to celebrate on the pitch, English rugby also faces a governance crisis off it. The financial state of the game is deeply troubling. Since rugby in England turned professional in 1995, the business model has remained unsustainable. Many premiership clubs operate at a loss, dependent on wealthy owners who can withdraw their funding at any moment, leaving clubs in financial ruin. In 2023, we saw the historic and legendary clubs of Wasps and London Irish collapse, as well as Worcester. The consequences have been devastating. Players and staff lost their livelihoods, and fans lost their beloved teams. The Culture, Media and Sport Committee at the time called it

“a stain on the reputation of the RFU”.

Despite these failings, successive Governments have taken a hands-off approach, hiding behind the excuse that the RFU is an arm’s length body and allowing financial mismanagement to continue unchecked. The RFU receives significant public funding. Since 2020, the Department for Culture, Media and Sport has provided loans through the sports survival package amounting to more than £123 million for premiership and championship clubs, with little oversight of how that money is used. Worcester received the largest loan, borrowing £15.7 million, but its administrators repaid just £9.8 million. Wasps’ administrators returned just £300,000 of its £14.1 million loan, and London Irish is yet to repay any of the £11.8 million that it received. Across the English game, we know that a staggering £30 million of these loans remains uncovered, with a further £11 million in unpaid interest. The RFU itself posted a record operating loss of more than £40 million last year and made more than 40 staff redundant while, as has already been mentioned, its executives awarded themselves £1.3 million in bonuses. How do the Government justify such recklessness when clubs are struggling to survive?

Premiership clubs collectively lost £30.5 million in 2022-23, and have net debts in excess of £300 million. Despite some financial reforms and a new £3.3 million per club funding deal, concerns over clubs’ sustainability persist. Seven out of 10 clubs are financially insolvent, surviving only on owner handouts. Only this week, the administrators that oversaw London Irish’s insolvency warned that it was only a matter of time until another premiership club goes bust.

[Dr Luke Evans]

The hon. Member is making a fantastic speech about the financial impact, but with all these clubs it is about the fans and the jobs that go out into the community. Does he agree that when we saw this situation in football, we had the fan-led review? Would it not therefore be wise for the Government to consider doing something similar in rugby? By having a look, they could lift the stones, pull the cover back and see what is actually going on with the state of rugby union in England.

[Edward Morello]

I 100% agree with the hon. Member. It is incredibly important that the Government step in and start looking at the governance of the game, otherwise there will not be a game to govern.

Only this week, the administrators that oversaw London Irish’s insolvency warned that it is only a matter of time before another premiership club goes bust. That is an appalling state of affairs for a sport that should be thriving, and it has been confirmed that London Irish will seek a place in the United Rugby Championship. A team’s decision to prioritise the URC over the premiership serves as a damning indictment of the mismanagement within the premiership and the broader state of our amazing sport. If a normal business operated in that way, it would have been restructured years ago.

I have received responses from the Government stating that the governance of rugby union is a matter for the RFU, referring to the RFU and Sport England as their arm’s length bodies. Yet, despite the substantial public funding it receives, the RFU appears to operate with little oversight or accountability to the Government. If a private business was in receipt of that much taxpayers’ money, there would be demands for a public inquiry.

We have also seen injustices in the league system, as has been outlined. The championship contains strong clubs such as Ealing Trailfinders, which have proved their quality by excelling in the premiership cup. Yet, due to outdated capacity rules, they are denied promotion, while some premiership clubs fail to sell out their stadiums week after week. The entire system must be reformed to reward financial prudence and on-field performance rather than the entrenched and unfair status quo.

My hon. Friend the Member for Tiverton and Minehead (Rachel Gilmour) has already outlined the alarming fact that rugby’s biggest stars are leaving for more lucrative contracts abroad. The loss of players such as Courtney Lawes to the French second division is a damning indictment of our commercial model. The RFU must do more to retain our talent and create a financially competitive environment.

At the same time, we face the threat of losing the Six Nations from free-to-air television. The proposed £100 million deal to move the tournament behind a paywall would be disastrous for the sport and net the competition just £10 million more than the existing deal. A TNT Sports subscription costs up to £30 a month, pricing out many fans and reducing viewership. The Government must ensure that the Six Nations remains free to air, to inspire the next generation of players and supporters.

Despite these challenges, rugby’s future can be bright. The upcoming women’s rugby world cup will showcase the extraordinary growth of the women’s game, with record-breaking ticket sales at Twickenham. Research in Scotland has shown that grassroots rugby delivers an economic benefit of at least £159 million a year, with a social return of £7.71 for every £1 spent. Investing in grassroots is not just morally right, but economically sound, yet funding cuts, declining participation and referee shortages have led to nearly 300 match walkovers in a single season.

