M23 Citizen
Well-Known Member
There’s not really much wrong with having debt in business. It’s just seen similar to me having a mortgage.
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How Would YOU Design Football Finance Law?
- Thread starter Citizen Green
- Start date
A billion pound mortgage. Lol..There’s not really much wrong with having debt in business. It’s just seen similar to me having a mortgage.
chris85mcfc
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- 28 Jun 2013
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Well then just don't have a rule saying you have to comply with a certain amount of debt.Can’t go down that road with PL. They’re too happy to be flexible only when it suits. Rules have to be black & white moving forward. Where do you draw the line?
There's absolutely nothing wrong with being heavily geared, it's just United have set a bad precedence and have made everyone think that debt is bad.
Debt is something that every single business use to their advantage.
MafeotulBlue
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- Team supported
- Manchester City
I like the idea of control so that the spirit of the competition is integral.
But i would change certain aspects to it.
1. If you purchase a team, and you must invest, for the first 5 years you are put under a Financial Controller, managed externally, audited to the blood.
2. A guarateed down-payment to be made for a set percentage of your investment, to be held as a guarantee, and fail-safe should you turn out to be a rat.
2.1. Once the first 5 years have passed your deposit returns to you gradually to be invested in the club under the current rule-set.
3. Clasification of all PL/EU clubs into different financial and sporting classes when applying new FFP rules. Class reviewed based on Revenue, historical Position in the league and Europe, etc. ( City/United/Arsenal - Class A - Coefficient A / Ruleset for A - Villa - Coeficient B and so on )
3.1 Once classified, teams to be given a percentage of allowed spend ( out of total yeary revenue ) increasing in allowance as the coeficient decreases. ( Example, Villa would be allowed to have an increased spend out of it's total revenue vs City ).
3.2 The margins wouldnt be wild, but it would make sense towards equalising the spread of good / very good players, without stunting the development of higher classed teams. ( as they are also allowed to invest )
3.3 For newly purchased teams, during the 5 year period, mentioned above i would simply allow free investment as long as revenue streams and coeficient points increase year on year. Once the 5 year period ends, a new coeficient calculus would take place and then they would work under the same ruleset as everyone esle.
3.4 Newly promoted teams are allowed to spend outside of their calculated coefficient for the first season.
3.5 Same for the relegated teams.
4. No academy players, to be treated as FFP bargains anymore, with sales of such assets to no longer influence the scale.
Just a couple of ideeas.
But i would change certain aspects to it.
1. If you purchase a team, and you must invest, for the first 5 years you are put under a Financial Controller, managed externally, audited to the blood.
2. A guarateed down-payment to be made for a set percentage of your investment, to be held as a guarantee, and fail-safe should you turn out to be a rat.
2.1. Once the first 5 years have passed your deposit returns to you gradually to be invested in the club under the current rule-set.
3. Clasification of all PL/EU clubs into different financial and sporting classes when applying new FFP rules. Class reviewed based on Revenue, historical Position in the league and Europe, etc. ( City/United/Arsenal - Class A - Coefficient A / Ruleset for A - Villa - Coeficient B and so on )
3.1 Once classified, teams to be given a percentage of allowed spend ( out of total yeary revenue ) increasing in allowance as the coeficient decreases. ( Example, Villa would be allowed to have an increased spend out of it's total revenue vs City ).
3.2 The margins wouldnt be wild, but it would make sense towards equalising the spread of good / very good players, without stunting the development of higher classed teams. ( as they are also allowed to invest )
3.3 For newly purchased teams, during the 5 year period, mentioned above i would simply allow free investment as long as revenue streams and coeficient points increase year on year. Once the 5 year period ends, a new coeficient calculus would take place and then they would work under the same ruleset as everyone esle.
3.4 Newly promoted teams are allowed to spend outside of their calculated coefficient for the first season.
3.5 Same for the relegated teams.
4. No academy players, to be treated as FFP bargains anymore, with sales of such assets to no longer influence the scale.
Just a couple of ideeas.
SalfordCityBlue
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- 2,515
I don't think this is possible until the purpose of it is clearly defined - is it to protect the financial security of all clubs? Is it to equalise the playing field for the sake of more even competition? Or is it to protect the elite clubs?
The first one should have no restrictions on investment and tight allowances for debt (subject to business/sustainability plans).
The second one - why is it needed now? The top flight has always had dominant club eras and became the biggest league in the world off the back of it - what changed to make this necessary? How do you balance this aim without devaluing the product (players not coming to England any more). They do this in the NFL, but there are no competitor leagues.
The third one? No way they will even cop to that being the reason, and even worse, no justification for it.
It seems like the first one is the only one worth exploring, but we all know that's the one that doesn't help the cartel clubs...
The first one should have no restrictions on investment and tight allowances for debt (subject to business/sustainability plans).
The second one - why is it needed now? The top flight has always had dominant club eras and became the biggest league in the world off the back of it - what changed to make this necessary? How do you balance this aim without devaluing the product (players not coming to England any more). They do this in the NFL, but there are no competitor leagues.
The third one? No way they will even cop to that being the reason, and even worse, no justification for it.
It seems like the first one is the only one worth exploring, but we all know that's the one that doesn't help the cartel clubs...
halfcenturyup
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- 12 Oct 2009
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- 12,417
Been discussed before. No restrictions on investment or profitability in the PL. Replace it with some proactive control over debt with protection for community assets such as stadia. Make teams comply with UEFA FFP if they are in Europe. Lets less successful clubs who want to invest catch up and narrows the gap but doesn't prevent PL clubs from competing with European teams.
