As tensions escalate, Cricket Australia has outlined why it believes the players' push to retain a payment model adopted for two decades is outdated, breeds "mistrust" and even "damages" the sport.
Fairfax Media can reveal an internal CA briefing note which outlines the governing body's displeasure with the set percentage model the Australian Cricketers Association wants to retain.
The ACA and player agents have complained about the lack of detail in how CA plans to share more than $500 million in the next five years to players and why CA wants to dump the current model.
The document sheds light on this. CA's concerns are based on several principles, including assertions the current pay model "effectively rules out any normal investment strategy aimed at growing the game", claims which the ACA on Saturday were a "silly cheap shot at a time when mediation is necessary".
An example is provided where CA says a "$100,000 investment that generates $115,000 of revenue should result in a profit of $15,000, to be invested back into cricket. But because the players get a share of revenue, not profit, they would be entitled to 24.5 per cent of the $115,000, leaving Cricket Australia with just $86,825 of the original $100,000, an actual loss of $13,175".
"Thus, any CA investment requires an unrealistic profit of 32 per cent just to break even. More than 70 per cent of Cricket Australia's expenditure is investment in elite cricket. Players are entitled to 24.5 per cent of every dollar returned from that investment, not just every dollar of profit," the document says.
CA also says it has an issue with how revenue "generated via grassroots cricket programs has to be distributed to elite player payments" rather than reinvested in these programs. CA says grassroots cricket is "chronically underfunded" and it can generate $76 million towards this under its submission.
"A proportion of revenue from the sponsorship of grassroots cricket programs has to be distributed to elite player payments," the document says.
CA claims that under the ACA's revised proposal, "a guaranteed 22.5 per cent of all CA and the states and associations revenue means the players would receive 22.5 cents of every dollar spent by parents on a junior registration fee".
An ACA spokesman fired back at CA, declaring: "The ACA proposal clearly refers to players receiving 22.5% of 'to be agreed revenue.' Revenue like government grants and local fees and the like would not be included under any scenario. CA know this because its in the ACA's proposal."
Discussions between the ACA and CA have gone nowhere, and the June 30 deadline for a new memorandum of understanding looms large. Should there be no deal, CA chief James Sutherland has said players will be locked out.
Players have already begun to make preparations of their own, including establishing an image rights company where rival CA sponsors and broadcasters can pitch deals from July 1. ACA chief Alistair Nicholson is briefing the Australian side in London over the weekend.
In the document, CA has also declared that players even benefit from contra generated through broadcast rights agreements, when networks offset a cash payment for advertising.
"Revenue that is never actually received in the form of cash must be distributed as cash to player payments," the document says.
"Even if not received as cash, the estimated value of products and services (contra) received by CA has to be paid in cash to the player payments pool (an example would be the estimated value of a broadcast partner providing free advertising spots to promote ticket sales for international cricket). This cash must come from other revenue intended for the game."
CA, led by former Rio Tinto boss David Peever, a man who has clashed with unions, says the current model "generates conflict and mistrust between players and administrators (the opposite of a sense of partnership)".
"There are constant disputes over the definition and treatment of various revenue streams and whether or not they have been properly accounted for and included in player payments," the document said.
"There is almost permanent mistrust between players' representatives and administrators over the treatment of perceived new sources of revenue. For example, the ACA claims that players should be entitled to a share of revenue from CA's digital media, even though CA digital has not generated any."
The ACA spokesman said "the relationship between the players and the administrators has been free of dispute for 20 years".
"That's because of the partnership. The source of current distrust is the threat of unemployment and the lack of financial disclosure. These things are not the fault of the partnership but rather an abuse of it."
CA also says the current model does not allow flexibility in terms of dealing with "emerging priorities" because the set percentage is locked in.
As reported by Fairfax Media in December, CA is also threatening to no longer fund the ACA, with $4.3 million - outside of player payments - handed to association over a five-year period.
