This is some revisionist bullshit.
Reds had no choice but to sign with News Ltd because Arthurson and Quayle made them and the other three expansion clubs fund the accommodation and flight costs for all visiting teams in ARL and reserve grade. It bankrupted all four expansion clubs and made them unviable. For Western Reds it was sign with News Ltd and survive or not be able to see through the 1995 season.
There was a plan in place from the 1970s to rationalise Sydney.
"On May 8 1973, new NSWRL boss Kevil Humpries told the Sydney Morning Herald about his vision for the future of the NSWRL, including a reduction of teams from twelve to six through amalgamation. Kevin also wanted to add teams in Newcastle, Illawarra, Canberra, Wagga and Brisbane.
By the early 1980s, many NSWRL clubs were no longer financially viable. The newly incorporated NSWRL made a decision that clubs would have to meet certain criteria to compete. The league kicked out Western Suburbs and Newtown at the end of 1983. Western Suburbs took the NSWRL to court and were reinstated.
In July 1986, Ken Arthurson proposed a “Super League” to replace the current KB Cup with four or fives from Sydney, two from Brisbane, three Country New South Wales teams, Queensland Country and Auckland.
On April 9 1992, a blueprint for the expansion of Rugby League was tabled by the Premiership Policy Committee of the NSWRL, followed in August by an Organisation Review, by Dr G. Bradley, which was distributed to the premiership clubs. The Bradley Report, as it became known, was central to the ARL replacing the NSWRL as the governing body of the premiership. The report concluded that:
“…to reduce the number of clubs in Sydney, will be very hard for the League to implement given the long-playing traditions of some of those clubs. In the long term, however, it is likely that Sydney is not going to be able to support eleven clubs as it does at present. Therefore in the long term, this is the only viable solution. Sydney based clubs are going to have to move to new areas, merge or be relegated from the League. This is going to be a painful process. In the long term, I believe that the ARL should be looking to reduce the number of clubs in the National Competition to fourteen, thus allowing clubs to play two complete rounds. This will mean, assuming that only four new clubs are admitted from areas outside Sydney, that there will be only five clubs based in Sydney.”
1895 Blog’s latest look at the history of rationalization plans of the NSWRL and the clubs who want to join the NRL
1895blog.wordpress.com