The RFU must do more to support community clubs, which are the bedrock of the sport. The RFU’s leadership has lost the confidence of both grassroots and professional rugby stakeholders due to financial mismanagement and a lack of transparency. The Liberal Democrats call for an independent review of the RFU’s governance, with structural reforms to improve financial oversight and club representation. A more democratic system, or even an external regulatory body, would restore trust and stability to the game. It is time for the Government to step in. The governance of English rugby is at a crossroads. The RFU must address the concerns of clubs and stakeholders to ensure the sport’s long-term sustainability. The Government must ensure that public money is spent wisely and intervene when financial mismanagement threatens the integrity of the game.

The travesty of this mismanagement of the game is not just its current state; it is the missed opportunity—the failure to realise the premiership as a premium global product, create superstars of our best players, fill stadiums, grow participation and monetise the game. Rugby is a national asset. We cannot allow it to be undermined by poor governance. The passion of players, coaches and fans remains unwavering. However, unless decisive action is taken, we risk further financial crisis and erosion of the game we love. The excuse that the RFU is an arm’s length body cannot be sanctioned any longer. We can argue over whether the RFU deserves a red or a yellow card, but I hope we can all agree that it is time for an off-field review.

[Mr Louie French (Old Bexley and Sidcup) (Con)]

As always, it is a pleasure to serve under your chairmanship, Sir Desmond. I thank the hon. Member for Camborne and Redruth (Perran Moon) and Hayle for securing this important debate.

Both rugby union and rugby league are games with proud traditions in this country. They bring together communities, inspire young athletes and represent the best of our national sporting spirit. I had the personal pleasure of playing both codes of rugby as a teenager and getting my coaching badges, and today I am proud to represent Old Bexley and Sidcup, which has two flourishing rugby clubs, Sidcup and the Dartfordians. Each club represents what rugby is really about: community, friendship and playing sport in the spirit of healthy competition, open to all, regardless of background, with thriving teams across all age groups. I look forward to wearing my half-and-half scarf next month, when the battle of Bexley takes place between the two senior first teams of my local clubs. I also look forward to continuing to work with the Mizen Foundation to promote schools rugby in my community.

Yet as we all know, the national game is at a crossroads, with major headwinds, including competition from other sports, club finances, as we have heard, and player welfare. Performances and results on the pitch have thankfully improved, with the men’s team having a strong Six Nations—sorry, fans of Wales and Scotland—and the Red Roses continuing to inspire girls and women across the country ahead of this year’s world cup, but the governance of English rugby union has been brought into the spotlight in recent months.

I want to be clear from the outset—I am sure Members across the House will agree—that this is not a criticism of the players or fans, or of hard-working individuals in clubs and the wider rugby community. It is about how we improve the governance structure of English rugby to ensure the long-term sustainability of the game, from the grassroots to the elite level. With the Six Nations under way, it is a good time to look at reforming the governance of the Rugby Football Union to ensure accountability, transparency and a long-term strategic vision for the sport.

Critics have argued that the governance structure of English rugby union has failed to keep pace with the evolving nature of the international game and, as a result, the game is beginning to suffer. Sir Bill Beaumont and the RFU board have come in for a fair amount of criticism in recent months, but I am pleased that they have been out meeting clubs across the country and engaging on a range of concerns ahead of their special general meeting on 27 March. As a result of roadshow feedback, the RFU is planning to take action in the following areas: governance reforms, financial sustainability, continued growth of the community game, reducing administrative burdens, simplifying and modernising competition structures, investing in community club infrastructure and improving communications. It is ultimately up to union members to vote on proposals, but I believe that those are the right areas of focus and hope that the game will tackle these important issues in the months and years ahead.

First and foremost, we must ensure that the RFU is accessible and accountable and operates transparently. The days of a top-down approach to the governance of rugby are over. Rugby is a community game and its leadership structure must reflect that. We need a range of voices at the decision-making table, including people from the grassroots who understand the challenges faced by our local clubs and understand the game itself. I am sure that Members in this place and members of local clubs are pleased to hear that the RFU has promised more control over our community game. I appreciate that that is an olive branch from the RFU in the wake of a chorus of criticism from the game, but it should be welcomed none the less, alongside the £120 million of investment in community rugby promised over the next four years.

The RFU is beginning with a review of how the community game is run, which it expects will encourage

“a shift to a regional structure where more decisions can be made locally, with greater flexibility achieved in competition management and devolved funding to help local decisions to be made to drive participation growth, aid player retention and support club sustainability.”

I think Members here and fans across the country will welcome that.

