This is a long post, but I've highlighted the important bit in the final paragraph.
We've all no doubt seen in the last few days that the Premier League's TV deal is set to be increased by 70% from it's current figures, bringing it up to a staggering £5.14 billion. Now, there have been many critics of this new investment, and they all have valid points. Lord Sugar suggests that the new money will only harm the prospects of the England team, but whilst I must admit that it would be nice to see England prosper, I'd sooner see a world-class Premier League than a world-class England, so in that sense I have no problem with the new deal.
However, my problems arise from the fact that so little of this money, or any monetary gains that any Premier League clubs make, is being reinvested further down the football pyramid. A lack of investment at grassroots level in this country has been maligned for years, and rightly so, but you don't need to go that far down the footballing hierarchy to see how wide the wealth gap has become. Several Football League clubs have run into administration in recent years, and a step into the highest level of non-league reveals that the situation there is even worse.
Two clubs - Salisbury City and Hereford United - were forcibly ejected from the Conference last season due to money problems, and both have now ceased to exist. Do you know how much debt Hereford United had accumulated? £350,000. Might be a lot to you and me, but in the footballing world it's a pittance. Wayne Rooney earns that in a week. And the stories of Hereford and Salisbury are just warning signs. My local club Lincoln City owes the bank £380,000, and if that is not paid in due course, or if an investor does not arrive, club assets will be seized and liquidation will loom large. I have supported Lincoln for years, as have thousands of others, and now we face the prospect of being left without a football club because of a few careless chairmen. And 0.007% of the Premier League's new TV rights deal could save us.
The wealth gap has become too large, so here is my suggestion: each Premier League club and financially-sound Championship club should donate a specified percentage of their yearly takings to a fund. It doesn't have to be a big percentage for this to all start adding up. That fund is then kept by the FA and used to help clubs like Hereford, Salisbury and Lincoln, or at grassroots level. I'm not saying that lower-league clubs who squander money should just be given the cash back, but surely it is better for a club to live than to die, regardless of what level they play at.
Sorry for the long post, but I think it's relevant.
The Wealth Gap
posted on 11/2/15
comment by Chris H (U15205)
posted 4 minutes ago
Yeah, maybe, although feels a bit like charity.
There are plenty of well run clubs that don't run up huge bank debts - what kind of encouragement is that to these ones that they know their is a bail out waiting if they fancy taking more risks with their money?
For me I'd like to see PL clubs invest more money in their local areas, on pitches and organisations that get youth involved in football.
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No club is ever safe for long once you get to non-league level. The rich get richer and the poor get poorer, so if the team doesn't have any upwards mobility then the financial problems soon start mounting.
I agree that it's a bit too charitable. I'm just an idealist; I never want to see a club go under if it could be prevented.
posted on 11/2/15
Comment Deleted by Site Moderator
posted on 11/2/15
"I'm just an idealist; I never want to see a club go under if it could be prevented."
Completely agree, but I think handouts from the PL is probably not the right way to go about it.
To be honest I think it's the same as most businesses these days - the big corporations are eating up all the little businesses!
posted on 11/2/15
It doesn’t even particularly benefit the clubs, because all it does is inflate the market for all of them.
It benefits the players and their agents, massively, but I don’t think the TV companies are too far away from a collapse in the viewing figures. The recession is still hitting hard, and if the TV companies hike the price much further, I think there’s a lot of people now on the cusp of what they’re prepared to pay.
As for bailing out the likes of Lincoln City, the difficulty, as you’ve implied, is in the fact that it could encourage reckless spending, knowing that there’s a safety-net in place. But I would guess that there are ways to prevent that....there are ways to prevent anything man-made.
I think it’s sad when a football club disappears, as football clubs are so bound up in the identity of the communities they sprang from, but in this country in particular we take the view that markets are our master, and not our slave.
In the age of food-banks, it’s already obscene, but for now, at least, we’re quite happy with obscene so long as we’re on the right side of the fence, and we can open a couple of tinnies in front of the TV. So the chances of anything happening, along the lines you’ve suggested, are pretty close to zilch.
Bread and Circuses, but there’s an alarming number of people now struggling to pay for the bread, and the Bread and Circuses formula breaks down when that reaches critical mass, at which point there is a risk of backlash.
Prefer the German model (both in football and in wider society), where markets are shaped in such a way that benefits the people participating in them (all of them), and where the community that supports the markets is in charge, and not the other way around.
As opposed to the model that treats markets as some kind of independent living organism that can’t be interfered with. (the same model, in fact, that caused the economic crash, along with a number of other disasters over the past 200 years or so).
We’re on the brink of a wealth gap that is so divisive as to be dangerous, as a growing number of economists are starting to point out, to deaf ears.
In terms of the football market, it's not, of course, dangerous, but it may end up being sad.
Is there any market in history that has ballooned and inflated like the football market has, and then let itself down gently? What tends to happen when a market inflates as rapidly as football has, and the boundaries of the growth seem limitless?
posted on 11/2/15
Wessie Road
posted on 11/2/15
Wessie Road
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It was long and (discursive, let's say), but for work reasons I've had a lot of hanging around to do this week, so I'm on a bit of a roll, and spitting it all out.
posted on 11/2/15
The theory of each club donating down to the lower divisions is an interesting one.
It makes sense to a certain extent but that old devil called greed seems to be the main obstacle. I believe that it would require a vote in favour from 80% of all Premier/Football league clubs to proceed.
Clubs who on a regular basis occupy the lower half of the Premier League and Championship will always vote against any donation. This would be a justifiable refusal as they could argue that nobody helped them during their original promotions up through the leagues.
It's like the "Turkey's voting for Christmas" scenario that will never happen. If it is restricted to the clubs with higher revenues then it might work, but it would still require a vote of 80%.
The truth is that we have too many clubs in the lower leagues, and natural selection will see many disappear over the next decade. This is just a reality of the economics that we are now facing.
All the money in the world won't put the England team back together and the FA have come close to spending as much.
It's time to accept that the ship has sailed for the England set up and for many of the smaller clubs - as sad as that may be, it's just the way it is.
M
posted on 12/2/15
Just give say 5-10% and spread it amongst the lower leagues, share it out equally. So it justs basically a boost to the financies of every club rather than a reward for incompetence.
A fund could be set up for low interest loans to save clubs where it is viable but they shouldn't be saved without question, there has to be a price.
Also lots of money devoted to football pitches all over the country for kids (or anyone else) some money into youth coaching as well.
Make it so everyone benefits from these constant increases (well everyone into football)
posted on 12/2/15
Comment Deleted by Site Moderator
posted on 12/2/15
I'm thinking on a bit more of a larger scale with large low cost loans offered out to those with realistic plans to save a club.
Could set up a sort of credit union for the lower league clubs in general, offer them low cost loans for things they need (infrastructure and stuff rather than players)