London Irish have been suspended from rugby union’s entire league structure after becoming the third Gallagher Premiership club to collapse this season.
The Rugby Football Union has confirmed that neither Irish’s owner Mick Crossan nor the American consortium planning to buy the club were able to prove they had the finances to compete in the top flight for the 2023-24 campaign.
Furthermore, the outstanding 50 per cent of May’s payroll owed to staff and players has not been paid before the final deadline set by the RFU of 4pm on Tuesday.
It means that Irish join Wasps and Worcester in becoming a casualty of the financial crisis gripping the Premiership, which will now become a 10-team competition.
Given the failure of the takeover and Crossan’s intent to stop bankrolling the club, the Exiles’ prospects for survival as a professional outfit appear extremely bleak with over 100 staff in limbo.
Irish said in a brief statement that it is exploring ways for the suspension to be lifted.
“We will be working closely with London Irish to confirm what the future of rugby at the club looks like. With regret, this will not be in any league next season,” RFU chief executive Bill Sweeney said.
After six months of talks, neither proof of funds nor the information required for the fit and proper persons test were provided and the RFU has acted to prevent the club going out of business during next season.
“This is desperately sad news for everyone who is part of the London Irish community as well as all the players, fans, staff and volunteers for whom this club means so much,” Sweeney said.
“In the absence of transparent proof of reliable long-term funding and for the duty of care for all involved at the club, the sad decision has now been taken to suspend the club from RFU leagues.”
Star players such as Henry Arundell and Tom Pearson will be snapped up by other teams, but many squad members as well as staff at a club that employed over 100 people face uncertain futures.
A hardship fund has been set up by the RFU, Premiership Rugby and the Rugby Players’ Association to help anyone in need of financial assistance and this is to be extended to those most affected by the demise of Wasps and Worcester.
Irish were due to celebrate their 125th anniversary next year but will not reach that milestone, underlining the shaky foundations on which the Premiership is built.
Premiership Rugby chief executive Simon Massie-Taylor noted that “if an owner decides to withdraw financial support for a club, we have limited options to keep it going”, but RFU chair Tom Ilube hinted at a reduction in funding for the league due to its “failing business models”.
“Rugby has an underlying need to professionalise its management off the pitch, just as it has done on the pitch over the past 25 years,” Ilube said.
“To thrive, rugby clubs need to have a wide-ranging offering and varied revenue streams. All three clubs that have failed this season have had fragile business models for many years.
“The structure and ownership of a stadium is a factor alongside reliance on a single funder, challenging societal trends, financial mismanagement, and an insufficiently large fan base.
“Not all three clubs had all these issues, but they faced a combination of these factors over many years before Covid and the current economic downturn.
“It is the specific job of the RFU, as the national governing body for rugby union in England, to reinvest revenues in the overall growth of the game both at a community and professional level.
“We currently contribute £25million to the Premiership each year but cannot continue to invest in failing business models. That means tough investment decisions.”
The downfall of Irish, who finished the Premiership in fifth place, concludes the darkest season in the history of the English club game.
Wasps have been demoted to the foot of the rugby pyramid after their new owners failed to secure the funding needed to relaunch in the Championship while Worcester have gone quiet on their plan of rebuilding from the fifth tier.
Irish have debts in the region of £30million and do not own their own stadium, instead playing at Brentford’s Gtech Community Stadium after a 20-year spell at Reading’s Madejski Stadium.
On Friday they were issued with a winding-up petition by HM Revenue and Customs over an unpaid tax bill as the club continued to spiral towards their fate.