Despite claims that the Premier League is in dire straits with its finances and wages are spiralling out of control. An in depth look into Deloitte’s report actually shows the Premier League is running rather well.
Firstly the Premier League’s turnover sits at an incredibly £2 billion. If we compare that with Italy’s Serie A or Spain’s La Liga, there is a £500 million gap in revenue. La Liga and Serie A are currently turning over somewhere in the region of £1.5 billon. In order to compete at the highest level the Premier League has put good use to this high revenue, by giving the players more money. Now to the average man on the street that sounds atrocious. Part of me takes his point too, but stick with me and I shall give you reasons why it’s working.
Firstly why is the Premier League arguably the best league in the world? Well one of the main reasons is the quality of players. The best players in the world play or wish to play in England. This isn’t because they want to enjoy the Manchester rain. It’s money. It is sad it has got to this, but it’s where we are at so we should accept it. The rise in dominance of the Premier League in the Champions League is all down to the increase in wages. The Premier League with its massive turnover can now spend much more to secure the best talent in the world.
I haven’t heard many fans complaining at the standard of football in the Premier League recently. That’s because it is the best in the world. The best things cost money. Furthermore if the Premier League is turning over £2 billion a year I would rather see the majority of that money in the pocket of the player rather than the fat cats sat upstairs. The players are the game. They create every goal, tackle, pass, free kick and corner that makes us coo so obediently. Their talent is a rarity and in the market rarity breeds value.
What also must be remembered is that the 67% of all turnover being spent on wages by Premier League clubs is not too alarming when compared to the continent. France and Italy both have higher ratios in the 70% region of wages to turnover. Spain is currently running at 67% also. So compared to the rest of Europe the Premier League is not haemorrhaging money on wages at ridiculous rates. In fact we are less than rivals. The Premier League’s profit last season was £79 million. Serie A produced figures of £116 million in the red and France’s Ligue 1 £64 million. So next time you hear Platini telling us how the English games finances need sorting out, tell him to look in his backyard first.
Ignore his and Sepp Blatter’s attempts at bringing in a fair play system in finances. It’s not revolutionary and will do little to change or help the game. If anything it’s bad for the fan and doesn’t create more competition. The basic idea would be that clubs could only spend in line with their revenue rates. So who would be able to spend the most money on players and salaries? Erm Manchester United, Chelsea, Arsenal and Liverpool. They currently have the highest revenue streams in the UK. Lots of change there then for competition. Additionally and more worryingly for the fan, clubs may increase ticket prices, merchandise, etc in order to raise their revenue streams so they could spend more money. That idea is really not helpful for football.
So where could we cut some money out of football and give the clubs some breathing place? You don’t have to look at the players. It’s agents. I came across an amazing statistic yesterday that 36% of all transfer money in 2008/09 in the Premier League went into the pockets of agents. That totals to £80 million. For myself I find that more shocking than the players wages. The Premier League has come into stick for running at only £79 million profit considering the £2 billion turnover. Get rid of agents or minimise their earnings to double that instantly. The £80 million drain on clubs over transfers could make substantial savings. I don’t understand that if a player is bought by a Premier League club for £10 million why a chaperone has to be paid £2-3 million?! Let’s eradicate that from our game first and foremost to save some money.
There are some worrying numbers in the Deloitte report, particularly for the Championship and Football League who are running at wages being a staggering 90% and 80% of turnover respectively. The Football League needs to take steps to bring this down. The Premier League on the other hand is still healthy and providing some of the best football in the world. Long may that continue. The problems seen at Liverpool, West Ham and of course Portsmouth are nothing to do with players wages, it has been the complete mismanagement of finances by the owners. Portsmouth’s staggering wage bill doesn’t come from player’s demands, they should have signed less players or individuals whose wage demands would have sat with their budgets.
Listen to the debate I had on Sky News last night on this very subject below.