The Political Economy of Football V2

Clearly, every club in England’s second tier is desperate to secure promotion to the promised land of the Premier League, but Middlesbrough have a more realistic chance than most, given the backing of owner Steve Gibson. In the last ten years, they have actually been promoted once, though only lasted one season in the top flight, while qualifying for the play-offs no fewer than three times. In addition, they have finished just outside the top six on three other occasions. Middlesbrough’s pre-tax loss almost doubled last season from £6.4m to £12.4m mainly because profit from player sales dropped by £5.2m from £22.3m to £17.1m.   Revenue rose £3.6m (13%) from £28.6m to £32.2m, though this was largely offset by other operating income falling £2.7m (69%) from £3.9m to £1.2m. Middlesbrough’s £32m revenue is obviously much lower than the £121m they earned in the Premier League in 2016/17, but it is worth noting that it has also virtually halved since their first season after relega...

From his Zurich fastness the Swiss Ramble casts his analytical eye over the 2018/19 accounts of Middlesbrough. Boro improved from a £6m loss before tax to a £2m profit, even though revenue dropped £6m (10%) from £62m to £56m and expenses were £3m higher, because profit on player sales more than doubled from £15m to £33m. They are actually one of just four Championship clubs to report a profit to date in 2018/19 with their £2m only behind Bristol City £11m, Hull City £3m and Rotherham £3m. This is a good performance, considering that almost all clubs lose money in this ultra-competitive division. That said, Boro would have also posted a hefty loss without £33m profit from player sales, including Adama Traoré to Wolves, Ben Gibson to Burnley and Patrick Bamford to Leeds. This was the second highest in the Championship, only surpassed by Bristol City £38m. Boro have made a profit twice in the last three years after accumulating £112m of losses in the previous six years, including a £32...

Kieran Maguire of the Price of Football writes, 'Some people have asked me why it’s only in last couple of years EFL clubs such as Derby, Villa (and if they ever publish their accounts possibly Sheffield Wednesday too) have been selling their stadiums and booking profits to comply with FFP. Under old rules this was specifically excluded from FFP.' 'However a look at the new Profitability and Sustainability rules shows that this clause appears to have been removed so clubs can sell land, their stadium etc to a "friendly" party (i.e. another entity controlled by the club owner) for a big sum and book a profit which reduces FFP/P&S losses.' 'Whilst I have some sympathy for Steve Gibson at Boro for being unhappy with the behaviour of Derby, Villa etc. the rules were approved by EFL club owners. So what has been done by these clubs gets a tick for compliance but a question mark for ethics.'

Middlesbrough chairman Steve Gibson has stepped up his crusade on clubs he calls financial fair play (FFP) 'cheats', giving to large to the EFL: EFL must act Aston Villa and Derby County are among the clubs that he has criticised and there were even rumours of legal action against the Rams. There is no doubt that the FFP rules have been imperfectly enforced with a somewhat diluted example being made of Queens Park Rangers. However, I have always thought (and some lawyers agree) that they are open to legal challenge because they are potentially in conflict with competition law. The EFL therefore has to tread carefully.

With Derby County getting into the Championship play offs and Middlesbrough denied, Tony Pulis thinks that the Rams have got round financial fair play rules. Derby County deny this and the EFL appear to concur: Puli questions rival's finances I have a great deal of respect for Middlesbrough, not least because former Charlton keeper Darren Randolph is their player of the year. Steve Gibson has been a model owner, continually pouring money in and largely getting disappointment in return. But I have to say that this has the whiff of sour grapes about it. Moreover, many Boro fans see the real problem as being Pulis's playing style. Another perspective is to look at the contrast between the finances of Boro and relegated Rotherham United: Gulf in finances However, another person I respect greatly, Kieran Maguire of the PriceofFootball thinks that there has been at least some creative accounting. The article linked to above notes, '[There was] a convenient move that saw...

The authoritative Swiss Ramble has looked at Middlesbrough's 2016/17 accounts, covering their year in the Premiership. Next season is the last season in which they will receive parachute payments as they were relegated after one season. Following promotion to Premier League Boro converted a pre-tax of £32.0m loss to £6.9m profit, as revenue increased by £100m to a record £121m and profit on player sales was up £7m to £11m. The club had the third lowest revenue (£121m) in the Premier League, so from that perspective relegation should not have been a great surprise. They did actually have the highest revenue of the three promoted clubs, ahead of Burnley £121m and Hull City £117m. 2016/17 was first time that Boro had made a profit since 2005, though very nearly broke-even in 2009. Since then, they accumulated £112m of losses in the Championship. They really “went for it” in 2015/16, resulting in a record £32m loss. TV revenue will fall significantly in 17/18 from £99m to an estim...

Steve Gibson continues to plough money into Middlesbrough and he has secured a scant return. The club owes him a total of £94m. The accounts for 2016/17 published online at Companies House cover the year in the Premier League. Turnover went up from £21.6m to £121.4m. There was an operating loss of £4.1m, but a profit of £11.3m on the sale of player registrations resulted in a £11.5m profit compared with a loss of £25.9m the previous year. Broadcasting revenues went up from £5.1m to £100.6m and accounted for 83 per cent of all revenues. Sponsorship and commercial increased from £4.9m to £8.1m. Gate receipts increased from £7.3m to £8.7m. Total staff costs were a healthy 53 per cent of turnover and the third lowest in the division.