Scottish Rugby is in robust financial health, cutting its debt and in line to plough more money into the domestic game, the Annual General Meeting was told yesterday. In his annual report, Gordon McKie, the chief executive, reported that despite the World Cup last season, the union had broken even and was in line to make profits in future years, with the debt standing below £16million.

In a generally rosy presentation, McKie told delegates that with the finances sorted out, they were able to concentrate on more fundamental matters, such as increasing the numbers of players and the numbers of volunteers.

However, there were also blips on the horizon. Eamon Hegarty, the finance director, struggled to explain a surge in the wage costs, mainly derived from employing the international players during the World Cup, but also caused by a complicated shuffle with the Borders club being closed but with the Edinburgh club being brought back under the union's control.

Plans to use part of the land around Murrayfield to help the union to recover from its financial woes could be scuppered by a four-year-old property deal that has given an outside company rights over some of the land around the stadium, McKie revealed.

In the financial chaos of 2004, when the union had just lost £8.4_million following a £2.6million loss the year before, the then board agreed a deal with Millar Developments to secure a parcel of land. However, McKie told the AGM, with the bank debt now under control and land being removed by government projects to build a tramway and to prevent flooding in the nearby Water of Leith, the union needs all the land round its stadium, only to find itself stymied by the existing agreement.

“The status of our property development is giving us some concern,” he said. “With the loss of the two back pitches and associated car parking, the union needs all the land it can get to maintain match-day operations and ancillary operations.

“We are also trying to bring more global events to Murrayfield. We think our land bank here is unique and will help to bring that about and will help us to increase our operating surplus. At the time of the contract with Millar Developments the union was in disarray and it was felt that the contract had to be entered into to secure the future of the union.

“Since then circumstances have changed and we now need that land because of those new circumstances. We have been in discussion with Millar about the need to renew that land but Millar are very keen to continue with that contract and take security over that land.”

With Millar having continued rights over that land, the rough area alongside the Murrayfield Ice Rink, it could delay any moves to use that land to help to bring events such as rugby league and American football to the stadium. The building work for the tram and flood scheme will already cause enough disruption - the main entrance is going to have to be moved, for example - and Millar's continued involvement could cause further problems.

However, this could be the last of the AGMs to be held on a Friday night, with delegates voting 97 to 84 to shift the meeting to a weekend date when more clubs from the outlying areas could be represented. About a third of the member clubs were unable to get to last night's event, but those who did get there saw the logic in the argument put forward on behalf of the Perthshire club that the event should be not be held on a working day.

The meeting was due to go on to discuss motions to axe the Scottish Cup and to scrap the Competitions Committee and bring the control of domestic competition under the direct jurisdiction of the Scottish Rugby Council, which is made up of representatives from the member clubs but with no representation from the union's officers or independent outsiders.