Suggested NPC salary cap may be ineffective

By CHRIS RATTUE

If you can get through rugby's latest competition review with a clear head, and a clear understanding about what lies ahead for the game on the domestic front, then take a bow.

The report, in clear black print on bleach-white paper, is as grey as a winter's day on many issues. A fitting conclusion to its 24 pages would have been, "More will be revealed".

The report was delivered to the public with little ceremony in Hamilton last Saturday. It was a toss-up as to whether "New Zealand Rugby Union Competitions Review - Executive Summary" or the test match that followed deserved more yawns.

The document may contain hugely significant changes for the game. Then again, it could just as easily become another instant museum-piece.

Not that this is entirely the NZRFU's fault. But quite clearly, the shape of the game within New Zealand will largely be dictated to by the search for more revenue - mainly through the international programme. The pressure to revamp and extend the Super 12 will also be a huge factor. And those two subjects are in the "who knows" basket right now.

The report is clear on one matter. The three-division NPC will be scrapped, replaced by a premier division of up to 12 teams and a first division of up to 15 teams, "no later than 2006".

The top division will have a five-team finals series, and is rated as a professional/semi-professional competition.

Division one is amateur - players will be "reimbursed for costs". Even here, though, the rugby union has yet to decide if two pools will be needed, because the number of competing teams has yet to be determined. The Ranfurly Shield will remain in its present format.

The big news is the introduction of a salary cap, which aims to curtail what is portrayed as out-of-control wages - the NZRFU says the average first-division bill has increased by 40 per cent in two years to reach $1 million - and to level the playing field between the major unions and also-rans.

The even bigger news, however, is that the cap level has yet to be determined. And the real implications of a salary cap are unfathomable unless this is known. For example, if it is set at $5 million, nothing will change.

Having a salary cap at all in this country is something of a misnomer, since the national union will already be paying the top players substantially more anyway through their Super 12 contracts.

The setup of rugby in this country, where all the significant contracts are paid by the central union, is completely different from the Australian rugby league competition, where each club pays the players under a cap system.

The NZRFU report says the earnings that will have to fit under a cap will include some of the players' Super 12 salary but again, crucially, it does not say how much.

And, as NZRFU assistant chief executive Steve Tew conceded, salary caps are not foolproof.

"They're hard to design and very difficult to police. They actually require the co-operation of people involved in it."

The National Rugby League experience suggests that salary caps have a minimal impact in swaying the balance of power.

The NRL cap was intended to save and aid clubs such as Wests and Souths, former city strongholds stripped of junior strength. Yet Souths and Wests are no closer to winning titles than they were in the pre-cap days and just about all the game's stars remain in the glamour teams like Brisbane, the Bulldogs and Roosters.

In fact, what the cap may achieve in rugby is allowing the big provinces to run their teams more cheaply while still retaining their strength.

Top players are sure to stay with big unions for maybe only slightly less money, knowing it is best for their careers and that smaller unions will struggle to match the pay anyway.

The big unions will be able to bargain by telling player agents, quite truthfully, that their hands are tied by the cap.

Major doubt must remain as to whether an artificial mechanism such as salary policing will even go close to creating a more even competition - and smaller provinces may in fact suffer through the temptation of using big-union offcuts who are here today, gone tomorrow.


And then there is the curliest of all the questions: Will the All Blacks still play in the domestic competition, which of course leads back to the questions over changes to the test and Super 12 seasons?

On this matter, the report contains a major NZRFU u-turn. Late last year, the union said the All Blacks would continue to play in the NPC for only two more seasons. Now it says they will remain involved until more major tests are added to the international programme - something that is inevitable as the national union searches for more revenue.

So this may well turn out to be the u-turn you have when you are not having a u-turn. It seems inevitable there will come a day, and not too far away, when current All Blacks no longer play in the domestic competition.

At that point - with the Super 12 and test programme being extended - public interest in the domestic competition will be minimal anyway.

The NZRFU has also taken minor steps to reduce the advantages that host Super 12 unions have in terms of the domestic competition.

It considered separating the all-important chief executive positions, and even the administrations.

Instead, it went for what appear to be cosmetic changes, altering the make-up of the boards and prohibiting the chairman of the franchise board from also heading the host provincial union.

You can feel competing forces at work though in this area, where smaller unions complain they are outside the sphere of influence, and so lose out on the best players. It is here that you can sense an NZRFU reluctance to make truly radical changes by actually taking on the big unions and stripping their dual influence in the Super 12 and NPC.

The NZRFU knows that the most successful Super 12 sides in this country have been based around one-union teams. The same applies in Australia, whereas the more fragmented South African franchises have dragged the chain.

If the power of the big unions was really dismantled to create an even domestic competition, New Zealand's Super 12 sides could actually suffer.

Tew, more than anyone, would know that, having helped pioneer the successful Crusaders system which stockpiled some of the best talent from around the country.

The report has received a mixed reaction.

Waikato chief executive Gary Dawson said players would prefer to go overseas rather than be forced to join uncompetitive and poorly run teams here.

He said the NZRFU's non-Super 12 player minimum payment level of $10,000 had helped send his union's salary bill from $300,000 to $1 million, partly because Super 12 players wanted increases to maintain relativity.

Players also wanted increases to compensate for the NZRFU holding their contract payments down.

"We also think that even with a salary cap you are still going to get a wide divergence between, say, Auckland, Wellington, Canterbury, us and the rest," Dawson said.

Canterbury chief executive Hamish Riach fears the cap may drive more players out of the country.

"My concern is not so much with the younger players coming through. It's more with the older, experienced players that can be squeezed out and will then look to go overseas."


Otago chairman Ron Palenski said changes would have little short-term effect on his union.


"There is a lot of detail to be worked out with the salary cap. No one knows yet what the ceiling is ...

"Long-term, I just don't know. We'll just have to wait and see what shape it takes.

"The average fan should be happy that they're trying to ensure the long-term future of New Zealand rugby. If nothing had been done, you couldn't guarantee that."

The bottom line may well be this: As long as All Blacks play in the NPC, the big unions will continue to dominate. They will move heaven and earth to keep their best players, who will not want to move to small unions.

Maybe the only way to really bring about a level competition would be to completely separate the unions and Super 12 franchises and also introduce a genuine draft system whereby the least successful teams at any time get the preferential picks - with the NZRFU paying the wages. This report stops well short of creating that sort of upheaval.

And when the dust really settles in the professional era, and the top players are removed from the domestic competition, it will become a low-profile feeder system anyway.

Is this report an attempt to level the playing field, or window-dressing to keep the minnows happy? Possibly a bit of both.

Without far more radical changes, market forces will surely continue to have their way.

The Major Changes

* Three-division NPC replaced by a premier division of up to 12 teams and a first division of up to 15 teams, no later than 2006.

* Division one is amateur.

* Introduction of a salary cap, level yet to be decided.

* All Blacks continue to play in NPC until more major tests are added to the international programme.