How Giteau deal may change rugby
By Peter Jenkins
April 21, 2006
AUSTRALIA centre Matt Giteau could be the catalyst for a ground-breaking salary cap in Australian rugby union.
The chase for the world-class Brumbies star - spiked by rumours that he could earn $900,000 a season if he signs for Western Force - has the ARU nervous about how to handle the danger of spiralling payments to top-end players.
Giteau's shift to Perth is imminent with The Daily Telegraph able to reveal his manager was there yesterday to meet with potential corporate backers prepared to help bankroll the move.
It is the rise of third-party deals that have Queensland boss Theo Psaros calling for a salary cap and Brumbies chief executive Andrew Fagan having an open mind on the idea.
Both fear third-party arrangements will be more readily available in the Perth and Sydney markets and are already being leveraged as key recruitment tools.
The Reds and Brumbies believe it could leave them struggling to compete for leading players unless funds are sourced from elsewhere in the future.
"We would reserve the right to look at options, a salary cap or something else, if we genuinely felt the game's interests were being jeopardised," ARU operations chief Rob Clarke said last night.
"We would always want to ensure provinces don't go broke and we would also do whatever we could to protect the integrity of the contracting process.
"I think there's also been a new dimension come into play with the number and (worth) of third party agreements on the increase across the board."
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Players can access the corporate dollar, as long as their agents attract the off-field income. Provinces are not allowed to attract the sponsors as part of negotiations.
But it remains one of two grey areas in the existing contract system.
The other is a so-called gentlemen's agreement where provinces put a ceiling on Super 14 salaries of around $110,000 - before match payments plus car and accommodation extras are added.
The ARU then provides top-ups for leading players and an incentive of more than $10,000 a Test.
There are claims that Giteau is being dangled more than $200,000 extra per season to go to Perth.
Waratahs boss Fraser Neill says "three kitchen sinks" have been tossed at Giteau.
Force chief executive Peter O'Meara denied he had offered Giteau an increase on the terms the Force tabled to the ARU, or that the franchise had secretly stitched together third-party sponsorships.
"No three kitchen sinks here," he said. "We haven't even thrown one. But if player managers get off their arses and find opportunities to build a player's profile ... we do have a very strong commercial precinct here, probably a lot stronger than Canberra."
For that reason, Fagan is wary of third-party deals which rugby league includes in its salary cap.
There is no doubt the advent of the Force has ramped up bidding for key players.
But Giteau is the first marquee Wallaby to test the water with all four franchises.
The result is that ARU officials are worried third-party deals could see sponsorship funds, earmarked for a state's grassroots, go to pay players.
Rugby Union Players Association boss Tony Dempsey said his union would oppose any move towards a salary cap.
"We are proponents of free market forces," he said.
Dempsey also claimed the perception that Super 14 teams could only pay players a maximum $110,000 a year was false.
He said the collective bargaining agreement between the ARU and RUPA - which runs until 2008 - banned collusion between state unions and the ARU to limit player payments.
The Daily Telegraph
