Salary cap confirmed

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Once L1 and L2 realise that they have been shafted by the Championship some, no way all, of the clubs might just think about what they have achieved. The more ambitious amongst those who voted in favour might, only might, just see that they have cut off any chance of recruiting a team with anything more than transient players and, that if they leave things as they are, will never, ever see promotion beyond L2 to L1.

Of course, many of those clubs are never going to move out of L1 let alone L2 and will see the status quo as their ticket for mediocracy in perpetuity.
 
A lot of people who defended it have gone pretty quiet.
‘All this vote does is formalise the financial gap that already exists!’

Nope - it has now massively exacerbated that gap and the only thing it has permanently formalised is the league positions clubs currently find themselves in. ‘Sustainability’ - do me a favour. How the hell is a club promoted from League 1, with its paltry squad size and salary cap, supposed to sufficiently level up their squad in a sustainable manner in one summer to compete with the relatively unfettered spending of Championship clubs, who will have accumulated massive squads over the course of years?

This salary cap looked ridiculous when it looked like a Championship salary cap would be introduced, too. Without it it’s just farcical.
 
Once L1 and L2 realise that they have been shafted by the Championship some, no way all, of the clubs might just think about what they have achieved. The more ambitious amongst those who voted in favour might, only might, just see that they have cut off any chance of recruiting a team with anything more than transient players and, that if they leave things as they are, will never, ever see promotion beyond L2 to L1.

Of course, many of those clubs are never going to move out of L1 let alone L2 and will see the status quo as their ticket for mediocracy in perpetuity.
The problem now is though that it presumably will take the same proportion of votes (66%) to overturn the decision as it did to implement it. So you would need more than eight of the clubs to change their minds.
 
The problem now is though that it presumably will take the same proportion of votes (66%) to overturn the decision as it did to implement it. So you would need more than eight of the clubs to change their minds.

Exactly which is why it won't happen.
 
Seems that the PL are voting again on the 5 subs next Thursday.
So when the bigger clubs in L1 get outvoted - we have to accept the result for the greater good of the game.
When the bigger clubs in the PL get outvoted - they just insist on a new vote until, presumably, they get the result they want.

 
The problem now is though that it presumably will take the same proportion of votes (66%) to overturn the decision as it did to implement it. So you would need more than eight of the clubs to change their minds.
Bingo. Anyone with a functioning brain saw this coming from the off, especially when the Championship wasn’t holding a vote at the same time. That was a serious red flag. I’m still absolutely stunned at how many people passionately defended and backed it only a few weeks ago. We love imposing economic sanctions on ourselves in Britain these days, clearly.

People forget that the head of the EFL is Rick Parry. And who is he again? Ah, yes, the original founding CEO of the Premier League. The organisation he played a major part in founding, which was implemented by ripping the entire top tier of English football away from the Football League.

The Championship will be the PL2 in the next few seasons, and they’ll all punt their B Teams - the ones filled with the talent we used to sign and sell, as well as those we can’t keep hold of because of squad restrictions on players over the age of 21 - into our divisions. Because we already let them into our cup competition, so what’s the harm, eh?

It’s one thing if idiots in suits want to ruin the game and don’t care about anything but their next free meal, but when supporters clap like chimps we really haven’t got a hope in hell.
 
The most ridiculous thing is that the division that needs a hard salary cap most of all is the Championship.
They are the division that are spending insane amounts relative to their incomes. The majority of football league clubs in significant financial strife got that way because of how they behaved in the second tier, desperately chasing the Premier League riches.

There's exceptions (Bury chief amongst them), but I actually think that the majority of lower league clubs are relatively (if not absolutely) sensible.

Putting in a low salary cap in League One & League Two, and nothing in the Championship is an absurd state of affairs - and the EFL should delay its implementation until the Championship agrees to a figure as well. Otherwise, if Championship teams keep behaving as they have done, we're going to be looking at a 14-15x difference in average salary between them and League One. That's a gap that would require a feat of extraordinary managerial brilliance to bridge (or a bunch of second tier teams going bust.....could well happen if they carry on as they are.......)
 
