Proposals to Extend FFP to Premier League Itself

[Socrates]

Manchester United and Manchester City split by proposals on Premier League
financial controls
Manchester United and Manchester City are on opposite sides of a new divide in the
Premier League: whether the competition should introduce its own Uefa-style financial fair
play regulations.

By Matt Scott
8:29PM BST 22 Aug 2012
At the League’s annual meeting the idea of tighter financial controls being imposed on clubs was
advanced by Liverpool. It gained the support of a number of their rivals, including United’s chief
executive, David Gill, who had previously helped shape Uefa’s ground-breaking Financial Fair Play
rules.
The delegation from Arsenal is believed to have spoken up in favour. The club’s owner, Stan
Kroenke is, like Liverpool’s John W Henry and United’s Glazer family, familiar with restrictive
financial regulations through the US sports franchises they own. West Ham United’s joint chairman
David Gold also gave his approval.
Gold told The Daily Telegraph: “I was involved in bringing in the FFP rules in the Championship
and at the time I thought should I get to the Premier League, I’ll lobby for it. I made it abundantly
clear we shouldn’t be doing nothing. David Gill was marvellous. He made lots of sense. Even the big

clubs now are saying we have to get to grips with costs.”
But the subject was not unanimously supported. Manchester City, whose owner, Sheikh Mansour
bin Zayed al-Nahyan , subsidised spending with £43.3million in cash between June 1, 2009, and the
end of May 2011, are believed to have cautioned that they would prefer to manage their business as
they see fit.
Fulham, whose rise through the leagues was financed by ‘soft’ loans from the chairman, Mohamed
Fayed, have also historically expressed the view that they would not endorse a system that “kills the
dreams” of others. However, this time they did not push back against Liverpool’s proposal.
It all meant the Premier League executive staff have been tasked with drawing up a report on what
proposals could be introduced. One option would be to adopt wholesale the Uefa FFP regulations.
Both Chelsea and United were instrumental in developing these, which require clubs to break even
within a margin of “acceptable deviation” of €45 million (£35.5 million) over the first two years of
their formal implementation – next season and the following.
Chelsea and United are confident of meeting Uefa’s rules despite their inclusion not just of cash
expenditure but accounting charges relating to historical spending under “amortisation”. However,
City will find that particularly challenging.
Their Premier League champions’ operating loss in the 2010-11 season alone – the most recent for
which accounts are available – was £194.9 million. Even though some areas of this spending will be
discounted as allowable, the discounts are unlikely to bring operating losses under FFP to within the
£35.5 million cushion over two years.
David Gill, Manchester United’s chief executive, has told Parliament: “We were involved through the
European Club Association, as were other clubs, such as Chelsea, who were on the working group
to develop those proposals with Uefa.
“It made sense and was for the benefit of football clubs could operate within their own resources
and it would bring about a limiting effect on player cost, in terms of transfers and wages.
“We are comfortable with it. The critical issue will be around implementation and the sanctions
around that, and making sure that it is appropriately applied. But I do not think anyone can criticise
the objective of ensuring that clubs operate within their own resources.”
How to guarantee compliance would be one of the biggest challenges of a new Premier League
regulatory regime and this month Henry expressed his concerns about Uefa’s will to impose its own
FFP regulations. But that view contrasts with recent Uefa actions.
The Court of Arbitration for Sport has upheld Uefa’s expulsion under financial fair play rules of

Besiktas. The Turkish club will be banned from the next two European competitions for which it
qualifies over the next five years.
The English top flight is the only league in the country not to have its own cost-restraint framework.
Leagues One and Two have both implemented salary capping while the Championship has
introduced a financial fair play system for this season based on the Uefa model. Championship clubs
flouting Football League rules will be hit with a transfer embargo.
© Copyright of Telegraph Media Group Limited 2012
Manchester United and Manchester City split by proposals on P... http://www.telegraph.co.uk/sport/footba ... remier-l...
3 of 3 23/08/2012 01:18

[Dameerto]

Their Premier League champions’ operating loss in the 2010-11 season alone – the most recent for
which accounts are available – was £194.9 million. Even though some areas of this spending will be
discounted as allowable, the discounts are unlikely to bring operating losses under FFP to within the
£35.5 million cushion over two years.

