The Australian Rugby Union will assume responsibility for the day to day management of the New South Wales Rugby Union following agreement between the Boards of both bodies.

Under the agreement, the Australian Rugby Union (ARU) will put into place a funding package designed to stabilise the financial position of the NSWRU.

The agreement follows an approach to the ARU Board, by NSWRU Chairman Mr Ron Graham and NSWRU Director Mr Dilip Kumar, who are members of both the ARU and NSWRU Boards.

The pair sought help for NSWRU after concern over the state bodies' financial position.

With the agreement of both Unions, an independent assessment of the NSWRU financial arrangements, was undertaken by accountancy firm KPMG.

KPMG spent four weeks examining the NSWRU operation before presenting their findings first to the ARU Board, then the NSWRU Board. As a consequence, the NSWRU Board undertook to accept the ARU's offer of financial assistance.

Critical features of the funding agreement are:

• The NSWRU Board to delegate its authority to a "Revival Committee", comprising Mr John O'Neill, Mr Bob Tuckey, Mr Ron Graham & Mr Dilip Kumar.
• NSWRU staff to report directly to ARU management.
• NSWRU undergo a review of its constitution.
• The Waratahs and rugby development to be quarantined to the greatest extent possible from the necessary financial restraints to be imposed on the operation.

Mr O'Neill says while there is no fixed timetable for management to be handed back, it's hoped NSWRU would have its own complete management structure before the end of next year.

"There's a job to be done and that is the most important thing. We are not pretending that we can wave a magic wand but there is a determination that New South Wales can be put back on its feet."

"Rugby is going through a period of exciting growth and development. It's critical that New South Wales is in the best possible position to maximise its opportunities."

The Funding Package

The ARU believes $5 million is required to restore NSW position.

The ARU remains confident that this path will provide some short term financial comfort. However, the ongoing revival of the business requires cost issues to be addressed, and revenues opportunities to be more fully exploited.

The Revival Committee

The "Revival Committee" has been appointed by John O'Neill following consultation with David Clarke, Chairman of the ARU and Mr Ron Graham, Chairman of NSWRU.

The delegation of powers to this Committee cannot be revoked without the written consent of the ARU Board.

The Committee comprises Messrs Ron Graham, Dilip Kumar, John O'Neill, Bob Tuckey.

Staffing Levels

It is inevitable that there will be some rationalisation of staffing levels. NSWRU cannot continue to operate at its current levels and remain viable. The staffing structure will be examined in the coming weeks.

However, the operation of the Waratahs and the rugby development area will not be compromised and will be quarantined from significant cuts. NSWRU management will report directly to senior management of the ARU.

Role of the Clubs

The ARU and NSWRU remain committed to the repositioning and revitalisation of the elite amateur game. Funding arrangements for Premier Rugby remains in place, with clubs given a greater opportunity to take responsibility for and manage their own affairs.

Constitutional Reform

The NSWRU will examine a range of reforms at its Annual General Meeting in November. The current constitution is no longer appropriate for the effective governance of a dynamic and modern sport.