Smith Backs LIV Purse Cuts as $7b Saudi Deficit Plunges Circuit Into Strategic Crisis

Australian golfing superstar Cameron Smith has broken ranks with his breakaway colleagues, admitting that LIV Golf’s eye-watering prize pools are fundamentally unsustainable and conceding the rebel circuit must radically scale back its commercial model to survive.

The extraordinary admission from the Ripper GC captain comes at a critical juncture for the Saudi-backed league. In late April, Saudi Arabia’s Public Investment Fund (PIF) sent shockwaves through the sports business landscape by announcing it would cease funding LIV beyond the current 2026 season. The sovereign wealth fund elected to pull the pin after absorbing staggering losses exceeding US$5 billion (A$7.1 billion) since the tournament’s disruptive launch in 2022.

The sudden funding cliff has left LIV executives scrambling to secure external corporate investment to keep the venture solvent into 2027. Currently, each individual LIV tournament guarantees a massive US$30 million (A$42.4 million) purse.

Speaking ahead of LIV’s Spanish event this week, the 32-year-old Queenslander pulled no punches regarding the fiscal realities facing the sport.

“This has been an awesome four or five years for us golfers, for everyone around the world. It’s changed a lot of things, but I think realistically, it’s time for everything to come back to the way it was,” Smith said. “It was obviously not working, and it’s pretty far-fetched, realistically. So we’ll see what happens. I’m sure there are going to be a lot of changes, particularly with prize money next year.”

Strategic discussions within the league have floated a downsized 2027 calendar comprising five ‘team majors’ and five ‘signature events’. Smith insists that leaning heavily into franchised team assets, like his all-Australian outfit Ripper GC, represents the league’s primary pathway to commercial viability.

“I think LIV is trying to be different, and through tough times, you lean toward what’s worked in the past,” Smith said. “I feel as though we really have to lean into the team stuff. It works in Australia and South Africa, even last week in Korea and Asia, they love it. I would love to see that become more than what it is now.”

The reform aims to restore the commercial value of sporting meritocracy, moving away from the limited-field, no-cut formats that have recently diluted the tour’s product.

“Any good process — in the sort of experience of my old job, any substantial change we’ve made always came with a lot of work and a lot of tension to the process. If you don’t have a good process and there’s not tension, it means you’re not asking the right questions,” Rolapp said. “I think we have lost a lot of that with the smaller fields, no-cut events. The competitive meritocracy that makes this sport great and unique is what we’ve gotten away from, and we’re getting back to (it).”

The PGA Tour’s policy board is scheduled to vote on the definitive structural framework on June 22, leaving LIV with a rapidly closing window to prove its downscaled business model can attract the private equity required to stay afloat.

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