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The NRL is investigating a potential salary cap breach at the Newcastle Knights in relation to a third-party deal involving superstar fullback Kalyn Ponga.
The NRL on Monday night confirmed it was looking into the issue involving one of the game’s biggest stars.
Sources with knowledge of the situation who requested anonymity to speak freely told the Herald there had been a series of meetings involving the NRL integrity unit, Knights officials and Kalyn’s father, Andre Ponga, late last week.
“The NRL is aware of the matter and is reviewing it,” an NRL spokesperson said.
On Monday night, a spokesperson for the Knights said: “All third parties are registered with the NRL. There’s no issue with Kalyn Ponga’s contract and anything to do with third parties remain between the player and his agent to resolve.”
The NRL has become involved following concerns raised by Andre Ponga, who claims his son is owed a six-figure sum from a registered third-party deal signed off on by the NRL in 2020.
The Herald is not suggesting that Andre Ponga’s allegation about non-payment is correct. Andre Ponga has been contacted for comment.
Complicating matters for the NRL is the fact it approved the third-party deal at the time. New information has since come to light which questions whether the deal was at arm’s length from the club.
The NRL’s salary cap auditor has discretionary powers to retrospectively include deals in a club’s salary cap if new information emerges, even after the expiration of a contract.
That was the case in 2018 when the NRL fined Manly $750,000 for breaches of the cap between 2013 and 2017.
The league imposed a $660,000 penalty that was applied to the Sea Eagles’ salary cap in 2018 and 2019 for breaches involving 15 players, totalling $1.5 million in undisclosed third-party deals.
If the NRL deems that the third-party deal involving Ponga isn’t at arm’s length, they can include it in Newcastle’s salary cap.
The NRL conducted an audit in 2020 to determine whether the third-party agreement was at arm’s length from the club, as per the rules, and approved the deal.
However, the integrity unit is now working with Andre Ponga and the Knights to gather more information.
The Herald does not suggest the Ponga family was aware of any possible problems with the deal.
One option available to Newcastle to keep the Ponga family happy is to pay the money themselves, but any payment made to the fullback will be added to the club’s salary cap.
Ponga’s contract is believed to be worth around $1.4 million a season after agreeing to an extension until the end of 2027 two years ago.
The Knights tabled Ponga the lucrative offer amid concerns that the superstar was tempted to switch codes to rugby union in a bid to represent the All Blacks.
At the time, Knights chief executive Phil Gardner told the Herald the club was open to the idea of inserting an “All Blacks clause” into Ponga’s new contract.
“I’d be really surprised if the All Blacks weren’t talking to him now, that’s the kind of talent we are talking about here,” Gardner said in 2020.
“He could play for the All Blacks, the Wallabies, or he may end up going to Japan or Europe. We genuinely want the best for the young man and while ever he wants to play rugby league, we want him to play here at Newcastle in an environment he enjoys.
“We have obviously put a deal forward that we believe is in the best interest of the club, but also in the best interest of him.”
The NRL did not approve the contract and required the Knights to replace the proposed All Black clause with generic player options. In 2022 those options were negated when Ponga signed an extension until 2027.
The NRL has cracked down on third-party deals since the salary cap scandal that saw Parramatta docked 12 points in 2016. The cap on combined private sector arm’s length agreements was reduced from $4.6m in 2017 to $1.5m in 2021.
The NRL is investigating a potential salary cap breach at the Newcastle Knights in relation to a third-party deal involving superstar fullback Kalyn Ponga.
The NRL on Monday night confirmed it was looking into the issue involving one of the game’s biggest stars.
Sources with knowledge of the situation who requested anonymity to speak freely told the Herald there had been a series of meetings involving the NRL integrity unit, Knights officials and Kalyn’s father, Andre Ponga, late last week.
“The NRL is aware of the matter and is reviewing it,” an NRL spokesperson said.
On Monday night, a spokesperson for the Knights said: “All third parties are registered with the NRL. There’s no issue with Kalyn Ponga’s contract and anything to do with third parties remain between the player and his agent to resolve.”
The NRL has become involved following concerns raised by Andre Ponga, who claims his son is owed a six-figure sum from a registered third-party deal signed off on by the NRL in 2020.
The Herald is not suggesting that Andre Ponga’s allegation about non-payment is correct. Andre Ponga has been contacted for comment.
Complicating matters for the NRL is the fact it approved the third-party deal at the time. New information has since come to light which questions whether the deal was at arm’s length from the club.
The NRL’s salary cap auditor has discretionary powers to retrospectively include deals in a club’s salary cap if new information emerges, even after the expiration of a contract.
That was the case in 2018 when the NRL fined Manly $750,000 for breaches of the cap between 2013 and 2017.
The league imposed a $660,000 penalty that was applied to the Sea Eagles’ salary cap in 2018 and 2019 for breaches involving 15 players, totalling $1.5 million in undisclosed third-party deals.
If the NRL deems that the third-party deal involving Ponga isn’t at arm’s length, they can include it in Newcastle’s salary cap.
The NRL conducted an audit in 2020 to determine whether the third-party agreement was at arm’s length from the club, as per the rules, and approved the deal.
However, the integrity unit is now working with Andre Ponga and the Knights to gather more information.
The Herald does not suggest the Ponga family was aware of any possible problems with the deal.
One option available to Newcastle to keep the Ponga family happy is to pay the money themselves, but any payment made to the fullback will be added to the club’s salary cap.
Ponga’s contract is believed to be worth around $1.4 million a season after agreeing to an extension until the end of 2027 two years ago.
The Knights tabled Ponga the lucrative offer amid concerns that the superstar was tempted to switch codes to rugby union in a bid to represent the All Blacks.
At the time, Knights chief executive Phil Gardner told the Herald the club was open to the idea of inserting an “All Blacks clause” into Ponga’s new contract.
“I’d be really surprised if the All Blacks weren’t talking to him now, that’s the kind of talent we are talking about here,” Gardner said in 2020.
“He could play for the All Blacks, the Wallabies, or he may end up going to Japan or Europe. We genuinely want the best for the young man and while ever he wants to play rugby league, we want him to play here at Newcastle in an environment he enjoys.
“We have obviously put a deal forward that we believe is in the best interest of the club, but also in the best interest of him.”
The NRL did not approve the contract and required the Knights to replace the proposed All Black clause with generic player options. In 2022 those options were negated when Ponga signed an extension until 2027.
The NRL has cracked down on third-party deals since the salary cap scandal that saw Parramatta docked 12 points in 2016. The cap on combined private sector arm’s length agreements was reduced from $4.6m in 2017 to $1.5m in 2021.
