Categories: Finances

A critique of how English football is financed

I was interested to read the opinion piece from Cliff Crown, chair of Brentford Football Club (“Regulation must not stop football clubs that dare to dream”, Opinion, February 4). However I believe there is more to the story.

While Brentford’s recent track record is impressive, parachute payments (to clubs relegated from the Premiership to the Championship) create a yo-yo effect instead of promoting competition.

Clubs like Southampton, Leicester, Burnley, Sheffield United, Norwich, Ipswich, West Brom and not many others continually bounce up and down between the Premiership and the Championship. The parachute payments system distorts competition and makes it very hard for others to break through.

Plus the financing and funding model of English men’s football is broken: the Premier League’s broadcasting deal brings in £3.19bn a year.

How is that money distributed? The football campaign group Fair Game calculates that for every £1,000 from the deal, around £880 goes to Premier League clubs; just over £70 to Championship clubs in receipt of parachute payments and around £33 to Championship clubs not in receipt of parachute payments. The report concludes: “This falls to £6.22 for League One clubs, and £4.15 for League Two clubs. National League clubs get 58p while it drops to just 15p for National League North and South clubs.”

Nearly every club in the Championship now spends more money on players’ wages than it receives in revenue. And the vast majority of clubs rely on an owner-benefactor just to survive: 58 per cent of clubs in the top 92 (ie the Premier League, the Championship, and Leagues One and Two) are now technically insolvent.

What we see in football — but especially the men’s game — is the effective result of self-regulation, ie no proper regulation at all.

So I see Crown’s article as essentially being about supporting the Premier League’s last-ditch efforts to get the football governance bill watered down, in the Premiership’s own interests rather than those of the sport, of fans and local communities.

Greg Campbell
Partner, Campbell Tickell, London EC1, UK

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