Phil Gould - NRL needs to consider setting minimum and maximum salary cap for clubs

[DC_fan]

One thing I cannot understand about the salary cap negotiations is why the NRL is so obsessed with this notion that the salary cap level has to be the same for all clubs.

I don't want to get into a debate between the NRL and Players Association over these CBA negotiations. What I do know is that the two parties are still far apart and it may take months to reach a resolution. That's a bad result for the game. The 16 NRL clubs need to manage their businesses and to have such uncertainty at this late stage leading into 2018 is unbelievably frustrating for all stakeholders in the game.

I will write more on this subject another time to try and cut through the politics and explain the realities of the situation. It's quite a complex situation. The discussions are hampered by a real lack of transparency and communication. As a result, relationships are fractured. With no relationships comes a lack of trust.


Dress it up anyway you like, that's the biggest inhibitor to these talks and until trust is established, we won't reach a satisfactory resolution.

However, I do want to talk to one point.

Arguing over whether the salary cap is $8.5m, $9m, $9.5m or $10m is ridiculous. It's not going to make that much difference.

The NRL is giving all 16 clubs $13m in funding.

Some clubs want to retain as much of this money as possible to ease the financial pressures on their businesses.

As a result, we have some clubs lobbying for a salary cap as low as possible. Other clubs obviously want a salary cap as high as possible.

The NRL seems to think it's important the salary cap should be level for all clubs.

The NRL has this philosophy that it is responsible for keeping all teams equal.

Well, NEWS FLASH: the competition is not equal now. It never has been. It never will be. There will always be stronger and weaker teams every season.

If the NRL had its way, all teams would be identical.

If that's the case, which team in the competition represents the NRL's model of the perfect team.

Should we be striving for all teams look like the Melbourne Storm or the Cronulla Sharks?

I'm assuming we don't want all teams to look like the Knights.

Are the Broncos the prototype?

Do we weaken the top teams and strengthen the bottom teams so all teams are level and maybe look like the Rabbitohs, Bulldogs, Warriors or Panthers as they do today.

The NRL salary cap rules produce a wild fluctuation in fortunes for most clubs. They have a window of opportunity for a couple of years at the top, before descending back towards the cellar to regroup and regrow for their next good period.

The only clubs who never descend to the absolute depths, or who always seem to be able to bounce around the top 8 every year, are those clubs with significant corporate support through Third Party Sponsorships for players.

The NRL claims the competition is equal.

Well, some clubs are simply more equal than others, and on a regular basis.

The public aren't blind. They can see the competition is not equal. Why pretend they it is?

It is my belief that the NRL should not be responsible for making teams equal.

What the NRL should be doing is providing the structure for all teams to be the best they can be.

It's up to the clubs themselves to work on their own competitiveness.

But at all times the club also has to work on its own financial sustainability, along with investing in its own business along the way, providing professional facilities, trained coaches and staff, and development programs for future players.

So, what if we said to the clubs, there is a maximum and minimum level you can spend on the salary cap.

You can spend any amount up to $9.5m, but you must spend at least $8.5m.

Then it's up to the individual clubs how they run their businesses. If you need the money to invest in your business and you only want a team worth $8.5m on the field, then that is your prerogative. It's actually responsible financial management.

Last season almost $30m of NRL money was used to prop up clubs which are struggling financially. Rather than setting a salary cap level that causes them financial stress, allow them to spend less.

But it's up to that club to answer to its fans.

Tell the fans that for the next few years we can only spend $8.5m because we have financial realities that have to be met. But in 2020, we will be in a position to spend $10m and have a real crack at this title for you.

Make it transparent for the fans. Tell them you are only spending $9.5m or $9m.

But no way should these clubs be dictating to the other clubs that they need to restrict their spending to hold them back to the field. Everything keeps being held back to our lowest common denominator. How does that help the game?

Right now the competition is not equal anyway.

At the moment some clubs have much more than a millions dollars in third party sponsorships outside the nominated salary cap level. Don't pretend for a moment that's not true. Announce the total levels to the fans. Let them know what they are up against.

You may or may not agree with what I'm saying, but I just don't see why we are so obsessed with all teams being equal all the time.

Let the clubs have the freedom to govern their own competitiveness and financial stability through responsible management.

