The English salary cap - Premiership report due on Wednesday, 4 February

Simmering silently on the back burner have been reports from 20 December last year ( http://www.telegraph.co.uk/sport/rugbyunion/club/11305609/Saracens-and-Bath-under-investigation-for-alleged-salary-cap-breach.html , http://www.dailymail.co.uk/wires/pa/article-2881625/Clubs-face-salary-cap-probe-Report.html).

Saracens and Bath each face fines of up to £10/£1* cap overspend plus (I believe) a points deduction.
*£4/£1 if only for one season.

A useful primer on sports caps in general and an overview of the English Premiership cap is at http://www.lawinsport.com/features/item/the-salary-cap-in-rugby-union

Personally, I hope that the book, the shelves then followed brick by brick, the whole effin' library is thrown at Wray and Craig should they have be caught fiddling the rules.

Not that the rules are in themselves necessarily legal...

Agree. If found guilty, the punishment should be huge. Much like the level that the NRL did a few years back

Its the points deduction that needs to be the deterrent as the fine will barely make a dent in their wallets. Perhaps Welsh will stay up after all...

Got to be about 20 points deduction. Should help us no end

nathan wrote:Got to be about 20 points deduction. Should help us no end

Is that enough? That would still make Champions Cup qualification a possibility. It needs to be enough to stop others, I'd say 50 minimum.

That sort of handicap might put us at a level standing HKC

Bathite wrote:That sort of handicap might put us at a level standing HKC

Why you spending that much over the cap then?

It will be interesting to see if the pumped-up rules of enforcement will be invoked after the October 2013 announcements http://www.rugbyworld.com/news/blogs/new-salary-cap-powers-for-premiership-rugby-33053

nathan wrote:

Bathite wrote:That sort of handicap might put us at a level standing HKC

Why you spending that much over the cap then? ;)

im sure that many of the other teams would hope so. It would give them an excuse.

Bathite wrote:That sort of handicap might put us at a level standing HKC

Its rather flattering that you have been forced to cheat to finally beat us

More seriously if you have been overspending you should get the book thrown at you, but you are also unlucky that so many teams clearly have done this in the past and got away with it.

haha!

If, buts a maybes - let see if there's any truth in the rumours, only time will tell.

I wonder how it would play out if one or two teams were caught over the cap.  

First off is the points deduction.  It would have to be severe.  And if a team is in gross violation of the cap, let's say by +£1 million, then a 50 point deduction would not seem out of the question.  

Second, and more interesting to me is what happens to the current salary structure at the club(s)?  If the hypothetical club is £1 million over, then how do they shed the £1 million and get instantly down to the top of the cap?  Can they simply let some players go mid-season despite having contracts?  Do they scale back all salaries by a percentage to ensure compliance, yet again in the face of valid player contracts?

Thirdly, are there, or could there be, other punishments?  If a team is able to have 50 points deducted yet stay above London Welsh, what have they truly lost?  A few players and one season of playoff money.  That's it.  Doesn't seem sufficient to me.

Finishing eleventh would mean no playoff money, now Champions Cup Rugby and that would effect ticket sales the following season. They'd also have to comply by the start of the following season meaning that a possible fire sale may have to take place with some players sacrificed.

It all depends on the level of overspend. If it's by 100k so they have in effect one more first team squad player than they should is that worthy of a big points deduction.

doctor_grey wrote:
Second, and more interesting to me is what happens to the current salary structure at the club(s)?  If the hypothetical club is £1 million over, then how do they shed the £1 million and get instantly down to the top of the cap?  Can they simply let some players go mid-season despite having contracts?  Do they scale back all salaries by a percentage to ensure compliance, yet again in the face of valid player contracts?

Worst case scenario for a club would be that they would have players contracted that they have to pay, but cannot play.

HongKongCherry wrote:

nathan wrote:Got to be about 20 points deduction. Should help us no end

Is that enough? That would still make Champions Cup qualification a possibility. It needs to be enough to stop others, I'd say 50 minimum.

40 points is the maximum penalt.

