No Premier League consensus on FFP
November 17, 2012Premier League Chairmen met on Thursday to discuss implementing spending constraints into the Premier League. Clubs have become noticeably more positive about the prospect of spending restrictions over the last two years and the Premier League executives (notably Peter Scudamore) have had to change their stance on the issue.
Although most club owners now believe some kind of restriction is going to benefit them, finding a single approach that will be acceptable to 14 of the 20 Premier League clubs is proving to be extremely difficult. Phil Alexander at Crystal Palace described proposal discussions on FFP for the Championship was “like herding cats” and the process is turning out to be even harder in the top division.
Four clubs are totally opposed to any spending constraint: Man City, Fulham, Aston Villa, West Brom. In addition, Everton are reported to be wavering. However, having 15 or 16 clubs broadly amenable to the concept of capping expenditure is long way away from reaching an agreement about what the measure should be.
It is interesting to see that Reading and Southampton are not amongst the clubs opposed to spending constraints. These clubs were the only ones that voted against the FFP measures for the Championship earlier in the year. This volte-face probably illustrates the level of vested interest that exists – despite Swansea Chairman’s talk of taking action ‘for the good of the game’, clubs will only agree to any change that they feel is going to favour their own specific position.
There are a number of possible approaches and each one is going to be more or less favourable depending on the particular circumstances of the club. The proposals so far discussed include:
- Break Even rule (which would favour Man Utd and Arsenal) but help smaller clubs
- ‘No increasing debt rule’ (which would favour Chelsea and Man City) but help smaller clubs
- Linking wage increases to the increased TV deal (which would generally favour the larger clubs)
- Capping wage spending to a proportion of turnover
With so many vested interests and each approach likely to favour a different sub-set of the member clubs, it looks difficult to see how common agreement will be reached when the clubs next discuss the proposals in February. To add to the problems, Al-Fayed (Fulham’s owner) is reported to be so oppose to the proposals that he is currently threatening legal action. Al-Fayed believes that under EU restraint of trade rules, he should be able to spend money as he chooses (it is worth noting that Fulham are £193min debt to Al-Fayed). From a purely legal perspective, he may well have a point.
Even if clubs could agree on a common approach, they will also need to agree the punishment for non-compliance. Unlike UEFA competitions, club can’t be excluded from PL competition. However, Championship and League 1 & 2 Clubs have adopted a transfer-ban as their primary sanction and it seems likely that this would form part of the punishment.
For more information and background I would recommend Daniel Geey’s article on the available Salary Cap options and possible sanctions.
Posted by Ed Thompson.
