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Covid's financial f...
 

Covid's financial fallout threatens to let rich clubs muscle in on EFL

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Clive Hurren
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@ken

I’m still hopeful that before I hang up my boots for ever Boro will again make it to a European final! It’s a long-shot, I know!! 


   
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Don't forget boys 'a man with a briefcase can rob more than a man with a gun'. I think Don eHnley said that or something very similar. Do not trust the at all, only for their benefit. Repeat after me...

UTB,

John

Let them form a super league with Europe and see who cares.


   
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Interesting perspective on “The Big Picture” from Steve Gibson in the EG.  

As he says not ideal but without this and other changes (salary caps) the pyramid is not sustainable.

Perhaps a bit of negotiation will make it a bit more palatable? 


   
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jarkko
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Posted by: @clive-hurren

@ken

I’m still hopeful that before I hang up my boots for ever Boro will again make it to a European final! It’s a long-shot, I know!! 

Me, too. I hope the wait is not as long as the first time. There is always hope.

Up the Boro!


   
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Premier League: “Whats the Football League ever done for us........?”


   
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From the soundings of other PL club, such as David Cameron's teams West Ham and Villa, it doesn't appear that 'Project Big Picture' has canvassed much support with those who need to vote for it - despite the veiled modern democratic threats that the self-styled altruistic 'big six' could form a new breakaway league if they lose the vote.

As to where that leaves the EFL rescue package is another matter and reports that most EFL clubs back Rick Parry in favouring the plan possible highlights the desperation of many to get the cash whatever the cost. Perhaps most EFL clubs are not particularly bothered if they have no chance of competing with the big six but I think they fail to realise that it's the wealth gap between the big six and the rest that drives the inflationary football ecosystem that impacts on everyone.

Either everyone just resigns to the fact that the big six are cartel that runs English football and just let them keep their inbuilt advantage or they are reigned in and their bluff is called on going their own way in creating a boring little rich-man's min-league.

It's perhaps worth pointing out that the big six have all qualified for European competition in 6 of the last 10 years and in the other 4 years only one of them missed out. It also means they've gained at least a £100m spending advantage on their nearest rivals in the PL and probably over £200m on at least half the league. Breaking their monopoly on occupying the top six places is going to become even harder if they get their way and it asks the question of why bother keeping them in the same league as everyone else if place 7 is the only realistic target. It doesn't sound like a sporting competition!


   
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@werdermouth.  Unfortunately it is the same in most walks of life, the rich get richer and the poorer get poorer and have to kowtow to the monopolists.  It’s just as well that the EFL clubs do not get a vote as they would say yes in the hope they can survive a few seasons before the next crisis hits them! 😎


   
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So the “Project Big Picture” has stumbled at the first hurdle and the PL and shareholders are not in favour of the proposals put forward.  

In my view this was always a negotiating ploy with the major players probably recognising they would not get everything they wanted but was put forward as a catalyst toward further discussions on the future of the game.  

I suspect we will see a watered down version, including the retention of one club one vote.  A reduction in the PL to 18 teams and the abolishment of the League Cup and the Community Shield.  

In return, the EFL receiving an injection of cash and an increased proportion of income generated by the PL and EFL. There will also no doubt be other tweaks to the current proposals.  

It’s a case of watch this space but the EFL cannot wait too long before clubs start heading into Administration.  Well that’s my take on the situation for what it’s worth. 😎

This post was modified 3 years ago by K P in Spain

   
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jarkko
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I was watching the Finland vs. Ireland match on TV yesterday. It was nice to see about 7 000 fans at the stadium and it made a difference to the atmosphere even on TV. It was only one sixth of the total capacity but still vocal.

We have had fans back at the league matches since July, too but not at full capacity. As Werder said earlier, countries with a woman prime minister are better handling the COVID situation, perhaps.

Anyway, after the Finland match, I continued to watch the England vs, Denmark match. The difference was huge in atmosphere and gave up after about 20 min. Partly because it was late but mainly as it felt like a practice match.

Up the Boro!

This post was modified 3 years ago by jarkko

   
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@k-p-in-spain

It was no surprise to see the deal unanimously rejected and everyone seemed to agree to continue discussions on restructuring the game. Although, I'm not sure why a rescue package for EFL clubs who don't have income without supporters has been conflated with restructuring the game - the two are not necessarily related unless the argument that overspending and inequality can't survive without gate income is perhaps overstating the issue.