Level of breach                  Points Sanction
£0 to £75,000   .                                     4
£75,000.01 to £125,000  .                   10
£125,000.01 to £175,000  .                 20
£175,000.01 to £250,000  .                 30
Over £250,000               .                     40

Surely it's not the penalty that's the problem but that the penalty meted out is sufficient to make it worthwhile to re-offend and to deter like-minded miscreants.

I'd bet that Tigers, Saints, Glaws and (dare I say this?) Exeter are all in the business of 'creatively' pushing the cap. Probably the Quins too

My bet is that the Tigers were well over it in the past and have constrained themselves whilst the Cherries and the Saints are still at it big time (whilst not in the Bath/Sarries league).

Which is a real shame as my true empathy and affection for Northampton would be scarred for life.

Personally I'd simply remove all the points they've scored whilst over the cap.

Heaf wrote:Personally I'd simply remove all the points they've scored whilst over the cap.

And then wait for the legal challenge.

Ffs, if a more than a couple-or-few match points were added to a serious financial fine it'd be disastrous for the Jeff PR-wise.

It depends on what the auditors reveal but I reckon that a severe (say £3/£1) penalty on overspend should suffice for a first offence.

So long as a huge points deduction is promised for any future culprit is assured.













This shows you how naive I am.

Has to be a points deduction, a financially penalty is not going to hurt those with sugar daddies.

formerly known as Sam wrote:
It all depends on the level of overspend. If it's by 100k so they have in effect one more first team squad player than they should is that worthy of a big points deduction.

This is slightly to simplistic a view in my mind fkas.

So Bath are talking to player A, as are Tigers. Tigers offer X amount of salary, Bath offer £10k more and as a result get their man (who is a top player).
So Bath are talking to player B, as are Chiefs. Chiefs offer X amount of salary, Bath offer £10k more and as a result get their man (who is a top player).
So Bath are talking to player C, as are Irish. Irish offer X amount of salary, Bath offer £10k more and as a result get their man (who is a top player).
So Bath are talking to player D, as are Welsh. Welsh offer X amount of salary, Bath offer £10k more and as a result get their man (who is a top player).....

and so on to 10 players and £100,000 over the cap.

10 clubs have missed out on a player and are therefore directly affected, as is the Premiership as a whole as Bath have used going over the cap by a small amount each time to build a top squad. (This is hypothetical by the way and I'm not sure why I selected Bath as an example )

In these circumstances £100k over would be more than 1 first team player and I would expect a a hefty punishment.

You could argue that is also too simplistic. Given the choice I would demand at least 10k more from a London club or say Bath than I would from say Tigers or Falcons as living expenses, property etc is more expensive in those locations.

For 350k you can get a well sized family house in a nice location in the Tigers/Falcons locations. In Bath or London you wouldn't get half the property foot print.

I take your point though. A little to outbid the competition each time may help.

i really hope the clubs involved get really hammered by way of points deduction.
steve diamond recently said that certain clubs are as much as £2 million over the salary cap and I tend to agree with him.
the powers that be must sort this out now as it will ruin our game and end up like the big and small football clubs, it's not a case of them not knowing it's going on is it.

2 million over is a bit of an exaggerated guess I'd have thought. If any team was that far over I'd hope they were instantly relegated. Even if it was my team, though judging from the mediocrity we've been serving up this season and the post season plans it would only help our clean out efforts.

The £2M was (seemingly) based on agent talk. Which you would think would be inflated. So if the upper limit is £2M you'd expect it to be a fair bit less than that. I do think players salaries are generally overestimated.

Only result of the investigation report which we can predict with 100% certainty is we know this thread will be busy.

We will be:
1.  Gratified with the investigation results and sanctions handed out as well as actions going forwards
2.  Uncomfortable with sanctions which have the whiff/smell/stench of political compromise
3.  Fuming that there was an apparent whitewash
4.  All of the above  

My personal expectation is violations will be found.  However, I further expect there will be indications of irregularities (a.k.a. payments) somehow outside the scope of the investigation, so sanctions will be on the lighter side (if any), but 'new regulations' will quickly be put in place to close those loopholes. They will likely require immediate or end of season compliance.  In this way, everyone amongst the principles goes home somewhat contented (also somewhat discontented) and life goes on.  Mark it down now, mes amis.  

Hoping I am wrong.

