A 25 point discount for the start next season? Of course. Roll up.

By Tony Attwood

This is a site which considers football from the point of view of supporters who support Arsenal – the club, the manager, the board, the team, the history, the style.

So why do we bother with stories concerning the likes of Portsmouth, Birmingham, Aston Villa, Leeds United, Wolverhampton Wanderers, Rangers?

Because these are clubs that have been big time clubs, and have fallen on harder times, for all sorts of different reasons.  If we ignore them, then we don’t understand football, and so we don’t understand why Arsenal is different.  We can’t be vigilant in helping keep Arsenal apart from such clubs.  We can’t gain the knowledge that will allow us to say no, not down that route.  Don’t go there.

To give an example, consider the activities of Peter Ridsale the man who was in charge of Leeds as it rose up to challenge in Europe and then trotted back down to division three.

Remember Ridsale?  His “sports consultancy” outfit WH Sports Group Limited provided “advice” to football clubs.  In 2009 it went bust with debts of getting on for half a million pounds.  A court decided Ridsale had moved money given by football clubs to his business (amounting to over a third of a million quid) into his own bank account. An easy mistake to make.  Could happen to anyone.  In October 2012, he was sent to prison for two years and disqualified as a company director.  So was Sophie Ridsdale (disqualified that is).  He is now chairman of “Proud Preston” (Preston North End).

Yes, I keep writing about this because I fear that there are some who would take Arsenal into the same sort of risky arenas as we have seen other clubs venture into.  Areas such as personal gain, money laundering, drugs trafficking, child trafficking, you name it, football has it.  Areas where people are said to have a “winning mentality”, that gloriously undefined concept which bloggers seem to have but certain managers and owners seem to lack.

Of course I accuse no one, just record a few facts and try and spread the word about how dodgy football is.

So today, a little bit about Rangers a club whose fans are standing up against the board, and demanding change, no matter how much it hurts the club in the short term.  I applaud them for that.

Rangers are, quite simply, bust.  They ran out of money this season and had to borrow more at a rate of interest that is so eye watering as to be unbelievable.  The money they borrowed was secured against their property, so that the lenders were in a win-win-win-win etc etc situation.  Now, they have to pay that money back out of their season ticket sales for NEXT season.  To make that happen the club brought forward the date of season ticket sales from next season in the Championship.  Many of the fans have told them where to stick it.

Given that Rangers are not in the top division next year, the benefit of having a season ticket is limited, since one can always just pay on the turnstyle.  So people are not buying, because the club is bust.

As a result there is a chance Rangers will go into administration again.  That would mean a 25-point deduction next season if it happens after this saturday.   Now Rangers might take that, since they won the third division this year with 40 points to spare.

But this lack of money is nevertheless annoying because the Championship could be tougher than the third division.  How do you buy players as you move up the league, if you ain’t got no cash and you are in total turmoil?  Who wants to come and play for you when you are bust and regularly asking your players to take a pay cut?

The problem is that the supporters are running a season-ticket boycott while the money is needed to pay back those insane loans made at an insane interest rate.  Ex director Dave King and former captain Richard Gough have asked fans not to renew in order to get the old board out.   Now we have heard that the company processing season tickets can’t accept credit cards (!!! honest).  Cash only for your season ticket squire.   Rangers finances are so bad that their bank won’t let them run a credit card machine.

Oh and there is more – like allegations that directors lied at the AGM, and a demand that the police act (that seems unlikely).  But trading as a limited company without funds to meet your debts is illegal, and directors who allow that to happen are committing a crime, so things are teetering.

The trouble is that while those outside the board say that the problem is that the board is refusing to secure fresh equity, no one is willing to lend Rangers money without a) security and b) an interest rate of around 25% minimum.

And the problem for the fans is that (as with all of us) if we pay season ticket money to a club that goes bust, we have lost our money.  When we pay Arsenal our money each year we trust Arsenal to survive the year.  Paying Rangers looks rather risky.

In essence the club is virtually saying that financially it is not a viable business, but continues to beg supporters for money without any way out of the mess.  The season ticket money pays this past season’s debt.  And then?  That is not a survival plan.

Wherever you look in football there are stories like this, which explains why Untold supports solid finances and careful planning.  Spending a fortune might buy you the league, but it doesn’t mean you will be there next year.

