By Tony Attwood
It has hardly been reported anywhere much, but the salary cap (technically known as Short Term Cost Controls – STCC) will be running in the Premier League from the forthcoming season, and will in fact run for the duration of the new TV financial arrangements.
It will run alongside the Premier League Profit and Sustainability rules which state that clubs may not lose more than £105m over three consecutive seasons.
The aim of the STCC, is a sort of limited Financial Fair Play, and was introduced when attempts to bring in proper FFP were abandoned by the Premier League, following outright rejection by Chelsea and Manchester City. With Uefa in turmoil and no real will on their part to fight that fight, the notion has fallen apart.
All credit to the Daily Mail (now that’s not a phrase you will often see here) then for publishing an article on the subject back in March. They said, as part of their headline “mild restrictions won’t hit high earners at top clubs” which is just about right.
The STCC arrangements only affect the TV money, so commercial revenue and of course the money from sponsors is not part of the deal.
Under the arrangements, the restrictions for the coming three seasons apply to clubs with player wage bills in excess of £67m (rising by £7m for each of the following two seasons), which I think more or less includes everyone although except possibly Burnley, Middlesbrough and Hull. But those clubs can, if they wish, can increase their salary spend to £67m.
The average wages bill in the Championship is around £8 million a year. This can be compared to the PL regulation that stops clubs increasing wage bills by more than £7m from the previous year. (That shows the gap between the two leagues).
Or if they wish, they can show that their aggregate player wages bill has increased by less than £19m from a 2012-13 base season. (More on that below).
The point is that clubs can exceed the £7m wages limit if they generate increased revenue from commercial income, player trading and Match Day income. But, as we have seen with the case of Leicester in the past two years, the notion of “commercial income” can get a little murky where there seems to be a front organisation for goodness knows what behind it.
When Untold first started writing about Leicester’s interesting way of handling sponsorship we were, apart from the Guardian, pretty much on our own. But since then, interest in the Leicester approach to marketing has grown and not just in football circles. An article in Marketing Week mentioned the enquiry into the oddities of the matter.
Campaign, another major magazine in the marketing industry went further in its piece noting the key point that “under the rules, losses are not allowed to be reduced by sponsorship money, where the amount paid is above market value.”
One interpretation of all this interest is that no one really cared too much what deals Leicester got up to in the past – because all the focus was on the way they manipulated their declared income while in the Championship. That is only an issue they will have to account for as and when they are relegated back to the Championship. But in the past year the investigators began to dig a little further into the very strange world that exists behind Leicester’s facade.
However Leicester is now of interest, as following the fact that a number of clubs have been sniffing around Leicester players once they found that the players had very low buy out clauses in their contracts, Leicester have been bumping up salaries right left and centre. A very rough estimate suggests that the renegotiated salary bills by Leicester this summer come to around £20m additional salary – and that could be an issue.
Of course I don’t know the truth of the matter about Leicester, and Untold certainly doesn’t have the resources to investigate a PL club; all we can do is notice a little flurry of articles that began to appear from April on, and the reports of dramatic pay rises offered in order to keep players in place. How are Leicester going to stay inside the Short Term Cost Controls?
So to summarise thus far, the key issue is that PL clubs cannot increase the salary bill for players by more than £7m over last year unless the money comes from its own revenue streams. The difficulty is when the sponsorship stream of income (which is allowable) is paid at something that the market experts would consider to be over the odds (which is the allegation against Leicester, made because its marketing company is obscure and secretive).
The most notable example of excessive sponsorship deals came with Paris St-Germain’s who were paid a ludicrous £167m by the Qatar Tourism Authority as sponsorship money. As a result the club failed Uefa’s financial fair play rules – as did Manchester City. The question is whether Leicester has been engaged in similar sorts of arrangements. It’s marketing secrecy makes it hard to say.
Now what makes this world all the more murky is that The Premier League has a web site, and for a while these financial rules were explained on it, but now that page has vanished from its site. Even more odd, if you go onto the Premier League site and type in “short term cost controls” you get the message that “No results have matched your search.”
So we need to try another approach.
Returning for a moment to the amount spent by promoted clubs in their effort to stay up, I have now translated the cost of the players into pounds (it was in Euros last time we looked to ease comparison with other countries) and added the players’ salaries, where the club stands in a salary league table, and how far above or below their spending the club finished in the league.
