Editorial: Otago rugby's sorry state its own doing

The future of the Otago rugby team is set to be announced today. Photo / Getty Images

The plight of one union should not be the catalyst for turmoil and dramatic change. All sorts of radical prescriptions have been suggested since the full extent of the Otago Rugby Union's financial woes was revealed. It would seem, according to several former Otago players, that the union is merely the unfortunate victim of an unaffordable and unsustainable structure.

Some have even suggested the situation is so dire that the only answer is to return the national provincial championship to its amateur roots. They are over-reacting. While falling gates and player wages have created challenges for all provincial unions, Otago's wretched situation is hardly typical.

The province has foundered on two rocks. First, its valuation of Carisbrook caused it to run up too much debt, which became a major problem when the ground was sold for far less than expected.

Second, it pushed the boat out too far in buying in players in an attempt to reclaim Otago's position as one of the country's rugby strongholds. It spent close to the $1.3 million salary cap last year as it tried to claw its way out of the ITM Cup second tier.

This urge may have been understandable, but the policy foundered on poor on-field performance, which, in turn, affected gate takings and sponsorship prospects. A $862,000 loss was the upshot.

Otago was not the first provincial union to gamble on buying success. Southland did this a couple of years ago when players from outside the province played a major part in the winning of the Ranfurly Shield. But its ambition also exceeded financial reality, and it had to be bailed out by the New Zealand Rugby Union.

In the case of Otago, the NZRU has decided that its financial plight is too great to replicate this rescue. That is the right course, not least because it sends a message to other provincial unions that they must cut their cloth to suit their circumstances.

Most have already been doing this. On the same day that Otago's predicament was revealed, the Hawkes Bay Rugby Union unveiled a net surplus of $16,797. Last year, it, like Otago, was a second-tier province keen to get back among the elite.

It managed this, while creating a profit which owed much to sponsorship packages. Otago's situation with Carisbrook demanded similar alternative revenue-gathering. If this was impractical, the responsible course would have been to restrict the amount spent on players to something like $500,000.

Hawkes Bay is not alone. According to the Players Association's Rob Nicol, Manawatu, Tasman, Taranaki and Southland have also shown they can operate in the ITM Cup and "break even or make a small profit".

To his list can be added Wellington and Waikato. It is far from easy to balance the books, and some have has to come up with innovative ideas. Ranfurly Shield-holder Taranaki, for example, has a farming project. And it has also tied in sponsorship deals to the end of 2014, a move made possible by the traditional strength of rugby in provincial New Zealand.

This suggests that Otago should also be able to survive if it adapts sensibly to its situation. Better that than trying to make the ITM Cup an amateur affair. In the first instance, it would be virtually impossible to put the professional genie back in the bottle.

Worse, the result would be the exodus of many young players to rich pastures overseas. The provincial competition's traditional role as a breeding ground of talent would diminish and thought would have to be given to making overseas-based players eligible for the All Blacks.

None of this needs to happen. Most provincial unions are already being responsible. If it is to survive, Otago must now do the same. The plight of one union should not be the catalyst for turmoil and dramatic change. Indeed, the New Zealand Rugby Union's stance should signal a more settled period.