The most ridiculous thing is that the division that needs a hard salary cap most of all is the Championship.
They are the division that are spending insane amounts relative to their incomes. The majority of football league clubs in significant financial strife got that way because of how they behaved in the second tier, desperately chasing the Premier League riches.

There's exceptions (Bury chief amongst them), but I actually think that the majority of lower league clubs are relatively (if not absolutely) sensible.

Putting in a low salary cap in League One & League Two, and nothing in the Championship is an absurd state of affairs - and the EFL should delay its implementation until the Championship agrees to a figure as well. Otherwise, if Championship teams keep behaving as they have done, we're going to be looking at a 14-15x difference in average salary between them and League One. That's a gap that would require a feat of extraordinary managerial brilliance to bridge (or a bunch of second tier teams going bust.....could well happen if they carry on as they are.......)

Wigan’s wage bill last season was over 150% of their turnover. Charlton’s wages in the championship was over 100% of their turn over. Southend, who always seem to be struggling and get put in the same bracket as Wigan and co for being in a financial mess, spent around 75% of their turn over on wages.
If the EFL want to be taken seriously they need to get a grip on Championship clubs and their spending.
 
Has there been any indication from anywhere in the last couple of weeks that the championship are even going to discuss a cap, let alone vote on having one?

From an article last week in The Athletic, in regards to Championship spending:

The EFL has not yet put a salary cap to the vote in the Championship but The Athletic understands a cap of £18 million would comfortably gain the two-thirds majority (16 of the 24 clubs) needed for a change in the rules. The reason the league has not yet moved to a vote is there remains no consensus on whether the cap should be introduced alongside the current P&S rules, whether those rules need tightening up or whether they should just be scrapped.

Last week, the Championship agreed to copy the example set by UEFA and the Premier League — amalgamating 2019-20 and 2020-21 into one season for P&S purposes because of the impact of the coronavirus pandemic on club finances.

Under the current rules, clubs are not allowed to make losses of more than £39 million over a three-year period but that has not stopped the division from running up an aggregate annual loss of more than £300 million and spending an average of £1.07 on wages for every £1 they earn. Addressing this situation with a salary cap is the silver lining the EFL hopes to find in the dark cloud of the Derby case.
 
From an article last week in The Athletic, in regards to Championship spending:

Just further to this, as the whole article is incredible (https://theathletic.com/2026581/2020/08/28/efl-pride-park-derby/), a few paragraphs on Derby's financial jiggery pokery, as an example of just how many potential loopholes can be found for FFP:

The second charge was based on the method Derby have been using to deal with the fees they have paid for players in their annual accounts. Players are considered as intangible assets for accounting purposes, and like all other assets, they have values which depreciate over time. How you do this is called amortisation.

Thanks to the Bosman ruling, players have no value to their clubs at the end of their contracts as they can leave for free, so the vast majority of clubs amortise the cost of buying a player in a straight-line basis over the course of their contract. So, for example, a player bought for £4 million on a four-year deal would cost most clubs £1 million a year in amortisation charges, with the player being worth £3 million after one year, £2 million after two years and so on.

Derby, however, did it their way, and it was not even the different way the EFL thought they were doing it when it charged the club. Confused? So was the EFL.

According to the club, at some point in 2015, chief executive Stephen Pearce and the club’s long-standing auditor Andrew Delve decided the usual method was not fairly accounting for the club’s nous in the transfer market, which helped them buy young players, nurture them and sell them on before the end of their contracts.

So they stopped amortising in a straight line to zero and started to apply what they called an “expected recoverable value” to each player, on the basis that he would be sold before entering the final year of his contract. So, to repeat the example above, Derby might decide that the £4 million signing would be worth £3 million after the third year of his contract, reducing the annual amortisation costs over that period from £1 million to £333,333, with the final £3 million being charged to the club in the fourth year of the contract.