Guys the sanctions that will be applied are not a mystery. They are in the 2013/14 Salary Cap document and have been outlined in various posts.

Full details here: http://www.premiershiprugby.com/downloads/SalaryCapRegulations201314.pdf

Put simply there is a Fine AND points deduction.

The points is a maximum of 40 (for a £250k) breach.

The fine varies from £3 per £1 overspend (applies when overspend has been a single season) up to £10 per £1 overspent (when the overspend has happened in two previous seasons).


So if a club was £2m over as Diamond alleges they would get a 40 point deduction and a £20m fine. The points penalty applies immediately so long as judgement reached before round 22.

Wow the £20m fine would pretty much end a club.

Sorry missed a bit. £20m fine assumes the club exceeded cap (by any amount) in two previous years also. Minimum fine would be £6m.


Confidentiality clauses do mean we would be told limited info, but they cannot hide the points deduction

one thing for certain regardless of the amounts of money involved any clubs paying over the top should get hammered.
I like most others on this site just look forward to a game at the weekend but we are not stupid and it is quite clear that bath and sarries are both paying over the odds.
steve diamond may have exaggerated the figure a wee bit but he like most of us are fed up with not being able to compete. £5 million per club was meant to represent a level playing field.

If the clamp down on over-sending by the teams mentioned above is indeed as severe as being mentioned above, it will make me relook at some of my thoughts on the English game, and the PRL's influence on it. It's hugely impressive if such fines are stuck to, and may well halt momentarily (but not stop permanently) the massive wage inflation occurring in Europe and even curb some of the French excesses. Here's hoping if breaches were made, the rules are followed.

Wolf, If you follow the link supplied by LT a few posts up, the 56-page document appears to be very prescriptive and (beyond auditors' financial interpretations*) appears to leave little wriggle room for flexibility in the sanctions.

*Aye and there's the rub.

[ed] Plus the legality of caps remains un-tested. And I'd be surprised if there wasn't one if the penalty is extreme.

doctor_grey wrote:Only result of the investigation report which we can predict with 100% certainty is we know this thread will be busy.

We will be:
1.  Gratified with the investigation results and sanctions handed out as well as actions going forwards
2.  Uncomfortable with sanctions which have the whiff/smell/stench of political compromise
3.  Fuming that there was an apparent whitewash
4.  All of the above  

My personal expectation is violations will be found.  However, I further expect there will be indications of irregularities (a.k.a. payments) somehow outside the scope of the investigation, so sanctions will be on the lighter side (if any), but 'new regulations' will quickly be put in place to close those loopholes. They will likely require immediate or end of season compliance.  In this way, everyone amongst the principles goes home somewhat contented (also somewhat discontented) and life goes on.  Mark it down now, mes amis.  

Hoping I am wrong.

Seems about right. My guess is there is a lot of " not proven" so penalties are very light

Yeah. I agree.

In other words, entire issue will most likely be fudged.

There will be no FudgeGate!

It will be clean, mannerly, all-above-board and all extremely well reasoned.

"Them lads, wot do be doin' the bad things like - it's not their fault in a way.  It's the mental pressure, see.  The mental pressure of struggling against the giants of France, who got it all their own way and everything with the chequebook stuff with the blank pages and all.  
And they'll [the French] be buying up anything of any value at all after the WC if we don't get our skates on, start living in the real world of Professionalism, and not be so ready to blame some forward thinking, humble rugby club owners who have nothing but the best interests of everyone at heart when they tried to dodge the Cap.

Let's agree they're guilty of the 'crime' - but hail them as visionaries of a new dawn and drop the Cap or we'll be left behind by clubs like Zebre and Edinburgh in a few short years."

The Cap Will Go - it's only a matter of time.  Wray will have his Way, by hook, crook or direct capitualtion of his enemies.  To paraphrase Chief Wiggum in the Simpsons movie; "He [Wray] is England's problem now"

secretfly we can't have France running away with the salary cap - England must be competitive. The way to stop the salary cap to rise is convincing the French.....

I don't agree with breaking the cap but I can understand why Wray and Craig would want to.

You like to demonise Wray, he's evil that bloke....

