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Rugby Football Union insiders fear the governing body could be forced to sell Twickenham or axe its grass-roots programme if England faced the "doomsday scenario" of relegation from the Six Nations under World Rugby's proposal for a new Nations Championship, The Daily Telegraph can reveal.
It is understood the concerns are not restricted to the RFU, with another Six Nations source claiming the potential financial impact for a union that is relegated could be "cataclysmic".
The revelations will come as a blow to World Rugby's hopes of securing agreement between the unions to sign up to the new tournament by April 5, having already postponed the deadline from March 29.
The unions are currently analysing a 27-page document that was sent to them this week by World Rugby, providing further details of the new global tournament, which is backed by a £5 billion investment by Swiss-based Infront Sports, owned by Wanda, a Chinese multinational conglomerate. The new tournament, which would start in 2022, would involve a 12-team league, with results from the existing Six Nations, an expanded Rugby Championship and summer and autumn Tests contributing towards the final standings. The top two teams would play off in a final.
The plan to introduce relegation and promotion to the Six Nations and Rugby Championship from 2026 is causing grave concern, however, both for financial reasons and for the integrity of the tournament. Several sources indicated that the Six Nations are not against opening up the championship but only when the countries currently involved in the second-tier Rugby Europe tournament are far more developed.
Questions are also being asked about whether addressing the financial pressures of the southern-hemisphere unions and increasing the competitiveness of the Tier Two nations would be more effectively resolved by retaining the Six Nations in its current format and using its economic power and profile to drive change with less risk.
While the World Rugby tournament is promising a £10 million uplift per year to each of the 12 competing unions over the next 12 years, there are widespread fears about the negative impact relegation would have on ticket sales, corporate hospitality, domestic sponsorship revenues and debenture sales. That scenario is aggravated by the fact that given that there would be no nations championship in a World Cup year and no relegation or promotion in a Lions year, any team relegated in 2026 – even though they would remain in the 2027 Six Nations – would then effectively fall out of the top tournament until 2030.
A view of Twickenham Stadium. Photo / Photosport
A senior RFU insider warned that the consequences could be dire for the governing body, given that 90 per cent of its £172 million revenue was generated last year by matches involving the senior England men's team. "This is not about the Six Nations selfishly protecting themselves – it's about understanding the financial reality of governing bodies and their wider responsibilities to the game," said the source.
"And you can't make simple comparisons with football clubs. Our fixed costs and obligations to the game are much greater. Any sharp reduction in revenue would be impossible to manage without unions potentially defaulting on their obligations, which could even include having to sell stadiums or dismantle community programmes. This is not about protectionism – a credible Tier Two structure has to be urgently developed by World Rugby before relegation can seriously be considered, because at the moment there is nothing but a void, which looks like a drop into oblivion."
Another source said: "While it might seem unlikely for a top team to be relegated, it is a risk, and we have to ask if the risk is worth the reward. We also have to consider just what the Six Nations will look like in 12 years' time when it might be handed back to us if the national championship does not continue."
Last year the RFU spent £37 million in the community game.
Given that the Football Association recently considered selling Wembley because of the scale of operating costs, RFU insiders fear they may have little choice but to sell Twickenham if England were relegated.
The RFU has just completed an £81 million investment in corporate hospitality facilities in Twickenham's East Stand, but it did not sell out for all of the autumn or Six Nations this season and it is concerned that if it was ever relegated to the second tier it would have a massive impact on ticket prices and revenues.
The RFU business plan is based on a four-year cycle, and dealing with a huge drop in revenue halfway through a cycle would be extremely difficult to absorb, particularly given their well-documented financial pressures in which they must make cuts of £10 million next year.
"We support growing the game and are very aware of our global responsibilities," said an RFU spokeswoman. "However, the challenge is that there is currently no credible Tier Two competition. If and when one exists, and is established, and has a robust commercial model, it might become less of an issue."
World Rugby insists however that any union that is relegated would be guaranteed to receive its current Six Nations and autumn internationals media/title sponsorship revenues through to 2033.
"We believe that the Nations Championship will provide unprecedented investment in our unions and the global development of the game, with no financial downside," said a World Rugby spokesperson.
"Importantly, the concept provides a much-needed opportunity to expand the game, enabling more teams to advance on the world stage.
"Under the Nations Championship proposal, World Rugby would significantly invest in second divisions in the north and south and in the competing unions to ensure a competitive and compelling annual competition."
