Premier League Salary Cap

[Anubis]

Your’s is more accurately titled so I should have shut up and let it run. Sorry.

[AngryOfTuebrook]

9 hours ago, Wezza said:

Isn’t it they’ve agreed to look into it as opposed to it’s definitely going to happen?

More or less: I think it's "have a really good look at it to sort out the details before a vote to introduce it".  (Something like what should have happened with Brexit.)

[Barrington Womble]

10 hours ago, Wezza said:

Isn’t it they’ve agreed to look into it as opposed to it’s definitely going to happen?

I think the clubs agree they don't want to continue with the current rules though and want something to replace it. The reason there's currently so little detail in the media is because there's no detail and as you say, they're going off now to make a model. But this model linked to the smallest TV earnings is the one they're going to go for and they're not looking at other models (for example the uefa style turnover to player spend ratio). The question for me is really how will it work from a practical sense in keeping clubs solvent. If clubs are allowed 5 or 6 times the turnover of TV revenues of the bottom club, it seems the only clubs who will spend within their means are us and the mancs and maybe arsenal now they look like regular CL participants again. 

[coachpotato]

What swung the Haaland deal for City is that they had much more chance of winning the Carabao Cup than us, Chelsea, Madrid or Barcelona.

Egg on his face the last three seasons! Ha!

[VladimirIlyich]

The problem with this is that it's another case of the bosses wanting to keep more of the profits and paying the workers less. If the players wages are capped then how much do you think they'll try and pay the 'less important' employees at the clubs?

[TD_LFC]

50 minutes ago, VladimirIlyich said:

The problem with this is that it's another case of the bosses wanting to keep more of the profits and paying the workers less. If the players wages are capped then how much do you think they'll try and pay the 'less important' employees at the clubs?

 

It's not a wage cap.

[VladimirIlyich]

Just now, TD_LFC said:

 

It's not a wage cap.

What is it a cap on? The thread says 'Salary Cap.' 

[TD_LFC]

29 minutes ago, VladimirIlyich said:

What is it a cap on? The thread says 'Salary Cap.' 

 

It's an overall cap on the total spent on wages, amortisation and agent fees.

 

The cap will be set ('anchored') at X times the total TV revenue received by the lowest earning club (suggestion is x4.5 or x5 but not agreed).

 

There are additional rules being discussed around clubs in Europe being able to spend 70% of their revenue and clubs not in Europe being able to spend 85%.

 

It sounds like the anchoring will be the upper limit to control clubs with huge revenues (real or otherwise) spending vastly more while the 70%/85% could be the normal limit.

 

The detail we haven't seen yet is what they mean by wages and amortisation fee. Is it the total wage bill or the wage bill of players and coaching staff, equally is the amortisation fee for new transfers or the total amortisation fee of the squad (I'd guess the latter).

 

[TD_LFC]

According to the Athletic it's tied to first team wage bill so my figure further up that included total wage bill would be considerably less and leaves us well under the proposed cap before you even factor in upcoming reductions.

 

[aws]

So nobody except Chelsea would be  “capped” and the Saudis would be  able to double their wages?  Marvelous. 

[TD_LFC]

36 minutes ago, aws said:

So nobody except Chelsea would be  “capped” and the Saudis would be  able to double their wages?  Marvelous. 

 

Based on the above City would be able to increase their combined costs by 17 million.

 

17 million would be the 1 year amortisation cost on an 85 million pound player without factoring in wages and agents fee's, so let's say a 60 million pound player at 12 million with 5 million split between wages and agents fee's.

 

Obviously that's if it was all put through the books legitimately and doesn't account for any reductions, brought about by contract renewals, players leaving etc.

[manwiththestick]

13 hours ago, TheHowieLama said:

 

I am pretty sure that post was tongue in cheek.

Yes, apologies, I was being facetious.

[Code]

2 hours ago, VladimirIlyich said:

What is it a cap on? The thread says 'Salary Cap.' 

 

It's a spending cap, see the thread further down. 

[TheHowieLama]

It is a spending cap where the majority of the spending is salaries and all of it is involved in players contracts.

The PFA will do their darnedest to squish this.

[VladimirIlyich]

54 minutes ago, Code said:

 

It's a spending cap, see the thread further down. 

You actually read the first page?

[SasaS]

Without additional rules tied to revenue, this will be a great incentive for sports washing and vanity investors to start buying mid-table clubs.

[Code]

 

Posted 19 hours ago

 

 

Premier League clubs back plan to look at spending cap

 

IMAGE SOURCE, GETTY IMAGES Image caption, 

Manchester City have won four of the past five Premier League titles

• Published
  1 hour ago

Laura Scott

Senior Sports News Reporter

Simon Stone

Chief football news reporter

 

Premier League clubs have voted in favour of developing plans to introduce a spending cap.

A majority of clubs voted in favour of the Premier League doing the final economic and legal analysis needed to create a spending cap model.

The model could be presented to clubs at June's AGM and - should clubs vote in favour then - it will replace the Profit and Sustainability Rules currently in place, from the 2025-26 season onwards. 

Manchester United, Manchester City and Aston Villa voted against the possible introduction of a spending cap on Monday, while Chelsea abstained. 

The league's current financial rules, which have seen Everton and Nottingham Forest penalised eight and four points respectively this season, have been criticised for favouring clubs with the highest revenue.

What are the current rules? 

The Premier League's Profit and Sustainability Rules permit clubs to lose £105m over a three-season period.

The Premier League says the current regulations are designed to try to ensure the long-term financial sustainability of clubs and maintain the competitive nature of the league by preventing "unfair advantages". 

What is the background? 

In February, the Premier League was warned that a failure to reach a funding deal with the English Football League would mean an agreement being imposed on it by a new football regulator being created by the government. 