He's a hugely passionate Saracens fan, a down to earth guy , he's not a sanctimonious owner who lives in his ivory tower, he's frank and honest about his opinions, you might not like what he says but at least he's up front. He's tried his best to help Saracens - his local club.

I respect Wray - don't agree with everything he does, he's not perfect but he tries to do what he thinks is best for his club.

What happens if more than half the clubs have been found to be cheating? If they all get punished with points deductions then they all end up in relatively the same position

Also how about the effect on the Euro cup?

beshocked what would happen to Saracens if Wray was to up sticks and leave ? Is he ploughing money into a club that cannot sustain the outgoings ? If he is and he then gets fed up and leaves, Saracens could cease to exist.

I do think the deficit funding that some clubs run is a huge issue. Making multimillion pound losses on playing budgets is not sustainable. its different perhaps if its bricks and motar

Lorddowlais it's Johann Rupert that is the biggest money backer now. Wray is the chairman and front man but in terms of funding, Johann Rupert and family have taken the slack I believe.

I think there is too much money in London for someone not to pick up Saracens if Wray leaves IMO.

10k stadium in a good part of London, great land and property - nice catchment area.

Potential is there to be financially liable IMO. Wray has given Saracens that security.

As for reputation that doesn't mean much, Quins easily recovered from Bloodgate, admittedly it helped getting a paltry punishment.

beshocked wrote:Lorddowlais it's Johann Rupert that is the biggest money backer now. Wray is the chairman and front man but in terms of funding, Johann Rupert and family have taken the slack I believe.

I think there is too much money in London for someone not to pick up Saracens if Wray leaves IMO.

10k stadium in a good part of London, great land and property - nice catchment area.

Potential is there to be financially liable IMO. Wray has given Saracens that security.

As for reputation that doesn't mean much, Quins easily recovered from Bloodgate, admittedly it helped getting a paltry punishment.

Its all if's and but's though beshocked, does your club spend more money than it generates ?

beshocked wrote:secretfly we can't have France running away with the salary cap - England must be competitive. The way to stop the salary cap to rise is convincing the French.....

I don't agree with breaking the cap but I can understand why Wray and Craig would want to.

You like to demonise Wray, he's evil that bloke....

He's a hugely passionate Saracens fan, a down to earth guy , he's not a sanctimonious owner who lives in his ivory tower, he's frank and honest about his opinions, you might not like what he says but at least he's up front. He's tried his best to help Saracens - his local club.

I respect Wray - don't agree with everything he does, he's not perfect but he tries to do what he thinks is best for his club.

Which now, and belatedly, seems to run contrary to what other PRL clubs consider 'Best' for them?  
It's only now that owners of those smaller clubs realise that Wray is out for his own interests (his prerogative of course) And that self-interest will be to argue and cajole the PRL into 'Accepting' hard facts that 'English rugby' must compete with the French.  Even if he's found guilty, that argument in him won't die - it will increase; and in time he'll gain more allies amongst the bigger PRL sides who will see his reasoning.  The others (like the smaller European clubs before them) will be asked to sacrifice themselves to the glorious future that's coming.  The others will be coaxed to accept 'the market' and be prepared to implode so that the natural balance is found in where money and fans really want to go to (mainly a flush top four or five teams in the League)

I'm not going against his reasoning at all.  I'm the one who has always maintained that after (and only after) Wray got his way in European rugby management terms, would he then chase down the English capping system and call it outdated and against the best interests of English rugby.
I said all this a year ago when the whole thing was boiling over and I was told by English fans that I was going down a totally wrong alley and that the ending of the capping system would never happen; and, indeed, that Wray himself was against the idea.
I kept insisting that the Cap will be chased down next and it's happening - this is just another well planned chapter of making the cap an issue and an issue of contention and debate.  Whatever the outcome, the debate now has fired and it will increasingly become a contentious issue within the PRL itself.  
Because YES, it is inevitable that English rugby would try to find parity with competitor clubs in France - it's inevitable.  But Wray didn't bring these thoughts with him to the European debate (when he might have actually found allies in the Pro12 for reeling in Top14 'inequalities').  But nope, Wray wasn't for making allies with Pro12 then so he chose instead to lie in bed with the super-rich France until he took care of his weaker targets in Pro12.

