The ACT Brumbies have been hit by a 30 per cent reduction of funds from Rugby Australia as the code prepares for a major drop in revenue.
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The peak body will decrease the amount of revenue allocated to the Super Rugby franchises next year in line with a projected 30 per cent loss in profit.
News Limited reported Rugby Australia will enter 2021 with $40 million less in their cost line and have had a 40 per cent reduction in overall expenses.
Brumbies boss Phil Thomson said the club is still working through what the financial implications will be for the organisation.
"It's a significant decrease in funding for 2021, a 30 per cent decrease is quite a large number," Thomson said.
"We're still working through the details of that but we'll have to adjust our business accordingly to make sure we're operating properly next year."
Asked if the Brumbies had expected the funding cut, Thomson said: "We were expecting some level of decrease in funding, given the current environment and the impact this year has had on rugby.
"The percentage number was probably higher than what was expected."
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The Brumbies will look to increase sponsorship and commercial engagements to make up some of the shortfall, while the gradual return of crowds will also help ease financial pressure in 2021.
The capacity of Canberra Stadium is capped at 50 per cent, which the Brumbies are hopeful will lift early next year pending the ease of COVID-19 restrictions.
"We have to look at our own commercial funds and we're working hard around the sponsorship side of things and bringing in additional revenue into the business on that," Thomson said.
"Hopefully there's more normality around crowd attendance and engagement if things get back to normal on the Covid front next year, so hopefully we'll see an increase in revenue generated in that match-day attendance.
"Crowds are part of the financial jigsaw puzzle, it certainly will help. We will continue to work on engaging with the community and our fans to get them back into Canberra Stadium to whatever capacity we're allowed to.
"I'm hopeful the work we've done over the last few years in the community and on the commercial engagement side of things, as well as the success of the team will hold us in good stead over the next 12 months."
Meanwhile, the Brumbies were out in the community on Tuesday setting up a 'giving tree' for local charity Communities@Work.
The community is encouraged to drop off gifts and non-perishable food items under the tree at Brumbies Headquarters for local families in need.
"We set up a tree here with Communities@Work, a major charity partner of ours, to help struggling families in Canberra throughout the Christmas season and try to bring some joy and hope to their lives," hooker Billy Pollard said.
"As a footballer, it's very important to be able to give back to the community, especially one as tight as Canberra."