League: Warriors' appeal hopes slim

The Warriors will need to stay tight but have little chance of overturning their salary cap penalty. Picture / Brett Phibbs

The Warriors' attempts at fighting the four-points deduction for salary cap breaches has little chance of success.

Unless they put new evidence before the NRL, the Australian competition's governing body will not be swayed.

The cap received unanimous support from all 15 club chief executives following the penalty imposed on the Auckland franchise and the NRL has made it clear it will continue to impose the spending limit and to police it.

And more of the means by which it polices the cap came to light yesterday when Benji Marshall's manager, Martin Tauber, fired a broadside at cap auditor Ian Schubert for conducting an unwarranted investigation into the Kiwi five-eighth's affairs.

Schubert's attention was apparently drawn when Marshall appeared alongside Wallaby Stephen Larkham in television and billboard advertisements for Blades Boots, a Wests Tigers sponsor.

Marshall appeared for free, Tauber said, adding: "He [Schubert] thinks he's James Bond revisited."

Schubert makes no apology and says all clubs and players have to abide by the rules. He doesn't talk about how or why he goes about his audits. But it wouldn't surprise if the high-profile signings of Ruben Wiki and Steve Price attracted not only his notice but some prompting comments from other clubs.

The comments from Sharks forward Lance Thompson that he was offered a post-retirement inducement of A$100,000 for taking a pay cut will also no doubt draw an inquiry from Schubert.

If time were divided equally, Schubert would have more than three weeks to spend investigating each club's list of the top-25 players to see if they fitted under the A$3.36 million cap. Divide the amount equally and it is $134,600 each. But of course some get far less and some far more and at most clubs the cap-breaking interest would focus on a handful of contracts.

Given that all contracts must be registered with Schubert, that does give him a lot of time to add the details.

Cap breaches over the years have largely revolved around supply of extras, often from sponsors, ranging from cars to interest-free loans to free accommodation, travel, sports goods and clothing. The Bulldogs case was an extraordinary one, simply because most clubs are not in a position to hand out huge cash incentives.THE financial viability of clubs as well as the evenness of the competition are the two reasons for maintaining the salary cap and both are valid.

Of the 15 clubs, the Warriors is the only one privately owned. The Broncos, North Queensland and Melbourne enjoy half-share backing from News Ltd, which has a clear vested interest in terms of its broadcasting rights. The rest, 10 in New South Wales and Canberra in the ACT, are funded largely by poker machine money.

The New South Wales Government is about to levy a major increase in pokie taxes and financial advisers reckon seven Sydney clubs will be in monetary trouble - defending champs Wests Tigers, the Penrith Panthers, Parramatta Eels, Canterbury Bulldogs, Cronulla Sharks, Manly Sea Eagles and Souths.

Newcastle and Canberra are seen as being on a healthier footing in one-team towns where they can corner sponsorship deals. The other two NSW clubs are the Roosters and the Dragons, which both enjoy major business backing.

Those are the two clubs that everyone looks at with raised eyebrows when considering player rosters: How do the already talent-stacked Roosters manage to poach Braith Anasta from the Bulldogs? How do the Dragons hold test stars Jason Ryles and Luke Bailey, Trent Barrett, Mark Gasnier and Matt Cooper? The NRL's simple answer is that players will go to a club for reduced money if other factors are attractive, for example, a club with title-winning potential, a club with a good coaching staff or one where the coach is a State of Origin or test coach.

In that regard there is a cap anomaly. The Roosters stack their coaching staff with the likes of Phil Gould as adviser and Brad Fittler as kicking instructor with the usual host of assistants and trainers. Other clubs could not afford to do so.

A second anomaly: Clubs can spend what they like on their development squad, allowing some to carry bigger back-up. But a limit of A$300,000 is imposed for spending on those from the reserves who play in the NRL.

The NSW Rugby League introduced the salary cap in 1990, recognising financial imbalances at the time by limiting the spend at some clubs to A$800,000 while others could spend A$1.5 million.