The benefits of doing it this way? 1) it initially reduces a club’s costs and 2) gives the club an extra degree of control over its expenses at the end of a financial year. The flipside? The club will realise no profit in their accounts when they sell that player for £3 million after three years, not the £2 million gain it would have been if they had amortised in a straight line.

Derby started doing this in 2015-16 and added a small note in their 2016 accounts to say they were now amortising their players’ values to a “residual value”. This note was repeated in 2017 and 2018 before anyone at the EFL realised this could pose a problem when you are assessing whether a club has breached the P&S threshold or not.

Not that the league grasped what this really meant until shortly before the hearing commenced in July, when the EFL learned from the club’s witness statements that Derby were not, as the league thought, allocating a “residual value” of more than zero to a player at the end of this contract, which would have been deeply problematic given the Bosman ruling, but was using its own estimate of a player’s resale value up until the final year of his contract.

The panel, which was comprised of two QCs and a forensic accountant, was unimpressed with the league’s failure to work out what Derby were doing before charging them but was positively damning of the accountancy expert the league put up to make the case that the club’s practice was contrary to the applicable accountancy standards.

Professor Peter Pope, an academic with no recent experience of working in accountancy, was criticised by the panel for failing to understand that independent witnesses in arbitration hearings are not meant to be so dogmatic and partial in their views, particularly when asked for opinions on subjects when there is clearly a range of views.
 
Just further to this, as the whole article is incredible (https://theathletic.com/2026581/2020/08/28/efl-pride-park-derby/), a few paragraphs on Derby's financial jiggery pokery, as an example of just how many potential loopholes can be found for FFP:
Hadn't heard of Matt Slater before the issues over lockdown and the EFL's wranglings over the various methods of finishing a season, but he's the absolute bee's knees. A superb correspondent on all things administrative in the EFL.

I may be misunderstanding it, but I still don't quite understand how clubs are supposed to account in their balance books for players who are brought in on the cheap, or have come through their academy, and whose market value rises rapidly. While this Derby method does seem deliberately (and cheekily) evasive of the Championship's FFP, surely the very nature of the value of footballers, and its inherent intangibility, means that while this may be against the spirit of FFP it's not technically a 'breach' of it?
 
While this Derby method does seem deliberately (and cheekily) evasive of the Championship's FFP, surely the very nature of the value of footballers, and its inherent intangibility, means that while this may be against the spirit of FFP it's not technically a 'breach' of it?

I think that's the point, really.
Derby are using creative accountancy, but nothing that they're doing is illegal or against any specific EFL rule.
The EFL just failed to properly understand what they were doing, and as a result got clowned in court. Again.

But it also illustrates why FFP rules, as they currently stand, are pointless and completely ineffective. Because there are a million and one ways around them if you've got good accountant. A hard salary cap, however, is simple, straightforward and easy to enforce - and might just make a difference in bringing down the currently absurd rate of spending in the Championship.

Which is why I still think that a salary cap in the Championship would actually be a good thing. For us as a club if we ever get there, and for the financial health of football in general. It's far more important at that level than it is at League One & Two, where spending is not and has never been generally quite so off the rails.

So of course it's the one salary cap that the EFL have not yet introduced........
 
I think that's the point, really.
Derby are using creative accountancy, but nothing that they're doing is illegal or against any specific EFL rule.
The EFL just failed to properly understand what they were doing, and as a result got clowned in court. Again.

But it also illustrates why FFP rules, as they currently stand, are pointless and completely ineffective. Because there are a million and one ways around them if you've got good accountant. A hard salary cap, however, is simple, straightforward and easy to enforce - and might just make a difference in bringing down the currently absurd rate of spending in the Championship.

