The Political Economy of Football V2

'Of all the unimportant things in life, football is the most important'- Pope St. John Paul II With a 17th June resumption, the £340m, rebate owed to broadcasters will fall to £170m should all the matches be completed by August 2nd.   There would be nothing to pay next season with the debt repaid over the two seasons that follow. The amount each club will have to pay will be equal but the Premier League will pay a subsidy to compensate for clubs receiving less TV revenue. The BBC will be given the opportunity to broadcast live Premier League matches for the first time while 25 will be available on Sky's free channel, Pick. The Premier League will not issue a rescue package to the EFL until its plans are in place for next season:  https://www.examinerlive.co.uk/sport/football/news/premier-league-chief-efl-package-18331587

Quite what is going to happen in Scottish football when it resumes is far from resolved.  As always, particular clubs are pursuing their own narrow interests. Former Inverness Caledonian Thistle manager Craig Brewster is surely right when he says that finances will dictate the format adopted:  https://www.pressandjournal.co.uk/fp/sport/football/inverness-caledonian-thistle/2222282/brewster-says-finances-will-dictate-proposal-to-expand-premiership/ He reckons calls for a 14-team Premiership will only succeed if the proposal is financially viable for the league’s leading clubs.  Hearts are desperate to push through an expanded top-flight in order to avoid relegation to the Championship, while the proposal would also see Inverness promoted as second-tier runners-up. The Scottish Supporters' Network has commented: 'In the absence of Scottish football action, countless column inches and Zoom call minutes have been taken up with planning for an eventual return, and the leagu...

The latest KPMG report confirms what we already knew: Arsenal are slipping behind the other big six clubs and their European rivals under the 'guidance' of silent Stan Kroenke:  https://www.football.london/arsenal-fc/news/stan-kroenke-arsenal-300million-finances-18329288 As someone from south of the river I don't want to get mixed up in North London rivalries, but I do rate Arsenal as a historic club and I always regarded my visits to Highbury and then the Emirates as a highlight of the football year, memories that I cherish even more now. I don't sign up to a simplistic 'foreign owners bad' model which is clearly nonsense, but there is more than one version of the American franchise model in practice and there is now a clear contrast between how it has worked out in Islington and at Liverpool.

The women's game was starting to make some real progress, but it could be one of the losers from the consequences of the Covid-19 pandemic.   In many quarters the women's game is seen as an optional extra, something nice to have but not essential when cost savings have to be made - and it wasn't that well funded in the first place:  https://www.soccerex.com/insight/articles/2020/coronavirus-in-danger-of-leaving-women-s-game-behind

In one sense the financial landscape of football has been shaken up by the Covid-19 pandemic, although I think that there is a little too much gloom and doom.   The latest KPMG report on value in football clubs has therefore been overtaken by events since it was compiled, but it still worth a look:  https://www.soccerex.com/insight/articles/2020/shake-ups-in-the-top-10-of-latest-kpmg-football-benchmark-report 'Italian teams did not come out looking as strong with Juventus, the only Italian club to have been represented in the Top 10 in the history of the report, have dropped down to 11 th place whilst AC Milan were the only team to have registered a decrease in the top 32 across the last four years.'

Crystal Palace turned a £36m loss into a £5m profit in 2018/19 and the authoritative Swiss Ramble explains how they did it.   For Palace fans an overview is available in the form of a two page fact sheet via the Swiss Ramble's Twitter account @SwissRamble. Kieran Maguire's Price of Football site has also provided an analysis of Palace finances:  http://priceoffootball.com/crystal-palace-2018-19-dissidents/ Writing from his Zurich fastness, the Swiss Ramble states ' very largely due to profit on player sales (mainly Aaron Wan-Bissaka’s move to United ) surging from £2m to £46m, though revenue also rose £5m (3%) to a club record £155m. Partly offset by expenses increasing £8m.' Player sales significantly improved from a very low £2m to £46m, mainly due to the lucrative Wan-Bissaka transfer. This was 3rd highest in the Premier League, only surpassed by Chelsea  £60m and Leicester City  £58m. The Eagles have made £83m from player sales in the last three seasons. Exc...

It looks as if troubled South-East London club Charlton Athletic will meet its financial obligations to staff tomorrow, but the overall situation has become more complicated as fanzine editor Rick Everitt reveals in a detailed analysis:  http://www.votvonline.com/home/the-2019-20-blogs/21-5-ex-directors-left-in-dark-over-latest-interest/ Everitt, who is also the leader of Thanet District Council, has been hunkering down in his Ramsgate fastness during the lockdown.   However, he appears to be well informed about the intentions of a group of ex-directors of the club who have a charge on the club's training ground and are about to commence legal proceedings.

Onward is a relatively new think tank designed to promote the intellectual revitalisation of the Conservative Party.  They are arguing that fans should take a stake in their football clubs to promote financial stability and sustainability:  https://www.theguardian.com/sport/2020/may/26/fan-ownership-rugby-football-clubs-thinktank-onward The report looks approvingly at the German Bundesliga model which is always held up somewhat uncritically as a shining example.

As there is a search for a reset of football finances, salary caps are one popular option.  They are extensively used in US professional sports, but here is an explanation of why they wouldn't work so well in Europe's  major soccer leagues:  https://www.espn.co.uk/football/english-premier-league/story/4098021/us-style-salary-cap-would-fail-in-europes-top-soccer-leagues-heres-why The key argument is that they only work if revenues are relatively throughout a league.   This is not the case in the Premier League because of owner subventions and differentials in broadcast and commercial incomes.   A version of financial fair play is a much better way of creating a level playing field.

Laurence Bassini has told Sky Sports News that he has pulled out of a £1.2m deal to buy Charlton from Tahnoon Nimer:  https://www.skysports.com/football/news/11684/11995567/laurence-bassini-pulls-out-of-charlton-athletic-takeover He said that one consideration was the presence of Roland Duchatelet who owns the stadium and training ground.   Bassini would just have bought 'the club', i.e., the golden share in the EFL. Bassini is maintaining his interest in Bolton Wanderers. Charlton fans are now placing their hopes in former Dinas Abertawe chairman Huw Jenkins, although the CAS Trust is exploring the unlikely possibility of a fan buyout.

The authoritative Swiss Ramble has reviewed the third quarter results of Manchester United.  He has a two page financial fact sheet on the club available via his Twitter account @SwissRamble. He comments, ' It is worth noting that Manchester United's £26m profit over nine months in 2019/20 is better than every other Premier League club’s financial result last season, except for Spurs and United.  Everything is relative – and half the clubs in the top flight lost money even before Coronavirus.' The main reason for the club's  £28m revenue reduction was broadcasting, which more than halved from £54m to £26m, due to £15m provision for COVID-19 rebate and playing in the far less lucrative Europa League, compared to the previous season’s Champions League.  Commercial up £2m (3%) to £69m, thanks to new sponsors compensating for lower retail sales, e.g. Old Trafford Megastore closed from mid-March. CFO Cliff Baty said COVID-19 was responsible for £23m of £28m revenue decrea...