45 Replies to “A 25 point discount for the start next season? Of course. Roll up.”

  1. Tony,

    In a word, Frightening.

    The scariest thing is how quickly it can happen.

    In Leeds case: One minute you are in a CL Semi Final and PL runners up, the next you are a busted flush and 15 years later you are still a busted flush.

    In Rangers case: Well frankly, God help them.

  2. I wonder if in the next times, Managers and coaches will take economic classes, trying to emulate Arsenal. Anyone noticed that in PL most of the teams are now playing(trying to play) what was once “the Arsenal way”?

    Looks like RM is through to final, unless Bayern can pull something out of the hat, don’t think so, but hey, it’s football.

  3. Well, a different kind of message has just been sent to owners. The NBA has just banned for life, the Clippers owner for racist remarks. He is going to be forced to sell his stake in the LA Clippers. I wonder if that might influence how the FA, UEFA or FIFA act in the future?

  4. I was talking to someone who ought to know at the weekend who said that McCoist is on £800k p.a. When you consider that many of his opposite numbers will be part-timers that is surreal. I expect a similar situation is mirrored amongst the players.

    So no one to blame except themselves I’m afraid.

  5. Nottingham Forest, once winners of the CL, no less.
    One of Clough’s rare successes.
    How he did it with the attendances
    he could muster, I will never know.
    Eventually, the bubble burst and Forest was conveyed to the lower levels of British football.

  6. Well, thank you for this article. I wish the “spend some f**king money” whingers would read this! We don’t have a sugar daddy, we are a financially responsible club that supports itself. We can’t “go big” on transfers, crossing our fingers and hoping to win the triple, while putting ourselves in massive debt. We spend what is prudent when we can. Live with it! That’s the Arsenal way!

  7. As I said a few times before my local club went bust, the guy whom I’m coming to the Emirates next Sunday his club went bust twice in the last 20 years.
    We are both Gooners and know how important it is to have a club that is being run in the prudent way Arsenal is.
    Thank God for the way our board and manager is leading our club.

  8. It certainly is the Arsenal way – as I am sure Tony can explain much better than I can for years from the 1930s Arsenal was known as “the Bank of England” club for its financial probity.

  9. The fans are really fickle. After the west ham game, one of the fans of WH called in talk shit & said that he & his is friend is certain that there is something going on behind the scenes @ WH. According to him, big Sam is just a temporary manager to keep them in the EPL & owners have lined up the club for sale to an arab owner. This seems to be the kind of thinking fans have. Get a rich owner and we are sorted. One of my ex-colleague an Everton fan also was wondering why a rich arab hasn’t purchased the club. Quick fix seems to be the way.

  10. Good article, Tony. Im gonna talk about something out of topic here. About the PFA Team of the Season. I have no idea how Laurent Kosielny is not there. Even worst is Adam Lalana is there at the expenses of our whole midfield. I think something really corrupt going on in this voting system or everyone just hates Arsenal for no goood reason. I noticed this discriminating trend first when that dumb Micheal Dawson was selected ahead of Thomas Vermealen during TV’s debut season. Read this article: http://www.footballfancast.com/premiership/arsenal/is-arsenals-defensive-linchpin-dangerously-underrated-in-england

  11. @Pete, I heard the same regarding McCoist salary and its huge in comparrison to other Managers, don’t think the guy should work for nothing but if a Season ticket is £500 then its 16,000 fans to pay his wages alone.

    Was speaking to a Wolves fan recently who told me that they still have 3 players on Premiership contracts and had to get promoted to be able to survive. Apparently when they were relegated from the Prem they had to reduce the wage bill considerably and other clubs would not match the wages so some players refused to move. Chasing the dream can cost without a sensible approach

  12. There are many warnings about what could happen to clubs if they over step the mark financially. A lesser evil, which is what Arsenal are guilty of, is under spending. Keeping hold of vast amounts of money whilst the squad falls behind the competition is not smart either.

  13. Michael. Fascinating argument only ruined by the facts. Vermalen was in the PFA team of the year in his debut season, Dawson has never made the premiership team of the year. And as for bias it’s simply that the footballers who vote (you know in that corrupt system called democracy) are biased by performances during the voting period, which this year coincided with our previously impregnable defence being unpicked by Chelsea and Liverpool. It’s the same reason Everton have two players in the team as the voting matched the period they moved up to 4th.

