Salary Cap

[t-ba]

In all of this chaos and madness, I think it's apparent that something needs to be done about this. The current cap is way too 'hard.' It lacks any real incentives and, imo, reduces the media profile of the sport and the stars who play it quite substantially. Something needs to be done. The game needs to be softer on spending, but it needs to be ingenious about it.

Dodgy player payments aside, it's clear we're up to our necks in it against other codes, in particular Rugby Union and the AFL.

I don't think the answer is open slather. Such a system would be catastrophic for the game in the long run that it may hinder any potential benefits of purging the financially weaker Sydney Clubs (Cronulla, Easts, Penrith and my own club included). But it's clear that the current system rewards financial mediocrity and punishes fiscal strength. A few proposals I'd have in mind would be:

-Marquee players systems: Each club should be able to contract 2-3 players outside of the Salary cap. This would allow the games best (and most marketable) players to attract big contracts and endorsements without having to worry about going over. Having these players outside of the current system would leave businesses to employ the services of the games top players, also increasing the games profile as a whole. Or maybe even have a number of players at each club who are free to pursue whatever sponsorship deals they please, third party or not.

-Long service benefits: Not just the current bullcrap one. Players who stick loyal for a substantial period of time with one club should have part of their contract considered to not be part of the Salary cap, possibly even none for players who have battled in the trenches for the same club over a decade in the top grade. This would also help substantially with depth, as veterans with a vast amount of experience who might be a step too slow for the top flights can be used by clubs feeders and also to add depth too NRL squads.

Now I know this would benefit some clubs MUCH more than others. However, in the interests of keeping talent in the game, I think it's important.

I'd also strongly disagree to any luxury tax for spending over the cap. A club like the Broncos would have absolutely zero problems spending double the current cap.

I'm completely aware this would reduce a fair amount of unpredictability from the competition. For those who think I say this from the selfish point of view of a current top club, I think that's a bit stupid. Manly are at absolute best a middling club currently enjoying a purple patch who can't possibly hope to compete financially in the long term with clubs like the Warriors, Souths, Parra, Canterbury, Saints, the Gold Coast and Brisbane. Not many companies would really be interested in putting up billboards of the Stewart Bros or Watmough along the M5 selling their products. We're a geographically contained clubs whose long term prospects aren't exactly the best.

What are your thoughts? Any suggestions?

 

[Eels Dude]

I Ignored 95% of your post. The clubs that break the rules deserve the punishment. Very simple. They know the rules. I agree with that fact the salary cap rules need to be changed and simplified. It's not an excuse for breaching them though.

 

[Jankuloski]

I think we should abolish theft laws. I think it's apparent that something needs to be done about this. A day doesn't go by that someone doesn't steal a car, or something else. Clearly this is impossible to enforce.

Now abandoning the sarcasm - the salary cap is a big reason why I follow NRL that closely. Just see ESL to see what happens when you get dominant teams and teams that reallistically can't do anything. It goes like this - 6 out of 7 rounds it's boring as hell and NRL is much better. On that 7th round they play the derbies and that weekend is the only one I prefer to watch ESL over NRL.

I can tune into any NRL game and there will be good competitive footy. St Helens v Salford is never going to be a match.

I can't understand people bagging the salary cap with last year being such a magnificent contest with so many sides really in contention for every spot. I hate soccer in part because you allways know who is the champion in which country, maybe you have two picks. In Serbia it's Partisan or Red Star for the past 20 years ffs!

All the systems that go around the cap ammount to abolishing the system - some clubs can't cope with paying anymore - they would get left behind!!

The salary cap shoul be INCREASED with first money NRL gets its hands on, but that's it!

 

[Perth Tiger]

I think recent events have shown the salary cap is being set for the lower end clubs. First it was the Bulldogs, then Warriors now the Strom with rumors of the Titans.

We are losing players to Unions and now AFL, while I am not one of those who say it is the end of the worl when we lose a player, I would still prefer to see the likes of Gasnier sbw and Hunt in our game.

Surely the salary cap needs to be re-evaluated to look at Marquee player allowances and discounts for long term loyatly.

This would disadvantage some of the sydney and regional NSW Clubs, including the Tigers, but for the benifit of the game it must be re-examined.

