Financial Fair Play

[FryattFox]

This is very bad news for the club in the financial state we're currently in and I can't see how there could be any way of kerbing these debts by 2014 if we don't go up either.

I can't fathom a viable solution in which we will meet the FFP criteria going forwards.

We made a £15m loss in 10/11 and I estimate this will be closer to £30m in 11/12. That doesn't necessarily represent the problem; it's the long term contracts that do. Even if we curtail all transfer spending this summer, we are still left with contracts that significantly exceed our revenue.

If we keep the players then their contracts will always mean that we are significantly loss making, and probably in excess of the permissible losses.

If we terminate their contracts then we'll have another huge loss next year, and the owners will surely be looking to get out if we're not going up.

So the only option is a fire sale and the owners taking the hit. Which I think is what will happen - it's just how long they are happy with that. And finding people to take Pantsil et al off of our books is going to be easier said than done.

I give it one more year. Shit or Bust...

 

[fitz]

I can't fathom a viable solution in which we will meet the FFP criteria going forwards.

We made a £15m loss in 10/11 and I estimate this will be closer to £30m in 11/12. That doesn't necessarily represent the problem; it's the long term contracts that do. Even if we curtail all transfer spending this summer, we are still left with contracts that significantly exceed our revenue.

If we keep the players then their contracts will always mean that we are significantly loss making, and probably in excess of the permissible losses.

If we terminate their contracts then we'll have another huge loss next year, and the owners will surely be looking to get out if we're not going up.

So the only option is a fire sale and the owners taking the hit. Which I think is what will happen - it's just how long they are happy with that. And finding people to take Pantsil et al off of our books is going to be easier said than done.

I give it one more year. Shit or Bust...

Taking measures to reduce the number of paying supporters will not help our situation either.

 

[FryattFox]

Taking measures to reduce the number of paying supporters will not help our situation either.

Agreed.

But although it all adds up, we're clearly in a results business and unless we're in the top 6 next year, we're in a lot of trouble irrespective of whether 20 or 20,000 people turn up.

 

[Feriol]

We are not the only club that spends significantly more than their income, and is in significant debt, and yet all but three clubs voted in favor so i think they must be comfortable with the needed adjustments.

I think it is likely to cause a sudden reduction in what the clubs are prepared to pay for players, the wages they offer, and how much agents can demand. It will be very interesting to see how players and agents react to this.

I'm sure that most of the clubs will be fine.

 

[Lako42]

It probably means we are stuck with the overpaid showers of shite on our books until their contracts run out, also the teams going up to the Premier League may have weaker squads then they would have liked in the promotion season meaning huge spending needed once they become a top flight club.

 

[GazLCFC]

Being reported on BBC Radio Solent that it was us, Southampton and Reading who voted no.

 

[Filthy Rich]

.............I can't see how there could be any way of kerbing these debts..................

.......curbing.............

 

[Mike - True Blue Tinter]

And finding people to take Pantsil et al off of our books is going to be easier said than done.

I give it one more year. Shit or Bust...

I did not think Pantsil was on a big contract. I think it would be much harder to offload big contracts such as Mills and Beckford.

 

[Matt_B]

I did not think Pantsil was on a big contract. I think it would be much harder to offload big contracts such as Mills and Beckford.

I can't wait to offload our 15 goal strikers.

 

[FryattFox]

I did not think Pantsil was on a big contract. I think it would be much harder to offload big contracts such as Mills and Beckford.

Even if he is only on £15k, over 2 (?) further years that's £1.5m. Multiply that by quite a few players who will only ever warm the bench at best, and you're taking away a large amount of the budget.

I have no doubts that we could get rid of Mills quite easily; it's just how much of a loss we are prepared to take.

And why you'd want to get rid of Beckford, who is forming a great partnership with Nugent that means that only one club have two strikers who have both scored more, is beyond me?!

 

[Darth Vodka]

Clubs with less debt loading will be in a better position than teams that have big debts

why?

 

[Darth Vodka]

Indeed, how very dare teams spend money on players and managers that their fanbase would not normally be able to afford. Rotters.

is exactly the gist of Financial Fair Play

 

[Biffa Bacon]

why?

Because they won't have debt repayments going out of the budget, much as clubs that own their grounds will be better off than clubs that rent their grounds.

 

[Darth Vodka]

meh, the Thais could buy the KP and give us a peppercorn rent...

they could buy our debt and lower the rates to us

 

[Biffa Bacon]

meh, the Thais could buy the KP and give us a peppercorn rent...

they could buy our debt and lower the rates to us

The point is that they have shown no signs of doing this or of investing anything that isn't covered by loans which the club has to repay at full commercial rates.

 

[Darth Vodka]

The point is that they have shown no signs of doing this or of investing anything that isn't covered by loans which the club has to repay at full commercial rates.

they didn't need to worry about posting a loss before

I generally agree with your points, loand and rents hit the P&L, but I'd just like to caveat it with the possiblility of accounting shenanigans, like Man City did in getting over paid for the naming rights of the stadium

 

[OldGit]

I tend to agree.

While I have no doubt this is a well-intentioned move, I suspect that the law of unintended consequences will, as usual with such things, take over. Give it a couple of years and I bet the only clubs penalised will be ones without rich backers.

 

[Redditch Fox]

My instincts are that Football League clubs should be allowed to spend as they like within the limits of the law.

I fear that this move will further widen the gap between the Championship and the Premier League effectively making the Premier League more of a closed shop.

Of course i realise that current patterns of spending by some Championship clubs - ourselves included - increase the risk of their financial implosion, But the game supposed to be about a bit of risk and excitement. Basically i think this is the cash non-rich majority trying to hold back those trying to climb out of the box. In the end it will drive clubs towards being more financially sustainable but at a price in terms of thrills and spills.

 

[The Old Fox]

My instincts are that Football League clubs should be allowed to spend as they like within the limits of the law.

I fear that this move will further widen the gap between the Championship and the Premier League effectively making the Premier League more of a closed shop.

Of course i realise that current patterns of spending by some Championship clubs - ourselves included - increase the risk of their financial implosion, But the game supposed to be about a bit of risk and excitement. Basically i think this is the cash non-rich majority trying to hold back those trying to climb out of the box. In the end it will drive clubs towards being more financially sustainable but at a price in terms of thrills and spills.

Ah, it is nice to be able to agree with you, again! I seem to have been gain saying you rather a lot recently but, I think that you are 100% correct in the divide of Premier League and 'the other ranks': indeed, I believe this to be the main purpose of the FFP laws.

 

[Jeff]

I think that you are 100% correct in the divide of Premier League and 'the other ranks': indeed, I believe this to be the main purpose of the FFP laws.

Why would the Football League bring in a rule with the primary aim of making the gap between them and the PL wider?
And if that is the primary aim, why did the majority of Championship clubs vote for it?