Premier Fair Play

February 17, 2013

 

WEBWATCH

 

Ken Masters

 

IT IS WELL DOCUMENTED ON THE WEB THAT THE PREMIER LEAGUE CLUBS IN ENGLAND HAVE AGREED FINANCIAL FAIR PLAY RULES IN RESPONSE TO THE UEFA INITIATIVE TO CONTROL CLUB FINANCES FROM THE START OF THE 2013/14 SEASON.

The Premier clubs in England voted with the necessary majority and have followed The Football League in coming up with a ‘Fair Play’ financial format.

West Ham co owner David Gold seems to have been at the forefront for financial reform with, not surprisingly, the likes Manchester City not so keen.

This from AOL Sport:

Premier League clubs have voted overwhelmingly for spending controls including financial fair play and restrictions on salary increases, West Ham’s co owner David Gold confirmed. Gold said that the proposals for controls had received the backing of the majority of top flight chairmen. He said; “We have all voted and it was overwhelmingly supported, not by all the clubs but the vast majority of the clubs voted in favour.”

It will be the first top flight European league to bring in such a system, but it is expected to be less hard hitting than UEFA’s financial fair play (FFP) scheme in that it will allow club owners to cover significant losses. Clubs will also be restricted by how much they will be allowed to increase their wage bills.

Gold added:

“It’s not a salary cap, it’s a restraint on over spending. If clubs increase their revenues then they can increase their spending. We have got restraint. that’s the important thing. What’s driving the whole thing is we’ve got to avoid another Portsmouth.”

Think we have got that then David, not as a salary cap as in Leagues One and Two, but a bit more like the over spending cap as in The Football League Championship. How do the Premier League rules compare with UEFA guidelines, I wonder. From various websites, this is what UEFA are looking for as I understand it in its most simple form. European clubs will be obliged to break even. within discretion of £4.3million (or is it Euros making it £3.9 million) over three years, although initially owners will be allowed to cover losses of up to £13m a year.

So what have The Premier League clubs agreed exactly and how does this compare with the UEFA proposals?

The twenty Premier club chairmen have agreed to two significant controls, to limit players’ wage bills from next season and to longer term measures that will restrict the amount of losses clubs can make to £105million over three years. Just a bit different to around £4 million then! Clubs whose total wage bill is more than £52m will only be allowed to increase their wages by £4m per season for the next three years, but the cap, sorry, it’s not a cap. does not cover extra money coming in from increases in commercial or matchday income.

Premier Leagues Richard Scudamore went further. He said; “The clubs understand that if people break the £105m we will look for the top end ultimate sanction range. a points deduction. No mention of the number of points then, two, four, ten. twenty?

The vote for financial regulations was not so overwhelmingly supported as David Gold would have us understand it. In fact it could hardly have been closer, with only 13 of the 20 clubs voting in favour, with six against and Reading abstaining. It meant that the ‘yes’vote only narrowly achieved the necessary two thirds majority of the 19 votes cast. Clubs sources say

Fulham, West Bromwich Albion, Manchester City, Aston Villa, Swansea and Southampton all voted against. Some surprises in this list. You would have been forgiven for thinking that it was the real ‘big boys’ who would have voted against but not so. Of the 20 clubs in the top flight, only Manchester City, Chelsea and Liverpool have reported losses of more than £105m over the last three years, according to the most up to date published accounts.

It seems to me that clubs were inclined to vote against or abstain because the almost instant success, as experienced by Chelsea and Manchester City, resulting from massive financial spending would not be possible in future. Indeed Richard Scudamore admitted that their own (Premier League) Financial Fair Play measures would mean it will take longer for benefactor owners to achieve success, but that it would still be possible. He said;

 

“The balance we have tried to strike is that a new owner can still invest a decent amount of money to improve their club but they are not going to be throwing hundreds and hundreds of millions in a very short period of time.

“While it has worked for a couple of clubs in the last ten years if that’s going to be done in the future it’s going to have to be over a slightly longer term without the huge losses being made. “I think at £105m you can still build a very decent club”

 

Certainly more so than with around £4 million Richard!

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