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How soon is imminent? 

This FSA article first appeared in FC Business (issue 155) which is free to download here…

When it comes to football regulation the word “imminent” has probably been said hundreds of times by ministers and civil servants in recent years – and an incoming football regulator (aka IREF) is more imminent than ever.

A commitment to legislation featured in November’s King’s Speech and, since April 2021 and the European Super League fiasco, MPs from all parties have furiously agreed with each other that action must be taken.

The FSA appeared in Parliament to talk about football’s inability to regulate itself as far back as 2013 and we sat on the more recent Fan-Led Review of Football Governance to which hundreds of our member supporter groups contributed. 

That evidence has flowed into this proposed football governance legislation.

“Legislation will be brought forward to safeguard the future of football clubs for the benefit of communities and fans.” – King Charles III

So why the delay? Because the Government wanted to give football the opportunity to put its own house in order. Football (or rather the Premier League) has had three years to do that and it has failed. 

During those years we have seen Premier League clubs allegedly breaking their own spending rules, EFL clubs being run into the ground by wreckless owners and non-league clubs disappearing altogether.

Yet still the Premier League has failed to come to an agreement with the EFL when it comes to the distribution of funds.

A few weeks ago Premier League CEO Richard Masters and EFL chairman Rick Parry appeared before Parliament’s cross-party Culture, Media and Sport Committee as MPs asked them about IREF and the general state of football’s finances. 

And this isn’t just a debate for the accountants – it has massive real world implications.

If we want a league system where every club can dream of getting to the Premier League then we need to care about this, as there were some staggering statistics.

Parachute payments

Rick Parry told MPs that parachute payments cause massive instability in the game – “the gap, cliff edge, the major divide” – which might sound a bit dramatic until you look at the numbers.

The new deal which the Premier League would like the EFL to sign would allow relegated clubs to spend up to 85% of their revenue on players while others in the Championship would be limited to 70%. 

“Relegated teams would be able to spend £110m and we’d be constraining other clubs to spend £20m,” said Parry.

This is a huge threat to the game’s competitive balance and would, ultimately, see the same few clubs repeatedly promoted and relegated from the top-flight. A de facto closed shop. The only people who can want this are existing Premier League club owners.

A redistributive model which shares football’s money more equitably is needed if we don’t want to see the top 20 (or 23) clubs shoot off into the distance.

The EFL are on record as saying a 75-25 split weighted towards the Premier League is one to which they would happily sign up. If that had been agreed in 2021 it would have meant an extra £285m per season flowing through the pyramid. 

Instead the Premier League’s clubs refused to sign off a figure and spent an extra £500m on player wages instead. Today is always the clubs’ priority. A regulator can think about tomorrow.

As reported by Miguel Delaney in The Independent, the EFL told MPs regulation and better distribution goes “hand in hand”.

Rick Parry said: “Don’t ever say they can’t afford it – this is about desire and priority. Football can’t do this. It needs an independent view. The regulator must have powers not only to set the financial regulations but to also set redistribution levels. In terms of regulation, better distribution goes hand in hand. They are inseparable. 

“You can’t have one without the other. And if the regulator cannot deal with redistribution then we would say the regulator cannot meet its primary strategic objective of securing sustainability and resilience. Football has shown it can’t solve the problem itself so we need help.”

The Government must get IREF over the goalline which would make it the latest – and arguably the biggest – FSA campaign success to file alongside safe standing, an away price cap, the defeat of a European Super League, and more.

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