Seven Premiership clubs deemed balance sheet insolvent as rugby ‘heading for financial precipice’

The precarious financial state of most clubs in the English top flight has been laid bare

(Getty Images)

The precarious state of finances within English club rugby has been laid bare by a new report warning that seven of the 10 Premiership are balance sheet insolvent.

A comprehensive study by insolvency firm Leonard Curtis assessing the financial sustainability of those within the English top flight has found that only Leicester, Northampton and Gloucester would be viable businesses without the backing of wealthy benefactors.

The analysis, reported in The Guardian, comes from the latest publicly available and audited financial figures from the 2022/23 season, a campaign in which London Irish, Wasps and Worcester all folded after entering administration. Championship side Jersey Reds also ceased trading last year.

Neither Premiership Rugby nor the Rugby Football Union (RFU) were involved in the report, which finds that clubs collectively lost more than £30m in 2022/23. Overall net debts within the league total £311m.

Former England flanker James Haskell warned that the sport is “heading for a precipice”.

“This is now a line in the sand moment where all the spin and bravado around how rugby is faring needs to stop,” said Haskell, who won 77 international caps and played club rugby in England, New Zealand and France.

“Rugby for me appears to believe that just because we have always done it in a certain way that is the right way, when it’s clear that unless drastic change happens our game is heading for a very untenable position in the future. We say we are professional but in my humble opinion we are far from it and at times resemble the wild west.

“I don’t have an axe to grind but I saw first-hand from the age of 16 to 35 the mistakes being made in the sport and just how badly things are done in almost every aspect.

“Rugby is heading for a precipice. I think they’re rearranging the deckchairs on the Titanic with some of the rule changes they’re trying to bring in. I’m telling you now there are warning signs everywhere. If I was a rugby player, I’d be terrified by this report.”

James Haskell has warned that English rugby is ‘heading for a precipice’ (Getty Images)

All Premiership clubs rely on backing from their owners to sustain themselves. Nine clubs ran up losses of more than £1m in the 2022/23 campaign.

It is a model that also exists across the Channel in France, though television revenues for the Top 14 and Pro D2 are significantly higher than for the English top flight. The Premiership’s new deal with TNT Sports is understood to be worth less than under the previous rights agreement.

The renegotiated Professional Game Partnership (PGP) agreed with the RFU guarantees Premiership clubs £3.3m in funding from English rugby’s governing body. Steps have also been taken at a number of clubs to reduce their wage bills this season despite the league’s salary cap rising again to £6.4m a season.