Stop all this senseless bickering over a few hundred thousand dollars here or there.

Whether the cap is $9m or $9.5m means nothing in the overall scheme of competitiveness.

Set a maximum and minimum level for the salary cap, and then let the clubs decide how they run their business each year. The clubs then have to answer to the fans for their performances. The NRL shouldn't have to.

There are more important matters to resolve.

Having said all that, I know there is no one down there at head office who would even contemplate such a decision for fear of criticism.

And therein lies much of the game's current problems.


Read more at http://wwos.nine.com.au/2017/06/16/...-salary-cap-for-nrl-clubs#MsPlrhpUHhOXgeLp.99

 

[OldPanther]

I like it. Do that + give more incentive in the cap for long term club players.

 

[Perth Red]

Very simplistic Gus, the NRL is responsible for creating a competition that maximises interest, revenue and growth in the game. Having teams as equal as possible on the field whilst ensuring they don't go broke off it does just that. What with this min cap nonsense? If clubs don't want to spend the full cap now they don't have to, I am not aware of any NRL ruling that says they have to spend up to full cap?
The reality of clubs financial strife is poor management, poor fan engagement, poor player behaviour leading to lack of corporate support and to some degree a centralised funding grants system that dishes money out to all clubs the same regardless of financial realities (and maybe over saturation but lets not go there ).

The game is rife with self interest, be at individual club level, group club v NRL level, RLPA player level and to some degree NRL leadership level. It may be a bit socialist but a comp of even teams on and off the field is far more likely to be healthy and interesting to customers than a comp of haves and have nots and clubs going broke and needing bailing out.

With the NRl needing to deliver 8 games a week to meet its obligations they cant just let clubs do what they want and hope they don't go bust, no matter how much you might want them to Gus.

 

[WaznTheGreat]

lol the salary cap doesn't even work,the Storm are headed for like there 6th minor premiership in the past decade this season.

How is it a level playing field if the same team keeps coming first and the same donkeys like the Eels keep missing the 8 every year? lol

 

[OldPanther]

Very simplistic Gus, the NRL is responsible for creating a competition that maximises interest, revenue and growth in the game. Having teams as equal as possible on the field whilst ensuring they don't go broke off it does just that. What with this min cap nonsense? If clubs don't want to spend the full cap now they don't have to, I am not aware of any NRL ruling that says they have to spend up to full cap?
The reality of clubs financial strife is poor management, poor fan engagement, poor player behaviour leading to lack of corporate support and to some degree a centralised funding grants system that dishes money out to all clubs the same regardless of financial realities (and maybe over saturation but lets not go there ).

The game is rife with self interest, be at individual club level, group club v NRL level, RLPA player level and to some degree NRL leadership level. It may be a bit socialist but a comp of even teams on and off the field is far more likely to be healthy and interesting to customers than a comp of haves and have nots and clubs going broke and needing bailing out.

With the NRl needing to deliver 8 games a week to meet its obligations they cant just let clubs do what they want and hope they don't go bust, no matter how much you might want them to Gus.

A player has to be paid a certain amount minimum as per what the NRL says their market value is. So they can't really spend less.

 

[Perth Red]

A player has to be paid a certain amount minimum as per what the NRL says their market value is. So they can't really spend less.

But that min wage combined wouldn't be anywhere close to the full salary cap, so yes clubs could spend less if they wanted to now.

In theory the club paid NRl salary cap for top 25 players is $6.3mill baseline. Min wage is $82,500 so you could have a 25 man squad on min wage ie $2.062mill

re Storms success compared to Eels, is that due to salary cap spending or general running of the club (and maybe off field spending?) Eels have had some pretty big name players over the last few years and managed to fail badly, even after cheating the cap and spending more than anyone else. that would suggest winning and losing isn't solely down to how much you pay your players.

 

[OldPanther]

But that min wage combined wouldn't be anywhere close to the full salary cap, so yes clubs could spend less if they wanted to now.

I don't know what the numbers are. The player agents also have some control here.

As for the Storm I'd say having the big 3 is the biggest factor. Followed by the proccesses eg. Coaching, how the club is run, Culture etc.

 

[Perth Red]

I don't know what the numbers are. The player agents also have some control here.

As for the Storm I'd say having the big 3 is the biggest factor. Followed by the proccesses eg. Coaching, how the club is run, Culture etc.

