Premiership clubs took £124million in taxpayers’ money
The amount of taxpayers’ money pouring into Premiership rugby clubs to prevent them from going bankrupt has more than doubled initial estimates to £124million, the Sunday Telegraph can reveal.
The true extent of the financial crisis that has engulfed professional gaming since the coronavirus pandemic can be unveiled in the week this newspaper revealed that Worcester Warriors had been hit with a liquidation petition by HM Revenue & Customs and wasps were also prosecuted for non-payment of tax.
It was originally calculated that the Government’s Covid-19 Sports Winter Survival Scheme would allocate £59million to Premiership clubs when the initiative was announced in November 2020 as part of a wide rescue package of the sector for those starving for vital ticket income during various lockdowns.
Four months later, however, that figure had risen to £88million following detailed submissions from clubs reporting their estimated losses. The Department of Digital, Culture, Media and Sport offers formulas adapted to the financial situation of individual organizations, granting them loans to give them the best chance of short-term survival. Rugby union was comfortably the biggest beneficiary of this program among professional sports.
It has now emerged that it has again jumped by more than 40% to average almost £10m for each of the 13 Premiership teams for loans over 20 years which they will soon have to start to reimburse. Premiership Rugby declined to comment.
In November 2020, as Premiership matches were played behind closed doors to wipe out vital revenue streams, the initial estimate of £59m was called a ‘much needed lifeline for our clubs’ by Darren Childs, who resigned as general manager of the league the following April and has since been replaced by Simon Massie-Taylor.
In a statement released earlier this week, Worcester said they were working on “solutions to secure the financial future of Worcester Warriors and to pay any taxes due to HMRC”.
“A solution, which would secure the long-term future of the club, has been approved. Unfortunately, there have been unavoidable delays beyond the club’s control in the final tasks required to complete the funding.
“Having kept HMRC fully informed of the situation, we are disappointed that they have taken the decision to launch a liquidation petition.”
A Wasps spokesperson said: “As with a large number of businesses, we have agreed a payment arrangement with HMRC as we emerge from the Covid-19 lockdowns. We have a strong relationship with HMRC and will continue to engage in proactive discussions with them.