The 20 Premier league clubs will meet next week to discuss the possible introduction of some voluntary spending limits, and for convenience for these meetings, the teams have been split into two groups of 10 teams each on a geographical basis, and we expect Derek LLambias will be representing Newcastle United at this meeting.
Derek Llambias – Newcastle’s Managing Director
As we reported this morning, the UEFA Financial Fair Play rules will be coming into increasing effect in the years ahead, with the end goal (so to speak) being that clubs can actually balance their books, and hopefully gone will be the days when clubs like Manchester City can lose £197M in one season, as they did from 2010-2011.
It seems that most of the clubs are in agreement for some voluntary controls, but they will need to come to agreement on what happens if clubs don’t meet the agreed to requirements.
There are various proposals to be put forward:
- UEFA’s Financial Fair Play Rules where clubs must break even over a given number of years – since English clubs will have to meet these requirements – this would seem to be a sensible approach
- Clubs only being allowed to spend a percentage of their annual revenues on the costs of players – which would largely be their wages – Newcastle’s wages to revenue figure is one of the best in the Premier League but some clubs – like QPR – spend more on wages than their total revenues – which is simply crazy
- Limiting the increases in players’ total wages to a maximum of 10% each year – this proposal is one coming from Sunderland owner Ellis Short
- One option that is popular is ensuring clubs can guarantee they can operate for several years in the future rather than just the next year (wow). So they would need to show they can generate future revenues to support players getting longer term contracts.
Portsmouth went into bankruptcy when they simply couldn’t afford the play the wages of their players on long term contracts after a year or two
The clubs who are most opposed to any of these plans being put into place are Manchester City – that’s not surprising since they are in the worst financial shape of any other Premier League club, Chelsea, who like Manchester City are used to spending whatever Romain Abramovich wants to spend – and Fulham – which is a strange one.
Chelsea and Manchester City have basically spent their way to winning some of the Premier League titles over the last several years, since they have spent so much more than any other English clubs over that period.
Chelsea have spent in excess of £1B since Abramovich bought the club back in 2003 – when he brought in 11 players – a full team – over that first summer.
Is it just me that thinks this is simply ridiculous?
And Manchester City are trying their very best to spend as much as Chelsea, with over £800M being spent on players over the last four years.
The interesting thing will be if controls are put in place, and it looks like some level of controls can be agreed to, what are the sanctions for breaking them?
We were very pleased to see that UEFA President Michel Platini is serious in saying that if clubs don’t meet the Financial Fair Play rules, they will not be allowed to compete in Europe.
So next May, why don’t UEFA announce those clubs who have qualified for Europe, but will not be allowed to compete, because they haven’t put their financial books in order.
That would send a great message to clubs, and soon get them to see the light – hopefully.
But the time when clubs like Chelsea and Manchester City can spend money like it grows on trees, will soon be one for the history books, and the game of football will be so much better off because of it.
And we’ll be asking in the years ahead – why were they ever allowed to do that in the first place?
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