Had a quick look and updated my post. You could put out a squad for just over $2mill!

 

[POPEYE]

Jabba has always thought he was one step ahead so you can bet there's a connivance somewhere in this. Why not just give all the clubs the same amount of survival money, if they can't manage to secure more through sponsorship it's not the end of the world

The NRL could tell the lowly clubs to spend what they've got on looking for unknowns instead of Hunting around for established superstars. Like searching for a hidden Easter Egg once extraordinary new talent is discovered the NRL can give the club the money it needs to keep that new talent . . . money earned

The cap will work a lot better if it is restricted to penalising clubs that poach and rewarding clubs that introduce talent to the top grade. The NRL would do better to enforce the current style cap on juniors to prevent stockpiling rather than having one-clubbers forced to become mercenaries

 

[OldPanther]

Had a quick look and updated my post. You could put out a squad for just over $2mill!

A players market value is seperate to the minimum wage. Though teams could still field under the cap if they want I'm sure.

 

[Captain Apollo]

A minimum salary cap spend is not a new idea. They've been doing that for the last few years in the US with the NFL where teams are supposed to spend at least 89% of the nominated salary cap each year.

 

[Perth Red]

Bu there is no need for a min cap, clubs can spend less now if they want to. They choose not to because they want to win, regardless of if they can afford full cap. It would have been more logical if he was calling for a cap based on revenue.

End of day if it ends up a $10mill cap and clubs are getting $3mill above that from NRL for operations, and still cant make ends meet then there is little hope they ever will!

What clubs spend $10-15mill a year on now beyond player payments is a mystery to me!

 

[Frailty]

Most salary caps in the US have a minimum to spend, but that's when they are dealing with significant amounts of money. We don't need it in the NRL because the wages are pissweak in comparison - no one says a team must spend up to the cap, the Sharks definitely didn't for a few years.

This seems like an idea for the sake of an idea that won't achieve much at all.

 

[OldPanther]

A big problem is player managers and the way contracts are done. Wages are inflated massively according to all the talk.

 

[Eion]

Clubs have always been able to spend less than the cap, and some of them have. I remember the sharks not spending up to the cap a while back.

But yeah, agree with transparency. Publish all player wages under the cap and TPAs. That will turn a microscope on it.

 

[Perth Red]

A big problem is player managers and the way contracts are done. Wages are inflated massively according to all the talk.

Players will only get what clubs are willing to pay, up to the cap limit. It is supply and demand and like most business the most influential staff get paid more.
Would be interesting to see a club who is financially stuck come out and say, sorry fans we can only spend $4mill on wages this year so we are going to offer cheap entry whilst we clear our debts and hopefully next year we will have more money. I wonder what the fans response would be? If Knights are spending full cap for last few years and still rock bottom you do wonder if it is worth their while spending all that money when they are running at a deficit.

 

[OldPanther]

Players will only get what clubs are willing to pay, up to the cap limit. It is supply and demand and like most business the most influential staff get paid more.
Would be interesting to see a club who is financially stuck come out and say, sorry fans we can only spend $4mill on wages this year so we are going to offer cheap entry whilst we clear our debts and hopefully next year we will have more money. I wonder what the fans response would be? If Knights are spending full cap for last few years and still rock bottom you do wonder if it is worth their while spending all that money when they are running at a deficit.

I wold be interested to see that as well.

 

[DC_fan]

What would be interesting to know is how many teams are actually spending their full salary cap

 

[The Mad Hatter]

Couple simple things:

The NRL centrally pays 32 players , 2 per club, generous marquee allowances and uses them for all ads, promos etc. Club nominates said players. If a marquee f**ks up they are ineligible for SOO or rep selection and clubs slugged $1m out of the following seasons funding or lose one of their marquee allowances.

Clubs can only have max two players selected for SOO. That's 32 players. The 2 captains are exempt from this classification so at most a single club could give to SOO is 4 players. That way talent would have to move not only for $$$ but rep selection and clubs not wholesale affected by SOO. If nrl expands to 18 teams, then it becomes an 18 man squad for SOO with 2 per club max.

 

[RockWheel]

7 different clubs have won the premiership in the last 7 seasons, changing to a soft-cap would probably lead to a more uneven competition.