  14. Indeed Graham….1930s. You do know there were Nazis in Germany in the 1930s? Still an absolutely nasty place, that Germany. And they have no right whatsoever to talk about justice, human rights, tolerance, etc.

  15. Jayram, you know nothing about the club’s finances, and nothing about how to run a football club no less, so keep your “lesser evil” nonsense to yourself.

  16. @jayramfootball

    Please tell me the state of Arsenals finances.

    Exactly how much have we got?

    The conditions of our loan. I.e. payments, penalties, requirements such as retained capitol to cover extenuating circumstances, etc. etc.

    You seem to know a lot more than me so I would appreciate any help you can give me.

  17. Sanity!
    At times it felt like I’ve been the crazy one for having the same belief about stability. The next 90 years is more important than the last nine. Sometimes however it seemed a lonely position.
    Perhaps clubs like Leeds, Portsmouth etc are out of sight out of mind. Maybe it will take one of the oil made sugar daddies to leave their ‘clubs’ with all the problems of honouring the unsustainable contracts before this message is reinforced.
    The David Dein issue aside the board seems to be taking a sensible view. Overall judgement on how they are must wait, however credit must be given for having a self sustaining business model.

  18. Jayram oh dear, if you were a Gers fan then you would buy a season ticket from a scalper, I reckon!
    Lesser evil or sensible approach, ‘tomarto’ or ‘toemayto’. If our way is the lesser evil then surely it is the better and smart way?

    I have a fear though, Arsenal is not a living being of 125 years old obviously, so what happens when AW leaves? Or Kronke decides to sell or Ivan leaves, who will be there to say this is how we operate and we won’t go down the spend it all on a couple of players route.
    They should put a law down that if you own Arsenal FC you must play by the rules etc is that possible?
    COYG!!!

  19. @Quincy and @jambug
    Arsenal accounts are free to read and readily available.

    If you would like to believe that hidden in the accounts somewhere is a reason that means we must keep vast sums of money as a cash balance then that’s up to you.

    I have been round this loop many times and argued that Arsenal have had plenty of money to spend, without risking the clubs future. The facts from the accounts back up that argument to the hilt. The statements from the club over the years also back up this argument. PHW often told us we had the finances to spend, at one point even quoting a figure. There are countless other comparisons to make with other clubs which suggest we are under spending. Only those seeking excuses are suggesting we had no money. The ops article is using sensationalism to try and position Arsenals under spending as necessary, using scare tactics like references to Leeds. It is just the same as tabloid journalism. Very poor.

    I am happy to debate the finances, it will take over a day to go through the data alone, and advise on the extensive research I have done on the subject. But I won’t do that here. It’s a pointless exercise to educate on subjects people are just not interested in. I could run through the accounts line by line with you, explain it all and then get to the end to show how much money we have had over the years and your response would be… Yeah but there might be something we don’t know about so we can’t trust arsenals own accounts.
    It always ends the same way for people who so desperately want excuses for failure in order to feel better. I understand that.

    Arsenal have had the money

  20. @jambug – email me and I am happy to share information. Not here though as it just would not be received well. I am bored of long arguments on the finances with people who seek 100% certainty on public finances that show we have had money for years and not spent it, whilst at the same time holding on for dear life to a position that has 0% basis in fact, i.e. that Arsenal have NOT had money to spend. Some fans are just too invested in the excuse in order to accept the truth.

  21. I’m not a financial genius but I have learned that money on the bank on one particular date doesn’t mean that all that money is available and can be spend.
    I think that is where many go wrong on reading the accounts.

  22. Jayram/Walter

    I don’t pretend to be a financial genius. In fact I don’t pretend to be anything !

    To be honest with Jayram I would not even attempt to read basic financial statements because it’s always down to interpretation.

    What I do try to read is people that ‘interpret’ it, and put it in plain English.

    My problem is I have read things, not only on here but elsewhere that say whatever it looks like on the surface, Arsenal’s available ‘cash’ is nothing like what it might seem on the surface. And then go on to give reasons such as keeping sums in reserve amongst other things.

    Then you have Jayram intimating that things like that are rubbish and we have got, and have had, loads of money to spend on transfers, if only we had the will.

