Debate: Financial Fair Play

What is your opinion on Financial Fair Play (FFP)?

Richard Pike: As a Wigan Athletic supporter, I have a mixed opinion on FFP. Had it been in place when we were climbing up through the Football League, it would have been tough to reach the Premier League. Bridging the financial gap to other teams in the Championship based in big cities and possessing big stadiums would have been tough.

However, I recently heard that Atalanta’s wage bill was around the same as Reading, currently mid-table in the Championship. If Atalanta, who manage their costs well, can finish ahead of both Inter and Milan in Serie A, why can’t someone like Everton do the same having spent considerably more on transfer fees and wages?

Andrew McAlister: As a Manchester City fan, I may have a somewhat biased position against FFP due to how our club has spent over the last decade. However, I see it as a way for Europe’s elite to protect themselves. With caps on spending, the door has closed for other teams to compete with the likes of Liverpool and Manchester United on a regular basis, though City Football Group’s investment allowed us to break through just in time.

Punishment may loom for City, but I think UEFA and FFP will see their flaws recognised and hopefully dealt with.

James Foster: I see it as a misguided tool to try and enforce sustainable running of a football club. I consistently hear Andrew’s argument from people about it being a mechanism for the “elite” clubs to protect themselves and I disagree.

Your spending is not being limited as handicap, it is limited to your turnover. Increase turnover and you can increase the amount that you spend. I will concede however, that it is a potentially flawed system and could quite easily be improved.

Hanu Trivedi: I feel like FFP as a whole is a good tool and a step in the right direction to counteract dodgy financial dealings and improve the sustainability of football clubs. The numbers are there to prove it, with overall profitability and club assets rising consistently since the implementation of the program.

The issue is that certain anomalies like Manchester City’s case and clubs like Bury going bust have given people the idea that FFP is the root of all evil in football. It’s simply become too unfairly maligned by the media and though there is need for reform in it, it’s still very useful.

With the lack of clarity around the application of FFP, and potential arguments around protecting the status quo of the elite clubs, should we return to the pre-FFP system?

Richard: Whilst I am not in favour of everything about FFP, I am more in favour of it than a return to an unrestricted free market system. Looking at it from a point of balance, I understand Man City’s arguments about them finding it hard to bridge the gap without their takeover in 2008 and how FFP could be used by the big teams to keep out competition.

However, if clubs are simply allowed to spend without restriction, a new closed shop could emerge to replace an old one. Equally, not every club can attract the level of investment Man City can. They have a large stadium and are based in a big city. Smaller clubs in the North West such as Wigan and Preston for example do not have this luxury.

Andrew: I’m not too sure on this one. Yes, an unrestricted free market had allowed for clubs such as Manchester City and Chelsea to compete with the ‘elite’ clubs, but it means different things for different clubs.

Technically, investment can come to any club, though the Premier League and the more established names are more attractive to prospective buyers. This leads to a gulf in class between divisions, alienating those in lower leagues.

James: No is the only answer here surely. As mentioned by others, an unrestricted market would be great for allowing sides to bring in stellar names and compete against sides that they might not normally challenge.

However, if every side were allowed to do that, not everyone can win and owners may walk. The only sides left competing at the end are the ones who make money sustainably or have owners more than committed to their club.

Hanu: No, not at all. I don’t see how FFP keeps big clubs big and it’s also not as if we haven’t seen clubs gatecrash the elite since FFP has been established. RB Leipzig and Monaco have done wonders in their respective countries. Shakhtar Donetsk keep going from strength to strength and clubs like Atalanta, Sheffield United and Getafe are challenging the elite despite not having endless pits of money.

The old system could lead to more clubs going bust and more needless spending. It wouldn’t help.

Is there any other system as an alternative to FFP that would work better for football?

Richard: How likely this is to happen, I’m not sure, but I think it is time for salary and transfer caps across all football leagues. I recently watched the NFL playoffs and it was great to see Kansas City, only the 38^th biggest city in the US win the Superbowl. 

If you removed salary caps and other levelling out methods from US sports leagues, the only teams that would be competitive and win would be the New York, Boston, California and Florida teams. All the money and sponsorship is there and all players would only want to move there.

Under transfer caps, Premier League & other European leagues could give each side a maximum of GBP/EUR 120 million to spend on transfers. A wage cap would be more gradual as existing player contracts have to be honoured. This would emphasise good coaching and scouting skills.

Andrew: I agree with Richard here that a wage cap could be the way to go, though indeed it’d have to be brought in gradually. Clubs would have to focus more on coaching and academy facilities and it could eventually lead to better scouting and more competitive leagues.

James: There is merit in exploring a wage cap as Richard has mentioned and as Andrew rightly pointed out it would force clubs to improve scouting and training. Contrarily, however, this would potentially penalise or handicap clubs who’ve already invested time and money into creating a profitable business model.

I like the draft system over in America, however, the rest of the world is so far removed from that model it would be impossible to introduce it now, and probably would render most academies pointless. You’re not guaranteed to get the best player in that draft class, but it’s on you if you don’t get something out of it, no one else.

Hanu: No, not really. I think educating clubs and owners about sustainable management is more important at this stage along with introducing stricter tests for new owners to ensure that they do not mess up the situation.

We would not have had most, if not any, of these recent debacles in the English football pyramid if the owners were properly vetted.

If we are going to keep FFP going forward, are there any ways you would tweak the system?

Richard: I like how FIFA have imposed a cap next season on the number of players over the age of 23 allowed out on loan.

I would do one other thing under an FFP system if it were to stay. A transfer window for managers in December and January. This can also be topped with another rule that restricts a manager from coaching more than one team in a country over course of a season.

This is a rule in place in Spanish football and it would stop smaller clubs with a talented manager having their manager poached mid-season.

Andrew: I’m also a fan of the cap on loans that FIFA are imposing. With fewer players leaving their clubs for lower league teams, it should see academy products progress either at other clubs after a move or at their original side as managers are forced to play them.

As academy players make the first team, clubs will not be forced to spend as much in the transfer market. I’d also like to see more clarity in regard to FFP. Some teams seem to be hit very heavily by punishments when not adhering to UEFA policy, while others seemingly escape with no issues or a small fine.

James: Have to agree with Richard here, we’ve mentioned manager windows in the past during our January Transfer Window debate and I’m 100% behind them.

With regards to improving FFP, one option would be forcing clubs who don’t have the turnover to back up their spending to put an amount into a trust that would allow the club to keep going if they walked away. 

That means if you buy a player for £30 million and his contract is £25 million over three years for example, anything that your projected turnover doesn’t cover, you have to stump up the remainder.

FFP is not there to stop clubs spending remember, it’s to keep them spending within their means.

Hanu: I’d probably keep the broad guidelines as they are but would actually enforce punishments as they are supposed to be enforced rather than get through the mud like the Man City investigation. 

If UEFA can actually clear their tracks and make an example out of clubs we will have a better landscape.