Is now the time to discuss radical changes to the football pyramid or was it just opportunism on behalf of the richer cubs to offset their offer for a bailout with a quid pro quo. OK, there are merits on looking at the League Cup given how dismissively its now treated by most clubs and has become something of an inconvenience.

However, what is driving the need for fewer teams in the PL as somehow the Championship and League One clubs currently have to play 8 games more with smaller squads than the PL. It seems to be based on the big six wanting space to play more European games and lucrative pre-season friendlies.

In addition, the case for removing parachute payments altogether has not been made if you consider the likely fallout would be many PL clubs could struggle to compete for players if the deal was drastically reduced wages on relegation or short-term deals. Much would depend on reducing the wealth gap between the Championship and PL to allow clubs to transition between the two without the need to ditch most of their players.

In some ways removing parachute payments further increases the advantage the better clubs who can then further out-compete others on their packages to players. Maybe parachute payments should be some form of ring-fenced spending that only applies to a percentage of existing contracts and can't be used to offer excessive deals to new signings or inflate transfer fees.

There are some sensible suggestions on wage caps or perhaps on total spend allowed on players wages - though if this is a good enough concept for the Championship, then why not the PL and beyond? The idea of level playing field shouldn't just apply to those who don't have wealthy owners.

So I suspect most PL clubs will not vote for radical change as its not in their interests to reduce their chances of remaining in the top tier - plus most of the proposals are aimed at making the Championship a more even league that doesn't favour those relegated from the PL. Therefore, I think any ideas for change have to be fully thought through and not based on the current difficulties caused by Covid - the bailout plans should just keep everyone from going under but much will depend on how long the crisis lasts.


   
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@werdermouth. It is always difficult to get the timing right for major changes in any organisation but as far as these proposals are concerned I think it is partly driven by opportunity and also by the EFL cash crisis brought about in part by covid but also through operating an unsustainable business model for years.

I agree that any changes need to be fully thought through on a long term basis rather than be driven by current short term needs.

Clearly the top clubs want a smaller PL to enable them to pursue their own agendas vis a vis Europe and pre/post season friendly games and hence their call for dropping the League Cup.  Whilst it may be of little interest to a number of PL teams, there are others including Championship sides and those in Leagues 1 & 2 who still see it as a chance for some glory and extra cash when drawn against clubs in leagues above them.  Perhaps one option to consider is that before each season starts clubs have to apply to enter the competition if they wish to do so giving those on both sides of the argument a choice to make and enabling them to pursue their own priorities.

I am not in favour of the proposal that the promotion plays off consist of 1 x PL and 3 x Championship as this is just another attempt of retaining the elitism of the PL and reduces opportunity for Championship sides; a backward step in my view.

The parachute payment problem is not an easy one to resolve but clearly needs to be addressed.  To my mind the current system provides too much of a cushion to the relegated sides.  I appreciate your point that doing away with them would slightly favour the better clubs but there are always going to be differentials between teams in a league which is always the case in a competitive environment.  

This would be better managed by ensuring that each team receives an equal share of the TV income/PL income which they can then each utilise as they see fit within a prescribed framework.  Salary caps/transfer & agent fees /squad sizes all needing to form part of the discussion, including clear guidance on penalties for non adeherance.  

Clubs who are successful in gaining promotion will then need to ensure exactly how they utilise the additional income generated by promotion and plan accordingly, including for the possibility of relegation after one season in the PL.  Player salaries/contracts would have to be managed/adjusted accordingly - not easy but not beyond the realms of possibility if done so as part of a major overhaul. 

This is not going to happen overnight and in the meantime there is the pressing need to address the current lack of income which will be present this season and possibly next by which time the football pyramid will likely be much smaller or have even collapsed. 😎

 


   
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Ken Smith
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The pyramid system is already in a period of change. Two seasons ago we had 3 equal divisions at level 7(step 3) each of 24 clubs. We now have 4 equal divisions of 22 clubs, and this reform is still continuing. Perhaps the idea is to have no League greater than 22 clubs or even 20. It might mean 3 divisions of equal status below the Championship separated between North, Midlands and South. I haven’t seen any blueprint for this, but it would cut down on travelling for many lower placed teams. I remember in 1958 when the top 12 clubs from each of the 3rd  Divisions North and South merged to form a new 3rd Division (now League 1) whilst the remaining 24 clubs from the 2 Leagues were effectively relegated at one fell swoop to form the 4th Division (now League 2). Perhaps regional Leagues are now on the agenda, but taking several more seasons to implement.


