Distribution of wealth in English Football

[Gilps]

Have-nots ask the millionaires to take a share option

 

The Football League has asked the Premier League to distribute some of its TV income to less affluent clubs.

 

Members of the Football League's board have held meetings with the Premier League's chief executive, Richard Scudamore, to seek a fairer distribution of the Premiership's booming TV money which, following the £625m secured last week for overseas rights, will total £2.7bn over three years from next season. The Football League is so sensitive about the issue it is refusing to comment publicly but the Premier League confirmed that talks are taking place about a revised funding package once the new deal kicks in.

 

The discussions centre on four areas: the amount the Premier League provides to Football League clubs for youth development, currently £4.2m a season; the possibility of funding clubs' community programmes; re-examining how the £17m which the Premiership will pay to the Professional Footballers' Association could be distributed; and a proposal for the Premier League to split with the Football League all money paid to the professional game from the Football Association.

 

Whether this will result in sufficient redistribution to prevent the Premiership disappearing into a different financial universe remains to be seen. So far there is no sign among the Premier League clubs of an attack of conscience, although an increased proportion of the £2.1bn domestic element of the next deal, around 7%, will go to grass-roots development, including the Football Foundation.

 

Before the Premier League was formed in 1992 as a breakaway by the then First Division clubs, the Football League's TV money was always shared throughout its four divisions. Latterly 50% went to the First Division clubs, 25% to the Second and 25% was split between the Third and Fourth. The arrangement enabled smaller clubs to compete with the grandest but, when BSkyB emerged to smash ITV and BBC's terrestrial budgets, the First Division clubs plotted to break away from the League and keep for themselves all the huge money about to pour into football. Crucially the top clubs were then backed by the FA, whose leaders believed a Premier League would strengthen their rule over English football; it has not. In return the FA asked for nothing from the top clubs: no sharing of the money with the remaining 72 Football League clubs or improved regulation of the game. Graham Kelly, the FA's chief executive at the time, has since admitted ruefully about that decision: "We were guilty of a tremendous, collective lack of vision."

 

The latest agreements, a triumph for Scudamore, bring the total TV revenue reaped by the 22, then 20 Premier League clubs since 1992 to an eye-watering £6.375bn. The money has fuelled the Premiership's success and rise to prime global television entertainment and enriched players, agents, club owners - and Scudamore himself, who is paid a bonus based on TV income. Yet genuine redistribution with the Football League has gone. Out of the current £1.6bn 2004-07 TV deal, the only money the Premier League pays directly to Football League clubs is the £4.2m to help fund youth development programmes, around £60,000 per club.

 

The three clubs relegated to a Championship whose other clubs earn less than £1m each from television are paid around £6m in "parachute payments" for two years to ease the shock to their Premiership-sized wage bills. That gives a richer few more chance of retaining their better-paid players and grasping the promotion places. Currently three of the Championship's top five clubs, Birmingham City, Southampton and West Bromwich Albion, are banking parachute payments.

 

Yet despite this institutionalised inequality which opened up after over a century of English football sharing gate money then TV income more evenly, there has been a strange silence since 1992 about the breakaway. It shapes football's financial landscape, a much more far-reaching and fundamental issue than, say, whether the odd club manager has taken a kick-back from an agent. Yet, while rumours of bungs inspire tabloid stings, Panoramas and £1m forensic inquiries by the Premier League, the football "family" hardly dares mention the divorce 15 years ago which still causes so much of its dysfunction.

 

Even now the League is refusing to comment about its efforts to secure a more decent share from the Premiership's next deal, as it clearly believes it will do better to tiptoe into discussions for fear of upsetting the rich clubs. Without a strong campaign to highlight football's rampant inequality, though, it is difficult to see the League being successful.

 

David Sheepshanks, the Ipswich Town chairman and League board member, is one of few raising the issue publicly. "I have complete admiration for the Premier League's deal," he says, "but my primary concern is that it will distort competition in the Championship if parachute payments to the three relegated clubs rise to the mooted £10-£12m next season."

 

There is an opportunity now for the League partly because there are some stirrings of discontent from middle and lower ranking Premiership clubs. Within the Premier League, clubs share 50% of TV money equally, 25% is paid in "facility fees" to clubs shown live on TV and the remaining 25% is paid according to how high clubs finish in the table. The overseas rights are shared out equally and Scudamore says overall the Premiership's is the most even formula within any top flight in Europe. It does, however, still reward greatly the top clubs who finish higher and are shown on TV more. From next season Scudamore has said the top club will receive around £50m, the bottom club around £30m.

 

"It was very good last weekend that the fourth-placed club beat the first and third beat second," says John Williams, the chief executive of Blackburn. "But most people can now name at the beginning of a season who the top four will be. The Premier League is becoming uncompetitive and we need a change to the way the TV money is distributed to create a more level playing field."

 

Charlton Athletic's chairman, Richard Murray, has long argued for a more equal sharing of money within the Premier League, and with the Football League, although the club's authority this season will be undermined if they remain mired in the relegation zone. Privately there are murmurs of agreement from several other clubs but a strange reluctance to argue openly for it. They will have to fight hard to secure the necessary agreement of 14 Premier League clubs to any change, and the big four form an intimidating presence around the table.

 

Williams believes the debate needs to happen now and can include the question of more equal sharing with the Football League. "It isn't for me to talk about that alone; I believe we should share the money more equally in the Premiership. But it is not mutually exclusive to discuss more even distribution with the Football League at the same time."

 

Perhaps most striking is that the FA, football's governing body which sanctioned the breakaway in the first place, is no longer in any position to influence it at all.

[Big G Superhero]

Wonder if noone's too keen to mention it as outvoting the big clubs would push them closer to a European Super League and out of the English game?