The RFU is facing a massive backlash from Championship clubs after announcing it will cut its funding by 50%, with Premiership Rugby ending its contributions altogether by 2021.
In a move which would appear to make ring-fencing a more likely reality in the near future, Championship clubs are to have their current total of £550,000 per-season halved.
The RFU and PRL currently support the league with an £8.1m financial package.
But RFU chief executive, Bill Sweeney, has voiced his view that the governing body could not justify financing the second tier after it had its funding increased after the 2015 Rugby World Cup.
“This is a decision based on a principle of ensuring levels of investment are geared to a clear return on investment,” said Sweeney, appointed as chief executive at the RFU last June.
“There are many worthy requirements from both the professional and community game and we need to make sure that every pound spent is clearly justified. The decision we have made is connected to a wider review of strategic objectives and resource allocation.
“The decision taken in 2015 to increase Championship funding significantly was against a set of objectives and deliverables that we do not believe have been achieved.
“Ultimately the difference in the levels of funding between the current agreement and our new commitment will not be the deciding factor for clubs with aspirations for promotion and will always require additional investment.
“The gateway is still open for clubs to get into the Premiership if they have the necessary financial resources and meet the minimum standards required.
“The Championship is, and will continue to be, a useful way for players to get additional developmental experience, but we do not believe it is the primary place where Premiership and England players are discovered and developed.”
Sweeney's words will fall silent on those who believe this is a designed move to shepherd in the ring-fencing of the Premiership and effectively cut the Championship and its clubs adrift.
PRL will cut its contribution from £1.7 million to £850,000 next season and then end its funding of the Championship altogether from the 2021/22 season.
Nottingham chairman Alistair Bow has been one of the first senior figures from the second tier to issue a public statement condemning the RFU and PRL.
“It's the RFU saying it doesn't want the Championship,” Bow said. “The Premiership has had a lot of influence over all the decisions regarding the Championship, certainly for the 10 years I've been involved.
“I do strongly believe the actions the RFU has taken have handed PRL everything on a plate and without having to pay a penny for it. The RFU has handed English professional rugby … everything, to the hands of PRL.”
A drop in investment in the RFU has forced Sweeney into the first significant move of his tenure since succeeding interim Nigel Melville.
Despite returning a profit at the end of 2019, investment fell by £7m to £100.5m.
With current forecasts projecting that number to fall again to £95m this year.
In its statement the RFU point to the Championship needing to become a financially viable league, with the average annual loss of its 12 clubs amounting to £260,000.
The last financial year saw Premiership clubs record losses averaging £3.7m.
