WRU face huge challenge from the west

Welsh rugby is once again at a crossroads after yet another period of tremendous upheaval

The WRU are facing a challenge from west Wales clubs Scarlets and Ospreys. Pic: Huw Evans Picture Agency

There is never a dull moment in Welsh rugby.

Just when things looked to be settling down and a new Professional Rugby Agreement was nearing completion, Cardiff entered administration, prompting the Welsh Rugby Union to assume ownership of the capital city club.

It was the right move by the WRU and there are very few people who would argue against that decision, but it has evidently caused issues elsewhere and has put the brakes on the new PRA.

Cardiff's situation has put a significant spanner in the works.

The WRU are desperate to get the PRA over the line because a deadline has been set by NatWest to refinance the debt acquired by all four professional clubs - Cardiff, Dragons, Ospreys and Scarlets - during Covid.

The WRU is looking to take on around £35m of new debt which would refinance its existing NatWest and Welsh Government facilities of £30m.

There is Welsh Government debt of £12.5m which was passed through to the clubs via the WRU. The idea is to increase funding but crucially improve the balance sheets of the clubs by taking away the debt they acquired during Covid.

But the banks will not agree to refinance the debt on the current PRA because any uplift in income is supposed to go to the four professional clubs, which they see as too much of a risk.

But on the flip side both the Ospreys and Scarlets currently see it as too much of a risk to sign the new PRA, which has created a stalemate.