First of all I'd build a time machine.
I'd head back to the 80s, and put in some FFP/PSR like rules to ensure that we never got to the position we are in now.
Other than that, I genuinely don't know. We could have a free for all, but the biggest clubs are around three times the size they were when our takeover happened. In 07/08 the gap in revenue every single year between Newcastle and Liverpool was about £70m, it's now nearer to £350m! United's squad was valued at £250m, while now we're valued at over £1b.
That means that in a free for all, instead of the £1.3b that our owners put in, you could be spending £5b or even more, to be able to afford players, and wages, long enough to establish a team at the top.
That kind of money is crazy even for rich people, so we're in a completely different World to the one where a local business man could turn a club into title winners. Do we really want a situation where it's pretty much nation states, and a handful of the richest people in the World, being the only ones who can own football clubs? It might be good for our club, but frankly it's not going to open up competition, because there aren't that many people who will be able to compete.
I'd head back to the 80s, and put in some FFP/PSR like rules to ensure that we never got to the position we are in now.
Other than that, I genuinely don't know. We could have a free for all, but the biggest clubs are around three times the size they were when our takeover happened. In 07/08 the gap in revenue every single year between Newcastle and Liverpool was about £70m, it's now nearer to £350m! United's squad was valued at £250m, while now we're valued at over £1b.
That means that in a free for all, instead of the £1.3b that our owners put in, you could be spending £5b or even more, to be able to afford players, and wages, long enough to establish a team at the top.
That kind of money is crazy even for rich people, so we're in a completely different World to the one where a local business man could turn a club into title winners. Do we really want a situation where it's pretty much nation states, and a handful of the richest people in the World, being the only ones who can own football clubs? It might be good for our club, but frankly it's not going to open up competition, because there aren't that many people who will be able to compete.
failsworthblueboy
Well-Known Member
I would bring it into line with every other sector of business in the world where owners are allowed to invest in there business, with a traffic light warning system for clubs in debt.
No debt = Green: Full access to the transfer market
<£200 million = Amber: Transfer activity allowed as long as the debt is reduced and transfer activity is full funded,
>£200 million = Red: No access to the Transfer market until debt is reduced
The £200 million is off the top of my head and just an example to show the system.
But we all know the PL prefers the debt ridden American model and God forbid that any owner spends there own money on there own business.
No debt = Green: Full access to the transfer market
<£200 million = Amber: Transfer activity allowed as long as the debt is reduced and transfer activity is full funded,
>£200 million = Red: No access to the Transfer market until debt is reduced
The £200 million is off the top of my head and just an example to show the system.
But we all know the PL prefers the debt ridden American model and God forbid that any owner spends there own money on there own business.
I do actually agree with OP that the fact PSR stops clubs like ourselves from (hypothetically) spending £500m every summer to inflate the market beyond the reach of all non-state competitors is one of its few positive functions.
However, I also agree there simply HAS to be a far better balance struck between enforcing this sustainability and encouraging investment. I don't really think any great innovations are necessarily needed to achieve this, just a loosening of the current rules.
E.g.
-Don't dock points for EVERY single offence. Hand out warnings for all first offences, luxury taxes for all second offences & a mix of luxury tax/points deductions from the third offence onwards depending on severity.
-Cap all points deductions at 10 points (I believe the EFL already does this but I don't think the PL does).
-Allow "opt out" years for one year in every 10, i.e. where clubs can register their expenditure for that year as NIL, thus essentially giving them a free hit to spend as they like for the three years that the opt out year is applied to, albeit in the knowledge that they'll then have to be PSR compliant once those three years are up.
However, I also agree there simply HAS to be a far better balance struck between enforcing this sustainability and encouraging investment. I don't really think any great innovations are necessarily needed to achieve this, just a loosening of the current rules.
E.g.
-Don't dock points for EVERY single offence. Hand out warnings for all first offences, luxury taxes for all second offences & a mix of luxury tax/points deductions from the third offence onwards depending on severity.
-Cap all points deductions at 10 points (I believe the EFL already does this but I don't think the PL does).
-Allow "opt out" years for one year in every 10, i.e. where clubs can register their expenditure for that year as NIL, thus essentially giving them a free hit to spend as they like for the three years that the opt out year is applied to, albeit in the knowledge that they'll then have to be PSR compliant once those three years are up.
cptaidan88
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- 8 Dec 2008
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An expensive team of lawyers and accountants can come up with whatever rules they like, but someone will always hire a bigger team of lawyers and accountants to find holes in them.
In terms of creating rules It depends what the hoped outcome is. If it's genuinely hoped to achieve fairness then a black and white squad cap should be in place, but I don't see an appetite for that.
In my opinion it should be something forward looking based on a forecast. If you commit to contract a player for 5 years, you must fund that in advance. Funding one season at a time would leave clubs exposed in future years if the funding tap was turned off. Would not be popular but is the only way to ensure a club is viable in the long term.
In terms of creating rules It depends what the hoped outcome is. If it's genuinely hoped to achieve fairness then a black and white squad cap should be in place, but I don't see an appetite for that.
In my opinion it should be something forward looking based on a forecast. If you commit to contract a player for 5 years, you must fund that in advance. Funding one season at a time would leave clubs exposed in future years if the funding tap was turned off. Would not be popular but is the only way to ensure a club is viable in the long term.