THE Island stands to lose millions of pounds a year in sports tourism revenue following the collapse of Jersey Reds, it has emerged – as questions grow over why the club was not given further government funding.
A former politician who held responsibility for sport and is now the chair of the Jersey Sports Council, Steve Pallett, said the government – which pumped hundreds of thousands of pounds into the club in recent months – should be ‘careful about writing it off’ given the potential economic benefit to the Island.
And a travel expert has said the loss of Jersey Reds was ‘going to hit the visitor economy’.
On Thursday morning the club announced that it had ceased trading and that liquidation ‘appears inevitable’ after talks with current and future investors fell apart.
Later that day, Assistant Economic Development Minister Lucy Stephenson, who has responsibility for sport, revealed that the government had recently provided Jersey Reds with £370,000 in emergency funding.
She explained that the grants were issued to buy Jersey Reds time to find private investment, but that the government ‘could not commit’ to giving them more money due to other demands on the public purse ‘and in fairness to other sports and businesses in the Island’.
Mr Pallett said his heart went out to the players, coaches, staff and other affected individuals.
‘It is going to have a huge impact. Like everybody else I’m disappointed and shocked that it has happened so early in the season,’ he continued, although he noted that the club had been ‘near’ to similar situations in the past.
He acknowledged that £370,000 was ‘a lot of money’, but stressed that the grant should also be viewed in the context of its economic benefits.
Robert Mackenzie, managing director of CI Travel Group, said the government needed to make ‘absolutely sure’ that it was not possible to keep Jersey Reds going ‘until they are able to realise further funding’ – although he acknowledged that this may have been the case.
‘It is clear that, at the end of the day, Jersey Reds brought thousands of visitors to the Island,’ he explained.
‘To lose that business, it is going to hit the visitor economy.’
In a statement, Visit Jersey said: ‘The Jersey Reds have played an important role in attracting sports tourism to the Island, have helped to raise Jersey’s profile internationally, and offered a valuable experience that was enjoyed by visitors and Islanders alike.’
Chair of the Jersey Reds, Mark Morgan, previously said that research suggested the club’s value to the Island was around £5m per year.
This, he explained, included the tax-paying staff they employed, GST on events and alcohol sold, as well as the value generated through players and visitors travelling to and from the Island and enjoying local hospitality.
An independent report carried out several years ago – and referenced in the 2020-2023 Government Plan – placed the figure at ‘up to £2.1 million a year’.
Mr Pallett said: ‘It’s hard to put an exact number on it but I wouldn’t be surprised if it runs to millions.
‘This is the biggest arm of sports tourism at the moment and it looks like it is about to be cut off.
‘Government need to be careful about writing it off when there is that potential benefit, which is on the cusp of being really big.’
Jersey Chamber of Commerce president Adam Budworth said the club’s collapse was ‘a real loss to the Island’.
‘This is more than rugby, this is Jersey PLC. Jersey Reds have put the Island on the global rugby map.
‘The exposure they have had recently, both domestically and internationally, in winning the Championship, the recent live coverage of the Bath game and the excellent interview with Harvey Biljon following the match, would in marketing spend have taken a significant portion of Visit Jersey’s budget,’ he added.
‘The value to Jersey in these terms, [is] added to the economic impacts this will have to related industries in travel, tourism, hospitality and retail from visiting teams and supporters.
‘Chamber, like the rest of the Island, feels for everybody involved with the club and particularly those employed there.’
– An independent relief fund has been set up and will be overseen by co-signatories Harvey Biljon (director of rugby) and Nicola Dando (welfare manager).
The fund’s initial aim is to cover employees’ September salaries, with any funds in excess of this being split equally between those affected. The details for the account are as follows:
Name: HB10 Limited (Staff welfare); sort code: 16-51-71; account number: 20086850.