WELSH rugby is set for another crucial power battle, with the new slimmed-down WRU on a major collision course with the vast majority of clubs.

WRU group chief executive David Moffett considered resignation after an overwhelming vote at Saturday's annual meeting for the union to rethink its decision to trim the budget to clubs from Division Two from £8,000 to £6,000.

Moffett was upset and angry at the decision and spent Saturday night considering his position before calling a Press conference at short notice yesterday morning.

Rather than announce his resignation, he said he would not respond to threats, and he called for an end to the situation where just ten clubs can call an extraordinary meeting of the WRU because of a decision they disagree with.

The new slimmed-down WRU board, run by a six-am executive, will be asked to approve the budget again at their meeting a week Thursday. That means voting again for the reduced figure of £6,000 for the majority of clubs.

They will then have to consider whether to accept that, going against Saturday's decision, or whether to call another extraordinary meeting.

They could then pass a vote of no confidence in the board, which would result in the lot of them resigning and Welsh rugby being left in even bigger turmoil.

"The clear message was if the board ignores what the clubs want they will seek the dismissal of the board," admitted Moffett yesterday.

"I don't respond to threats. That may have been the way Welsh rugby worked in the past, but while I'm chief executive that's not the way in future or we've got no future.

"I could understand the clubs taking this decision if we were financially viable, but we've spent time outlining our financial position to the clubs of the £66m debt, which is climbing.

"Besides the parlous financial position, they have ignored our position with the bank and BT, who have been fantastic supporters of the WRU.

"I would like to meet that by facing our obligations or I'm not sure where we'll be.

"I've stepped on toes and moved people along, but I've done it for Welsh rugby and for good governance.

"The decision taken by them on Saturday has made my and the board's position almost untenable, and has led me to give serious consideration to my position.

"There has been speculation I was considering resigning, and I've given it large consideration with my partner, with David Pickering and also the new management board.

"I took overnight to think about it and had further discussions today. But I never run away from a fight because I am a person of principle, and the first is good governance.

"I owe it to the board and the Welsh people to continue to show good leadership, so will recommend maintaining the budget we have agreed.

"That will be a matter for the board to make a decision on Thursday week.

"Community rugby is at the heart of Welsh rugby, and we will continue to explore funding not finding a way into players' pockets."

Pickering pleaded for a way to be found for the WRU to overturn a deficit of £3.7m this year, with already huge borrowing requirements on a £66m debt.

"It's a serious situation. We have fundamental decisions to make and we must manage the situation properly because every time our judgement is questioned we back off," he said.

"We have to listen to the clubs, they are shareholders, but they have obligations to the people they put in power.

"Now is the time for people in Welsh rugby to embrace the professional management and support the sound professional judgement we've made.

"We ask for stability. What we badly need in the next 12 months is to honour our obligations to creditors and the banks. If we don't stick to the budget and make another loss in 2004-5... that's not an option."

Pickering says the union is already certain to make another loss next year because of poor ticket sales for next month's home internationals against England and Scotland.