' New Spending Rules from next year in the prem '

BBC
7th Feb 2013

" Premier League agrees new financial regulations for next season "

The Premier League says its clubs will be punished with a points deduction if they breach new spending controls.

The 20 teams will not be allowed to make a loss above £105m over the next three seasons, while from 2013-14 they must limit their player wage bills.

"If people break the £105m we will look for the top-end ultimate sanction range - a points deduction," said Premier League boss Richard Scudamore.

The rules are designed to improve the financial sustainability of clubs.
Investment in areas such as stadia and academies will be exempt.


The aim is a 'break even' model similar to the Financial Fair Play regulations introduced by Uefa for sides in European competitions. The FFP allows only a £38m (45m euros) loss - significantly less than the Premier League's new limit of £105m between 2013 and 2016.




Analysis

Gordon Farquhar
BBC sports news correspondent
One thing that's been guaranteed in the unpredictable world of Premier League football is that when TV revenues go up, so do the financial rewards to players.

It was many people's assumption that the astounding sums agreed by Sky and BT for the live rights for the next three seasons would result in another ticket to El Dorado for the current crop of playing talent.

However, against the run of play, the clubs have shown signs of self restraint. Could sustainability become the new spend spend spend?

In theory, these measures will present clubs with an opportunity to pay down some debt, secure a more stable financial platform, and even stick something away for a rainy day. Now that would be an interesting development.....

Agreeing to cost controls marks a major change for Premier League clubs - they made cumulative losses of £361m in the 2010-11 season - and Scudamore is adamant the system will be enforced.
"As with all things in our rulebook, you will be subject to a disciplinary commission," the Premier League chief executive warned clubs.
"Normally we stay silent on sanctions as the commission has a free range but clearly if there is a material breach of that rule we will be asking the commission to consider top-end sanctions."
Scudamore confirmed there would be an "absolute prohibition" on teams reporting losses of more than £105m over the next three years, with the first sanctions possible in 2016.
Of the 20 top-flight sides, only Manchester City, Chelsea and Liverpool have reported losses of more than £105m over the last three years, according to the most up-to-date published accounts.
It emerged that the vote for the financial regulations could hardly have been closer with only 13 of the 20 clubs voted in favour, with six against and Reading abstaining.
The 'yes' vote only narrowly achieved the necessary two-thirds majority of the 19 votes cast.
It is understood that Fulham, West Bromwich Albion, Manchester City, Aston Villa, Swansea City and Southampton all voted against. Chelsea, who had initially been viewed as opponents of financial fair play regulations, voted in favour.
"A new owner can still invest a decent amount of money to improve their club but they are not going to be throwing hundreds and hundreds of millions [of pounds] in a very short period of time," said Scudamore.
"While it has worked for a couple of clubs in the last 10 years, if that's going to be done in the future it's going to have to be over a slightly longer term without the huge losses being made.
"I think at £105m you can still build a very decent club with substantial owner funding but you have to do it over time, not in a season."
Chelsea won the Premier League two years after Roman Abramovich acquired the Stamford Bridge outfit, and Manchester City's title success came three years after Sheikh Mansour's takeover.
Any club making a loss of above £5m a year will have to guarantee those losses against the owner's assets, which should help prevent the situations that afflicted Leeds and Portsmouth.
"In some ways that's the most significant part, this is a three-year rolling system of secure funding - it's one year at the moment," Scudamore added.
Clubs whose total wage bill is more than £52m will only be allowed to increase their salaries by £4m per season for the next three years (2013-14: £4m, 2014-15: £8m, 2015-16: £12m).
However, that only applies to revenue centrally distributed by the Premier League - essentially TV income - and does not cover extra money coming in from increases in commercial or matchday income.
The 'short-term cost control' measure applies solely to clubs with a player wage bill in excess of £52m in 2012-13, £56m in 2014-15 and £60m in 2015-16.
West Ham's co-owner David Gold said that the proposals for controls had received backing of the majority of chairmen.
"We have all voted and it was overwhelmingly supported, not by all the clubs - some are a little concerned - but the vast majority of the clubs voted in favour," he explained.
"It's not a salary cap, it's a restraint on over-spending. If clubs increase their revenues then they can increase their spending.
"We have got restraint, that's the important thing. What's driving the whole thing is we've got to avoid another Portsmouth."
Minister for Sport Hugh Robertson commented: "I am pleased that Premier League clubs have agreed further financial regulations that will help ensure they are run on a more sustainable basis.
"The Government has been clear that we want clubs to be on a secure financial footing for the long-term health of the game. This is a welcome and positive move."

Let's hope its never changed to include EXSISTING debt........

Another reason why we need to increase the ground capacity.

Wonder are swansea were against it. Perhaps they were hoping to invest largely on their team.

Let's hope its never changed to include EXSISTING debt........

Equity.

Another reason why we need to increase the ground capacity.

The £12m+ outlay would involve approx £3m extra income and therefore £3m extra that could be put on the wage bill so it definitely might be a good idea if an extra £3m is going to make a difference.

Judging by the accounts for 2011 there were 6 clubs with over £52m but less than £61m
Sunderland £61m
Newcastle £54m
West Ham £56m
Fulham £58m
Everton £58m
Bolton £56m
There were 7 clubs with less than £52m so I am assuming that there will be a somewhat level playing field for the lowest spending 13 clubs in the premiership. None of the clubs can vastly increase there wages so any club that can invest their wages wisely should have as much chance as any of the other 12 clubs. Villa had a wage bill of £83m and could get relegated so that would mean 14 clubs on a level playing field.

What I don't understand is it looks like everton couldn't increase their wage bill by more than £4m but if we get promoted and could break even with a £45m ish wage bill then if Tan was willing he could give us a £90m wage bill for the next three years and we wouldn't break the £105m rule. So we could spend £30m more than Everton on wages and not break any rules. Is that correct?

Clubs are always a step ahead, they keep brining in all these rules and regulations but nothing changes.

Clubs are always a step ahead, they keep brining in all these rules and regulations but nothing changes.

Spot on. Hearing these rules and that been made but none of them are never inforced.

When you look into it even more the new rules mean nothing. It only occurs for what's spent on tv money. You can overspend all you want with cash coming from other streams. All it means is owners will sell naming rights to everything. And Chelsea, man city, QPR, united etc etc will just buy the rights to name the ground and overspend hugely on it to even things p.

If VT is as good as his word (debt to equity) and he pulls off his Far Eastern enterprises (betting, TV, soccer schools & shirt sales) then we could be in one hell of a position financially in a few years time....

When you look into it even more the new rules mean nothing. It only occurs for what's spent on tv money. You can overspend all you want with cash coming from other streams. All it means is owners will sell naming rights to everything. And Chelsea, man city, QPR, united etc etc will just buy the rights to name the ground and overspend hugely on it to even things p.

That's very true but the good thing is the naming rights/shirt sponsorship's etc will have been 'sold' and the revenue will be income rather than being a 'loan' and weighing down the clubs balance sheets.

At the end of the day you should be able to spend your income as you want.

Its fine i heard malaysia sponsor is going up due to prem football, we will make 1.8 billion over 3 years! (this is all the owners of different clubs will say) its a joke really, anyone owned by british owners will get hit the most. Due to not being able to looking into sponsors from abroads companies.