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Money in Football

From Roman Abramovich arriving at Chelsea FC to Manchester City owner Sheikh Mansour the sugar daddy’s seem to have let transfer fees, player wages & ticket prices spiral out of control.  In English football how far away is the riches of  the Premier League from lower leagues?  Will UEFA’s new Financial Fair Play regulation bring an end to the crazy money being passed about & will football ever be the same again?

As money in football increases so does each individual player’s salary.  Although along with the rich club owners it is the normal football fan helping fund the game.  Gone are the days that you could go to a top flight game at an affordable price along with picking up a match day scarf, programme & pie.  In today’s game the cost of a ticket for a top flight game can be in access of £70.  This is for a normal seat – no VIP hospitality…for that you will pay well over £300!  Then we have the mega stores.  To purchase the latest full kit along with name, number & Premier League logo we could be talking £70, & that is only in a child size.  This is before you enter the ground for the over priced food & drink.  Although let’s concentrate of player wages in the Premier League.

Premier League Wage

It is believed that one player in the Premier League at a top club can earn up £1.5 million a year.  Comparing this to over 5 seasons previous you will find the highest paid player received approximately £650,000.  Premier League players on average will receive £780,000 per year.  If you compare this other industries you will be shocked.  A nurse will receive £23,500 per year, a teacher £30,000 per year…Wayne Rooney?  £250,000 per week!  His 2012 earnings were £17.2 million!  This shows not only how much a week he earns with his wages but extras through bonuses, sponsorship & player image rights!

Top to the Bottom

So the average Premier League wage is £22,000 a week…before bonuses!  Or if you like, £1.16 million a year.  Compare this to the average Championship player who receives £4,050 per week (£211,000 per year).  This is a fifth of a difference for playing one league down!  Dropping down to league 2 you will find the average weekly wage is £750 which is 30 times smaller than those in the Premier League!

All good managers talk about needing a strong spine in their team.  So whose the top earners as we strengthen our team down the middle?  The manager at the top of the wage chart is the man who keeps his house in good order, Arsene Wenger.  He earns £115,000 per week.  The top shot stopper is Peter Cech from Chelsea earning £96,000 per week.  Not to be outdone his team mate, John Terry, earns £130,000 playing centre back.  Manchester City purchased midfielder Yaya Toure from Barcelona in 2010 for £24 million & offered him a weekly salary of £190,000.  But across the city at United Wayne Rooney finds himself leader of the strikers receiving £250,000 per week!  Despite being in a world recession top Premier League players earnings have went up more than 200% since 2000.  Is it time for a salary cap?

While Football league clubs research has revealed 72 clubs from the Championship, League 1 & League 2 have racked up a combined debt of £2 billion.  We have all witnessed the demise of Portsmouth FC going into administration so UEFA’s new Financial Fair Play Model needs to be adhered too.

Wealthy Owners

The Chelsea owner, Roman Abramovich, is a Russian business tycoon.  Russia’s 5th & the world’s 50th richest person he is estimated to be worth £8.4 billion.  When he arrived at Chelsea money was made available for transfers, & plenty of it.  When Shevchenko arrived for £30 million Chelsea’s end of year showed a loss of £140 million in June 2005.  By the end of June 2006 this was down to £80 million.

Manchester City owner, Sheikh Mansour, has an estimated wealth of £17 billion but a family fortune of at least $1 trillion US dollars.  He completely wiped Manchester City’s debts of £305 million on arrival.  From September 2008 approximately £300 million has been spent on transfers.  By year ending May 2009 there was a loss of £92.5 million.

UEFA

The Financial Fair Play regulations want clubs to live within their means & was first introduced during season 2011/2012.  Failure to do so could mean disqualification from European competition.

The concept has also been supported by the entire football family, with its principal objectives being:

• to introduce more discipline and rationality in club football finances;
• to decrease pressure on salaries and transfer fees and limit inflationary effect;
• to encourage clubs to compete with(in) their revenues;
• to encourage long-term investments in the youth sector & infrastructure;
• to protect the long-term viability of European club football;
• to ensure clubs settle their liabilities on a timely basis.

These approved objectives reflect the view that UEFA has a duty to consider the systemic environment of European club football in which individual clubs compete, & in particular the wider inflationary impact of clubs’ spending on salaries & transfer fees.

In recent seasons, many clubs have reported repeated, & worsening, financial losses. The wider economic situation has created difficult market conditions for clubs in Europe, & this can have a negative impact on revenue generation & creates additional challenges for clubs in respect of the availability of financing & day-to-day operations. Many clubs have experienced liquidity shortfalls, leading for instance to delayed payments to other clubs, employees & social/tax authorities.

Therefore, as requested by the football family, & in consultation with the football family, UEFA is introducing sensible & achievable measures to realise these goals.  They include an obligation for clubs, over a period of time, to balance their books or break even.  Under the concept, clubs cannot repeatedly spend more than their generated revenues, & clubs will be obliged to meet all their transfer & employee payment commitments at all times.  Higher-risk clubs that fail certain indicators will also be required to provide budgets detailing their strategic plans. (from UEFA.com)

This should help clubs compete on a more level playing field.  It should also stop the investors finding loopholes, for example, selling advertising boards for £100 million!

The Magic of Football

Although the top 4 in England used to be a contest between Manchester United, Chelsea, Arsenal & Liverpool the millions have brought Manchester City into this bracket.   We have also seen Tottenham Hotspur challenge for a place in the top 4 in recent seasons.

But one thing will never change & that is the magic of the FA Cup.  Most recently Premier League side Liverpool visited struggling League 1 side, Oldham Athletic.  The cash strapped League 1 side dumped the Premier League stars out the FA Cup!

I have just received some great coaching equipment from www.TheSoccerStore.co.uk & will be sharing my notes & record the session that I’ll take with my academy side. Check back for my next post that will include all my notes!

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