Clubs in League One and League Two have today voted for the introduction of new financial controls in the form of ‘Squad Salary Caps’ into their respective divisions which take effect immediately.
The decision follows extensive and comprehensive consultation with all Clubs in respect of addressing sustainability and wage inflation issues across the EFL which were initiated prior to the suspension of football in March following the COVID-19 outbreak and have continued during the course of the summer.
Those discussions culminated in today’s divisional vote, with representatives of League One and League Two Clubs opting to implement the new measures in place of the existing Salary Cost Management Protocols, with fixed caps of £2.5m and £1.5m respectively.
Discussions continue with Championship Clubs in respect to amendments to their own financial controls. League One and Two Clubs are also going to continue discussions towards the introduction of additional measures aimed at addressing Club financial sustainability.
When calculating total salary spending, the ‘cap’ includes:
• Basic Wages;
• Taxes;
• Bonuses;
• Image rights;
• Agents’ fees and;
• Other fees and expenses paid directly or indirectly to all registered players
It was coming due to the current situation smaller or rather lower league clubs find themselves in, now can we expect some more financial assistance to follow based on such a cap? I hope so for a lot of clubs futures, look it’s not ideal but with a package to follow it may save a lot of clubs going pop.
I don’t have any inside knowledge of this, but my suspicion is this is intended to be a relatively short-term fix (say up to five years) until clubs and the league put their respective financial houses in order. But of course, if it proves to be successful then it will stay.
However, the EFL still have a lot to answer for in term s of how they have allowed so many unscrupulous owners to come and go across the leagues over the years, leaving many in a perilous state. Then there’s just bad financial management by individual clubs.
Funnily enough, the PFA were very quick to object. But they have failed to realise it’s better to have all (or most) of their members under contract somewhere than less than half when clubs start to go bust. Just my opinion, of course.
Good point Josh but as regards the PFA let’s not forget the greedy little guy who runs it, is it really about the welfare of every member with a man like him in charge?
Good point Josh but as regards the PFA let’s not forget the greedy little guy who runs it, is it really about the welfare of every member with a man like him in charge?
I hope the PFA lawyers blast this out of the water. It’s a step nearer Premier League 2, which will see an even bigger gap between the Championship and L1/L2.
I hope the PFA lawyers blast this out of the water. It’s a step nearer Premier League 2, which will see an even bigger gap between the Championship and L1/L2.
It’s our time.
Especially since relegated championship clubs will most likely get a season or 2 grace period to “allow them to bring their finances into line” aka outspend everyone else so you only have to play with the plebs for one season.
This is great news for lower league football, it should make for a much more level playing field, where clubs can’t just buy success by living beyond their means. It also dramatically reduces the risks of club going bust. I can’t see why anyone would be against this, my only concern is the one mentioned above about clubs being relegated being given time to “adjust”. I don’t agree with that at all, they need to ensure they can hit the salary cap if they are relegated by planning in advance.
This could be the first step in an overhaul of how the game is governed in this country. I just hope there’s more to come.
I was a little worried about the salary cap thing at first however the more I think about it the better it seems.
This is a huge leveler and hopefully should see clubs in the lower leagues start to invest in their youth set-up, talent scouting, and coaching set-up. No longer will clubs just throw money at players in an attempt to snap up all the best talent and gain promotion. Clubs will a small fan base will be on an equal financial footing as those with a larger following.
Some might say it’s unfair, especially if you have a large fan base for L2 such as Bradford City or Bolton. However for me it seems like the clubs with the best coaching, manager, youth set-ups etc. will be the ones that succeed in the long-term.
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