Premier League clubs agree to trial new cost-control rule next season

Premier League clubs have agreed to trial “top-to-bottom anchoring” (TBA), on a non-binding basis, as an additional cost-control rule next season at their annual general meeting on Thursday.

However, a proposal to lift the amount of money clubs are currently allowed to lose over a three-year period from £105million to £135million was rejected.

The idea was proposed by Aston Villa but failed to receive much support, with only one other club in favour, three abstaining and 15 opposed.

A second proposed amendment to the financial rules, a more bespoke approach to the Villa proposal from Crystal Palace, was also rejected.

It was an attempt to mitigate the disadvantage clubs like Aston Villa, Brighton and Newcastle United face when they qualify for Europe but then receive considerably less money than more established European clubs because UEFA distributes a percentage of the prize money on the basis of a club’s performances in Europe over the last decade.

Palace suggested that clubs in Villa’s position next season should be able to add the difference between their “coefficient” payment and the top clubs’ payments, which could be £25million, to their permitted loss threshold.

In regard to anchoring, it is a de facto hard salary cap that would limit the amount clubs can spend on their first-team squads to a multiple of the amount the bottom-placed team receives in centralised media and sponsorship income, with 5:1 being the proposed ratio.

As agreed at a previous meeting, the existing profitability and sustainability rules (PSR) will remain in place for one more year, with UEFA-style squad cost rules (SCR) running in shadow next season, in tandem with the TBA trial, before they are fully introduced in 2025/26.

(James Gill – Danehouse/Getty Images)

The league had initially hoped to put the TBA rules to a vote this week so they could be brought in with the new SCR regime in 2025/26 but opted to run them as a trial after the Professional Footballers’ Association (PFA), the players’ union, threatened legal action because of a lack of consultation.

In a statement issued after the AGM, the league referred to the need for further talks with the PFA, saying the trial “will enable the league and clubs to fully evaluate the system, including the operation of UEFA’s equivalent new financial regulations, and to complete its consultation with all relevant stakeholders”.

The clubs first discussed anchoring at a league shareholders meeting in April, when 16 of the 20 voted in favour of progressing the idea to the AGM, with Aston Villa, Manchester City and Manchester United opposed and Chelsea abstaining.

The idea’s opponents believe tying their ability to invest in their squads to another club’s earnings is a restraint of trade. They also believe it will hinder them in international club competitions and damage the league’s ability to attract elite talent.

The two Manchester clubs are also annoyed that their spending would be tied to a multiple of the league’s central distributions, as opposed to their own commercial and matchday revenues, which they say are the result of their own efforts over a long period.

The PFA also believes anchoring is a restraint of trade, as it implies the creation of a hard ceiling on wage bills, and has always resisted them in the past. The recent hiring of Nick De Marco KC, a sports lawyer and frequent opponent of the football authorities, would suggest the union is ready for another fight.

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(George Wood/Getty Images)

If anchoring was applied in the 2022-23 season, the cap would have been £518million, five times the £103.6m that Southampton, who finished 20th, earned from the league, with only Chelsea spending more than that on wages, amortised transfer fees and payments to agents. Manchester City were the next highest spenders but would have been under the threshold.

The new squad cost rules, on the other hand, are less controversial, as they are a soft salary cap.

Premier League clubs will be allowed to spend 85 per cent of their commercial, matchday and media revenues, as well as any profit they make from player-trading, on wages for their first-team squad and coaches, the amortised cost of any transfer fees and payments to agents.

Clubs participating in Europe, however, will have to meet UEFA’s lower threshold of 70 per cent, which is another of the concerns flagged by the clubs opposed to anchoring, as they believe a multiple of five will force them to make cuts to their playing budgets.

The Premier League disagrees with this view, though.

“The overall system aims to improve and preserve clubs’ financial sustainability and the competitive balance of the Premier League, promote aspiration of clubs, facilitate a workable alignment with other relevant competitions and support clubs’ competitiveness in UEFA club competitions, while providing certainty and clarity for clubs, fans and stakeholders,” its statement said.

“SCR will regulate on-pitch spend to a proportion of a club’s football revenue and net profit/loss on player sales. TBA is…designed to be a pre-emptive measure to protect the competitive balance of the Premier League.

This protection is intended not to have an impact unless significant revenue divergence of clubs occurs.”



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(Top photo: Neville Williams/Aston Villa FC via Getty Images)

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