 

[Berkeley_Eagle]

The history of NRL Salary Cap breaches:


http://www.nrl.com/news/news/newsar...1/history-of-salary-cap-breaches/default.aspx

 

[Brutus]

In all of this chaos and madness, I think it's apparent that something needs to be done about this. The current cap is way too 'hard.' It lacks any real incentives and, imo, reduces the media profile of the sport and the stars who play it quite substantially. Something needs to be done. The game needs to be softer on spending, but it needs to be ingenious about it.

Dodgy player payments aside, it's clear we're up to our necks in it against other codes, in particular Rugby Union and the AFL.

I don't think the answer is open slather. Such a system would be catastrophic for the game in the long run that it may hinder any potential benefits of purging the financially weaker Sydney Clubs (Cronulla, Easts, Penrith and my own club included). But it's clear that the current system rewards financial mediocrity and punishes fiscal strength. A few proposals I'd have in mind would be:

-Marquee players systems: Each club should be able to contract 2-3 players outside of the Salary cap. This would allow the games best (and most marketable) players to attract big contracts and endorsements without having to worry about going over. Having these players outside of the current system would leave businesses to employ the services of the games top players, also increasing the games profile as a whole. Or maybe even have a number of players at each club who are free to pursue whatever sponsorship deals they please, third party or not.

-Long service benefits: Not just the current bullcrap one. Players who stick loyal for a substantial period of time with one club should have part of their contract considered to not be part of the Salary cap, possibly even none for players who have battled in the trenches for the same club over a decade in the top grade. This would also help substantially with depth, as veterans with a vast amount of experience who might be a step too slow for the top flights can be used by clubs feeders and also to add depth too NRL squads.

Now I know this would benefit some clubs MUCH more than others. However, in the interests of keeping talent in the game, I think it's important.

I'd also strongly disagree to any luxury tax for spending over the cap. A club like the Broncos would have absolutely zero problems spending double the current cap.

I'm completely aware this would reduce a fair amount of unpredictability from the competition. For those who think I say this from the selfish point of view of a current top club, I think that's a bit stupid. Manly are at absolute best a middling club currently enjoying a purple patch who can't possibly hope to compete financially in the long term with clubs like the Warriors, Souths, Parra, Canterbury, Saints, the Gold Coast and Brisbane. Not many companies would really be interested in putting up billboards of the Stewart Bros or Watmough along the M5 selling their products. We're a geographically contained clubs whose long term prospects aren't exactly the best.

What are your thoughts? Any suggestions?

Great post. Agree.

We are in desperate need of a marquee player system.

The NRL is deliberately cutting down the costs of the game to suit the News LTD agenda.

 

[Fonzie]

I have 2 comments on this:

1. All the talk I hear about the salary cap being too hard to police is BS. All they need is proper procedures. For example, make every NRL player sign a Stat Dec at the end of each NRL season setting out the total of all financial and non-financial benefits they received from their club, or any sponsor of the club, during that year. That would act as a 1:1 cross check against the clubs' books. The players might still collude with the club and lie in the Stat Dec, but they will have personal accountability that might discourage them from accepting 'overs'.


2. The salary cap is an exercise in reducing the overall quality of talent in the competition in exchange for achieving a good competitive balance. Setting the salary cap at the level of the poorest club sacrifices too much overall quality of talent. The cap should be set at the level of say the 12th best financially performing club. That would only lead to a small reduction in competitive balance and would improve the quality of the competition significantly. It would also incentivise the bottom few clubs to improve financial performance.

 

[leaguerules]

ihave no idea how the system works but i think its pretty naive other baeckhanders are not happening whether its extra $1000 0r 50000.

how about the nrl has to sign thers player checks(or however they are paid) and any other stuff third party.

