New Zealand Rugby Union was projecting a substantial loss from the World Cup.
So concerned is the NZRU that New Zealand officials allegedly travelled to Australia recently seeking financial help because of concerns their sub-host role in the tournament could see them suffer a A$6million (US$3m/B3.4m) loss.
To ensure New Zealand makes a profit, the Australian Rugby Union is recommending the provision of a substantial subsidy and that the country cuts back the number of venues at which it plays World Cup matches - sticking to the large stadiums where a profit can be made rather than playing games throughout the country at far smaller venues.
The catch is that to ensure Australia can recoup the subsidy, New Zealand must either relinquish a semi-final or a whole pool and a quarter-final.
New Zealand was originally to stage two pools of five teams, two quarter-finals, the third-place play-off, and a semi-final - a total of 24 matches.
The ARU board is expected on Friday to approve the signing of the World Cup host union agreement. A sub-host proposal will then be forwarded to the NZRU.
It is also understood that at last week's International Rugby Board meeting in Dublin, Australian officials were asked if they would be capable of hosting the tournament on their own, in the event of New Zealand's financial problems intensifying. Australia is believed to have replied in the affirmative.
But the ARU is keen to work positively with the NZRU and ensure it has a considerable role in the tournament.
