Joseph Suaalii's bombshell backflip has sent shockwaves across two codes after the teenage phenom reportedly turned his back on the NRL for a $3 million rugby deal.

Last month Suaalii agreed on a three-year, $1.7 million deal with the South Sydney Rabbitohs in the NRL, but the contract could not be registered until his 17th birthday in August.

In a stunning backflip, the Daily Telegraph has reported the 16-year-old is instead signing a $3 million, three-year deal with Rugby Australia, having caught their attention after dominating the GPS school rugby competition.

The Telegraph claims Suaalii is expected to make his Super Rugby debut for the New South Wales Waratahs later this season, with the long-term goal to represent Australia in the Rugby Sevens at next year's Tokyo Olympics, and the Wallabies at the 2023 Rugby World Cup in France.

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The report forced Rugby Australia interim chief executive Rob Clarke into a quick denial.

"Joseph Suaalii is an upstanding young man and a talented rugby player, who has proven himself to be an exciting rugby prospect for the future. We have made it no secret that we would like to keep Joseph within the rugby pathway," Clarke said.

"At this stage there has been no agreement between Joseph, his family or his representation. Rugby Australia continues to have an open and exciting conversation about his potential future in our game.

"Financial offers being speculated in the media presently are totally fanciful, and is being propagated by the usual suspects whose sole interest it is to inflate and misrepresent contract values."

Rugby Australia interim CEO Rob Clarke has denied signing Joseph Suaalii. Photo / Getty Images
Rugby Australia interim CEO Rob Clarke has denied signing Joseph Suaalii. Photo / Getty Images

The shock report has received mixed responses from within the rugby community — although the 15-a-side game has been in desperate need of a win this year, many have questioned whether a teenager is worth that sum of money.

Furthermore, signing Suaalii to a significant contract could be considered reckless spending if as Rugby Australia continues to recover from a dire financial situation. One-third of their staff were stood down amid the coronavirus epidemic, and players have been forced to accept hefty pay cuts.

Also, during this year's Annual General Meeting, RA declared a preliminary $9.4 million loss for the 2019/20 financial year.

To make matters worse, RA is set to have missed out on potentially $15 million a year, after reportedly rejecting a $25 million-per-year broadcast deal, and now said to be considering a deal in the $10 million-per-year range.

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'IT'S MADNESS FROM A GAME THAT'S BROKE'

Speaking on Fox League's NRL 360, Daily Telegraph reporter Paul Crawley berated the seven-figure offer.

"It's just madness; it's madness from a game that's broke," Crawley said on Tuesday.

"Everyone that has seen this kid play in the GPS rugby competition says he is just a freak; he's outstanding. He's something seriously special.

"We've all been around long enough to see this sort of talent come along every so often, and that talent doesn't always equate to a tremendous professional rugby league player.

"Kurtley Beale was a great example … everyone was chasing him. Did Kurtley Beale turn out to be that player?

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"It's a desperate attempt to try and save yourself."

Joseph Suaalii represented Kings College in the GPS competition. Photo / News Corp Australia
Joseph Suaalii represented Kings College in the GPS competition. Photo / News Corp Australia

NRL 360 host Paul Kent also questioned whether RA had put their eggs in the wrong basket.

"Rugby is not renowned for making smart decisions as of late, and this is another one that is very questionable," Kent said.

"To pay $1 million a year for a 16-year-old — and they're going to fast-track him into the Waratahs. Word is, when he turns 17 in August, that he will make his Waratahs debut.

"Rugby's been crying poor for the past six months. They're stuffed up their broadcast deal — they've knocked back $25 million a year, and they're now thinking of taking $10 million a year.

"They sit here, and they're going to pay this sort of money in a game that's getting scaled-down financially, it's crazy."

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When asked for his two cents' worth, veteran rugby league broadcaster Phil Gould lamented the sport's dwindling youth programme.

"Well done to all those at the NRL who voted to remove the National Youth Competition (NYC) from our Pathways Player Development Model," Gould tweeted on Tuesday.

"After only a short period of time (as predicted) the impact on our game of abandoning the NYC has been significant."