If the amount spent on player transfers had a direct effect on league position Arsenal would have been in fifth position. If the salary spend had been a direct effect on league position Arsenal would have been fourth. So Arsenal over achieved in both cases. In fact all of the top three teams overachieved on both counts.
| Pos | Team | Cost £ | Cost pos | Cost/Place | Salary | Salary pos | Sal/place |
|---|---|---|---|---|---|---|---|
| 1 | Leicester City | 61.2m | 17 | +16 | 49m | 17 | +16 |
| 2 | Arsenal | 259m | 5 | +3 | 192m | 4 | +2 |
| 3 | Tottenham H | 196m | 6 | +3 | 111m | 6 | +3 |
| 4 | Manchester C | 48m | 1 | -3 | 194m | 3 | -1 |
| 5 | Manchester U | 453m | 2 | -3 | 203m | 2 | -3 |
| 6 | Southampton | 155m | 7 | +1 | 60m | 14 | +8 |
| 7 | State Aid Utd | 122m | 9 | +2 | 70m | 11 | +4 |
| 8 | Liverpool? | 292m | 4 | -4 | 152m | 5 | -3 |
| 9 | Stoke City | 63m | 16 | +7 | 72m | 9 | 0 |
| 10 | Chelsea | 346m | 3 | -7 | 215m | 1 | -9 |
| 11 | Everton | 119m | 10 | -1 | 75m | 8 | -3 |
| 12 | Swansea City | 69m | 15 | +3 | 51m | 15 | +3 |
| 13 | Watford | 42m | 19 | +6 | 29m | 19 | +6 |
| 14 | West Brom | 71m | 14 | 0 | 69m | 13 | -1 |
| 15 | Crystal Palace | 82m | 13 | -2 | 59m | 16 | +1 |
| 16 | Bournemouth | 31m | 20 | +4 | 25m | 20 | +4 |
| 17 | Sunderland | 110m | 11 | -6 | 71m | 10 | -7 |
| 18 | Newcastle U | 133m | 8 | -10 | 76m | 7 | -11 |
| 19 | Norwich City | 47m | 18 | -1 | 37m | 18 | -1 |
| 20 | Aston Villa | 107m | 12 | -8 | 65m | 12 | -8 |
By and large, clubs that over achieve in relation to their transfer dealings also over achieve in relation to their salaries. Eight clubs overachieved on both indexes (marked in brown).
So what makes clubs have lots of players on high wages, and yet underachieve? A hint as to the answer comes by looking at what marks out three of the clubs at the bottom is that they had more than one manager. Thus they were in a situation of having players on high wages bought by a previous manager but now no longer in favour. It is one of the benefits of managerial stability.
Some Premier League clubs are however allowed to increase their salary bill even more via another rule in the arrangements which allow clubs to increase salaries by up to £19m compared with 2012/13. This rule is obviously no use to clubs who are already paying more than £19m a year more in salaries than they were in 2012/13.
Arsenal is in this category, because in 2012/13 the new stadium was still hampering financial freedom. With the removal of that Arsenal increased salaries considerably (including of course the higher salaries for Ozil and Alexis). Indeed Arsenal has increased salaries more than any other Premier League club in the period between 2012/13 and 2015/16.
In fact Arsenal has increased its wages by more than any other club in the last three years.
| Club | 2012/13 wages | 2015/16 wages | Increase |
| Arsenal | £154m | £192m | £38m |
| Chelsea | £179m | £216m | £37m |
| West Brom | £54m | £79m | £25m |
| Manchester Utd | £181m | £203m | £22m |
| Liverpool | £132m | £152m | £20m |
But there are always ways around regulations. Manchester City has shown the money it gave to Mancini as his pay off, not as a redundancy payment but as wages. This pushed up their wages at that time, and so has allowed them to increase their wages further now, if they wish. Add to this the massive increase in money from their sponsors (which as I noted, some suspicious people like me think is a deal akin to the PSG deal) and Man City are going to be able to run riot on the wages front for next season and thereafter.
Recent posts…
- Proving that neither transfers nor buying a top goalscorer are the way to win the league
- Arsenal Squad 2016-17. We urgently need to loan or sell eight players
- Why are football’s administrators so utterly and totally inept?
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- Why watching football from England is a major disadvantage
- Why do the owners of PGMOL actually want the organisation to be ultra-secretive?
