Featured

The inauguration of the Premier League in 1992 ushered in a new era for the English game. Increased broadcast and commercial revenue saw the league turn from a multi-million to multi-billion-pound industry, as domestic and overseas investment influenced the financial power available to clubs. Training facilities the size of villages were erected, record transfer fees were eclipsed and the subsequent technological advancements led to better, more entertaining football – increasing the league’s profitability and effectively turning it from sport, to business. The industry believed the money would never dry up, but the COVID-19 pandemic has highlighted a lack of contingency plan, as the postponement of professional sport has brought the suspension of broadcast income – roughly 60% of Premier League clubs’ annual turnover – as well as the possibility that around £750million would have to be repaid to broadcasters if the league is declared null and void. As such, by subtracting two forms of club revenue – the other being matchday sales – out of the three streams of income – commercial deals being the other – yet still needing to pay the wages of playing and non-playing staff, you are left with a political, expensive and highly publicised issue.

Premier League clubs have tried to navigate this financial challenge in different ways. Some – Burnley, Wolves, Leicester, and both Manchester clubs to name but a few – have confirmed they will not utilise the government’s furlough scheme to pay staff wages. Others – Southampton and West Ham – will defer part of their players’ salaries but protect non-playing staff, while Arsenal and Everton have announced they will continue to pay all staff until they reassess the situation at a later date. Of the clubs to announce they would implement the government’s furlough scheme to aide financial strain, Bournemouth and Norwich sit 14thand 17th in the Premier League’s profit/loss table, losing £32.4m and £39.4m over the 2018/19 season respectively. Newcastle United announced a gain of £23m from the previous season, with fans condemning the action taken by the club’s universally unpopular owner, Mike Ashley. As for the two teams that made up the 2019 Champions League final – and have since reversed their decision following intense fan-group pressure – Tottenham announced gains of £87.4m, with Liverpool profiting £41.9m from the previous season, making them the league’s two most profitable clubs.

Of the £461m of turnover Tottenham earned over the 2018/19 season, only 39% was spent on wages, making them – relatively – the lowest wage spenders in the league. As a result, their decision to utilise the government’s furlough scheme before topping up the remainder of non-playing staff salary (thus protecting the wages of their star players, board of directors and chairman) was met with fierce uproar, as the Tottenham Hotspur Supporters Trust called on the club to “do the right thing” and reverse the decision. The Health Secretary, Matt Hancock, further publicised and politicised the issue when he incorrectly framed it at as a footballer issue – rather than a club matter – calling for players to “take a pay cut and play their part”. This could be argued as a misguided, inappropriate suggestion, as it demonises footballers rather than the bosses who took it upon themselves to utilise – his government’s – furlough scheme. This invoked an emphatic response, with Wayne Rooney describing it as a “disgrace” that footballers have become “scapegoats”.

The Premier League footballers did respond to Hancock’s suggestion though, initiating the #PlayersTogether campaign, in collaboration with the NHS Charities Trust, where players from every Premier League club could contribute money to “where it’s needed most”, as they outlined their determination to “help in any way they could”. Though this is an impressive, charitable feat and one that will provide the NHS with additional resources to continue their vital work in a time of national crisis… it does not solve the issue. Hancock called for the players to take a pay cut to protect those in less glamorous positions within the clubs and to ensure the government’s furlough scheme is not abused by billionaires, when tax payer’s money could be more effectively distributed.

Some Premier League clubs have inaugurated alternative initiatives, designed to protect those within the club and ensure the stability of teams while their broadcast and matchday revenue streams have dried up. Bournemouth head coach Eddie Howe was the first manager to take a voluntary pay cut, Brighton’s deputy chairman, chief executive, technical director, as well as manager, Graham Potter, have taken ‘significant’, voluntary pay cuts for the next three months and West Ham’s David Moyes, vice-chairman Karen Brady amongst others have confirmed they have decided to take a 30% salary cut. But further options are limited due to the presence of financial fair play – designed to prevent clubs spending more than they earn. Though it is expected these rules will be cooled over the coming months, they have not been yet, meaning wealthy owners cannot just bail them out by ploughing millions into the club. This brings me back to the crux of the matter; why football’s financial bubble is about to burst. Effectively, people need to be paid, but the people paying them do not have the money that they presumed they would.

Resolutions for such problems are difficult to imagine, but by modelling different strategies on the policies of contemporary politicians amidst this crisis, the landscape of resolutions become more apparent. President of France, Emmanuel Macron, announced that supply chains of produce in the country will have to become more French as opposed to spending money in different markets around the world. As such, domestic spending would refuel the economy and – if other countries follow suit – could slow down the process of globalisation. We too could see a similar financial strategy adopted by Premier League clubs – with greater impetus placed on the need to produce home-grown academy prospects, rather than spending big money abroad, thus easing the financial strain of COVID-19. If other clubs around the world follow suit, we could see young players in their home countries get more opportunities to play for the club of their dreams. Surely this would positively impact the sport? It would increase the opportunities for players committed to their club, rather than filling agents’ pockets by moving a particular player from club-to-club around the world. Dedication to youth need not be a negative for the elite clubs in the country. Chelsea, for example, finally enjoyed success from their widely praised youth academy this season as they utilised their impressive pool of youngsters to refresh the squad amidst their summer transfer ban. We could also finally see a potentially welcome change, in the shape of a reduction in transfer fees for the next few seasons. This would level the playing field to an extent as clubs with famously impressive youth systems such as: Ajax, Southampton and Anderlecht could reap the rewards of their academies.

With clubs scrambling to balance their books, sports finance expert, Dr Dan Plumley claimed that the financial shock of COVID-19 has highlighted just how stretched the industry is and how many clubs have been living from hand to mouth. This has often benefitted the agents and transfer brokers who focus – not on ensuring a player gets the chances they deserve – but on increasing their brand and money-making potential. Admittedly, cutting out the power agents and brokers alike possess could be classified as idealistic, potentially wishful thinking, but it would benefit the sport and the experience of those most closely involved. There are alternatives to simply coughing up more and more money and by reducing the number of high-profile, international transfers, we could see football’s financial bubble burst for the better.

The modern game has been too heavily influenced by agents and dodgy deals; by slowing down football’s globalisation, we could return the sport to its roots, where clubs succeeded on merit and philosophy, rather than investment. Sport should be about the on-field competition, rather than the financial strength of a select few. Maybe, just maybe, COVID-19 is what we needed to realise that there is more to the game than astronomic transfer fees and ridiculous wages, with those at the top competing to see who can add more zeros to the end of their cheques.