We must also continue to ensure that financial decisions are made with the long-term health of the game in mind. We must not continue to see short-sighted financial choices that damage the sport’s infrastructure and leave our clubs struggling. There have been many media reports about the RFU’s record-breaking loss last year, and it has been mentioned during the debate, but what has not been reported on is the four-year financial cycle in which the RFU operates, which follows the fixture list. During half of the cycle, the RFU makes a profit; in one year it breaks even; and one year results in a loss. It announced a record-breaking loss last year, but the loss was actually less than it had planned. Having looked into the details and met the RFU, it is clear to me that there is a financial plan in place, but it is not always sufficiently headline-grabbing to be made clear to the public.

[Edward Morello]

I have also heard the RFU explain its four-year business plan. It is nearly impossible to imagine a business running on a four-year plan under which it makes a loss three years out of four. Given how long the RFU has been in charge of the game, I find it staggering that it has not found a way to create a business plan with a more even distribution of income and outgoings. If it is ever going to get on to a sustainable footing and provide cash to the game, it needs to find a way to be profitable in every single year.

[Mr French]

I agree. The commercial elements of the game and its growth are vital. In conversations with the RFU—I suspect I will have many more—that is one area that we must try to continue growing. I have also met Six Nations, which represents all the different unions in this space, and looked at some of its media options, which the hon. Gentleman mentioned. I think they are worth tracking in the weeks and months ahead.

Financial stability at the grassroots is just as important as financial success at the top of the game. Let us be in no doubt: many clubs that were only just recovering from the pandemic are now facing significant headwinds from Labour’s Budget, whether because of high utility bills or staffing costs. I urge the Government again not to lose sight of what it means for communities across the country when clubs are put at risk of closure.

The way the RFU operates allows it to invest in the game’s grassroots, including by funding school rugby managers, who are tasked with making contact with local clubs to ensure that there is a relationship between the schools that they look after and the local rugby club. That is an important way to ensure there is a pathway from that first game of rugby in a PE lesson that can lead any child to a future at the elite level if their talent allows.

The development of our next generation of rugby players is arguably the most important function of the rugby pyramid and those who govern it. Talent must be nurtured from the earliest age, and pathways to community or professional rugby should be clear, fair and accessible to all. We need to empower our coaches, clubs and schools to provide the best environment for young talent to flourish.

The RFU is making good progress on achieving that already, but I know that it can and wants to go further. Data from Sport England’s active lives survey shows that participation in the men’s game is up to 183,000 players from 157,000 in 2021-22. Age grade rugby is also growing, with over 178,000 players registered by the end of last season and over 171,000 so far this season. With the challenge of players’ time commitments, however, it is a wise move for the RFU to be looking closely at having more Friday night fixtures, for example. I look forward to tracking the progress of T1 rugby, which is currently being rolled out in schools, and the growth of the women’s game following this year’s world cup.

From my conversations with stakeholders, the RFU is restoring some faith and good will within the rugby community, and it must continue to do so and listen to the many concerns that have been raised in today’s debate. If it can get that right, and create a governance structure that is more transparent, accountable and inclusive, the future of rugby in England will be brighter than ever. The RFU must do that collaboratively, however, in conjunction with all the sport’s stakeholders. Rugby is a sport of passion, and we cannot afford to lose that.

I will push the Minister on some areas of the sport and the Government’s policies on it. The financial insecurity of many clubs, and the collapse of others in recent years, to the detriment of local communities and fans, raises an important question for the Government: why are they planning to regulate football, and making a lot of noise about it, but not rugby? To be clear, I am not advocating that they should. My personal view is that rugby has enough challenges to deal with and that, as with most things in life, more Government intervention is not the answer, but there is an inconsistency in the Government’s approach to sport that I hope the Minister will address.

Linked to that, can the Minister tell us what the Government are doing to help to ensure the financial sustainability of rugby clubs, and to encourage and develop the governance and the accountability for the taxpayers’ money that is being used, as has been raised already? In the light of recent reports, how will the Government manage the expiry of covid loans, which helped to keep clubs afloat during the pandemic? If more clubs go bust, taxpayers’ money will be lost forever. Will the Department take a more pragmatic approach to those loans, perhaps with extended payment dates and flexibility?

What impact assessment has the Minister made of the combined impact of raising national insurance and employment costs on the game at an elite and community level? Will the Government ensure that rugby continues to be part of the school curriculum? What assessment has she made of the effect on participation in rugby of Labour’s school tax, given the prevalence of links with rugby union among public schools? Finally, does the Minister share my concerns that playing fields will be lost due to the Government’s planning changes, as announced this week?