Mr. Philip Browne:

I thank the committee for the invitation to update it on how we have operated since the onset of Covid-19 earlier this year. I echo what Mr. Horan said in that we not only represent our sports, but the many other sports that are not represented here today that are also facing up to the huge challenges of Covid-19. We believe that rugby has a significant role to play in the physical and mental well-being of Irish people and that, in the face of this cruel pandemic, we continue to have a positive contribution to make to public health and society, and hope to do so for years to come. We have covered these areas in detail in the documents provided to the committee and I am happy to explore them further should the committee have questions.

Before I proceed, I wish to acknowledge how difficult it has been, and continues to be, for all those who have lost loved ones or have had their health compromised by the virus. A huge "thank you" goes to all those front-line workers who have stepped up to help at this time of crisis.

The adjective “unprecedented” has been overused in the past six months but our experience to date and history will show that, if anything, the description of the 2019-20 season as being unprecedented is understated. Our season, and our business operations, were thrown into chaos by the Covid-19 pandemic in March, when our Six Nations fixture against Italy became the first mass gathering to be cancelled. This represented the first major blow to our sport and finances.

Pre-Covid, our financial situation was looking quite positive. Now, we are facing an unprecedented cash flow crisis as we try to work towards the objectives of protecting our national men's and women’s teams and our professional provincial teams, and, most important, ensuring that we preserve the amateur club game and support the jobs of our 500 employees to the extent that we can. It is important that I put context on the financial reality we are now facing. The key issue facing rugby is the absence of spectators at major fixtures. The absence of a clear pathway to the return of spectators, in meaningful numbers, means our perilous financial situation will continue to deteriorate at an alarming rate into 2021, moving to an unsustainable position by the third quarter of that year if we do not take certain actions.

The IRFU is the only sporting body in the country totally supporting a professional game which is massively dependent on the men’s national team’s ability to generate funds. The men’s national team generates 80% of all revenues, which, in turn, is fed down to support all other national teams, the four professional provincial teams and, most important, clubs and schools across the country. Every stakeholder in Irish rugby is shouldering their share of the economic burden, including salary cuts of up to 20%, redundancies and the elimination of all but the most critical overhead costs.

Going into this crisis, the IRFU balance sheet was very healthy and, notwithstanding the welcome Government supports rugby avails of and greatly appreciates, it has always sought to live within its means. However, Irish rugby’s net losses in 2020 as a result of Covid-19 are catastrophic and are forecast to be in excess of €30 million, despite the implementation of the cuts and initiatives provided by Government, as previously mentioned. This excludes more than €32 million of 2020 ten-year ticket renewal moneys due.

We are unable to invoice for these sums in the absence of any visibility of fans attending games. This figure relates solely to 2020 and the outlook for 2021 is far worse. In very broad terms, it is anticipated that the IRFU and the provinces will continue to burn at least €5m a month, primarily on professional game wages and costs. This is not a sustainable position and will require significant additional actions after December 2020 if there is no sight of spectators returning at that point.

The current projected position to the end of June 2021, shows a negative cash swing of almost €40 million from a cash surplus of €28 million in June 2020, to borrowings of just in excess of €10 million, backed by IRFU assets. This is very serious and is being kept under constant review. The IRFU will be forced to commence borrowings in January. If these projections were to materialise, the very existence of professional rugby on the island would be under significant threat in 2021.

Our audited financial statements for the period to 31 July 2020 will show an actual record financial loss of more than €35 million. In January 2020, we were forecasting a planned deficit of €3.5 million. Until we can admit spectators in meaningful numbers into our stadia, and return to some level approaching self-sustainability, the entire rugby infrastructure built over the past 150 years is under threat. Indeed, there may be a requirement in our accounts to comment on the uncertainties we now face regarding future going concern challenges for the union.

We will, of course, continue to follow NPHET and public health guidelines on this, but that will come at a significant cost to our sport, not only at the top level but at club level, schools level and grassroots level. It is our ambition, with the support of Government, to survive as a properly functioning unit and repay the faith shown in us by playing our part in supporting the national recovery effort that will demand so much of us all in the years to come.

We remain available to discuss any issues or provide the chair and his colleagues with any further supplementary information they may require.

Before I close, I extend my thanks to the countless volunteers in clubs and schools around the country who have been meeting the challenges posed by Covid-19 as best they can to preserve our club and schools game. I thank the committees and subcommittees at the IRFU and the provinces and the IRFU and provincial staff, who have adapted to the changed working circumstances and, in the case of our staff, have experienced significant pay cuts. I also acknowledge the provincial chief executives who have worked closely with the IRFU to ensure a coherent and aligned approach to the challenges that we are collectively facing. I thank Sport Ireland and the Department of Transport, Tourism and Sport for the support they have given to Irish rugby and to sport in general, and I thank the Government for the initiatives that have been put in place during the Covid-19 crisis, which have helped enormously.