Explained: What's going wrong in English club rugby

Wasps and Worcester are fighting for their futures amid a major credit crunch right across the Gallagher Premiership.

Here, the PA news agency examines what is going wrong in English club rugby’s beleaguered top-flight.

What has happened to Wasps?
Bosses at the Coventry club have confirmed their “intention to appoint administrators”, amid a battle to stave off a winding-up petition from HMRC.

What does that mean?
The taxman will call in Wasps’ debts should the club be unable to prove ability to pay back what they owe. Wasps’ latest move is an attempt to generate a stay of execution from HMRC’s order.

Are Wasps in administration then?
Wasps insist they have not entered administration, but have signalled the intention to do just that should current talks aimed at acquiring investment not succeed.

What are the risks to Wasps?
Premiership rules mean automatic relegation for any club slipping into administration. The financial fall-out of any such penalty could see the club fold.

How have Wasps come to this point?
Wasps heralded saving the club from the brink when securing a move from High Wycombe to Coventry in 2014. The club bought the Coventry Building Society Arena with high hopes of big crowds and bulging coffers. But not even a supporter bond issue in 2015 could revive continued financial issues. Wasps admitted being unable to repay that £35million bond on schedule to supporters in July, with the club seeking refinancing options.

What about Worcester then?
Worcester are facing a battle to continue to operate from one day to the next. Owners Jason Whittingham and Colin Goldring have insisted for more than a week that a deal is close to being completed with new buyers. But no evidence of that deal has yet been produced.

Why are Worcester in trouble?
The Warriors are saddled with more than £25million of debt, with an HMRC winding-up order due in October. Players and staff at the Sixways club have not received their full wages, with the lack of funds leading to major operational shortcomings.

What will happen to Worcester now?
English club governors at the Rugby Football Union have been so concerned by the Warriors’ plight as to issue a stark ultimatum: prove future funding and a long-term plan to rejuvenate the club by 5pm on Monday, September 26 or be suspended from all competitions.

Why are so many clubs struggling?
The pandemic’s impact cannot be ignored but Wasps’ problems long predate Covid-19. Worcester equally cannot hide behind Covid as a catch-all excuse. Rising wages for top players and coaches, despite salary-cap curbs, a constant contest to lure in punters and continued battles to boost match excitement are all major factors.

So where does English club rugby go from here?
Exeter boss Rob Baxter admitted that English rugby might simply have too many clubs. Sustainability will be a major watch-word for the coming weeks and months. The authorities will do everything to avoid either Wasps or Worcester going to the wall. But the wider argument over the Premiership’s best long-term plan will rage on.