- Martin Ødegaard does the right thing, and what the media absolutely won’t tell you about Arsenal
Any news on FFP this year Tony . the two Manchester clubs are spending like no tomorrow or is there different rules for them . Maureen throwing money aroun like confetti hope Pogba doesn’t go to old toilet .ps like reading your work good Arsenal man
Sorry to be off subject, don’t know where to post this
http://www.sueddeutsche.de/sport/fussball-em-der-letzte-englaender-1.3071304
In short, Mr Clattenburg was barred from refereing in the Euro 2016 because of his tattoo by Mrrs Riley and Elleray (from FA not PGMO, so the germans don’t know the organisation that well)- is considered by Mr Colina as an excellent referee and was thus chosen over their will by Mr Colina.
Which really raises the question of the sort of leverage the PGMO can have on an electrician from Newcastle as the newspiece describes him when he referees an Arsenal game.
And out of curiosity, are you making a review of the games refereed by Mrrs Atkinson and Clattenburg, so as to see if they change their ways once outside of FA/PGMO reach ?
Cheers
Chris
financialfairplay.co.uk show a nice little flow chart thing, if that helps anyone understand it.
Uefa is too deep in the mire to do anything about FFP as far as I can see. It is this question of legitimate or not income from marketing and sponsorship and I don’t think Uefa wants the court cases that would be needed.
Would the 2016 Ballon d’Or be at stake for Cristiano Ranaldo to win it ahead of Lioness Messi as France take on Portugal in the final match of Euro’16? I will think so if he can lead Portugal to victory against France tonight to add that trophy to the Ucl title he won late on in May.
I hope that France win tonight. Olivier will know, however, not to expect any fouls committed against him to be awarded by Mr. Clattenburg. Kos, on the other hand, seems a likely candidate for a yellow card.
France 3 – 0 Portugal . A Giroud hattrick ?
Euro Final(ly over)
The Daily Flail showed the early incident with Payet on Christina. I think I could believe a ACL injury of the left knee, but it is just one image, not video. I’ve no idea if that is what Christina was limping over. As he dives, it is possible he was looking to dive in that challenge, and did himself in.
Any opinions?
—
Congratulations to the Ladies, winning 2-0.
Former Arsenal Ladies Harvey (managing Seattle Reign) made the news. It seems they’re latest game was rescheduled for “part of” a baseball pitch, because the real pitch was under repairs or something. The field was only 58 yards wide. The league thought it would be okay to play on such a narrow pitch. Oops.
Should be their, not they’re.
I don’t have predictive typing on a smartphone to blame.
Tony,
And I hear the UEFA’s lawyers would not be in the same league as those opposing them in any court.
Tony.
Having multiple people posting under the same nickname is confusing.
Untold Arsenal does not want to post the email address with a message. So, while Untold knows the combination of nickname and email address is unique, none of us do. We just see multiple people posting under the same nickname (with or without case sensitivity in the nickname (email addresses are by definition not case sensitive)).
If a person took a MD5 sum (which is a kind of hash sum which is insecure now) of the email address, it wouldn’t look like an email address. But, someone could decrypt this trivial encryption with a little effort.
If you generated a random salt for each nickname/email address, and calculated a MD5 sum of the salt concatenated with the email address, you could post that as we wouldn’t know what the salt is (different for each nickname/email) to attempt decryption.
I’ve no idea if wordpress has something like this.
In a sense it is the same as what we had before, in that each nickname/email address combination got a unique ikon. The problem with that icon (which you were getting from some external site?), is that the icon is constant to the email address, so people could go harvesting these icons over the internet, and comparing them. They could then say nickname1 at site 1 was the same as nickname 14 at site 12, 17 and 38.
Sorry for going nerd on you here. Perhaps your staff could explain it? 🙂
The Ronaldo incident was actually a nasty attack by Payet, which the ref (surprise surprise) failed to judge properly and award the deserved yellow card. Payet made sure he touched the ball first, but the intent to injure his opponent was clear. And no, I’m not a Chistina fan (thanks Gord).
But the ref (you know who) also forgot that he’s in a Euro final, not in a PL match, and booked Kos for being an Arsenal player who accidentally got in contact with the ball via his hand, when the shot came from just about 1 meter away. Oh well. Rant over.
@Florian
Actually, Koscielny was booked for Eder’s hand-contact with the ball which makes Clattenburg’s decision more baffling. Portugal nearly scored from that free-kick as Raphael hit the bar.
I would neither say Payet made an attack on Ronaldo nor that he wanted to injure him. I was more shocked with Quaresma’s stupid wrestling move on Kos. Players have been sent off for less but Clattenburg had proven his incompetence to deal with the bar-fight moves during Chelsea v Tottenham farce.