    I wish I knew who to believe.

    NB: As I have said so many times, even if we had/have this phantom £100 million available it is still a fifth of what the oilers have spent.

    Anyway, I wish someone would resolve it for me but alas high finance seems a subject best left in the ‘gobbledegook’ box.

  23. @Walter, I have had that argument many times – that a point in time cash balance does not tell the whole story. Of course that is correct. There will indeed be draw downs, but there will also be income streams through the year too. The net effect is not shown in the accounts on a day by day basis.

    However, there are two things to note that all but rule out the theory that Arsenal’s cashflow profile means they need a huge cash balance to operate.

    1) No other football club in the world needs that level of cash in the bank AT ANY TIME in order to operate. Arsenal’s cash balance is about the same as all other clubs in the PL combined.

    2) Arsenal have grown their cash significantly over a period of 10 years – the net effect of the inflows and outflows is positive. Anyone running a business knows that cash flow week on week can be manipulated easily through financing. Factoring is an example. Another point to consider is that Arsenal put £100m in to short term deposits to earn interest a year ago. That makes the £100m unavailable for the term of the deposit. 99% of the time short term deposits are loans to the govt for a fixed period (usually a full year). If Arsenal REALLY needed that money to cover in year costs, what were they doing tying it up in short term deposits?

    The evidence STRONGLY points to the fact that Arsenal have had plenty of money for a long period. 100% conclusive? No. Is it more likely than a scenario that we have had no cash? Absolutely yes.

    As I said, there are some that would rather believe the highly unlikely scenario because it supports the view that our hands have been tied.

  24. @jambug

    There is no way that Arsenal could afford to spend what the Oilers have spent. That is for sure and something I agree with. If they tried then that would be scenario that could destroy the club – the scenario that the OP is warning against.

    No sane Arsenal fan would suggest Arsenal spend what the Oilers do, so the OPs warning is somewhat superfluous.

    Given what is available in the accounts and studying our year on year position, my estimate is that we could have afforded to spend a NET additional £20m a year for the last 4 years. That would bring our net spend somewhere close to Liverpool’s over the last decade.

    At those levels we would have been fine financially.

    Would that have meant we would have been any better off performance wise? Who knows. That would be up to the manager to ensure.

    I stand by my point though that we have underspent – NOT managed finances sensibly to balance on field performance with off field financial stability.

  25. Jayram,

    Lets assume we built the stadium in the first place to make us financially competitive.

    A reasonable assumption no?

    Lets assume that Wenger was the driving force behind the building of the stadium, no?

    So why, having done that would Wenger then not wish to spend those funds?

    It doesn’t make sense.

    What you’re proposing is that Wengers put himself in particular, and Arsenal in general, through all this shit in order to build the stadium, in order to raise available funds just to then not spend them.

    WHY WOULD HE DO THAT ?

    If wenger only cared about himself why didn’t he just stay at Highbury till he’d took us as far as he could and then left, back at a time when surely his personal ‘stock’ was at it’s peak.

    Nothing you or his detractors says about him hiding/sitting on this kitty for selfish, self serving purposes, makes any sense what so ever.

  26. @jambug

    I do not believe this to be Wenger’s decision. I do not think the money has been made available to him, despite it being available.

  27. jayram,

    Sorry, whether you are right or wrong as to our financial status there is no way Wenger wasn’t in full agreement with whatever course has been taken.

    He would of left.

  28. Jambug

    In your 7:44 pm post you ask some very good questions but I don’t think for one second Wenger doesn’t spend all the money available to him for selfish reasons, quite the opposite actually.
    In my opinion he refuses to spend the maximum he could for very unselfish reasons.

    1. Maybe he believes that the ” sellers ” transfer market is unsustainable and he doesn’t want to get stuck with a bunch of overpriced assets
    (players) a few years down the road.

    2. Maybe he doesn’t believe spending an extra £20M per season will make a difference where a title race is concerned.

    3. Maybe he believes he already has enough talent to win the league so spending more than he has isn’t necessary .

    Whatever the reason for not spending there’s no question in my mind Wenger has the well being of our club in mind. The only question is , has he been right or has he been wrong.

    Some have suggested that due to inflationary nature of the transfer market, sitting on vast amounts of cash is actually losing Arsenal money because
    buying the right talent will appreciate more than the cash in the bank.

