Australia have backed New Zealand's contention that leading countries will not be able to afford to participate in the World Cup unless they gain greater commercial freedom to offset the income they lose in taking part.

Steve Tew, the chief executive of the New Zealand Rugby Union, told the Guardian that it cost his organisation some £7m in lost revenue to compete in a World Cup and said that the chances of the All Blacks taking part in the 2015 tournament, which is being held in England, were slim unless fundamental changes were made.

He was been backed by his Australian Rugby Union counterpart, John O'Neill, who said the financial cost of competing in a World Cup had become too much.

"As Steve Tew correctly pointed out, the current economic model is unsustainable and unacceptable," O'Neill said. "We look to the International Rugby Board executive to resolve these issues urgently because, as a national union, the ARU is unable to continue making these significant losses every four years."

The Rugby Football Union will suffer a drop in income of £10m this year, but is better able to sustain the loss than its New Zealand and Australian equivalents who centrally contract their players and have suffered from wage inflation as they look to keep their best talent from migrating to Europe.

"The ARU firmly supports ongoing funding assistance programmes for emerging nations and for the growth of the game worldwide," O'Neill said. "It should be an overriding ambition to have what are currently tier-two unions accelerate their transition to tier-one status both on and off the field. At the same time, there also needs to be cognisance of the need to sustain the financial strength of the existing tier‑one unions, whose teams currently drive the commercial success of Rugby World Cup."

Tew said that New Zealand and Australia continually had to bang the table hard at meetings of the IRB executive because the major European nations had an in-built majority and there was invariably a north-south divide. Among the changes they want from the tournament organisers is an end to the total exclusion of their sponsors during a World Cup.