By Tony Attwood
Here’s two things: the world of football finance could be turned upside down later this year; and I want you to buy two things at the Emirates this Saturday if you are there.
An odd combination you will think but there is a link. One reason to go shopping is to buy a copy of “Making the Arsenal” by, well, not to put too fine a point on it, me. And the link between that book and what follows (which is all about clubs being sued by Revenue and Customs over unpaid tax) is that “Making the Arsenal” is about our club in 1910, when we went into administration due to lack of funds.
Yet there was a difference between Arsenal in 1910 and clubs today. In 1910 our new owner (Henry Norris) was honourable. He personally paid off virtually all the debts of the old club when forming the new Arsenal that took over that year – and the main one he didn’t settle was a very curious debt to Archie Leitch, the architect who built many of the famous football grounds of the era. My colleagues and I who work on Arsenal History still can’t fathom out quite why that very old debt emerged in 1910 but wasn’t on the club’s books, although “Making the Arsenal” gives a hint.
Moving on, and before I get completely into club finance, while hanging around the stadium, please buy a programme. It took a year to get Arsenal to sell Making the Arsenal on line and in their main shop, and now the book is finally there, it would be terribly embarrassing to me if it didn’t sell well. Just as a decline in programme sales would not look good if they came along just as I got my regular page in the programme.
Incidentally there is a new book on its way: “Woolwich Arsenal, the club that changed football” which is, I believe, the definitive history of our club up to 1914, but that’s not quite ready yet. Maybe for Xmas, but if not, then early in the new year.
So that’s my ad, now the rest of football.
It is just possible that the notorious football creditors’ rule could be history as early as November, as HM Revenue & Customs are challenging it again. This is the rule that ensures footballers and other clubs get their money before the “unsecured creditors” when a club goes into administration. So wealthy players can get the dosh, but the UK government, not to mention the guy who cleans the clubs windows, doesn’t.
The UK government has lost tens of millions of pounds this way just in the past five years, and Sir Guy Newey is having a look at it as part of the Plymouth Argyle case. (Revenue and Customs who collect money for the government are putting in a claim against the legality of the rule at every administration case they fight. In the Portsmouth case the judge said he wasn’t qualified to look at it. This time they got a judge who is).
Even some football men like Manchester United’s chief exec, David Gill, have said that the rule is indefensible, not least because of the crazy state of football finances.
The Premier League’s 20 clubs owe something like £14m in tax between them. The Football League clubs owe the tax offices £7m. The figures for 2009/10 for tax owing were…
- Premier League (20 clubs) £14,407,106
- Championship (24 clubs) £6,412,370
- League One (24 clubs) £461,859
- League Two (24 clubs) £534,242
- Conference (68 clubs) £344,955
Quite clearly football is a tax avoiding industry that uses every trick to ensure that it gets away with everything it can.
The Premier League is trying to avoid the issue, as Dan Johnson said, “The Premier League’s starting position is that there should be no debt to HMRC, which is why we have introduced a raft of financial criteria to encourage clubs to run themselves in a responsible and sustainable manner.”
Which is a bit like saying, “there should be no crime, which is why we encourage everyone to be honest.”
The Football League says that debt among their clubs is actually decreasing which maybe is right, but as Dave Boyle of Supporters Direct said a while back, “Football clubs make great play of being engaged in their communities, but that rings hollow if clubs don’t contribute to their communities by paying their tax on time, especially in the current economic and fiscal climate.”
Sporting Intelligence, who provided the above tax figures, also revealed that even the little clubs in the Welsh Premier League owed £42,583 in tax at the end of the last tax year. HMRC issued 40 petitions in 2010 against the limited companies that own clubs in the Premier League, Football League, three divisions of the Conference and the Welsh Premier League, some of these against people who have pulled the trick before.
According to Sporting Intelligence HMRC sought winding up petitions against 19 clubs in 2010, named as: Accrington Stanley, AFC Bournemouth, Bishop Stortford, Cardiff City, Chester City, Crawley, Crystal Palace, Dorchester Town, Forest Green Rovers, Hinckley United, Ilkeston Town, Lewes, Notts County, Plymouth Argyle, Portsmouth, Preston North End, Sheffield Wednesday, Southend United, Welling United.
Making the Arsenal can be bought at the main Arsenal shop, on line at Arsenal.com, plus on line from the publishers, and on line via Amazon.co.uk. If you order from the publisher and want a signed copy just put that on your order, and I’ll do. Tell me what you want me to say.
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