RRW - the body which represents the four professional Welsh regions - and the WRU have been involved in an unedifying dispute over the best way to keep the top Welsh players in the principality. The four regions have grown frustrated at watching the best domestic players leave in big-money moves to French and English clubs.
WRU chief executive Roger Lewis said: "We have identified the priority of keeping Welsh qualified players in Wales and developing them to their full potential. Discussions with the regions are continuing on a range of issues but this is a clear indication that the WRU will engage in a meaningful way within the financial constraints we all know exist."
He added: "This is a one-off amount but the investment is of a scale which can be of true benefit to the game at the professional level."
Jamie Roberts, Dan Lydiate and George North, all currently touring Australia with the Lions, are to join the exodus this summer. Roberts and Lydiate are to switch to Racing Metro from Cardiff Blues and Newport Gwent Dragons respectively, while North is on the move to Northampton from Scarlets.
The deal taking North to Franklin's Gardens was the catalyst for the ongoing dispute, and the two sides appeared to be miles apart at the height of the disagreement in April, but meetings have since taken place, and the WRU hopes its plan for extra investment at community, regional and international level, proves a constructive step.
Of the total £2.5million, £1million of it has been targeted at the regional game to "target the development, recruitment and retention of Welsh international players".
A final decision over exactly how the money will be used will be determined by further meetings between the WRU and RRW. RRW declared its initial approval of the announcement, but awaits further talks with the WRU.
RRW chief executive Stuart Gallacher said: "We remain focused on our original published objectives, including the development of Welsh international players and their retention in Wales, so we are of course encouraged to hear of any proposed initiative that may help contribute to that particular goal.
"We have been consistent in our position that we need to work to define long-term structural solutions that can strategically improve the framework of professional rugby in Wales."