Bill Pulver has a number of ideas to "heal" Australian rugby © Getty Images

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Wallabies players may have to accept reduced salaries for the good of the game in Australia, Bill Pulver said in an exclusive interview with ESPNscrum.

The financial health of rugby in Australia "is a concern", the Australian Rugby Union (ARU) chief executive told ESPNscrum when asked about the union's $8.4 million deficit for 2012 after the $10.5 million deficit in 2011. And "sadly there is not as much money coming in from the Lions tour this year as we would have wanted because of a quite difficult sponsorship market".

"Historically we have had these periodic windfalls," Pulver said in explanation of the Australian game's financial situation. "Hosting the 2003 Rugby World Cup, and a ton of money came in. Every 12 years you have a British & Irish Lions tour and a ton of money comes in … Australian rugby has pretty much survived on major windfalls that have covered … losses until the next windfall comes in.

"But the reality is that the next windfall [after the coming Lions tour] is 12 years away [the 2025 Lions tour]. The two big windfalls are Lions tours and Rugby World Cups. With World Cups, they generally alternate between north and south. So 2019 is Japan in the north. With 2023 if you were a betting man you'd probably be saying South Africa; 2027 goes north and 2031, there's probably a decent chance the IRB will want to develop the game in South America. So it's possible it could be as long as 2039 before our next World Cup staged in Australia. So our next windfall being 12 years away does worry me."

Pulver said the ARU had "to cut our expense cloth according to what we can afford in the short term" and he flagged the possibility of reduced salaries for the Wallabies and the country's Super Rugby players, through negotiations with the Rugby Union Players Association (RUPA), as a possible short-term aim. Pulver accepts the potential ramifications of such a decision, saying "the real solutions involve getting revenue growth going". But "in the context of our financial situation, let me just say everything is on the table".

"I don't want to position this as a disaster scenario, but we need to finesse our cost base. So everything is on the table."

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Pulver suggested the Wallabies' gold jersey would remain a lucrative attraction for top players, even if the prospectively reduced salaries could not match those available overseas or in rugby league, particularly given the additional lure of the Olympic Sevens program.

"We have two pressure points," he said. "One is other codes, and the other is international, particularly from Japan and France. But the opportunity and the excitement associated with the Wallabies jersey should carry a lot of value. What differentiates our game is not only we are an international game, but we are a very competitive international game. In some ways you could be only modestly satisfied with our performance at Wallabies level over the last few years, but we are still ranked third. So what happens if we absolutely get it right? The lure, power and magnetism of that Wallabies jersey is significant."

Pulver accepted, however, that Australian rugby had to do more than prospectively reduce player salaries if it were to regain rude financial health, not least that it had to reconnect with the fans.

"What I'm most concerned about is fan engagement," he said. "The good news is that we have a fantastic year and the excitement around the Lions tour has been palpable. Our Super Rugby teams are performing better than for a long time, and that should equate into a super competitive Wallabies team. If we can win a Rugby Championship and Bledisloe Cup, that will springboard growth into the game.

"It can be addressed, but turning around revenue is on the one hand about winning more at the elite level when 95% of your revenue comes from Super Rugby and the Wallabies, and it is also turning the entertainment package around. Our rusted-on rugby fans have been slipping away from the game, and we've got to get them back. We have a fair bit of work to do."

ESPNscrum will publish part three of Greg Growden's exclusive interview with Bill Pulver on Monday, May 13