Football League agree in principle to adopt UEFA's financial fair play system

cafcfan

This from the BBC as breaking news.

But what does it mean for Charlton?  I thought the rules said a club must break even over a rolling three year period.  Clearly, on our current budget we are not going to do that.  Will the owners have to be creative with the ways they inject funds into the club?

sygonrima

The 72 football league clubs have agreed to cut costs at their meeting IN CYPRUS.

Could they not find a football club with a meeting room going spare in the UK?

 

Off_it

Football League beano to Ayia Napa. FACT.

Macronate

You can only make decisions like that when the sun's out.

Covered End

This is what it says. Perhaps this is why our new owners are optimistic about our future & are trying to build the club in the right way. As perhaps there is now no longer the option to throw money at it ?

 

The Football League says its clubs have agreed in
principle to adopt Uefa's financial fair play system.

Uefa has introduced the rules to try to make sure that clubs balance their
books and break even.

The 72 league clubs, faced with increased levels of debt, agreed "in
principle" to the regulations at their annual meeting.

"This is a very important step forward for professional football," said
Football League chairman Greg Clarke.

"It will help our clubs exert greater control over their finances.

"Much more work needs to be done, but I am hugely encouraged and impressed by
the energy and focus of our clubs on this issue.

Perhaps the impact of the recession combined with reduced television revenue
from 2012 means clubs are more receptive to taking a long, hard look at their
bottom line

"They have been the catalyst for change and have shown a real desire to
self-regulate in this area. I congratulate them on taking this bold step."

The Football League clubs voted in favour of the new measures at the meeting
in Cyprus following a presentation by Andrea Traverso, Uefa's head of club
licensing and financial fair play.

Debt in Football League clubs now totals approximately £700million, Clarke
told BBC Sport's Paul Fletcher earlier this week, "and more than 80% of this is
in the Championship".

The Championship clubs agreed to work towards the new regulations being
"developed and approved by the beginning of the 2012/13 season".

League One clubs have also agree to introduce the Salary Cost Management
Protocol (SCMP) from next season, where teams will only be allowed to spend a
fixed proportion of their total turnover on player wages.

The SCMP already operates in League Two at the 60% threshold, which will be
reduced to 55% from the summer.

FA chairman David Bernstein described the Football League's announcement as
"very encouraging".

He said: "I welcome the Football League's new cost control measures. The FA
supports these regulations and they are a welcome step in the right
direction.

"While giving evidence at the Select Committee in March, (FA general
secretary) Alex Horne and I called for such measures.

"I would like to congratulate Greg Clarke and all at the Football League for
their continued progress in this area."

ISawLeaburnScore

As Covered End says, the probable medium term vision is get the house in order now, make a reasonably big push to get us in the Championship and drop anchor so we avoid a disaster of coming straight back, increase the academy's output to both add to our playing staff ("for free") and add to our income and sit back and watch the rest of the Championship not on parachute and not well-run implode. I mean honestly you only have to look at what Cardiff have done with ZERO success to see the dice being rolled by some of the boards in that division. There can only be one Blackpool or Swansea per year top whack given how the PL is rapidly turning into PL1 and PL2 overspill with the heightened parachutes and interestingly neither Swansea or Blackpool have broken that stranglehold by spending silly money.

cafcfan

Yeah, but what's a "proportion of turnover"?  You only have to do something similar to Marcus Evans at Ipswich and pay (and maybe pay over the odds) money into the club for shirt sponsorship.  Voila!  It becomes turnover rather than a loan from a director.  Turnover is thus artificially increased and your wages budget along with it.  In theory if the club makes a profit it can then pay that back to the owners by way of dividend.  Job done  - UEFA rules circumvented.

MuttleyCAFC

The sad thing is, it is probably cheaper in terms of transport costs and venue to go to Cyprus for the meeting.

colthe3rd

Yeah, but what's a "proportion of turnover"?  You only have to do something similar to Marcus Evans at Ipswich and pay (and maybe pay over the odds) money into the club for shirt sponsorship.  Voila!  It becomes turnover rather than a loan from a director.  Turnover is thus artificially increased and your wages budget along with it.  In theory if the club makes a profit it can then pay that back to the owners by way of dividend.  Job done  - UEFA rules circumvented.

I thought UEFA were going to implement something that meant wealthy investors could not get away with that because City were implying they had nothing toi worry about as they would have some Middle Eastern company sponsoring them for hundreds of millions and UEFA said they were going to shut all loopholes like that. I could be wrong but that's the last I heard about that.

MuttleyCAFC

I don't see how you can shut loopholes - there must be many different ways to get money into the club through sponsorship and other means. I think the initiative is laudable but suspect that when it comes down to it, the wealthy will find ways around it as they do in life in relation to the tax system.

Bournemouth Addick

I think the relevant part of that is "in principle" i.e. there are unlikely to be sanctions if someone decides to blow their budget on signing the Marcus Bents of this world.

(1984)

I don't see how you can shut loopholes - there must be many different ways to get money into the club through sponsorship and other means. I think the initiative is laudable but suspect that when it comes down to it, the wealthy will find ways around it as they do in life in relation to the tax system.

True, theres no way to stop wealthy owners giving clubs money but it will stop them from loading them with debts (whether that be personal or bank debt) and that's the more important point in terms of safeguaring clubs futures.

 

DRAddick

I don't see how you can shut loopholes - there must be many different ways to get money into the club through sponsorship and other means. I think the initiative is laudable but suspect that when it comes down to it, the wealthy will find ways around it as they do in life in relation to the tax system.

True, theres no way to stop wealthy owners giving clubs money but it will stop them from loading them with debts (whether that be personal or bank debt) and that's the more important point in terms of safeguaring clubs futures.

 

I think that's the hope, and i agree with the efforts, but won't necessarily the case.

All the guidlines say is that clubs should be able to make the repayments on any debt they take on. So it depends how the finances are represented officially. That's what good accountants earn lots of money, so finances say what people want them to say.

Henry Irving

Good points on dodging the rules but at least there will have to be some sort of regulation and scrutiny of Club's accounts.

kings hill addick

'Gifts' are ok. Excessive commerical deals funded by directors are probably also ok. The issues that Portsmouth had were due to Directors lending the clubs millions that was spend with the debt ro be repaid.

Also, as I understans it the turnover figure to be used is a three year average, so that will prevent one off lump sums being injected. In actual fact if a wealthy enough benefactor is willing to give a club £100m a season then there is no reason as to why they shouldn't be able to spend it. The Glazers' gearing Man Utd, and simioar schemes with smaller clubs, is what needs to be stopped. If all the clubs sign up for it then inevitably the cummulative players wages will fall to a level that is affordable to the clubs based on their turnover, rather than every club having to run at a loss.

I mean, if the average League 1 wage was reduced from £2k a week (£104,000 a year) to £500 a week (£26,000 a year) I seriously doubt that many of those currenlty playing their trade there would give it up and do something else. There would just be more twitter tweets from Spain and less from Florda, Veags and New York.

Sadly, what it will do is make it much harder for teams to punch above their weight, because a club will need to be in the Prenier League for three sesons before it can use that average turn over even close to those already there.

redman

I',m not sure if there anything in tthe UEFA regulations that stop the Glazers doing what they did. It is harder to do with small clubs because they dont have the revenue potentail. Not too many Plymouth shirts or being sold In Thailand let alone TV subsciptions