Which is why I still think that a salary cap in the Championship would actually be a good thing. For us as a club if we ever get there, and for the financial health of football in general. It's far more important at that level than it is at League One & Two, where spending is not and has never been generally quite so off the rails.

So of course it's the one salary cap that the EFL have not yet introduced........

The difficulty is that the Championship is one tantalising step from the immersive trough of greed that is the Premier League....so its either spend,spend,spend to jump the gap or close the door behind you on the lower league paupers and create PL2.
Once that is done the next step is a European League...no need to travel, £50 a match on your telly/IP Stream...............

The game is thoroughly fubar`d.
 
The difficulty is that the Championship is one tantalising step from the immersive trough of greed that is the Premier League....so its either spend,spend,spend to jump the gap or close the door behind you on the lower league paupers and create PL2.
Once that is done the next step is a European League...no need to travel, £50 a match on your telly/IP Stream...............

The game is thoroughly fubar`d.

I've said it before on here.....but I reckon that a European Superleague might actually fix football.

You'd likely siphon off the 'Big 6' into a closed league with the other big European clubs. They would hoover up all the international TV money & sponsorship, much of the domestic as well, and would be the place to play for all the top players.

But they would then leave the rest of the English football league to get on with it.
Wages would have to drop astronomically to account for the fact that TV and sponsorship revenue would be way down and there was no Premier League pot of gold for teams to chase........but we'd have a league and a game that was much more similar to the football of the 90s that I grew up with. Just without the Manchester & North London clubs, Chelsea & Liverpool. Quality would probably drop, because all the best players would end up in the Superleague, but that's a compromise that I'd accept.
 
I've said it before on here.....but I reckon that a European Superleague might actually fix football.

You'd likely siphon off the 'Big 6' into a closed league with the other big European clubs. They would hoover up all the international TV money & sponsorship, much of the domestic as well, and would be the place to play for all the top players.

But they would then leave the rest of the English football league to get on with it.
Wages would have to drop astronomically to account for the fact that TV and sponsorship revenue would be way down and there was no Premier League pot of gold for teams to chase........but we'd have a league and a game that was much more similar to the football of the 90s that I grew up with. Just without the Manchester & North London clubs, Chelsea & Liverpool. Quality would probably drop, because all the best players would end up in the Superleague, but that's a compromise that I'd accept.
Majority of those players are foreign at the moment and if there is no relegation it all might get very boring after the initial hype.
 
Majority of those players are foreign at the moment and if there is no relegation it all might get very boring after the initial hype.

Boring for us - and probably boring for your average, regular Man U or Liverpool fan who used to stand on the Stretford End or in the Kop.

But I doubt it would be boring to your average armchair supporter, or your average Premier League fan in North America or Asia. And because they - rather than the fans who actually turn up to games - are the ones that bring in the real money nowadays, they're the ones that a European Superleague would be built for.

And, as I say, I think it might leave the rest of English football much poorer, but with a product that's again forced to appeal to the traditional football fan (because we'll be all that's left watching it). Which is decidedly not what we've got at the moment.
 
I've said it before on here.....but I reckon that a European Superleague might actually fix football.

You'd likely siphon off the 'Big 6' into a closed league with the other big European clubs. They would hoover up all the international TV money & sponsorship, much of the domestic as well, and would be the place to play for all the top players.

But they would then leave the rest of the English football league to get on with it.
Wages would have to drop astronomically to account for the fact that TV and sponsorship revenue would be way down and there was no Premier League pot of gold for teams to chase........but we'd have a league and a game that was much more similar to the football of the 90s that I grew up with. Just without the Manchester & North London clubs, Chelsea & Liverpool. Quality would probably drop, because all the best players would end up in the Superleague, but that's a compromise that I'd accept.
I’ve wondered that ... lose the big teams and you’ve got a tough Leeds side competing with an exciting young Southampton or Forest team for the title. Might be less predictable and more 70s
 
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