The January transfer market has collapsed. So what is going on in Premier League football




By Tony Attwood

One year ago clubs in England spent between £815m and £843m on transfers (depending on which newspaper you read) which was double the previous January record.   Chelsea alone spent £323m.  

At the last count we seem still to have under 20 players being signed by Premier League clubs – and that includes loan deals which account for around half of what has happened so far (although of course as I write this on the morning of deadline day, it is possible the unexpected will be happening right now.  (Please don’t laugh too much if it happened just as I push the “publish” button.)

And it wasn’t that January 2023 was out on its own.   Until this window every window was hailed by the over-excited media as a record transfer window. 

So what’s gone wrong?  Simply Financial Fair Play which changed its name to the less exciting “Profit and Sustainability Rules,” the increasing feelings in some quarters that Manchester City won’t be cleared of all charges, the thought that Everton are not only going to lose their appeal but are now being hit by a second set of charges, that Nottingham Forest are in FFP trouble, and Chelsea still don’t know what will happen to them after they put their hands up, admitted guilt, but blamed the previous owners. 

Of course it is the nature of the punishment that is causing some clubs to wobble.  Fines for spending too much never worry clubs.   But points deductions… now that is different.   That and the fact that the limit on the losses (excluding the allowable things like developing the youth training ground) is limited to £105m over three years.

Worse those three years roll over so a loss made last year is in the books for two more years as the accounting process goes forward.

What has happened is that clubs across Europe – and they of course are the powerhouses in all this – have just stopped spending – but not just because of the financial rules.  

The case of Barcelona really is exercising the minds of many – as it seemed inconceivable just two years ago that the club could get itself into a tangle so deep there seems to be no way out.  Then the notion of selling off future broadcast rights came along, and using the money to show the current season was in balance (which of course was thrown out by the authorities).  That was so bonkers (the first week of accountancy classes would tell anyone that wheeze is not on), that the realisation sank in.  Barcelona really are bust, which could mean that money due from them to other clubs simply won’t arrive on time. 

As a result everyone paused, and the investigations into the clubs in England simply made that pause go on and on.

Saudi Arabia stepped up and started offering bizarre money for some older players, until the players and their partners realised just what living in a repressive religious dictatorship is actually like, and anyway the crowds haven’t turned out in huge numbers to see the old men.

Thus the transfer turnover which sat at £161m in January 2015 and was £842m in January 2023, is now almost nothing.  Loans are still taking place but that’s about it.

Only seven players have moved on permanent deals as I write this, and four of them were loaned out again straight away.  14 Premier League clubs have not bought anyone.

So what’s the cause?

First the enquiries into Manchester City and the rest are worrying the clubs, and the punishment to Everton (who some thought had the excuse of their stadium build as a get out of jail card) plus their second charge now being heard, is really worrying everyone.  

Second the delays in the Manchester City case are also equally worrying.  That club has repeatedly stated that it has clear answers to every issue raised by the League and there was nothing to worry about.   But it still rambles on.

Third, we seem to be getting a drip drip drip of other clubs that have broken the rules.  Nottingham Forest are the latest to be put under the microscope, and we’ve no idea if there are any more.

Fourth clubs like Arsenal are saying that FFP restrictions are stopping them from making purchases.   And then we see Manchester City buying just one player (Claudio Echeverri for £12,5m) and then leaving him at his current club for a year on loan, seemingly in order to keep him out of their books.

Now all this has a knock on effect.  Clubs buy new players to put in their “25” – and that generally means they then sell one or two players to make room.  But if no one is buying, they can be left with the previous Chelsea situation in which players are bought but are simply not in the 25.   

So it is not just about buying – but also selling, and if no one is buying then …. well you see the connection.   If you can’t be sure of selling a player, most clubs can’t buy a player, even if the owner could hand over another £100m.

As a result there has been a growing use of under 21 year olds in squad.- and that is fine except those players have a habit of getting older (Saka, Martinelli and Timber all recently jumped up from not being in the 25 to being of the age where they are counted).

And even that is not everything because in recent years European clubs have used the largesse of Premier League clubs to fund their own spending.  Now the Premier League is not buying big time, a lot of European clubs are not selling.  Transfers have stopped.

Plus if that were not enough, the Premier League has often been able to rely on the clubs that have come up from the Championship to buy like crazy in a desperate effort to stay up.  But after the Nottingham Forest experience (for whom it worked but only just and now they are being investigated), it is now not considered a good idea.

So everyone is in a tangle.  And with Barcelona trying to renegotiate its stage payments and liable to slip even further into financial chaos plus FFP certainly not going away, it probably isn’t all over yet.

7 Replies to “The January transfer market has collapsed. So what is going on in Premier League football”

  1. The big problem with talking about club’s finances is the lack of hard financial data. Sports writers seem to work on the basis a vague comment is all that’s required. So exactly where clubs are in terms of fair play rules is not clear, why for instance are Arsenal seemingly struggling while Spurs apparently aren’t ? It’s hard to argue with the aim of forcing clubs to manage their finances properly. There are some questionable rules. Treating the sale of a home grown player differently to one you’ve bought is debatable, from a cashflow viewpoint a sale is a sale. But the moans from managers and fans that they are being made to act responsibly is laughable.

  2. No one seems to know the club’s limit to spending and how the FFP authority calculates it’s club spending limit. Also some smaller clubs rely on bigger clubs buying their players to enable them to have cash for new players. So if the FFP authority are part of a democratic decision to employ them then it makes you wonder, what teams voted for them in the first place and who decided that the idea of a FFP system is a good thing to have in our football league.

  3. @jod

    Accounts are your starting point. Tottenham have a stadium depreciation which is huge and as with all clubs depreciation etc included from FFP.

    Also check the Charitable Expenditure section of Community Trust and Women’s side total expenditure..Academy is guesswork. Tottenham well clear IMO.

    Plus forget Cash Flow. A player when Purchased is capitalised as an Intangible Asset ie Player Registration and Idk £20m fee, 4 hear deal £5m per year. Straight line (save for Impairment or contract extension).

    Sell after 2 years and it’s £10m for a breakeven point. An Academy Player is zero or bear as dammit, may not even be on the Balance Sheet hence pure profit.

  4. And yet, it is unwise to expect clubs to divulge their true financial situation because this can be used against them when negotiating for a player.

  5. Wellm Paddy, you might be right, but I only got as far as your first paragraph before I began to wonder. The bit I know reads…

    “Article 58 (2) clarifies the notion of relevant expenses as follows: “Relevant expenses is defined as cost of sales, employee benefits
    expenses and other operating expenses, plus either amortization or costs of acquiring player registrations, finance costs and dividends. It does not include depreciation/impairment of tangible fixed assets, amortization/impairment of intangible fixed assets (other than player registrations), expenditure on youth development activities, expenditure on community development activities, any other non-monetary items, finance costs directly attributable to the construction of tangible fixed assets, tax expenses or certain expenses from non-football operations.”

  6. It is apparent that financial fair play or whatever it’s called exists to prevent clubs from shooting themselves in the foot and going out of existence. That possibility doesn’t seem to have bothered Forest.

  7. SkySports’ transfer deadline show has turned into a damp squib, featuring Darts, Boxing and Clinton Morrisson (financial expert).

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