How the fuck can Matt Scott even pretend to be qualified enough to make a judgement like that? He takes a figure from a self confessed period of accelerated spending and tries to extrapolate over another two seasons based on it. Talk about shoddy.

[Michigan Blue]

I wonder when Liverpool fans will start asking serious questions of John Henry and FSG. The club missed their chance to pull up the drawbridge a few years ago, and now that they are a Europa League club they are supporting a rule that would preserve Rag hegemony for decades.

[Tokyo Blue]

The whole thing looks a great way for owners to make money from their clubs.

[john68]

Thanks for flagging that up Socs, it was only a matter of time before this was going to happen.
For those who seem to still believe that this is all UeFA based and Platini led, think again. This shite is and always has been led by the old G14 Elite clubs to safeguard their own self interest and defend the income channels forced on UeFA by them.

@Michigan,
Despite their recent lack of success, Liverpool were still as high as 9th (E203M) in the last Deloitte (European clubs) rich list, covering the 2010-11 season. Though it would allow the rags' hegemony to remain in place, it also protects their position as a massive earner.

@Dameerto,
The quoted £194.9M deficit is the actual figure on City's balance sheet. There are certain one off special payments to deduct which lowers the figure to about £146M. His judgement that we are unlikely to lower that deficit to the target figure is pretty well founded. There have been numerous reports and studies published or blogged on City's position and the SwissRambler seems to be the only one that is in any way positive about our chances. Even then, they use all the best case scenarios regarding our income to achieve this.
It looks like our owners understand we won't make the target in the set timescale but will show sufficient significant improvement to dodge the ultimate sanction of being disqualified from UeFA competition.

In purely Prem terms, we were the 6th largest earners (E189.6M), behind the rags @ E367M, Arsenal @ E251.1M, Chelsea @ E249M, L'Pool @ E203.3M and Spurs @ E181M. Our recent runs in Europe, our domestic success with the ensuing increased broadcasting revenues etc, should see a dramatic revenue increase, enough to overtake Spurs. A Prem based FFP would/could hurt us badly if brought in quickly over the next few years.

[john68]

The whole thing looks a great way for owners to make money from their clubs.

It will certainly protect their financial positions.

[Dameerto]

Im aware it's on the balance sheet, Im also aware a large part of it is due to our accelerated spending, which has ended. That in it's self will show us heading in the right direction for FFP when the next season's figures are published. He seems to assume we will carry on at the same (or similar) level of losses though.

[ashton287]

The scum had a hand in the way FFP will work?.

I knew it was to stop us and help the old guard maintain their place at the troff but to actually let them help write it is beyond Fucking ridiculous.

[Im_Spartacus]

What many seem to forget, and this cunt himself either forgot or intentionally ignored even though he mentioned it in his article, is that the accounting measure for FFP does not take into account the overall loss of the club. The club have, through their books shown cash purchases of players, hence the huge losses.

There is effectively a seperat accounting measure for the player transfers whereby regardless of the deal is structured, the club is able to spread that cost over the length of the players contract. Thus, 200m spnt on players since january 2010 will at worst go on the books at 50m a year. The club have and will continue to increase income to match this - last year alone the additional CL income took away a huge chunk of that, even before new sponsorship deals come into it,

Additionally, A reason why the Adebayor deal made so much sense, is that the transfer fee shows as income for FFP, wheras the subsidised wages do not, as he was signed in summer 2009. Ultimately, the same is true of De Jong, Johnson, Bridge, Santa Cruz, etc etc.

Effectively, under amortisation, if we keep a player 3 years before moving him on, the transfer fee received will almost always show a profit in the year they are sold. Bearing in mind we are not signing short term measures any more, and the team is made up of top stars who most clubs would give their right arm for, in the year they are sold, even at a reduced transfer fee, they will show as a huge profit for the club for the purposes of FFP. On the other hand, if the player is good enough to stay beyond the end of his current contract, we have effectively signed a player for free.

