GPS is the saviour as well as being detrimental to Rugby in Australia.
Having Rugby still being played and at a high level in GPS/Private schools gives the sport a profile amongst "wealthy" citizens which can lead to sponsorship etc. Rugby is known as the more "well-to-do" sport and players are attracted to these schools ( education as well as facilities,coaches ) to enhance their chances of getting into higher level rep teams. This can concentrate the talent into these schools.
This "concentration of talent" is to the detriment of the sport in general. The oldies know, Rugby used to be played at public schools ( think of the Ella brothers etc ) up till fairly recently however the costs involved, lack of support from the top and the eniticement of players to GPS/Private schools slowly led to the public schools leaning towards League. Now it's AFL.
The ARU needs to cast a wider net to attract and keep talented players. Without the GPS, Rugby would die very quickly. However, the concentration of players in the GPS restricts the growth of the sport therefore it may eventually die a slow death.
Club Rugby is very important and needs to be promoted andheavily funded to attract the public schools kids as well as the private school kids. This will lead to a broader player base and hopefully more talented kids playing and staying in the sport