http://www.bbc.co.uk/sport/0/football/20319573 Wigan owner Dave Whelan believes Premier League clubs will vote for a new break-even rule on Thursday. Under plans which could be introduced next season, clubs would not be allowed to spend more cash than they generate. Whelan told BBC Sport: "I think the clubs will say break-even is something they want. We could definitely see it." The rule would mark a major change for the league, with champions Manchester City, for example, having made a £197m loss in their latest set of results. Premier League clubs made cumulative losses of £361m in 2010-11, the most recent season for which there are complete financial results. Representatives of the 20 Premier League teams will hold one of their regular "shareholder meetings" in London on Thursday - with 14 clubs needing to vote in favour of the proposals for them to pass. Financial regulation will be at the top of the agenda and Whelan says Fulham are the only club opposed to any kind of new rules being brought in. Premier League clubs' latest financial results Man City: £197m LOSS (2010-11) Man Utd: £23.3m PROFIT (2011-12) Chelsea: £1.4m PROFIT (2011-12) Arsenal: £36.6m PROFIT (2011-12) Tottenham: £32.3m PROFIT (2010-11) Liverpool: £49.4m LOSS (2010-11) Newcastle: £3.9m LOSS (2010-11) Wigan: £7.2m LOSS (2010-11) "This break-even rule will stop clubs getting into the red," he said. "There's nothing worse than seeing a club like Portsmouth getting into financial trouble - or Rangers, who are such a big and powerful club. "I don't think Fulham want anything at all to do with it but generally it is accepted it's a very good rule. If it's passed on Thursday I think it's going to be a very good thing for football." There could still be some flexibility permitted under any potential change, with wealthy owners allowed to put additional money in. Uefa will introduce its own financial fair play rules next season, permitting clubs to make only set losses in the first three seasons. Failure to comply would result in exclusion from the Champions League or Europa League and Whelan believes the penalties should be severe if a break-even rule is introduced in the Premier League. "We've got to say 'if you agree with this, you've got to abide by the rules'," he said. "If you don't break even, you get relegated or get a 10-, 15-, 20-point deduction." A new £3bn television deal comes into force in the Premier League next season, up 70% on the existing arrangement. The chairmen are eager to ensure the extra money is not swallowed up by increased player wages. Premier League clubs spent almost £1.6bn on wages in 2010-11, constituting 70% of their income. Only once in the 20 seasons of the Premier League - 2004-05 - have wages fallen year-on-year. Uefa's Financial Fair Play rules Uefa wants clubs to balance their books over a three-year period starting from the 2013-14 season. It is not until 2018 that clubs have to bring their annual deficits to below £8.8m on current exchange rates. Uefa will have the power to ban any side that repeatedly flouts the rules from European competition. Manchester City spent 114% of their income on wages in 2010-11, Aston Villa 103%, and Chelsea 84%. Another proposal is the introduction of a wage cap, pegging a club's salary bill to a maximum percentage increase year-on-year. Sunderland have pushed hard for this, but Whelan is not in favour. "We control ourselves and don't pay what we can't afford," he said. "I don't think they will go along with a wage cap, I can't see them getting a majority to put in too many controls. "I say to players, get what you can while you can but be sensible and give respect to the club you play for." Wigan reported a profit in earnings before interest, tax and other associated costs in their latest set of financial figures and Whelan expects them to be able to easily comply with a break-even rule. "This doesn't come as any shock or surprise to a club like West Brom or Wigan, which are very carefully, well-run clubs," he said.
Morning sku The only clubs that will vote in favour of this will be the likes of Wigan, reading Norwich etc, none of the big clubs will want these rules brought in
No chance. The EPL is where the billionaires of this world indulge. Force them to walk away, the league is f***ed.
I tend to think they are the reason the league is in the poop in the first place. If clubs only paid their players 'normal' people wages, maybe they would have a chance to survive? Let's be realistic here, for someone to earn 50 - 250K a week is simply madness. An even playing field would certainly break the monopoly of the 'big four' and would make the competition more attractive. At the end of the day, players will accept whatever is being offered, whether it be 250K a week of $5,000 .............. which is still nothing to sneeze at ( for us mere mortals).
Agree the wages are unrealistic but it's too late to fix that. If English clubs don't pay then someone else will. And if the league can't attract the best players in the world, everyone will suffer in the long run (revenue-wise). Hey it's not ideal but something should have been done 10 years ago and across the whole of Europe.
This would make the stadium all the more urgent if that was bought in. All they need is a salary cap.
3 of last year's top 4 already meet the rule, why would they be opposed to Man City being made to play ball as well? By going to a break even rule the clubs with CL revenue and greater prize money for finishing higher up the league would be able to spend more money making it easier to maintain their position. The rules won't be a suitable final result, but they'll be a good starting point to develop in future to one that ensures fair competition. I'm glad they're doing it now as well because it'll give me extra material for my dissertation.
A break even rule is worthless if you allow debt. eg a buy out of Man U mortgaged on the clubs future should not be allowed as it massively loads debts onto the club.
"This would make the stadium all the more urgent if that was bought in. All they need is a salary cap." No offense Flyer, but you need only look at the National Hockey League strike , err...lockout to see what would be one possible outcome of trying to start a salary cap. i agree something has to give, and maybe there is a better way to negotiate than what the NHL are (not) doing, but... I dunno - i don't miss the hockey but I surely would miss football
The difference is the salary cap is not linked to income which is what the NHL wants. Most yank sports have a 50/50 split and here in England its more like 60-90% to the players and of course we are at something like 120% of income goes to the players. A salary cap could lead to a ticket price cap and also every team being able to win the league. Id also add that every team can cancel just 1 contract each summer so we dont get any lazy mercenaries in the teams, ie it would have been SWP last season and Green next season although he isnt to blame for the contract.
If a club operates at a profit then the underlying finance is a minor consideration for the footballing authorities. The purpose of the rules is to ensure that one club spending bucket loads of cash they don't have doesn't make other clubs have to spend beyond their means to be able to compete. If someone chooses to buy a club that way it doesn't create a great pot of money for them to spend, and effectively handicaps them as the interest costs will reduce what the club is able to spend on the team going forwards. That in itself should make it less attractive as a way of buying clubs in the first place as it'll be harder to get a return. From a corporate governance and protecting the clubs from their own owners point of view it's a different discussion.
They also need to stop owners "lending" the club money and doing a Chris Wright when theyve had enough. Things need to change because the TV money wont keep going up
Other than for capital projects like building a new stadium the only reason to "lend" the club money is to cover losses. If the club has to break even or be penalised points and therefore prize money then why is an owner going to lend the club money? At the moment they do it in order to make a greater gain later on through success on the pitch, if the success on the pitch is made irrelevent due to the penalties there's no gain to be had and no point in running the club that way.
Chris Wright lent the money thinking hed get more back when we got promoted, that didnt happen so he took all the money back and that bankrupted us. Its no good a club "breaking even" if thats only due to the money being lent. Its a bit different if the money is given to the club.
If a club is lent money it doesn't affect profit and loss (other than the interest payments being an expense), it only affects the balance sheet so loans can't be used to make a club break even, they just provide the finance to cover the losses. There will be no point doing that as all that happens is the authorities will take away promotions, titles, European places or whatever you've gained by doing it. I think (though I need to check) that dividends can only be given out of profits from that year, not even from retained profits from previous years, so unless the club is profitable money can't be taken out that way. The only option, other than salaries, is for the club to buy back shares from the shareholders.