Given the age of many of the squad, we can expect that once the transfer fees of Aguero, Nasri, Dzeko, Balotelli, Milner etc have been absorbed via amortisation, when added to the likes of Hart, Kompany, Richards who on an FFP basis cost us nothing, in the next two years we will have a core squad aged 25-26 who are of no significance for FFP calculations. the only things that will, will be a replacement for Yaya, Lescott, and the odd other signing which may be big transfer fees, but much more rare as the core squad will be being topped up as players leave.

Im not overly concerned at all

[s1ty m]

Sharks in charge of the swimming pool.

[dick dastardley]

Their Premier League champions’ operating loss in the 2010-11 season alone – the most recent for
which accounts are available – was £194.9 million. Even though some areas of this spending will be
discounted as allowable, the discounts are unlikely to bring operating losses under FFP to within the
£35.5 million cushion over two years.

How the fuck can Matt Scott even pretend to be qualified enough to make a judgement like that? He takes a figure from a self confessed period of accelerated spending and tries to extrapolate over another two seasons based on it. Talk about shoddy.

All this bollox by the rags is only cos theyve been toppled and surpassed by another club!! if they were still top dog they'd be sayin fuck all....................

[Blue Blood]

To be perfectly honest if City say no to this I doubt highly the league could realistically enforce it.

City is a business and others have absolutely no right to tell you how to run your business. It's anti-competitive and outrageous that laws could be passed under the pretence of FFP when really it is only to protect the established old guards revenue streams, even perhaps give them a financial edge. Disgusting.

It's bad enough we have to stand for UEFA's FFP, I hope City fight this to the end.

[Ted Hughes]

"But the subject was not unanimously supported. Manchester City... are believed to have cautioned that they would prefer to manage their business as they see fit,"

Here we go..

[ronk]

All they're doing is looking at ideas. A compromise will be worked out and implemented. Some form of FFP is probably necessary to deal with the wages problem. Too many ordinary players are on crazy money.

[aaron bond]

All they're doing is looking at ideas. A compromise will be worked out and implemented. Some form of FFP is probably necessary to deal with the wages problem. Too many ordinary players are on crazy money.

There are 2 ways the wages issue could potentially be addressed:
1. A wage cap, or wage bands, are introduced with actual limits, e.g. the highest you can pay a play is £150k per week, or
2. A wage cap for a club as a % of turnover

Option 1 would be the better way to go for all clubs but it's unlikely player power would allow it to happen. Clubs like the old 'Big 4' will push for Option 2 as it benefits them as they have the highest turnover.

Unfortunately, it seems like there are clubs out there such as Wigan and West Ham whose chairmen seem to agree with whatever clubs like United seem to say. They either don't seem to realise that Option 2 will ensure no club could ever again 'do a Man City' and break into the group of top clubs, or they choose to ignore as it allows them to financially benefit personally.

[Wooders]

the issue is that we can't enforce a rule like that in just one league, otherwise we'll destroy the premier league, the best in the world, as clubs in france, spain, germany will offer players the higher salaries - 99% of players are mercs and we'll lose out - we'll also been blown out of the champs league every year as well

[aaron bond]

the issue is that we can't enforce a rule like that in just one league, otherwise we'll destroy the premier league, the best in the world, as clubs in france, spain, germany will offer players the higher salaries - 99% of players are mercs and we'll lose out - we'll also been blown out of the champs league every year as well

I completely agree - it needs to be universal decision otherwise it won't work.

Whether the old G14 try to get wage cap as a % of turnover in through UEFA though, is a potential concern.

[feedthegreek]

scum are just greedy bastards fair play bollocks, 78,000 seater stadium, giving only 3,000 or less to away fans, raking in champs league money for decades, the prem league teams shouldnt be allowed to vote on it by themselves, every division should vote, every team aspires to reach the prem league.

[john68]

the issue is that we can't enforce a rule like that in just one league, otherwise we'll destroy the premier league, the best in the world, as clubs in france, spain, germany will offer players the higher salaries - 99% of players are mercs and we'll lose out - we'll also been blown out of the champs league every year as well

I am aware, though I don't know the details, that there are already some sort of domestic financial compliance regulations in place in Germany and France (possibly other leagues too). A major part of their pro FFP viewpoint has been what they see as the unfair advantage the Prem clubs have had, with our financially unregulated league.

