THE SALARY SOMBRERO PARADOX
This week the Roosters announced the signing of veteran try machine Brett Morris. With this news hot on the heels of the unveiling of hulking English winger Ryan Hall on a two year deal from Super League giants Leeds Rhinos, the addition of another quality finisher surprised many.
The assumption for most had been that Hall would be a like for like replacement for current Roosters outside back Blake Fergusson who recently announced that he would be leaving the club to join the Parramatta Eels on a multi-year deal.
Having already committed a large portion of their 2019 salary cap to the second year of Cooper Cronk’s deal (who has a player option), and a rumoured $1 million per season for new recruit Angus Crichton, it appeared that Ferguson had become an unwitting casualty of the Rooster’s ballooning payroll.
Then they went out and signed Hall AND Morris, and anybody with even a passing interest in the NRL collectively raised and eyebrow. Cue jokes about “Uncle Nick” Politis and his Salary Sombrero:
It is entirely possible that these people are correct – that the Roosters have a salary sombrero while other clubs have a cap, and at the same time it can also be true that they haven’t actually broken any rules.
As is the case with so many things in the NRL, it began as an imperfect solution to a serious problem – rival codes had been pinching some of the brightest names in Rugby League, and with their comparatively modest coffers, the NRL and it’s clubs had to come up with a way to retain their biggest names without raising the salary cap in a way that would financially cripple struggling clubs.
Enter Third Party Agreements. TPAs allow players to receive uncapped payments for their own intellectual property from companies external to the club – without it counting against the salary cap. The agreement is contingent upon it not being arranged by the club as a way to circumvent the cap and all agreements must be registered with the NRL before being signed.
The NRL recently released figures which demonstrate that TPAs are actually in decline – down from $11 million in 2015 to $9.6 million in 2017, which they used as evidence of the dwindling impact of TPAs on parity in the NRL.
However, these figures ignore the very real existence of illegitimate TPAs. When they introduced Third Party Agreements to the game, the NRL in effect gave clubs a blueprint for rorting the salary cap, and then kindly asked them to not do so.
For their part, Nick Politis and the Roosters have pulled the ultimate “nothing to see here boys” move of hiring the NRL’s former salary cap auditor Ian Schubert to oversee their books. Books which Politis insists they simply manage “better than most clubs” – a claim made despite his Chief Executive Joe Kelly being tangled up in Manly’s salary cap scandal.
It feels a lot like a sleazy boyfriend inviting their girlfriend to look through their phone, safe in the knowledge that all their dodgy dealings took place on the prepaid phone stashed in a shoe in the bottom of the closet.
Further complicating the situation is the vested interest the NRL has in allowing clubs to execute these deals. When a club comes to them the way the Roosters did ahead of the 2013 premiership season seeking to add Sonny Bill Williams to a roster that had recently accommodated Michael Jennings, James Maloney and Luke O’Donnell, the NRL must balance their need to protect the integrity of the Salary Cap against their desire to grow and promote the game.
Get The 12&UNDERTAKER’s stories in your inbox
Join Medium for free to get updates from this writer.
The return of Sonny Bill Williams would provide the type of publicity and exposure the NRL could only dream of, and eager to move on from the fiasco that cost the Eels Israel Folau’s signature a few months before, the NRL signed off on William’s contract – despite reservations from salary cap auditor Ian Shubert.
Come season’s end, Sonny Bill Williams had played a pivotal role in delivering the Roosters their first premiership in more than a decade.
If the intention of the NRL’s salary cap is to augment parity by spreading the playing talent as their website suggests, then the addition of the TPAs has caused the Salary Cap to act paradoxically.
While the salary cap places all teams on an even playing field, it is the higher profile clubs who are better positioned to take advantage of the competitive loophole that is created by TPAs, so rather than evening the playing field, TPAs do the opposite – they maintain the status quo.
The same list of usual suspects turn up whenever a big name hits free agency – and as was the case with Sonny Bill Williams, they invariably end up with either the Roosters, Broncos, Sharks, Rabbitohs or Panthers.
The NRL cannot be relied upon to act impartially in this because their objectives are allied with the clubs in question. Big names arriving at big clubs is good for business, and so Sonny Bill Williams becomes a Rooster, and Jack Bird becomes a Bronco, and the other clubs come unstuck trying to compete.
For years, people have been talking of the need to make players salaries public, but that misunderstands the problem.
The Salary cap is like a pond, and Third Party Agreements muddy the water just enough that those sitting on the edge of the pond – the journalists, and the fans of the game, can’t quite see what’s going on below the surface.
Occasionally the NRL and their salary cap auditors will hook an Eel, or a mangy Sea Eagle out of the pond, stuff it, and mount it on the wall as evidence that the system works. But all the while, in the murky depths of the pond, the big fish of our game remain undisturbed.
THE PICKS:
I am running a bit late with the column this week so I have just two games to pick from – The Titans vs the Warriors and the Roosters vs the Dragons. I don’t feel overly confident about either.
You really can’t tip the Titans against the Warriors given their dreadful record against NZ and in general, and their decent home form shouldn’t be enough to alter that. The Dragons are faltering and the Roosters are surging which mean I am going to go the other way and back the Dragons with the points despite their recent run of bad form.