The result was the plundering of city and west clubs by the then-rich Manly Sea Eagles as well as the Roosters and Dragons.

But drink-drive law changes, spread of other clubs, increase in interest in rugby and a host of other reasons saw Manly's income fall away.

The 1997 Super League war skewed everything, with player salaries blowing out to unsustainable amounts. There is a limit to what the game earns all-up. The NRL puts that at A$107 million.

For the first two years after Super League, club spends were well over the cap as player contracts signed by both Super League and the ARL were honoured and allowances made for that.

In 2000, the Warriors were among eight clubs fined for cap breaches. There have been 35 breaches since and only Manly have not been convicted of any offence.

The cap includes all monetary wages, interest-free loans, travel, accommodation, vehicles and servicing, managers' fees and fringe-benefit taxes paid by a club. It also includes appearance and win bonuses - where many clubs get into trouble.

At the start of the season all will have pushed the A$3.36 million limit without including bonuses. If they make playoffs and have to pay, the amount can be transferred to the following season. But that means they must cut players and that happens when other less-successful clubs are plying them with offers. The usual course is to cut numbers of lesser-lights and keep the stars in the hope that up-and-coming juniors will fill the holes, as no coach likes to let go of a damaging attacker.

The cap has not been substantially increased since 1998, though there were allowances made for extra money brought in from sponsors (A$200,000 added in 2002) and veterans (A$100,000 added in 2004) and this year clubs can pay two in their top-25 another A$50,000 provided that also is from "extra" sponsorship.

The NRL gives each club a A$2.75 million grant this year, an amount that has been rising slowly.

The body's chief executive, David Gallop, wants the grant to match the salary cap and believes the cap should not be pushed further out until that is the case.

The Players' Association wants the cap at A$5 million.

In future, it seems likely that investigation of cap breaches will examine the role of players and their managers more closely.

The NRL warned this week that it had looked hard at Warriors players and, though no action would be taken, all NRL players should be aware they could be fined, suspended from games or de-registered if found to be complicit in rorts.

There is a push to have all player agents accredited and the latest saga will add impetus to that.

Wests Tigers chief executive Steve Noyce credits the cap as being an important part of the club's 2005 premiership victory.

A levelling in spending ensured 26 competitive rounds. "Everyone agreed that the cap had been at its most effective in the last two seasons and that those were the best two seasons the game had seen."

Souths chief executive Shane Richardson said it was nonsense to suggest that players paid "extras" did not know that these were outside the rules and that those caught out should face a minimum six weeks' suspension. Players knew to the penny what they were getting, Richardson said, and if the exact amount did not go into their bank account on the allotted day their wives would be on the phone first thing the next morning.


How it all unravelled


* NRL salary cap auditor Ian Schubert opens books at the Warriors last November and sees enough to investigate further.

* Club in the throes of management changes after the exit of chief executive Mick Watson in August, then underling Spiro Tsiros, and coach Tony Kemp in September.

* When Schubert asks for and is given more information from the Warriors books for 2005, he finds breaches of the A$3.36 million ($3.76 million) cap amounting to A$860,000.

* It's understood the breaches include a promise of employment to Ruben Wiki after his playing career has finished.

* Warriors informed of the problem and asked to respond. Early this week board chairman Maurice Kidd, board member and director of football John Hart and new chief executive Wayne Scurrah go to Sydney with a lawyer from majority owner Eric Watson's Cullen operation to plead their case.

* The NRL, having warned clubs two years ago that it will deduct points where future salary cap breaches are found, denies the Warriors' pleas for mercy and deducts four points from them for the 2006 season and fines the club A$430,000.

* The NRL has since had backing for the cap from all 15 clubs. Chief executive David Gallop says the actions of player agents and the players themselves were looked into in Warriors deals. He signals that in future there will be further focus on what players and managers know and what their roles in contracts are.