So yeah, I don't have a lot of time for Wray.  I think it's plainly natural why.  To me he's a Robet Maxwell type - says anthing to pretend he's a innocent philantropist but behind the veneer sits the snake trying to create the world to suit his own personal pocket.

I don't think that many "professional" clubs are actually self sustaining these days - possibly only Tigers, Quins and Exeter in the Jeff, they all rely on "benefactors", whether as commercial sponsors, or like the Walkinshaws at Glaws acting as a benign support or the more directly involved "my money, my gaff, my rules" style of Wray and co. at Sarrries.

Of course the influx of TV money has been a bit of a game changer and all the pro clubs still get a lot of funds from the RFU.

It would be quite funny though if the teams who made so much fuss about the new "Champions Cup" format missed out on it next year and had to join Zebre, Connaught and Rovigo in the "little cup"  

Roll on Wednesday.

Secret Fly - I do agree with you that Wray is determined to basically to turn rugby into a soccer style system where the rich get richer and "devil take the hindmost", but what I don't see is where they get a return on their investments given the comparatiely small amount of money pro rugby generates.
I think that this is more about ego than money and his mission is to make Saracens the best club in Europe whatever it costs  - more an Abramovich than a Glazer approach.

Irish Londoner wrote:Secret Fly - I do agree with you that Wray is determined to basically to turn rugby into a soccer style system where the rich get richer and "devil take the hindmost", but what I don't see is where they get a return on their investments given the comparatiely small amount of money pro rugby generates.
I think that this is more about ego than money and his mission is to make Saracens the best club in Europe whatever it costs  - more an Abramovich than a Glazer approach.

A return in investment comes from the 'Worldisation' of Club rugby.  A return in investment will come from what Wray and his kind see as the globalisation of the club game.  

I have no doubt that he envisages his Saracens side eventually playing 'league' games or 'European' games wherever the highest bidder for such a product might be in any given year.  And for him that's not necessarily Europe.  He wants AP club sides playing big games against each other in USA or Japan etc [spreading the gospel].  

He wants his 'Saracens' BRAND to become like you just say, a football brand, a Manchester or a Barcelona - a world Brand, not just a European one.  He wants Jamaican and Mexican and German and Indian kids buying Saracens shirts and watching AP or European Rugby at the weekends.

But first he has to make a big impression here in Europe, he has to suck in all best rugby players/coaches to Europe - he has to drain the SH of their stars and for that to happen he needs a blank chequebook to meet the French with; and if that happens, we get to see truly massive bidding wars between top AP and Top14 sides.  And that creates business, and news, and spectacle, and showmanship, and bigger sponsorship deals, and more TV interest etc.  

And eventually, despite themselves, the SH players and coaches will eventually see that their 'club' futures are in Europe from an earlier period than the present.  Europe becomes the club homeland for highest grade club rugby and that produces a massive worldwide market to recoup the initial outlays.  

I firmly believe that's what his sights (and other likeminded English and French owners) are set on but it's an elitist pathway that casually and heedlessly consigns small things and little nations to the scrap heap beneath market-driven 'progress'.  Therefore I can't buy it... it's self defeatist for Irish people to buy it.  But I can understand how English people would be excited by it.

Slow yourself down there Fly. English people, as far as I am aware, as a group are not remotely excited by this.

I want my club run properly, and to be self sustaining, and that's what the new board are trying to achieve. I agree with you as to what the Saracens/Wray plan is, but believe me, very few are buying into it, certainly from within the PRL. It is a club of 2 who want the cap abolished (I'll leave you to work out who the other is), there is no support for that from the other AP clubs.

Ozzy3213 wrote:Slow yourself down there Fly.  English people, as far as I am aware, as a group are not remotely excited by this.

I want my club run properly, and to be self sustaining, and that's what the new board are trying to achieve.  I agree with you as to what the Saracens/Wray plan is, but believe me, very few are buying into it, certainly from within the PRL.  It is a club of 2 who want the cap abolished (I'll leave you to work out who the other is), there is no support for that from the other AP clubs.

You should read more 606  
Over the years I've heard it all....

/there should be games between the winner of HEC and Super League at the end of each season - it would be great, it would be smashing etc etc.  