   
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@ken.  It should certainly be included as part of the discussions. 😎


   
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@k-p-in-spain

I agree with most of that and I think it's important to get to the bottom of what is driving all this unsustainable spending and debt before the problem can be fixed - otherwise it could be just another case of throwing more money onto the bonfire to keep it burning.

I think there are numerous issues that lie ahead and it's likely that the business model that is primarily driven by huge TV deals may be about to change. New technology and people's viewing habits mean it's possible consumers will no longer want these general monthly packages to watch live games. We've seen with iFollow and now in a covid world that fans maybe prefer to watch their own team.

Interestingly, one of the proposals in the big picture document was that the big six wanted to be allowed to sell the rights to eight of their own games each season, which in a reduced league would be almost 25% of their games - or nearly half if they meant home games. So in offering the EFL 25% of the cash from future PL TV deals perhaps they were being a little sneaky as no doubt if those deals were no longer exclusive and were fewer in number then the prices bid for them would likely be lower.

For me the issue is still the massive financial gulf between clubs that cause the inflationary nature of players wages and transfer fees. It starts with clubs spending to chase European glory and then continues with PL clubs overspending to qualify for Europe, which in turn creates a gap with those clubs trying to ensure PL survival. Subsequently, Championship clubs overspend to gain promotion to the big pay-cheque of the PL.

All that creates the inflation in wages that other clubs who wish to compete have to join in with if they want to obtain better players. It also results in many clubs carrying debts over their failure to realise their ambitions and as they slide down each league and often down to the next then they become borderline bankrupt businesses. Add to that the arrival of multi-millionaire owners from abroad who see an opportunity to have a punt on a club or just want to rub shoulders with the wealthy business elites now in the game and it's all become a bubble waiting to burst.

So what is it football wants to fix? The predictable outcome of which teams are successful or the causes of the financial unsustainability? In football it's clear that success is bought and those who have the most will finish at the top - as we see with the very notion of a big six. Perhaps there are questions and answers that those at the top don't want to hear.

This post was modified 3 years ago by werdermouth

   
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This is how the PL see the EFL....perhaps short term success, but ultimately they don’t think they belong.

 

https://m.youtube.com/watch?v=p97RYfZqAXs


   
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Ken Smith
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Posted by: @jarkko

I was watching the Finland vs. Ireland match on TV yesterday. It was nice to see about 7 000 fans at the stadium and it made a difference to the atmosphere even on TV. It was only one sixth of the total capacity but still vocal.

We have had fans back at the league matches since July, too but not at full capacity. As Werder said earlier, countries with a woman prime minister are better handling the COVID situation, perhaps.

Anyway, after the Finland match, I continued to watch the England vs, Denmark match. The difference was huge in atmosphere and gave up after about 20 min. Partly because it was late but mainly as it felt like a practice match.

Up the Boro!

When I visited Helsinki 10 years ago I visited the Olympic Stadium where Emil Zatopek won both the 10,000 and 5,000 gold medals in 1952 and where there are statues of Lasse Viren and Jean Sibelius in a park nearby erected, but watching the Finland v Ireland highlights this morning in Helsinki the stadium looked larger than what I remember. Is it in fact the same Stadium or are my eyes deceiving me?


   
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jarkko
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@ken

It is the same stadium but it was renovated during past the four years and re-opening again this Autumn. A lot of facilities were built under the old one but the stadium itself looks exacly like the original from outside as well as inside. Only roofing was added to the stadium (originally only the main stand had a roof). But there is exacly as many seats as before. The museum authorities were luckily very strick that all places remained the same except the extra roofing.

So only the three rooofs were added to the one you saw, Ken. Even the new seats look like the old ones. It is very beatifull now.

Up the Boro! 


   
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I also watched the Finland v Ireland match and then I looked back at my photos of the stadium taken from the tower when I visited Helsinki in 2015. 


   
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A lot more being unearthed now....

 

https://www.bbc.com/sport/football/54587893


   
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@grovehillwallah

Interesting stuff and it appears the wolves are circling around the EFL to try and pick over the bones or at least get a cheap slice of the action while many are in need of a bit of cash.


   
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Posted by: @david-in-cumbria

I also watched the Finland v Ireland match and then I looked back at my photos of the stadium taken from the tower when I visited Helsinki in 2015. 

