It’s ten years since Sunderland last finished in the top ten of the Premier League but, even though they have lost their last four games, this season the Wearsiders look to be on course to end that decade-long spell away from the upper half of the table. It was little surprise, then, when Steve Bruce was handed a new contract as a result of the positive influence he has had upon the club’s league position and style of play since taking over as manager in May 2009.
Bruce’s side are currently in eighth place and, while Darren Bent might have opted out of the manager’s project, he left behind him players like Asamoah Gyan, Jordan Henderson, and impressive new signing Stéphane Sessègnon to carry on the good work. As well as being in with a chance of matching or bettering the back-to-back seventh-place finishes the Black Cats achieved in 2000 and 2001, this current squad is the most talented since the days of the side featuring Kevin Phillips and current chairman Niall Quinn too.
The success story on the pitch, however, is not matched by the tale off it. Attendances are marginally down on last season, prompting the harsh words Quinn had recently for the fans he suspects to be staying away from the Stadium of Light on Saturday afternoons in order to watch Sunderland’s matches in pubs with illegal satellite hook-ups instead. The former striker said he “despised” such fans, and the reasons for the strength of his anger become apparent once the club’s finances are considered.
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Sunderland are bankrolled by Ellis Short, the Texan billionaire who since becoming owner in May 2009 has put just over £95m into the Mackems’ coffers on top of the money he spent to acquire the club in the first place. The American’s continued generosity is of paramount importance to Sunderland because two years of transfer activity – funded in the most part by Short – and the increased wage bill associated with it have both contributed to Sunderland’s announcement of pre-tax losses of £27m and £28m respectively in the last two years. In total, the Black Cats are £66m in debt.
Sunderland’s poor financial showing has certainly been exacerbated by their inability to sell the few thousand extra tickets Quinn would like the club to in order to meet his average gate target of 44,000, while the revenue generated from other means such as shirt sponsorship and television coverage is less than that which other clubs benefit from. However, as at so many top flight clubs, buying expensive new players (and then paying their salaries) is the root cause of the balance sheet problems on Wearside even if that strategy is deemed to be the only way to maintain Premier League status.
A net spend of £65m on players since promotion in 2007 has left Sunderland with a wage bill standing at 82% of their turnover. Given that UEFA’s Financial Fair Play scheme – which will see clubs’ books scrutinised from next season with a view to the regulations’ implementation in 2013/14 – recommends no more than 70% of a club’s income be spent on their players’ pay, Sunderland’s business model looks to be as in need of change as the more high-profile examples at Manchester City and Chelsea.
It’s not the first time Sunderland have been big spenders either. Their £125m outlay on transfers in the last four years is reminiscent of the period during the 1950s when similar cash-splashing behaviour – by the standards of the age, at least – resulted in the Black Cats being dubbed “the Bank of England club.” Fans will be hoping for a less traumatic outcome on this occasion, though, as will become apparent.
Sunderland earned their Bank of England comparisons during a period of spending that began in 1948 when they prised Len Shackleton from neighbours Newcastle United for £20,500. Don’t be underwhelmed by the size of the fee; it was a world record at the time. Just two years later, however, Sunderland made that figure appear insignificant when they paid £30,000 for another centre forward, as Trevor Ford arrived from Aston Villa. The 50% increase between the two record fees proves how transfer fee inflation is not just a modern phenomenon.
Don Revie (£22,000) and Billy Bingham (£8,000) were two other notable Sunderland signings during the fifties but the club’s massive investment did not bring them any silverware. They did finish one point off the top in 1950 but, for a club that had won the First Division six times by 1936, that achievement hardly met expectations.
Matters really started to unravel in 1957. Sunderland received a heavy fine and saw players such as Ford suspended by the Football League after an investigation found the club guilty of making illegal payments to its squad members. A scam involving overpayments to contractors had allowed Sunderland to pay their players in excess of the maximum wage, which was then £15 per week. The scandal resulted in the break-up of the club’s expensively-assembled squad and the following season they were relegated.
Sunderland languished in the Second Division for six years, finally being promoted back to the top flight in 1964 three years after the maximum wage had been abolished. Several other clubs were believed to have committed similar offences to those that Sunderland were found guilty of in order to circumvent the draconian law but went undetected, only compounding the suspicion on Wearside that the Black Cats had been made an example of.
There is obviously no implication here of impropriety at Sunderland under their current regime. Nonetheless, the desire to better their league position that motivates their present day spending in the transfer market and on wages must surely only be sustainable for as long as the club retains Ellis Short’s financial backing. Were he to back out then those same players would probably have to be sold and relegation, as in 1958, might be the result.
Financial data in this article courtesy of the Swiss Ramble. Follow William Abbs on Twitter.
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