And let the players have more accountability let the nrl sure it takes abit of there privacy away from the player but let the nrl have look at there income tax stuff what they are submitting to the government and if it matches to what the nrl understands the player should be getting. if its unknowing wrong nrl can alert club/player or if aplayer if choses to hide money they a doing fraud and if caught face the tax fraud.

like i said my knowlegde with this stuff is minimal but im sick of league(love this game best game inthe world) always finding trouble and this has to do massive damage to league in victoria from here in canada ithought was on the rise.


it seems every 4-6 years something major happens to league

• superleague
• souths out and merges
• bulldogs cap and (other thing) as a doggies fanit was hard time
• now this and with the current salary cap run the way it is basically "trust system" "word will leak" can see some wanker/s doing this again to a club

anyway that turn into personal boring rant sorry
but been travelling for 2years and probable be away for afew more i want to come home to a strong league. that includes a strong melbourne storm

 

[t-ba]

Storm did the crime, serve the time. Quite simple. Even though I think it's a little harsh on the Storm, the decision needs to be accepted. (And I f**king hate the storm. I was in the stands that glorious day in 2008 booing the sh*t out of Cam Smith when his ugly mug shot up on the big screen around the 70th minute and I gloated when Big Izzy cried at the end of the game)

But that doesn't mean that the laws aren't in need of some serious re-evaluation. Big clubs shouldn't be punished for being big like they are today. Players earning potential, and, more important to the game as a whole, their marketability, shouldn't be hamstrung. Nor should long term players be forced to go collect a pension abroad.

 

[Quidgybo]

If we're going to talk cap reform then I think we actually need two caps - a Hard Cap that represents what we can afford to spend and a Soft Cap at some level beneath that.

The Hard Cap would be the maximum dollar value that a club could spend on player payments including all bonuses, concessions (more on that in a moment), cars etc etc. The game can't spend more money than it brings in and we can't arbitrarily say we're going allow clubs to spend more just because player x was a local junior or has been loyal. The Hard Cap represents what the game can actually afford to spend on players. Whether the Hard Cap is determined to be $5m or $20m, clubs can't spend a penny more on players, end of story.

The Soft Cap might be say three quarters or four fifths of the Hard Cap (the exact figure could be debated separately). Without any concessions, a club could only spend up to the Soft Cap on players. Now we introduce the incentives...

* 10% discount for players who have played more than 20 NYC games for the club (ie. cap benefit for developing your own juniors to senior team)
* 10% discount for each additional year over five years with the same club (ie. cap benefit for showing loyalty to aging stars and keeping them in the game longer)

These concessions can be counted outside the Soft Cap up to the Hard Cap ceiling.

So taking an example. If we have a Soft Cap of $4m and a Hard Cap of $5m then a club that has not developed any of their own Toyota Cup players into first graders and has not retained any player for more than five seasons could only pay a total of $4m in player payments. A club whose entire team has graduated from their own Toyota Cup side could discount 10% of each player's wage allowing them to allocate $400k over the Soft Cap, effectively allowing them to spend $4.4m in player payments.

If a club has a 28 year old player who has played seven seasons and is being paid $300,000 per year, then they would receive a 20% discount (2 years beyond five seasons). This would mean only $240,000 of that would count under the Soft Cap and the other $60,000 could be allocated above the Soft Cap. If they still wanted to pay him the full $300,000 under the Soft Cap then effectively that means they could increase his total salary to $375,000 by claiming the increase as the 20% concession. As long as they don't go over the Hard Cap, they can allocate their concessions however they see fit.

The inherent restriction in this is if a club recruits players they haven't developed then they can never claim the 10% junior development concession for that player's wage. That player will always cost the club more under the Soft Cap than an otherwise equivalent junior. And if a club lets aging stars go then they lose the concession benefit of being able to claim an annually increasing part of that players wage outside of the Soft Cap. Without any concessions you can only spend up to the Soft Cap. Imports always cost you more under the Soft Cap than your own juniors or long serving stars. The only way to ever spend up to the Hard Cap is by developing your own players and showing loyalty to those players who have stuck with you long enough to start earning discounts.

Leigh.

 

[t-ba]

Don't mind that actually.

Maybe in combination with a Marquee player system.

I think there is a potential problem with wealthier clubs warehousing junior talent, but it's certainly alot more thought out and elegant a system than mine.

 

[Generalzod]

Canberra were over the salary cap when they won the premiership, ARL didn't strip them of the comp.

 

[Quidgybo]

The problem with Marquee players is still the whole reason for having a Hard Cap. You can't spend more than you can afford to spend. You could have a Marquee player who doesn't count at all under the Soft Cap. But ultimately you still need to draw a line at some Hard Cap and say our game and our clubs simply can't afford to be spending more than X on players because it would be financially irresponsible given current revenue and adds an unacceptable risk that clubs will start going broke.