Seeing a team like that win makes me despise international tournaments just a little bit more.
Negative football is doing rather well these days, Leicester in the second half of the season, Chelsea the last, Utd the next, , athletico, and now Portugal, who make a purist despair. maybe Roy Hodgson should have stuck to his true nature rather than what the FA tried to make him
Clattenburg made a big error in “mistaking” a black hand for a white hand. Portugal nearly scored from the resultant free kick, and a few seconds later a koscielny who was now on an unjustified yellow couldn’t put in a proper tackle for fear of getting booked and Portugal score… And yet Graham poll saw absolutely nothing wrong with clattenburg’s performance last night.
I too, am starting to despise football; negative tactics seem to be prevailing over positive football aided by dodgy refs, mourinho back in the PL…. nothing to like really.
Clearly clattenburg didn’t see who handled the ball, so why issue a card when you’re guessing???
Wondering if Kos would have been booked if he played for a scum team rather than Arsenal.
I was wondering if anyone noticed the story about Sakho’s drug related ban in the mail this morning?
http://www.dailymail.co.uk/sport/football/article-3683594/It-s-disgrace-UEFA-treated-Mamadou-Sakho-s-career-contempt.html
The comments and conclusions by Martin Samuel once again shows that Liverpool!!!!!???? can do no wrong in the eyes of the media.
JP I haven’t got to the Mail today, but thanks for pointing that out. But I have got the draft of an article concerning the way that Uefa has now pulled football out of WADA regulations, so I’ll check that article as well.
Mandy Dodd
“Negative football is doing rather well these days, Leicester in the second half of the season, Chelsea the last, Utd the next, Athletico, and now Portugal, who make a purist despair.
Although I would hesitate to call myself a ‘purist’ per se, I share your sentiments. The way the pundits seem to drawl over these teams that fail to register a shot on target for 85 minutes then win it on the break baffles me.
This season is going to be a nightmare.
Al
Agree mate.
Clattenburg gave one of the most incompetent performance ever in the Chelsea Spurs match, and his reward was the FA Cup final.
He had an awful first half, and not much better second in that, and his reward was a Euro cup final and he makes a monumental cock-up in that.
And STILL he’s lorded as a World class referee.
I like you my friend, despair.
Yes, Clat got it completely wrong with the free kick & yellow card (how do you mistake white for black at such a short distance?), but I don’t think it affected Kos’ challenge on Eder for the goal as it looked to me as if he managed to get his right foot to the ball ahead of the scorer but only knocked it on a little which allowed Eder to get better position for his shot. If anyone was to blame it was Sanga with his very inaccurate throw in.
JP
RE: Martin Samuel
Similar with him and the odious one.
Just google ‘Mourhino and Martin Samuels’ and you’ll be witness to an array of sycophantic articles you would not believe.
He is so far up his arse he’s emerging out of his mouth. It’s sickening.
JP/Tony
I mentioned it (Sahko not a druggie according to UEFA) day or two ago. Along with some other corruption related note. Details escaping me at the moment.
Looking at Google News (my news fix), joggled my memory. The other corruption thing was Neymar charges being thrown out in Spain.
—
Hayden loaned to Newcastle United. I don’t know that Newcastle United is a destination I would have chosen, but I wish him well. I gather Benitez is still there.
Grrr, I am not batting well today. Hayden sold, not loaned. Good luck at Newcastle, Hayden.
John L, 6:35pm
Sorry I hadn’t read earlier posts when I posted mine, but how you got that one spot on! And Kos didn’t have to do anything, he just had to be on the pitch, to earn a yellow! This is what you get with PL refs, absolute shite.
Jambug,
I’m dreading the start of the season for precisely what you mention in your response to JP. Imagine the media wankfest over mourinho when he was at the chavs, and now he’s at the media darlings Utd…. it’s about to get much more worse, tenfold.
I am seriously considering taking a one year sabbatical from all things football, not good for my health. The thing I’ll sorely miss is watching Ozil, and Messi (forget his tax trouble ? ). These are guys who come once in a generation, and I’d hate to say I didn’t watch either when I had the privilege to watch both.
Everyone of tony’s followers.Take a look at his blog on Man City.At last you have been found out.Not only have you double standards on copy and pasting others stories from other sites but for years you have censored this site to allow only followers who are prepared to kiss your arse and follow some of your brainwashed theory’s!!!,