    Whatever one’s position on this subject is I think being honest about it is the best way to go.

    Bootoomee , with whom I have disagreed on occasion , has the wright approach on this and when I say ” the right approach” I mean honest .
    His view , as I understand it, is Arsenal are a privately own enterprise and they spend their money as they see fit and if you don’t like it than you don’t have to support it.
    I happen to disagree with him but I can’t say his opinion isn’t honest.
    The fact that I choose to spend a bunch of money on Arsenal merchandise doesn’t entitle me to tell the board or the owner what to do.
    However , disputing whether Arsenal could’ve spent more than they have in the last few years , at this point in time is denying the obvious.

    There’s an article on Arsenal’ spending restrictions by ‘Angry of Aslington’ , you may find it interesting.

  29. Jayramfootball

    Very good posts. I agree with you all the way especially with the Liverpool reference . I stated some weeks ago that there was nothing stopping Arsenal to do what Liverpool have done or close to it, without risking our club’s financial stability but like you said some people on here are just too much personally vested on this issue to be objective about it , hence their rooting against Liverpool winning the league.
    If Man City win it , they can sleep better knowing it was the club that spent the most , which means Arsenal couldn’t have done it.

  30. Think for a large part, Wenger trusts himself to develop players, rather than trust the transfer market, and some of the unsavoury characters that inhabit it…..though there are of course exceptions. In terms of what money has been recently available, wenger may well have underspent. I firmly believe that compared with some managers, wenger is not so at ease with spending huge sums of money….a fault, or strength….you decide.
    But it must be difficult being wenger. He is now going for the high end of the market….and that brings serious competition. Despite what some would have you believe, I am sure wenger is well aware of what goes on with the players markets. Maybe last summer, he had to balance spending a huge amount on ozil….perhaps with pressure from above if some are to be believed……with the knowledge…that say…Cesc would be available a year later. Now, it would be very difficult to put Cesc into the team if he is available.
    Wenger is also primarily a developmental manager rather than a checkbook manager, though recently, he has perhaps been forced to go for experience a bit more.
    I do find some of our transfer activity frustrating at times, while also trying to unspderstand what’ they are up against. Sometimes, it seems to an outsider like me they make things harder for themselves. But one thing I do know, wenger would not be acting in any way to harm the club, as Tom says, quite the opposite

  31. We made the champions league by 1 point last year, and if we had missed it then we’d be more than 20M worse off.
    We may well have cash in the bank, but how much more will that be worth in a transfer window where the oilers have FFP transfer bans?

  32. TOM

    If, and I maintain it is still ‘if’ Wenger has had £20 million to spend in each of the last 4 transfer windows then I am sure he didn’t spend it all it for the ‘right’ reasons.

    But lets for arguments sake say he did have it.

    Well first off, didn’t he spend 2 of those £20 Million pots last year.

    That leaves £40 million he hasn’t spent which would of been available in the Summers of 2010 2011.

    Assuming that is true, that is £40 Million during 2 close seasons in which the likes of Carol and Torres where moving for ludicrous amounts. In other words, an insanely inflated market place. One best left well alone maybe?

    In any case £20 Million per season is peanuts.

    Chelsea and City have been operating with Net spends of £50 million per season for over 10 and 5 years respectively.

    Lets talk Liverpool. Well they’ve been spending at around £25 million per season for 10 years and look how many titles that’s won them.

    You say we (the AKB brigade 🙂 ) are quite happy to see Liverpool fall short in order for the status que to be maintained with regard to the oilers hovering everything up, and I don’t deny there is an element of truth to that.

    But that is no worse than the AAA’s jumping on the Liverpool bandwagon on the back of ONE good PL season in God knows how long and trying to say ‘look, that’s how it’s done.

    Well, no it isn’t actually.

    You and I know that’s bull. Liverpool have been spending ‘big’ for years in there fruitless pursuit of the oilers and have in the process took there Club to the brink of financial catastrophe. They gambled, it looks like it still hasn’t paid off, they are still not out of the woods and they are still struggling to put the finances together for there new stadium.

    All is not as Rosy as some may think at Ainfield. The gamble may yet backfire.