Leigh.

 

[myanonymoususername]

2. The salary cap is an exercise in reducing the overall quality of talent in the competition in exchange for achieving a good competitive balance. Setting the salary cap at the level of the poorest club sacrifices too much overall quality of talent. The cap should be set at the level of say the 12th best financially performing club. That would only lead to a small reduction in competitive balance and would improve the quality of the competition significantly. It would also incentivise the bottom few clubs to improve financial performance.

I agree with this, and was thinking along these lines myself. Instead of setting the cap at the lowest common denominator, have it at say the level 75% of clubs can manage. Increase it over a period of time to 50%.

Perhaps even give the lowest clubs subsidies or concessions to enable them to compete, and reduce these over time. Give them say a window of 3-5 years to get to the level required and if they still can't do it, tell them they're on their own.

 

[t-ba]

This handicaps the earning potential of the games stars. Unless of course third party sponsorships are considered completely outside of the cap. Which raises the spectre of big clubs simply enticing players over with the opportunity of earning substantial money for playing at a popular, high profile club that increases their own marketability.

I still think the games best deserve the opportunity to be earning more from their value as an advertising tool.

 

[bobbis]

The problem is the cap is aimed at a level sustainable for the likes of Cronulla. Unfortunately that isn't very sustainable for the NRL, as Cronulla can't afford to compete with AFL clubs, the ARU or French rugby. This means the top talent will be increasingly drained. The cap needs to be aimed at a level appropriate for the top 50-75% of teams. If the poorer clubs can't compete, tough luck. Either choose to be a national competition that can compete for the best football talent or choose to be a surburban comp where Sydney suburbs like cronulla can one day dream of a premiership.

I'm not sure this was the best punishment, the NRL may of gone to far and may have killed off its own expansion. The fans and sponsors will all bail as there's nothing to play for and the season is only early, together with the fines and the previous heavy yearly deficits i can't see how they can survive financially, they'll have to be bailed by their owners. Rather than stripping the Storm of their premierships, ruining 2 past season and then ruining this 1 by giving them no points and turning every remaining Storm fixture into a farce i think the NRL should've punished them in a similar manner to how they cheated. They went over by 1.7 million make them go under the cap by 1.5 times the breach, about 2.5 million in the subsequent seasons. I'd have them compete 0.625 million under the cap for this year and the 3 after. Thus the Storm would have to immediately cut players pay and let players go. In addition the fine theyre given that is distributed amongst the other clubs would be added onto all clubs caps for this season and next enabling them to buy up out work Storm players.

 

[Quidgybo]

The problem is the cap is aimed at a level sustainable for the likes of Cronulla. Unfortunately that isn't very sustainable for the NRL, as Cronulla can't afford to compete with AFL clubs, the ARU or French rugby. This means the top talent will be increasingly drained. The cap needs to be aimed at a level appropriate for the top 50-75% of teams.

The affordability of the cap for any one club is going to become increasingly irrelevant to this discussion. The stated aim of the league has for many years been to close the gap between the cap and the annual grant to the point that they match - ie. effectively all player wages will be funded centrally, not from club income. The difference in club income will dictate how much support each club can put behind their team but the amount of central income, predominantly from television will affect how much the game can afford to spend on players and thus the level the cap is set at per club. With a cap of around $4.1m for 16 clubs, the game currently spends about $65.6 million per year on players. That's our true salary cap. For each additional million we raise the cap for clubs, the game as a whole needs to find an additional $16m. That's the equation we need to deal with, not whether 50% of clubs can afford $6m dollars or 75% of clubs $5m for a squad of 25 players. But whether the NRL can afford to spend more than $65.6m for 400 players, and when and how will that central pot increase?

Leigh.

 

[Didgi]

Was going to make a thread about this myself. There needs to be a major overhaul of the third-party sponsorships rulings. I can't completely agree with raising the cap majorly, teams like the Sharks are reportedly struggling to spend all of it at the moment.

 

[Red Bear]

What about transfer fees? Some reward when a club loses a player.

I remember Gus floating an idea along the lines of players a club develops are exempt from the salary cap. Where do you class as developed? Players who have only played first grade for you, players who came through the U/20's or players who came through Ball/Harold Matts?