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Posted on 7th August 2020
League One and League Two clubs have voted in favour of introducing a salary cap which will come into effect immediately.
The caps have been set to £2.5m in League One and £1.5m in League Two. Wages, bonuses, taxes and image rights, plus agents’ and other relevant fees, will be included within the cap but bonuses gained from promotion or progression in cups will be exempt.
Clubs could be fined or face further sanctions from the EFL if they exceed the spending limits which have been put in place following the decision at the EFL’s AGM.
EFL chief executive David Baldwin said: “The financial impact of COVID-19 will be profound for EFL clubs and today’s vote will help ensure Clubs cannot extend themselves to the point that could cause financial instability.
“Over the last two weeks the discussions amongst Clubs in both Leagues One and Two have been healthy and constructive, allowing us to reach a clear consensus today and I am pleased that the clubs have determined to adopt the new approach.
“We will now work with all Clubs, the PFA and, where appropriate, other stakeholders to implement the new rules and continue our efforts to bring long-term sustainability to the EFL.”
Financial sustainability and over-spending has been a hot topic in the EFL in recent seasons following the demise of Bury, multiple administrations across the EFL and persistence of “crisis clubs”.
The FSA, committed to wider reform of the game’s governance and financial regulations, acknowledged the outcome of today’s vote:
“The FSA welcomes attempts by the EFL to address the issue of sustainability of their member clubs.
“Salary caps can be a useful component as part of a package of broader reforms to the governance and financial regulation of the game as a whole. Wide consultation and dialogue with all the stakeholders in football will be key to the success of any proposals.”
Yesterday supporters from fan groups in the FSA’s League One & Two Network gave evidence to the government’s fan-led review. The chair, Tracey Crouch MP, and the rest of the panel heard from a number of supporters’ trusts and fan groups about the big issues in the third and fourth tiers.
In a worrying development in non-league, two clubs – Abingdon Town of the Hellenic League at Step 6, and Whyteleafe of the Isthmian League at Step 4 – have given up their league status for the 2021-22 season in disputes over stadium rent.
The FSA’s Community-Owned Club network has welcomed two new members to its fold in recent weeks, as the fallout from the COVID-19 crisis further demonstrates the value of supporter ownership and engagement.
The Premier League has announced that it will extend the £30 away ticket price cap, and include a price cap in its rules for the first time, following today’s shareholder meeting.