/Saracens (was it?) either playing or organising to play some league games in Dubai or somewhere HOT a few years back?  

/Pro12 defenders getting told clearly and bluntly that the world has moved on, no free dinners, market forces are going to increasingly drive the game, sacrifices must be made for the 'growth' of the game in new territories,

/"helping out" the minnow nations that have BIG potential for BIG money - Russia, Japan, USA etc

/Staging AP league games in America to spread the word (like American Football do in reverse every so often)

I've heard lots of discussions that tell me it's not as clear cut as you think Ozzy.  I think a sizeable section of English rugby fans are salivating at the idea of the very Top rugby players in the world turning up to their League and being only a bus drive or a train ride away weekend after weekend, in a new exciting world where English rugby could finally meet and eclipse the domination of French rugby. That can only happen if they're allowed the opening to enter bidding wars.  

And I don't think that's a train that can be stopped now, Ozzy.  The first stage was Europe Competition - but that was only a first step.  You, as English club fans, will now increasingly hear the appeals and marketing logic from your club owners (and PRL overlords) that will attempt to bring you all around to the idea that the future is out there and it's true equality with Top14 buying potential.

Wanting to grow the game globally is not a problem, or shouldn't be. That should be what all rugby loving people should want, to share our wonderful game. Taking it to places that could potentially sustain growth and develop into top national outfits also has to be beneficial.

Trying to take over the world game by concentrating all of the stars in one place (the AP/Saracens/wherever) is not what should be being strived for.

Ozzy3213 wrote:Wanting to grow the game globally is not a problem, or shouldn't be.  That should be what all rugby loving people should want, to share our wonderful game.  Taking it to places that could potentially sustain growth and develop into top national outfits also has to be beneficial.

Trying to take over the world game by concentrating all of the stars in one place (the AP/Saracens/wherever) is not what should be being strived for.

I agree wholeheartedly with that sentiment but that's the problem.  I don't see how the two are compatible or can co-exist without one trying to eat the other - I can't see how rugby businesses (Saracens for example) would believe in 'sharing' the game yet not wanting the financial spin off to be an increased interest in their own products and brands (AP/ERCC etc).  

Increasing knowledge of the game in areas not yet familiar with it is hard, hard business as much as it might be a touch of genuine philanthropy - the pay off is increased global awareness of specific products and brands and increased marketing potential/earning capacity because of it.

And increased earning potential is self-perpetuating - a bigger and bigger slice of the market is the goal all the time so as to increase earning potential still further.  Better then to have an newly converted east coast USA kid not actually watching rugby based in the USA at all but instead subscribing to the 'best rugby in the world' back in Europe.  The idea isn't always to spread the game to other parts of the world but to spread the audience for the game that already exists in traditional parts of the world.  Subtle sounding but dramatic difference.

Anyway.........  that's my treatise for today.   I'm exhausted and think I might go watch a movie.  Ciao for now

Ozzy3213 wrote:Slow yourself down there Fly.  English people, as far as I am aware, as a group are not remotely excited by this.

I want my club run properly, and to be self sustaining, and that's what the new board are trying to achieve.  I agree with you as to what the Saracens/Wray plan is, but believe me, very few are buying into it, certainly from within the PRL.  It is a club of 2 who want the cap abolished (I'll leave you to work out who the other is), there is no support for that from the other AP clubs.

Spot on Ozzy. Glaws have made a profit 4 years on the trot and I am immensely proud that we are self sustaining. It's far more important to me to know we'll still be around in 20 years than to have a brief moment of dominance until the wheels fall off. The only way the cap will go is if the majority of the 14 clubs with a share in the PRL vote for it and as it stands only Sarries, Bath and Bristol would gain from it. Saints, Glaws, Tigers, Quins, Wuss and Exeter are all successful enterprises but would be massively stretched if the cap was scrapped. Irish, Sale, Falcons and Welsh would either need a sugar daddy or they'd not be able to compete Wasps are probably in the latter category at present. I just can't see the bulk of Jeff chairmen commiting hari kiri. From a political sense I am all for the free market but in this instance the restriction of the cap is for the benefit of all.

Tick, tick, tick.