UEFA to push clubs to tackle debt
Source: Agencies |
January 27, 2010, Wednesday
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HALF of Europe's leading clubs are losing money with more than 20 percent facing huge deficits, UEFA's general secretary Gianni Infantino said yesterday.
Despite revenues going up, European soccer's governing body UEFA is becoming increasingly concerned and will publish a report on the scale of the problem next month before bringing in new tougher regulations later this year.
The new rules will be part of UEFA's club licensing regulations in 2012-13, meaning that from 2013-14 clubs must break even - only spending the money they generate - or risk facing exclusion from the Champions and Europa Leagues.
UEFA does not believe clubs will start to fold but it is worried that if the financial problem is not tackled now, it could spiral out of control.
"I would not paint such a cataclysmic picture of major clubs folding because football has always shown there can be solutions but having said that, we are seriously worried to see these trends. The clubs themselves are worried, the leagues are worried," Infantino said.
"These are the reasons that pushed us to take the decision to do something and what is healthier and what can bring a more sustainable model than saying you cannot actually spend more than the revenues that you generate.
"One could say if a club goes bust 'who cares?'. But we care. We care for that club and all the other clubs who would have problems because one club has gone and not paid them and then there is a spiral," added Infantino.
"We are doing this after very detailed research which we will publish next month. Our report has analyzed 650 clubs all over Europe and it shows around 50 percent of those clubs are making losses every year - and 20 percent are making huge losses every year.
"Huge losses mean more than 20 percent of their revenue. It also shows of these 650 clubs more than one-third are spending 70 percent or more of their income on salaries only, which is worrying," said Infantino.
"The other element, which is again worrying, is that last season revenues in European football generally went up by 10 percent which is very positive. But, on the other side, the increased costs have gone up 11.5 percent and player salaries have gone up 18 percent."
As a result UEFA's Financial Fair Play initiative was sanctioned by the executive committee last year.
With the backing of all the game's stakeholders including wealthy owners like Chelsea billionaire Roman Abramovich, that will mean that from the 2013-14 season, clubs must break even or face sanctions which could mean exclusion from European club competition.
Despite revenues going up, European soccer's governing body UEFA is becoming increasingly concerned and will publish a report on the scale of the problem next month before bringing in new tougher regulations later this year.
The new rules will be part of UEFA's club licensing regulations in 2012-13, meaning that from 2013-14 clubs must break even - only spending the money they generate - or risk facing exclusion from the Champions and Europa Leagues.
UEFA does not believe clubs will start to fold but it is worried that if the financial problem is not tackled now, it could spiral out of control.
"I would not paint such a cataclysmic picture of major clubs folding because football has always shown there can be solutions but having said that, we are seriously worried to see these trends. The clubs themselves are worried, the leagues are worried," Infantino said.
"These are the reasons that pushed us to take the decision to do something and what is healthier and what can bring a more sustainable model than saying you cannot actually spend more than the revenues that you generate.
"One could say if a club goes bust 'who cares?'. But we care. We care for that club and all the other clubs who would have problems because one club has gone and not paid them and then there is a spiral," added Infantino.
"We are doing this after very detailed research which we will publish next month. Our report has analyzed 650 clubs all over Europe and it shows around 50 percent of those clubs are making losses every year - and 20 percent are making huge losses every year.
"Huge losses mean more than 20 percent of their revenue. It also shows of these 650 clubs more than one-third are spending 70 percent or more of their income on salaries only, which is worrying," said Infantino.
"The other element, which is again worrying, is that last season revenues in European football generally went up by 10 percent which is very positive. But, on the other side, the increased costs have gone up 11.5 percent and player salaries have gone up 18 percent."
As a result UEFA's Financial Fair Play initiative was sanctioned by the executive committee last year.
With the backing of all the game's stakeholders including wealthy owners like Chelsea billionaire Roman Abramovich, that will mean that from the 2013-14 season, clubs must break even or face sanctions which could mean exclusion from European club competition.
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