The Great Big FFP Debate

woppy101 said:
Over 5-10 years absolutely not, but over 1-5 years why not, Villa are in a phase where they are trying to grow to join the “top6” party, but the current FFP rules make it impossible it’s basically 2 years and you’re out.
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It’s definitely not OK for a club to be getting themselves hundreds of millions in the hole chasing the dream. Even if they did manage to break the top 6 and become successful on the pitch, it’s not going to pay back those kind of losses any time soon. With the amount of money sloshing around the PL I find it astounding that any club is being run at a loss. If anything PSR needs tightening up to force all clubs to run at break even at worst (with some short term losses allowed for unforeseen issues)

It’s all very well dominating Europe and buying all the biggest bestest players for daft sums of money but if it leaves most of our clubs as absolute basket cases it’s not healthy and needs to be stopped.
 
woppy101 said:
So you want to tar every current and new owner with the same brush?
Everton ****** up, so you’re now saying no other club owner, new or otherwise can try and grow their club, to compete and try to win the league and become a global brand?
What you’re saying is the complete definition of the closed shop you want, Manchester United, Liverpool, Manchester City, Arsenal, Chelsea and Spurs have grown their worldwide brand, what your saying is no other club should be given the same chance, just incase they do an Everton.
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Talk about missing the point. And no I'm not saying anything like that. I've given my views and ideas on a fairer, safer way that would allow investment but I know full well it won't happen because none of the owners of these clubs currently ****ing money up the wall would agree to them. As we've continually seen with all these clubs, their owners won't even cover 100% of the money they're losing today let alone put guarantees in place to cover losses in the future just in case things change.

Any club that is losing huge sums of money and relying on outside investment is at risk. We've seen owners die, we've seen Icelandic banks go bust, we've seen individuals be sanctioned and we've seen owners just lose interest and or decide they cannot afford (or want) to keep losing money and like flicking a light switch these clubs go from "giving it a go and trying to compete" to being on the brink of administration because they do not have the money to pay the bills. That is not sustainable, that's nothing more than gambling and these owners swan off having lost £200m, £300m or whatever and the club is left with its pants down facing continual £100m+ losses for the next few seasons.
 
BaZ87 said:
Talk about missing the point. And no I'm not saying anything like that. I've given my views and ideas on a fairer, safer way that would allow investment but I know full well it won't happen because none of the owners of these clubs currently ****ing money up the wall would agree to them. As we've continually see with all these clubs, their owners won't even cover 100% of the money they're losing today let alone put guarantees in place to cover losses in the future just in case things change.

Any club that is losing huge sums of money and relying on outside investment is at risk. We've seen owners die, we've seen Icelandic banks go bust, we've seen individuals be sanctioned and we've seen owners just lose interest and or decide they cannot afford (or want) to keep losing money and like flicking a light switch these clubs go from "giving it a go and trying to compete" to being on the brink of administration because they do not have the money to pay the bills. That is not sustainable, that's nothing more than gambling and these owners swan off having lost £200m, £300m or whatever and the club is left with its pants down facing continual £100m+ losses for the next few seasons.
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Thats fair enough and you’re quite level headed Baz( most of the time :cry:)
im using Villa as an example here, they currently have no debt attached to their books, but because they spent heavily in the last 18 months, they are now limited what they can spend and likely have to sell one or two of their best players to balance the books, yet spurs or manu can almost in essence spend what they want but both are in over £600m worth of debt.
If a club has no debt it should be able to spend money, and a club with debt should have to run that debt down before being able spent money, or at least pay the same amount spent off the debt, ie if you spend £100m on transfers this season by the end of the same season you must have payed £100m off the current clubs debt.

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woppy101 said:
Thats fair enough and you’re quite level headed Baz( most of the time :cry:)
im using Villa as an example here, they currently have no debt attached to their books, but because they spent heavily in the last 18 months, they are now limited what they can spend and likely have to sell one or two of their best players to balance the books, yet spurs or manu can almost in essence spend what they want but both are in over £600m worth of debt.
If a club has no debt it should be able to spend money, and a club with debt should have to run that debt down before being able spent money, or at least pay the same amount spent off the debt, ie if you spend £100m on transfers this season by the end of the same season you must have payed £100m off the current clubs debt.
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Their full accounts aren't available on companies house as yet however as of their last published set of accounts Villa absolutely do have debts (+ loans to their owners). They have circa £25m of bank debt and net transfer debt of a staggering £140m! The issue however is not simply debt. The issue is cashflow. A club can make a profit and still lose cash in a given year and likewise, can record a loss and have a positive cashflow due to the way things like transfers are accounted for. In the case of Villa, using their last set of accounts, they lost £12m in cash from their day to day running of the club before factoring in payments (in and out) on historical or future transfers. Using that £140m and assuming an average payment term of 3 seasons, Villa have to find another £47m odd just to pay for the costs of yesterday! That's £60m in actual cash losses before any future transfers. Even in their last set of accounts, with a £100m sale of Grealish (and putting at least £80m of their transfer spend on the credit card), Villa still lost nearly £40m in actual cash terms.

