London Welsh will be docked 20 league points and drop to the bottom of the Championship when the club go into voluntary liquidation this week, but they can remain in the second tier, if they avoid relegation, by coming up with a business plan that is accepted by the Rugby Football Union and paying a six‑figure bond.
London Welsh, who faced a court hearing on Monday over an unpaid £250,000 bill to Her Majesty’s Revenue & Customs, announced the club were going into liquidation to reform as a semi‑professional entity on the day the support coaches for the British & Irish Lions tour to New Zealand next year were announced.
The Lions have won a series in New Zealand just once, in 1971 when London Welsh supplied seven players, far more than any other club. One of the leading sides then, they have paid for two seasons in the Premiership this decade that left them with debts and a wage bill they cannot afford.
“London Welsh has reached a difficult point in its illustrious history,” said the club’s chairman, Gareth Hawkins, who took over two months ago.
“The current business model is totally unsustainable with the playing budget at £1.7m and gates numbering as low as 400. The debts left the club with no alternative but to seek liquidation. Having to break that news to 40 staff was extremely difficult. In the new year, it is the intention of the board that London Welsh will be able to return to playing at Old Deer Park. However, it will be necessary to change the club’s business model to a semi-professional setup and then raise £300,000 so that the club can regain a position within the RFU Championship.”
An RFU spokesperson said: “London Welsh intend to go into voluntary liquidation. When that happens, the club will receive an immediate 20-point deduction. They can continue to play while the process is ongoing, and the RFU are working with the club to find a way to fulfil their fixtures this season. We will update all clubs as this develops.”
Hawkins cited the example of Richmond, the club the Exiles replace at the bottom of the table, as proof that the semi-professional model can work in the second tier.
It means an end to ambitions of playing again in the Premiership but if London Welsh’s business model is not acceptable to the RFU, or they fail to find the money to pay the bond, likely to be £150,000, they will, like Richmond in 1999, drop all the way down the leagues to start again. Waiting for them in the Hertfordshire and Middlesex second division would be the Bank of England.