    We’ve already built our new Stadium in case you hadn’t noticed. And no it didn’t spring out of thin air. It cost best part of £500 Million.

    So however much you try to accuse Wenger of under spending I would much rather he did that than take any unnecessary risks, risks that probably would, as in Liverpools case, still ultimately end in failure. Because when you are chasing Clubs that, should you get any closer to them, just spend EVEN MORE, it is suicidal.

    Whatever you say the oilers money is STILL likely going to win out.

    So frugality, financial prudence, and a big dose of reality, are surely the order of the day when you are sailing in such unpredictably choppy and dangerous financial waters.

    Complaining about a manager who has steered us so brilliantly through these treacherous waters, whilst building us a brand new Stadium and elevating our Clubs standing in the World to new heights (despite the lack of Trophies) on the pretext that perhaps he should of spent a ‘bit more’ is criminaly ungracious, and in my opinion, misguided in the extreme.

    So in conclusion, maybe he did have some more money. Maybe he could/should of spent a ‘bit more’ but honestly after all Wengers done for us can you not give the guy a little credit that whatever he did was in the best, safest interests of our Club, and he has, perhaps 3 or 4 years later than some would of liked, got us to where we are now.

    Which is, if you ask me, in pretty good shape.

    Or maybe that’s just me.

  33. “there was nothing stopping Arsenal to do what Liverpool have done or close to it, without risking our club’s financial stability”

    You mean by being the fourth highest spenders in the premiership era with nothing to show for it?

  34. @jambug
    I really appreciated reading your last post. It moves the argument away from ‘ did we have money’ to ‘ why we did not spend it’ and I think all your points are good ones, whether I agree with all of them or not.
    There are indeed a lot of positives in the fact we have built and are well on the way to paying for the new stadium and we have managed to stay top four. Overall I am still very disappointed though in our inability to beat the top sides and I am quite sure Wenger would say the same.
    We will never know whether spending an extra £20m a year for the last four years would have made a difference.(that is on top of all the spending we did up to this point by the way)
    Personally I think it would have because it would also have meant keeping certain players and having a more settled side (another discussion all together). Regardless, what we do know is that we are back in the CL again and have a great chance to win a trophy. I said at the start of the year that 4th and a trophy would represent a good year and I stand by that despite some frustrations. If we do it, then with the extra income on the way, we have a great chance of building the squad and competing for the league. The board and Wenger must be prepared to invest now though. With new income streams we can safely invest £300m net in the squad over the next 5 years. If Wenger is allowed to do that then he might just achieve his dream for Arsenal after all.

  35. Jambug

    Like many times before ,you and I are more in agreement than not .
    As far as Liverpool goes ,I never said theirs was the way Arsenal should’ve followed but only that we could’ve matched their spending if we wanted to and I couldn’t care less if they win the league or not.
    Also , I meant Arsenal could’ve spent £20M per year more and not in total.
    The last summer’s spending total was £31.5M and not £40M so when you look at the numbers again ,it’s a lot more than your entire post is based on.

    You and I start out in the same place which is ,Wenger is a better manager than most ( if not all) . Where you and I differ is ,I think Wenger doesn’t have to match or even come close to matching other clubs spending to be able to beat them. Seems I have more faith in him than you do 🙂

  36. Bootoomee,
    Sorry I don’t watch the pundits spewing nonsense in the run up to a kick off; I only switch over at kickoff. The downside to that is it usually takes me about 10 minutes to figure out the line ups 🙂

  37. Boo,Jayram,Tom

    Thanks for your kind words.

    Boo and I are almost always 100% in agreement.

    It’s seems Jayram and Tom less so, but nether the less not a million miles apart.

    I think the biggest point that I, and dare I say Boo differ, (Excuse me if I’m wrong Boo) is that even if there has been these funds available, and in my mind it is still a big ‘IF’, we have 100% faith in Wengers FINANCIAL management, as well as his footballing management.

    Whatever his reasons, we have every faith that Wengers prudence was well founded and with Arsenals best interests at heart.

  38. jambug,

    Damn right pal.

    I am not a football manager. My understanding of football management is laugh-out-loud ignorant compared to the man that is saddled with the onerous task of managing Arsenal FC. So, I do the sensible thing by leaving him in peace to do his job.

    Supporting Arsenal, on the other hand, is where I think I excel.

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