Premier League Financial Fair Play Will Bring a New Set of Problems

Will Tidey@willtideySenior Manager, GlobalJanuary 14, 2013

The Premier League has been debating for some time whether to introduce a version of UEFA's financial fair play rules, which require clubs to break even over a three-year period and—in theory—protect against unsustainable spending.

The application of UEFA rules will be felt for the first time next season. Six clubs (most notably Malaga, pending appeal) have already been excluded from European competition in their next qualifying season (should it come inside three years), and a further two have been dealt fines (UEFA).

The question is whether the Premier League is ready to go the same way, or just part of the way. To make anything happen, they need approval from 14 of the 20 member clubs, and a meeting is tabled in February to advance the agenda.

The most likely outcome—so say the Press Association—will see the clubs agree to an agreed level of losses that can be covered by owners. Anything above that level would be seen as a breach of financial fair play, with penalties to follow.

With Chelsea, Manchester City, West Brom, Aston Villa and Fulham against spending controls (Daily Mail), this is being billed as a "compromise." And it wouldn't go far enough for four clubs who want the Premier League subject to the same regulations that now govern access to the Champions League and Europa League.

In a letter dated December 17 to Premier League CEO Richard Scudamore (printed exclusively by the Daily Mail), Manchester, Arsenal, Liverpool and Tottenham called for "a strict adoption of the UEFA fair play rules."

The position of these four historic institutions of the English game in simple. They want Premier League clubs to break even. Their model would see "concessions for new owners and promoted clubs," and also rule out the possibility of a mega-rich owner achieving what Roman Abramovich has at Chelsea or Sheik Mansour has at Manchester City.

The Daily Mail's Martin Samuel is not alone is suspecting a self-interested plot to freeze the Premier League's power base:

If clubs like United and Arsenal, with the biggest grounds and revenue streams, can limit spending to percentage of turnover, they will always have the biggest transfer pot and therefore the greatest chance of success. That is why owner investment terrifies them.

Samuel's is not a new argument. In the modern game, it's not realistic to achieve a seat at football's top table without a substantial stake to to buy you in. If you make it impossible for clubs to rely on wealthy owners to fund such a stake, the established rulers get to eat their cake without interruption.

Is that what we want? Because some would argue the emergence of City and Chelsea has made the Premier League better. It's certainly made it more competitive—the great selling point so often stressed of its now global product.

The counterargument—as is publicly stated at least—is that the prolific spending we've seen from City and Chelsea is short-termism that has distorted the transfer market and left the clubs overly reliant on the whim on an individual investor. What if Abramovich or Mansour were to walk out tomorrow? What then?

When you consider the two clubs are reigning Premier League and European champions, the temptation for other billionaires to play the market has to be strong. But the likelihood is that City and Chelsea will represent the last time we see such swift revolutions in English football.

That doesn't mean we'll see the end of people trying.


FFP is flawed because it does sod all to a) stop dodgy owners; b) stop leveraged buyouts; c) prevent debt; d) give better deal to the fans.

— sportingintelligence (@sportingintel) January 13, 2013


As for Chelsea and City, their respective spending has been justified with success. Bolstered by the huge financial reward, Scudamore is confident both will now generate enough revenue meet UEFA's financial fair play requirements (ESPNFC), and there is every motivation for Europe's top clubs to ensure they do the same.

City and Chelsea will feel they got to the top table just in time, because if new rules come in as expected, the Premier League's richest are about to get richer. 

Football had to do something, but financial fair play brings with it a whole new set of problems.