And you never visited me! Next time, sure.

Up teh Boro!


   
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Maybe I’m a bit slow on the uptake, but I can’t quite get my head around this. From what I can understand the PL are giving a small amount of money to enable the EFL clubs to be able to get themselves in to more debt.

I thought that they were going to “ give” some of their Telly money to help them out.

https://www.bbc.co.uk/sport/football/55172426

 


   
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@grovehillwallah if I understand correctly a Grant is a payment gift rather than a Loan, in other words Clubs in League One and Two don't have to pay it back. 

The Championship clubs are getting a Loan which needs to be paid back by 2024. It's not dissimilar to Rishi Sunak's logic where some people can get £2,500 a month for being sat at home furloughed but Small Business owners of Limited companies that have been recently set up within the last three years and are now going to the wall can get themselves into even greater financial difficulties by taking out a Loan that needs to be paid back with thin air.


   
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@redcarred

“The Premier League will pay up to £15m to help the EFL secure a £200m loan which it will then lend to Championship clubs interest free.”

Doesn't that mean the debt is the Campionship’s clubs, and they have to pay it back?


   
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I still maintain that football supporters are in an ideal position to push for a greater say in how the game is run. If only there was an organisation for them to demand concessions, in return for them coming back to support the game by attending.


   
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@werdermouth

What they want to fix is this dreadful habit of life intruding on a 'Good thing', and by that I mean the nightmare enjured by Liverpool as they won nothing for an age, and the fear that United and Arsenal are in the early stages of same, I believe that Liverpool had a 30 year sabbatical (I can't believe that I just typed that). The dreadful six are working very hard on the impossible, namely, taking more of the gold coming from TV income, it can only happen if the also rans vote for it, and there are more of them, but each time they vote, a couple more Turkeys vote for Xmass, amazing! It seems that these Turkeys believe they are special? Strange. Another project is, 'losing relegation' yes, they visualise a world where the money machine is forever. The programme to defenestrate the chairman of the players union was orchestrated by them, they owed him one for getting his players a share of the TV gold. They have a stooge all ready waiting to step in when he goes.      


   
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Posted by: @grovehillwallah

@redcarred

“The Premier League will pay up to £15m to help the EFL secure a £200m loan which it will then lend to Championship clubs interest free.”

Doesn't that mean the debt is the Campionship’s clubs, and they have to pay it back?

The £200m loan to the Championship Clubs will have to be paid back by 2024 with a max borrowing ceiling of £8.33m per Club. To me that means that the "loan" is a debt and that it is the responsibility of each individual Championship club for whatever amount they borrow up to that £8.33m maximum.

"The Premier League will pay up to £15m to help the EFL secure a £200m loan which it will then lend to Championship clubs interest free." So the Premier League aren't actually stumping up the £200m, I'm guessing that the £15m provided by the Premier League is just the actual interest for the "loan" being covered.

For League One and Two clubs I read it as a Grant which doesn't have to be paid back..

 


   
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jarkko
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@redcarred

I think I understood that the 'normal' Financial Fair Play rules must also be followed. If so, some clubs will be in trouble but I think Gibbo's Boro are safe again.

Also, I hope Sunderland will survive. They are in chaos now with no manager, no coaches and the club waiting for a new owner. I hope the do not opt for a Chinese business man. Remember Wigan?

Up the Boro! 

This post was modified 3 years ago by jarkko

   
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Posted by: @jarkko

@redcarred

I think I understood that the 'normal' Financial Fair Play rules must also be followed. If so, some clubs will be in trouble but I think Gibbo's Boro are safe again.

Also, I hope Sunderland will survive. They are in chaos now with no manager, no coaches and the club waiting for a new owner. I hope the do not opt for a Chinese business man. Remember Wigan?

Up the Boro! 

I was wondering about the FFP Rules. How on earth can the EFL enforce them (not that they do anyway) let alone Police them under the current situation.

If a Club can normally cover its wage bill with gate receipts and trades acceptably but has had no income since March then if the Chairman/Owners etc. are paying the wages to keep the Club afloat then surely its preferable that the Club survive than go under without any income stream? The same would go for Transfers if a Club has lost players in key positions for whatever reason. Justifying signings when there is no income is a strange one.


   
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Bit more insight here.....

https://www.bbc.co.uk/sport/football/55186670

 


   
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