The following month, the Premier League and the EFL failed to settle on a funding deal.

Instead, the Premier League said that the clubs in the top flight had agreed to introduce a new, competition-wide financial system to replace the Profit and Sustainability Rules. 

What is Uefa's Financial Fair Play model?

When the idea of moving away from the Profit and Sustainability Rules was first discussed, it had been anticipated that Premier League clubs would move towards a model adopted by Uefa.

Under Uefa rules, clubs can spend no more than 90% of their revenue on squad costs. This will reduce to 70% from the 2025-26 season. 

This means the amount they can splash out is limited by the amount of cash they generate.

Why do some clubs oppose the plans?

Some clubs oppose the idea of a spending cap because they feel it threatens to penalise clubs with large revenues, which - they argue - have been built by sporting achievement and commercial innovation.

Others say that levelling out competition in the Premier League threatens to undermine the global standing of the league itself, as it could put English top-flight clubs at a disadvantage against their European counterparts. 

What happens next? 

The Premier League will now develop a spending cap model.

The vote on Monday only concerned the development of a model, not the introduction of one.

Premier League clubs will meet again at June's AGM, when they could be presented with the Premier League's analysis and model.

Discussions will then take place on the model, before a possible vote. 

 

https://www.bbc.com/sport/football/articles/cpegd3dy8j7o

[TD_LFC]

11 minutes ago, SasaS said:

Without additional rules tied to revenue, this will be a great incentive for sports washing and vanity investors to start buying mid-table clubs.

 

There are additional rules tied to individual clubs revenue, whether it will be enough is another matter.

 

The hard spending cap looks to be an attempt stop the bigger, high revenue earning, clubs from running away with it (x% of City's revenue is a lot more than x% of Sheff Utd's) but it's a secondary rule to the 'main' rule that looks to limit the amount any club can spend to 70% of their own revenue (if they're in Europe) and 85% of their revenue if they're outside of Europe.

 

Personally I think the 70%/85% split needs to be revisited in light of the new 'anchoring' rule and a distinction needs to be made for European competitions between the CL, EL and ECL given the vastly different earning potential in each competition.

 

With no figures to back it up (so the assumption may be wrong) capping participants of the Europa League and Europa Conference League at 70% would seem to put them at a disadvantage compared to those out of Europe on 85% and those in the CL on 70%.

 

 

[Barrington Womble]

3 minutes ago, TD_LFC said:

 

There are additional rules tied to individual clubs revenue, whether it will be enough is another matter.

 

The hard spending cap looks to be an attempt stop the bigger, high revenue earning, clubs from running away with it (x% of City's revenue is a lot more than x% of Sheff Utd's) but it's a secondary rule to the 'main' rule that looks to limit the amount any club can spend to 70% of their own revenue (if they're in Europe) and 85% of their revenue if they're outside of Europe.

 

Personally I think the 70%/85% split needs to be revisited in light of the new 'anchoring' rule and a distinction needs to be made for European competitions between the CL, EL and ECL given the vastly different earning potential in each competition.

 

With no figures to back it up (so the assumption may be wrong) capping participants of the Europa League and Europa Conference League at 70% would seem to put them at a disadvantage compared to those out of Europe on 85% and those in the CL on 70%.

 

 

It makes it unmanageable for clubs moving in and out of Europe year by year, unless they can lock player bonus payments to qualification. The reality is though, whatever they try to introduce us unfair to someone. This, more than anything else, is what I think football in general refuses to understand. The flow of money in the game is so great at the top, nothing can be fair and if you devise something domestically to level the playing field, you fuck the top teams at European level. 

[VladimirIlyich]

16 minutes ago, Code said:

Some clubs oppose the idea of a spending cap because they feel it threatens to penalise clubs with large revenues, which - they argue - have been built by sporting achievement and commercial innovation

Man City? Hahahahahahahaha!

[TD_LFC]

1 minute ago, Barrington Womble said:

It makes it unmanageable for clubs moving in and out of Europe year by year, unless they can lock player bonus payments to qualification. The reality is though, whatever they try to introduce us unfair to someone. This, more than anything else, is what I think football in general refuses to understand. The flow of money in the game is so great at the top, nothing can be fair and if you devise something domestically to level the playing field, you fuck the top teams at European level. 

 

I'd guess that's the thinking behind the 70%/85% with the rational that increase in revenue from European competition makes the 70% and 85% virtually the same (the formula probably accounts for a tolerance of x%).

 

It's a risk if the PL get their sums wrong and clubs who are one and done in Europe suddenly find themselves non-compliant though.

 

The 70% also brings them in line with UEFA's limit of 70% so I guess the thinking is any team that crosses paths will technically be working to the same restriction (even if UEFA's is a staggered implementation), but again, until you see it in practice it's hard to know.

[TheHowieLama]

14 minutes ago, Barrington Womble said:

 The flow of money in the game is so great at the top, nothing can be fair 

I think the NFL is double (maybe near triple) what the PL is in terms of revenue.

There is a salary cap and revenue sharing.

There have been 7 different champions in the last 11 seasons.

[Code]

2 minutes ago, VladimirIlyich said:

Man City? Hahahahahahahaha!

Cant take away the commercial innovation though! 

[TD_LFC]

1 minute ago, TheHowieLama said:

I think the NFL is double (maybe near triple) what the PL is in terms of revenue.

There is a salary cap and revenue sharing.

 

Far more complicated as well, be interesting to see the reaction to the introduction of a concept like dead money in the Premier League because Chelsea bought a player and after 1 year decided they didn't want him and wanted to buy another player but had to eat up 50m of dead cap.

[VladimirIlyich]

14 minutes ago, Code said:

Cant take away the commercial innovation though! 

It's usually defined as 'financial crime' in most other cases.