Prem Rugby clubs will be required to meet a minimum salary cap spend of £5.4m under new plans to expand the league’s commercial profile and competitiveness.
The English top-flight is moving away from a traditional promotion and relegation model to an expansion league, with expressions of interest and a tender process opening next season as it works towards a goal of adding two new teams by 2030.
As part of that move, the existing 10 clubs in the Prem will have to meet a “salary floor” in a drive to ensure close competition across the division while ensuring financial sustainability.
The move comes with the Prem actively seeking investment into both existing sides and possible new franchises, and follows major moves by Red Bull at Newcastle and James Dyson at Bath in recent months.
The salary cap is currently set at £6.4m, with a number of credits and exclusions meaning clubs can spend up to £7.8m plus one excluded player salary. While a number of clubs in the league spend close to the cap, some others are understood to currently fall short of the £5.4m figure.
While the salary floor still needs regulatory approval, it has been approved in principle by clubs following a consultation process. It will be introduced next season, although clubs will not be punished for failing to meet it until the 2029/30 season.
Any new club into the Prem shall be permitted a transition year whereby it shall be permitted to spend 25 per cent on the condition that it can present a clear plan to spend at least the full in its second Prem season.
Simon Massie-Taylor, the Prem Rugby chief executive, cautioned that the league are not necessarily looking to increase the cap in the near future.
“Our vision is to be the best league in the world,” Massie-Taylor explained.
“We are on a journey to define exactly what that means, but it doesn’t mean we are going to spend beyond everyone else and create wage inflation around the world, paying so all the Galacticos turn up. There are other aspects in terms of how we can define ourselves as the best league in the world for fans and players. Once distributions from Prem Rugby get to a certain level, then that will allow us to increase that in a sustainable way.”
The Prem’s plans were unveiled ahead of their “Big Match Bonanza” this weekend, with games being held at the Principality Stadium, Villa Park and the Tottenham Hotspur Stadium on Saturday.
The hope is to hold up to 10 of these spread across the season in the future, with the possibility of taking the league’s semi-finals to larger, neutral venues by 2029.
“Big games are really important, as they make games bigger, and appeal to a wider fanbase.” Massie-Taylor added. “Our ambition is to have ten big games by 2030, and that includes the final and the potential for neutral playoffs.
“We see that adding to the narrative, and the general scale of the league. Big games are hard to do, so we as a league need to provide more support on that and to help market it to a wider audience. We need to manage the calendar of big games too.
“The reason you do it is because of scale. They are big games and you want to make them bigger. France do it. They’ve created a moment there and we want to explore it. It allows us to take the game on the road, and that’s what we’re seeing with Gloucester hosting a game in Birmingham this weekend, it’s a big undertaking but a big step in building a new market.
“England have a game against Fiji at the Hill Dickinson Stadium up in Liverpool, which is a great new 55,000 seater stadium, and in an area where there is clearly demand, as people are buying tickets to England-Fiji. Is that a good example of where we could host a playoff event? Maybe. There are lots of options. We’re intending to do this in 2029, deliberately because it takes time to secure venues, and find the right spot and build demand.”
