Welsh regions agree to salary cap
The four Welsh regions have announced that they will operate under a salary cap from the start of next season as part of a landmark agreement designed to deliver long-term sustainability in the professional game in the principality.
The salary cap of £3.5million will cover the players registered for European competition by the Ospreys, Cardiff Blues, Scarlets and Newport Gwent Dragons, but does not include development players or academy costs.
It is hoped that the cap will lead to a greater emphasis on developing the next generation of Wales-qualified players.
The Welsh regions have seen an exodus of star talent in recent seasons, with several players choosing to join wealthy French clubs.
James Hook, Mike Phillips and Lee Byrne sealed moves to Perpignan, Bayonne and Clermont Auvergne respectively, while lock Luke Charteris is also thought to be close to a move to Perpignan after announcing that he will leave the Dragons at the end of the season.
Ospreys prop Adam Jones and Blues counterpart Gethin Jenkins have also been linked with overseas moves, leading regional coaches to call for the Welsh Rugby Union to provide them with extra funding in an effort to help them stave off the threat of cash-rich clubs in England and France.
But rather than top up the money handed to the regions, the new agreement effectively removes the potential for dramatic increases in salary costs as a means of holding on to big-name players.
Stuart Gallacher, chairman of Regional Rugby Wales, the umbrella body which represents the regions, said: "This is a significant step forward for regional rugby in Wales and the future viability and balance of our four rugby businesses that are so vital to the development and promotion of the game in Wales.
"The regions have come together with a shared sense of responsibility to get their own houses in order and find solutions. This agreement is the start of that journey. They are eager to do all they can to achieve greater self-sufficiency and our governing body the WRU has been wholly supportive of and endorsed the initiative we have taken.
"This is a powerful signal of our determination to achieve our aims amidst some tough economic challenges in Wales now and in the future. All four regions are working very hard indeed to manage their businesses more effectively in a very difficult environment for everyone."