Rob DaviesFootball clubs have for a long time lived beyond their means and there’s no better example than some of those in the Championship with Derby County and Reading both suffering points deductions this season due to financial mismanagement.
There is thought to be more sailing perilously close to the wind (and I’m not talking about Storm Eunice) with many clubs close or in breach of the EFL’s profit and sustainability rules for next season, even with the exceptional circumstances of Covid-19 taken into consideration. It is thought to be at least six.
Our own club were in serious danger of being one of those clubs following relegation from the Premier League and an eye watering wage bill that was never going to be sustainable in this division.
But largely, and we won’t discuss any of the recent news that’s come out from the club, it can’t be denied that Swansea are on a reasonable footing financially and have cut their cloth accordingly in the years since relegation. Especially since Andre Ayew was released at the end of his contract last summer.
But the eye watering sums are still clearly being wasted at other clubs up and down the land. Last weekend’s visitors Bristol City for one recorded a £38.4m pre tax loss for the latest financial year and whilst I am certainly not an accountant, that is not a sustainable position for any club, let alone one in the Football League.
That is in spite of several high profile sales raising significant sums of cash, namely Lloyd Kelly for £13m, Adam Webster for £22.5m, Josh Brownhills for £9m, Bobby Reid for £10m, Joe Bryan for £7m and Jonathan Kodjia for £15m. That’s nearly £80m in the last three or so years.
So the question is, how does a club recoup that much cash but then still lose so heavily?
The answers are sky high wages and hedging your bets on profit through future sales (which then don’t happen).
Covid largely wrecked the landscape of football’s transfer market as evidenced by the paltry fees received for two of Swansea’s best performers last year Connor Roberts and Jamal Lowe. The Championship saw the lowest transfer fees spent in many years in the past three windows with the exception of Bournemouth.
Now, Robins chairman Steve Lansdown is proposing a salary cap to bring clubs into line in the Football League with his club’s wage bill far in excess of its turnover.
“We have issues following on from Covid,” Lansdown told the Times.
“Having had no income for a while and the transfer market being completely scuppered, so balancing our books is difficult. I am having to fork out more and more money to keep the club afloat.
“If you don’t balance the books you don’t have a club. We’ve seen instances of that already [such as Bury]. One thing that is close to my heart and I’m very proud of is Bristol City Football Club has always paid its bills, always paid its staff, and it has always looked after its community as best it can.
“Football generally is still spending money on contracts and agents which it shouldn’t do. A cap scenario needs to come in because we need some control in that area.”
As a note of slight positivity for Bristol City, they did move on some high earners last summer like Famara Diedhiou and Jamie Paterson, but with expensive salaries like those for Nakhi Wells and Kasey Palmer still on the books and not contributing on the pitch, there’s still serious work to be done.
What do you think? Should this be the way forward?
‘But largely, and we won’t discuss any of the recent news that’s come out from the club, ..’ It should absolutely be discussed with regard to Bristol’s situation.
We may not be spectacularly managed but we are very well managed in a sustainable way.
Bristol calling for a wage cap is like a a fat bloke calling for someone else to nail down the lid of the biscuit barrel.
I think it was more a reference to it still being a sore subject Badlands rather than not reflecting it to the success we have achieved.
And you’re absolutely right it is fairly ridiculous.