It certainly was an issue a few years back in Auckland; Pacific Islanders seem to physically mature quicker, but I believe that there are now weight divisions that you can play your rugby in (you can't play in some divisions if you are over a particular weight), so it probably isn't an issue anymore
This seems a very good idea, I don't know if it is the case everywhere, but it would encourage smaller boys, who may become bigger boys, to play. (Oh, and girls too!)