Barassi Line

Australian rugby has reached its lowest point. How did it get here?

Retrieved on: 
Monday, September 25, 2023
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This represents Australia’s worst result in a World Cup match and its biggest-ever losing margin to Wales.

Key Points: 
  • This represents Australia’s worst result in a World Cup match and its biggest-ever losing margin to Wales.
  • And it will almost certainly end Australia’s 2023 World Cup campaign at the group stage for the first time.

Sport Management 101: Investing in grassroots and junior development

    • The AFL understands this investment in the grassroots level is not only vital to producing the next batch of superstar players, but also key to ensuring the sport remains embedded within local communities.
    • Rugby Australia has not valued this necessity, with World Cup results illustrating the deleterious impact of falling behind competitors when it comes to grassroots investment.
    • We discovered the code’s professionalisation in the mid-1990s resulted in a drastic shift in how the organisation spent its money.
    • A clear implication from the analysis was a significant divestment from grassroots development in the past 20 years.
    • In 2001, 13.76% of Rugby Australia expenditure (A$7.06 million) related to community rugby.

Fighting a losing battle for talent

    • Read more:
      Are the Wallabies' struggles a sign of rugby union's decline in Australia?
    • This is particularly the case for Pasifika rugby players, for whom maximising professional incomes is tied to familial and cultural priorities.
    • The salary caps (the total value a team can spend on player salaries) of the codes are instructive.
    • Poor Wallaby performances will only drive up the cost of buying established talent.

Where to next for rugby union in Australia?

    • Rugby Australia is in an increasingly perilous market position, with declining on-field performance only adding to a vicious spiral of downward pressures.
    • It was announced in recent days that Rugby Australia has disengaged from private equity discussions on account of disappointing valuations.
    • In 1996, rugby union’s overall revenue ($21 million) was a quarter of the AFL’s ($85 million).
    • Rugby Australia’s semi-professional women’s rugby program is now firmly behind both other national rugby unions, as well as the many vibrant domestic women’s leagues such as the Women’s Big Bash League, AFLW and NRLW.

Devils in the detail: an economist argues the case for a Tasmanian AFL team – and new stadium

Retrieved on: 
Monday, May 1, 2023
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A new stadium is the last of 11 AFL requirements for a Tasmanian club to become the league’s 19th team, joining ten Victorian clubs and two each from the other four states.

Key Points: 
  • A new stadium is the last of 11 AFL requirements for a Tasmanian club to become the league’s 19th team, joining ten Victorian clubs and two each from the other four states.
  • The Tasmanian government wants the stadium, which it will own, to anchor a new “arts and sports” precinct.
  • Without an AFL team and new stadium, Tasmania is likely to still have a homeless problem.
  • In fact, the problem may even be worse without economic activity the new team and stadium will bring.

Economic rationale

    • The rationale for the federal and state governments is that a new stadium is a precondition for a Tasmanian AFL, and that both together will generate $2.2 billion in economic activity over 25 years according to Tasmanian government.
    • The Tasmanian government estimates construction will generate $300 million in economic activity and 4,200 jobs.
    • It expects the stadium when operational to sustain 950 jobs and generate $85 million in economic activity a year.

The case for a Tassie team

    • In assessing this decision, we can’t just consider the business case for the stadium.
    • It’s about the case for a Tasmanian AFL club.
    • The percentage of Tasmanians that only follow the AFL is 35%, compared to the national average of 19%.
    • Read more:
      The Barassi Line: a globally unique divider splitting Australia's footy fans

More than the bottom line

    • It’s sort of a blend of strict financial business and not for profit […] If we wanted just to make money, our model would be quite different.
    • It’s about more than just the bottom line.
    • The entry of the Tassie Devils into the AFL can be justified on economic, social and (most of all) footy grounds.