You use Utd and Spurs as an example but these clubs are generating the cash to pay their bills. Villa aren't. They're relying on 10s of millions in handouts each season just to keep the lights on. As we've seen with Everton (Derby, Reading etc etc) this is fine as long as the owner is willing (or able) to continue to do this but the day it stops the club are in a pickle.
 
BaZ87 said:
As we've seen with Everton (Derby, Reading etc etc) this is fine as long as the owner is willing (or able) to continue to do this but the day it stops the club are in a pickle.
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Could you not say that with any club though, top6 included? As manu fans keep reminding us look at the state of old Trafford and the training ground, considering how much the glazers are taking out, they are just happy to keep the debt as it is and pay the interest alone.

I think now with the amount of money in the game, club debt should be getting smaller, not staying the same or increasing. The PL should now stop any takeover that loads a club with debt, and any club that’s currently in say over £50m of debt should be made to pay off a percentage of that debt every year to meet FFP, with an end target date for it all to be paid off, if that years debt repayment isn’t made you can’t register any new players that season.
Clubs or owners should be able to spend what they like and can afford, but it should be spend in cash and not loaded onto club debt, ie you buy a £50m player on £10m per year, that fee should be paid upfront with the first years wages also paid into club accounts and then each additional year at the start of each season, then if an owner does become bored or skint a club won’t go into financial meltdown.
 
woppy101 said:
Could you not say that with any club though, top6 included?
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No because not every club is losing millions upon millions of cash each season. As an example, Liverpool are generating £100m+ each season in terms of cash before transfers & investment into stadium works etc. Utd (and Spurs) are generating enough cash from their day to day activities (running the club, paying wages etc) that they can meet the interest payments and any future transfer installments and still have cash left over - Newcastle, Everton, Villa etc aren't and instead rely on outside investment.

As I've said numerous times before, if an owner wants to invest then make them put financial guarantees in place to cover whatever the club is losing for at least another 2 years so that if he dies/gets sanctioned/gets bored/goes broke, the club has a 2 year buffer to sort themselves out. These owners won't do this though. As I said, from Villa's last published set of accounts they didn't even put the cash in to pay for their transfers, Villa just increased transfer debt by another £80m. Newcastle done the same. And as long as these owners are doing this, clubs that are losing huge amounts of cash are at risk. As I said in the Everton thread just the other day, you might not believe it or want to think about it until it happens but it can happen, just ask Everton fans, ask Derby fans, ask Reading fans.
 
Shamikebab said:
blimey 89% is crazy high
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Not just that, who on earth are they paying that much to!

woppy101 said:
The impressive club there is arsenal, I know it won’t include Rice( who will be on a fair whack) but to build a team like they have at 51% of their turnover on wages is very impressive
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It is but it will be more impressive if they can keep it there in 2-3 years time when all these players who are part of a very good side start getting tapped up by other clubs and have their contracts up for re-negotiation.

Also, Man City with their ridiculous turnover. Do me a lemon. Bent as a 9 bob note.
 
woppy101 said:
Absolutely
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Poor form mate. I'd rather the league be sustainable and clubs can compete rather than rich owners just buying success. And I'm saying that as an NUFC season ticket holder.

Having historic clubs like Everton, Villa or Newcastle potentially go to the wall and be destroyed because owners were allowed to saddle them with unsustainable debt and then walk away when they got bored would be horrendous.
 
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woppy101 said:
So it’s now Villa(who’s owners have plenty of money BTW) will now likely have to sell their big players to the Sly6 to comply with FFP(remind me again what part of it is fair), just because they wanted to try and grow their club and compete, FFP completely designed to keep the top6 status quo and not let anyone else join the party.
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I actually agree with this view.

Although it’s kind of back firing in the McDonalds league, Bein sport might have to pay well over the odds for TV rights so that PSG and others in the league can comply with FFP.

Mental.
 
The top two wages bills lol

Nothing that has been said before. Wage bill is the biggest correlation over a period of time to success. Fair play to Arsenal being competitive over the last two season.

money buys success who would have thought
 
:D
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That sort of thing scares the **** out of me as a Villa fan. With the current regs in place, I have no idea how we get out of it. Probably going to be waving goodbye to Ramsey in the Summer and possibly Luiz.

One of the few conselations is that if things got real bad we have a lot we could potentially off load. Cash (likely to go in the Summer anyway I reckon), Zaniolo (on loan), Sanson, Olsen, Carlos, Lenglet (on loan), Chambers, Hause, Dhuran could be gone to free up a ton of wages and a few fees.
We're essentially getting 2 'free' signings next season what with Mings and Buendia coming back into the squad so that will definitely cushion the lack of spending in the Summer. You could even count Kamara in that number now.

The good to take from it is that we're operating (supposedly) within PSR I guess.

Isn't £60m of that loss including covid?
 
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I'd like to see owners be able to invest in a club to try and challenge the established clubs, but there do need to be safeguards.

For me, if an owner wants to come in and sign up a dozen players on long contracts, kind of fine, as long as the financial commitments they signed up to are guaranteed in some way.

So if a player is signed on a 5 year contract at £500k per year and 5 annual payments of £10m to the selling club, then the owner has to cough up the full £52.5m up front and put it into an account that is solely used to service that commitment.

If the owner walks away, the damage to the club is limited, but it does give people the chance to 'give it a go'.
 
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