Massive shake-up needed in football finances

Link: Football Clubs unprepared for risks

The group released its findings today, focussing on the huge divide between the rich and poor clubs and the current epidemic of football clubs going to the wall.

To address these problems MPs recommended:

• a wage cap be considered
• the introduction of a ‘fit and proper person test’ for football directors
• that premier league clubs double the amount of revenue passed on to the lower divisions from 5% to 10%
• sharing of gate receipts should be reintroduced guaranteeing visiting clubs revenue
• that research be carried out into the transfer window, which restricts the period when players can be bought and sold

The group also voiced its support for the 10 point deduction imposed on football league clubs that go into administration.

‘Football is richer today than ever before, but more clubs than ever before are going to the wall. Why? It was this paradox that our inquiry looked to answer,’ said Alan Keen, chairman of the group.

‘After nine months of detailed investigation, we have concluded that the financial divide between the ‘haves’ and ‘have-nots’ must be tackled urgently,’ he added.

The report echoed similar sentiments contained in yesterday’s report from the Independent Football Commission, which recommended soccer authorities should introduce tough financial controls and also ensure directors are fit and proper people to run them.

The IFC also said clubs should be required to show they could pay salary costs and transfer fees, particularly where there was a change of owner.

‘Football has never had such a high level of external resourcing, yet has never had so many clubs,’ the IFC said.