Manchester United: Financial Fair Play Will Rightly Protect Man United

Much has been written recently about the potentially damaging effects of introducing UEFA-style Financial Fair Play to the Premier League.

Many believe that the self-interests of the clubs championing the idea—Manchester United, Arsenal, Liverpool and Tottenham Hotspur—will only serve to secure them further success and see off the assault of clubs that aim to triumph via benefaction.

Bleacher Report world football lead writer Will Tidey claimed recently that FFP will bring a new set of problems—the richest clubs will only get richer. But should this be considered a negative prospect?

A much different outlook exists—FFP will return principal and restore sanity to the beloved game, protect the integrity of competition and ensure market position is earned rather than purchased.

The richest clubs didn’t become rich by chance. Decades of diligent hard work, both on and off the football field, has won success fair and square and merited leadership in the market place.

The fundamental question has become lost in all the commentary, largely because of one side’s polarised perspective. But it must remain at the forefront of any sensible debate:

Should a football club spend more than it earns?

Background

Chelsea, Manchester City, Paris Saint-Germain and Anzhi Makhachkala are the largest recipients of benefactor money, and all make operating losses on a large, unsustainable and unfair scale.

The spending by such clubs has warped the market so significantly that responsible break-even clubs are struggling to stay in touch with the consequent inflating market.

The morality of this feral attitude to “investment” in football has to be tackled. It’s void of principle and decency, and it severely damages any hope of an ethical future for the EPL.

Manchester City, for example, posted world-record operating losses of £194.9 million in 2010-11. A year later, the club boasted that it had reduced this figure by almost 50 percent.

But the shortfall of £104.1 million in 2011-12 still represented the largest operating loss of any football club in the world that year, and it would have bankrupted many of those clubs without a wealthy owner to conveniently swallow up the deficit.

Benefaction is not the only driver of market inflation

Many fans would argue, however, that Manchester United have been inflating the market for years, breaking transfer records, paying high wages and leaving others in their slipstream.

This is simply not true—any transfer spending has always been responsibly balanced by player sales. Reinvestment has been remarkably controlled.

In terms of net transfer spend, Manchester City has outspent its neighbours in 13 of 20 complete Premiership seasons so far, according to TransferLeague.co.uk.

This illustrates how conscientious and successful Manchester United has been by comparison to its cross-city rival, because during this period, and despite the aforementioned spending, United secured 23 major trophies to City’s two.

Such skilled and savvy reinvestment into United’s playing staff saw the Old Trafford outfit reap the reward both on and off the field throughout the 90s and noughties, and deservedly so.

Benefaction isn’t as bad as a club in debt

In any walk of life, domestic or commercial, debt is justified so long as it’s serviceable.

For example, the Glazer family has burdened Manchester United with a very large debt, but the payments have been honoured consistently.

Detractors are quick to ignore that “Uncle Malc” has delivered record commercial results, growing Manchester United into a truly global brand and pioneering the product into emerging markets—Southeast Asia (particularly China), Mexico and now their home nation of the United States.

Record commercial deals have been struck under their guidance: Nike, Chevrolet and DHL—the list goes on. Would this have been possible without the expertise and leadership of the Glazers?

Manchester United is now rated the most valuable sports franchise in the world, according to Forbes.com.

When they leveraged a buyout in 2005, Chelsea’s success had spiked, and so did the Glazer investment. When Manchester City’s success spiked, so did the Glazer investment. Over seven years of Glazer ownership, United has won nine major trophies.

The revenue streams they have worked diligently to generate outweigh the debt they have placed on the club—as the old saying goes: “You don’t buy a Rolls Royce to turn it into a Mini.”

But clubs cannot compete without benefaction

It’s not just Manchester United that deserves credit for its achievements. There are many other examples of clubs that have managed to carve out success without having to resort to benefaction.

Sir Alex Ferguson famously broke the Old Firm stranglehold of Scottish football with Aberdeen—a domination that many said was impossible to smash.

More recently, Arsenal has won the Premiership three times with a closely controlled budget and responsible spending.

Wolfsburg won the Bundesliga in 2008-09 for the first time in its history, as did Montpellier in Ligue 1 last season. And FC Twente broke PSV and Ajax’s domination of Eredivisie in 2009-10.

The most notable current example is Germany’s Borussia Dortmund.

Having been close to bankruptcy, Jurgen Klopp’s back-to-back Bundesliga champions have proven you can compete even on the European stage with bold management, savvy player investment and strong youth development rather than massive irresponsible cash injections.

In summary

Manchester United's position may well be protected by FFP, but only because decades of dedicated hard work and superb management (on and off the field) has already established the club as the market leader.

While benefactor clubs continue to artificially and undeservedly position themselves at the top of football’s leagues on the back of unaccountable losses, the game loses its integrity.

Benefaction seen on this scale is a slap in the face to those clubs that have competed responsibly and ethically in building their sporting franchises.

Even-handed competition has to exist, and to ensure this, spending has to be regulated. A club’s revenue must dictate its expenditure; otherwise football will be dragged into a Wild West casino-like quagmire.

Should FFP be installed in the EPL? Is it only right that United and other responsible clubs will be protected by its introduction? Give me your thought’s below or hit me up on Twitter @jonathanbeever.