It will be interesting to see how PSG are treated by the French League when they have to submit their balance sheets for scrutiny.

[Rag_hater]

Manchester United and Manchester City split by proposals on Premier League
financial controls
Manchester United and Manchester City are on opposite sides of a new divide in the
Premier League: whether the competition should introduce its own Uefa-style financial fair
play regulations.

By Matt Scott
8:29PM BST 22 Aug 2012
At the League’s annual meeting the idea of tighter financial controls being imposed on clubs was
advanced by Liverpool. It gained the support of a number of their rivals, including United’s chief
executive, David Gill, who had previously helped shape Uefa’s ground-breaking Financial Fair Play
rules.
The delegation from Arsenal is believed to have spoken up in favour. The club’s owner, Stan
Kroenke is, like Liverpool’s John W Henry and United’s Glazer family, familiar with restrictive
financial regulations through the US sports franchises they own. West Ham United’s joint chairman
David Gold also gave his approval.
Gold told The Daily Telegraph: “I was involved in bringing in the FFP rules in the Championship
and at the time I thought should I get to the Premier League, I’ll lobby for it. I made it abundantly
clear we shouldn’t be doing nothing. David Gill was marvellous. He made lots of sense. Even the big

clubs now are saying we have to get to grips with costs.”
But the subject was not unanimously supported. Manchester City, whose owner, Sheikh Mansour
bin Zayed al-Nahyan , subsidised spending with £43.3million in cash between June 1, 2009, and the
end of May 2011, are believed to have cautioned that they would prefer to manage their business as
they see fit.
Fulham, whose rise through the leagues was financed by ‘soft’ loans from the chairman, Mohamed
Fayed, have also historically expressed the view that they would not endorse a system that “kills the
dreams” of others. However, this time they did not push back against Liverpool’s proposal.
It all meant the Premier League executive staff have been tasked with drawing up a report on what
proposals could be introduced. One option would be to adopt wholesale the Uefa FFP regulations.
Both Chelsea and United were instrumental in developing these, which require clubs to break even
within a margin of “acceptable deviation” of €45 million (£35.5 million) over the first two years of
their formal implementation – next season and the following.
Chelsea and United are confident of meeting Uefa’s rules despite their inclusion not just of cash
expenditure but accounting charges relating to historical spending under “amortisation”. However,
City will find that particularly challenging.
Their Premier League champions’ operating loss in the 2010-11 season alone – the most recent for
which accounts are available – was £194.9 million. Even though some areas of this spending will be
discounted as allowable, the discounts are unlikely to bring operating losses under FFP to within the
£35.5 million cushion over two years.
David Gill, Manchester United’s chief executive, has told Parliament: “We were involved through the
European Club Association, as were other clubs, such as Chelsea, who were on the working group
to develop those proposals with Uefa.
“It made sense and was for the benefit of football clubs could operate within their own resources
and it would bring about a limiting effect on player cost, in terms of transfers and wages.
“We are comfortable with it. The critical issue will be around implementation and the sanctions
around that, and making sure that it is appropriately applied. But I do not think anyone can criticise
the objective of ensuring that clubs operate within their own resources.”
How to guarantee compliance would be one of the biggest challenges of a new Premier League
regulatory regime and this month Henry expressed his concerns about Uefa’s will to impose its own
FFP regulations. But that view contrasts with recent Uefa actions.
The Court of Arbitration for Sport has upheld Uefa’s expulsion under financial fair play rules of

Besiktas. The Turkish club will be banned from the next two European competitions for which it
qualifies over the next five years.
The English top flight is the only league in the country not to have its own cost-restraint framework.
Leagues One and Two have both implemented salary capping while the Championship has
introduced a financial fair play system for this season based on the Uefa model. Championship clubs
flouting Football League rules will be hit with a transfer embargo.
© Copyright of Telegraph Media Group Limited 2012
Manchester United and Manchester City split by proposals on P... http://www.telegraph.co.uk/sport/footba ... remier-l...
3 of 3 23/08/2012 01:18

That seems one of the issues for argument,just because we have more resources than the others IMO they cannot discriminate against us.