Massive spending by top football clubs is “unsustainable” and “eventually something has to give”, the UK’s new Culture Secretary has warned.
Lucy Frazer has sounded the alarm bell about the dangers facing cherished football clubs as stars command sky-high salaries.
She said: “The combined net debt of clubs in the Premier League and Championship is now around £6billion, with Championship clubs spending an unsustainable 125% of their revenue on player wages alone.”
Ms Frazer is concerned that clubs will go bust and leave fans “devastated” if spending is allowed to get out of control.
She told the Sunday Express: “Bury, Macclesfield Town, Rushden & Diamonds: all three have gone to the wall in recent years – taking with them huge chunks of our history and heritage, and leaving a huge hole in their communities. Derby County was on the edge of a precipice last year too.”
In a scathing rebuke of how clubs treat fans, she said: “Football is nothing without them. And yet in recent years, they have been ignored or shut out by their own clubs – whether it is in decisions to move stadium or change the kit, or to try and join hugely unpopular breakaway competitions like the European Super League.”
Her comments come just days after her department launched long-awaited plans for an “independent regulator” to help stop clubs collapsing into financial ruin.
New measures will be introduced to stop clubs falling into the hands of “unscrupulous owners”. Fans will be given a greater say in how clubs are run, including on decisions affecting “team names, badges and stadia”.
The Government’s white paper on football governance warns that “many clubs throughout the English football pyramid are operating in financially unsustainable ways”.
It highlighted a “steady rise in borrowing, mostly through ‘soft’ loans from owners” with net debt in the Premier League and Championship reaching £5.9billion at the end of the 2020-21 season.
Setting out the fragile state of football, the white paper warns: “Clubs are being run in unsustainable ways, and with a reliance on owner funding that increases insolvency risk if the personal circumstances of these owners change. When the vetting of these owners is not as rigorous as it should be, this risk grows even greater.”
Labour accused the Government of wasting “years” by not launching a regulator earlier and called for it to “take responsibility for any clubs that go under”.
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