Financial Un(Fair) Play

With the success of Chelsea and Manchester City in season 2011-2012 still fresh in the memory the debate about “financially doped” clubs is raging with everyone looking to UEFA’s Financial Fair Play (FFP) rules to curb the rise of such clubs. I find it astonishing that the consensus opinion seems to be that FFP is a good thing and one that is desperately needed to halt the march of these lawless billionaires playthings. The only dissenting voices against FFP are from those that think UEFA won’t be able to apply it and that clubs like City will circumvent the rules by moving money into the club via sponsorship from one of Sheikh Mansour’s other vehicles (boo!). Indeed City have already secured a monster deal for the naming rights to the stadium and training facilities. The collective conscious of the fair play knights took umbrage at this move and angry fists were waved at this shameless dodging of FFP. The “I told you so” brigade band was playing its favourite tune (also named “I told you so”).

But hang on a minute! What on earth has financial fair play got to do with football? There have been big clubs with enormous resources and financial wealth since time Immemorial and by sheer coincidence those clubs have been incredibly successful for decades. No one has ever cared about fair play before, if there were any dissenting voices against the likes of Real Madrid, AC Milan and Manchester United having an unfair advantage I’ve never heard them.

Let’s be honest, FFP hasn’t come about because UEFA have suddenly developed a conscious and want to protect the best interests of the beautiful game, it’s come about because the established old guard have got their noses out of joint because their cosy, untouchable positions at the apex of world football are under serious threat from the likes of Chelsea, City, PSG et al. Why were UEFA not perturbed when Real Madrid mysteriously wiped out their debt by selling their training ground (but still keeping it)? Why do they turn a blind eye to the fact that Barcelona and Real have made La Liga a two game shoot out with their massive TV deals while the rest of the league struggle in vain to compete? UEFA are worried that City can afford the best players by offering silly money but didn’t bat an eyelid when Perez and Madrid tapped up players brazenly and urged them to force through moves. Barca are not innocent of this most basic of tactics either. Even other members of the G14; Juventus (Zidane), Arsenal (Fabregas) and Manchester United (Ronaldo) were not spared such tactics. Was that fair play? Given their inaction it was clearly acceptable to UEFA.

It is oft said that football is now big business and indeed the professional nature of how contemporary football clubs are run (with the odd Gary Cook incident aside) is more in keeping with big business than the old style Chairman fan. That begs another question, if a company wants to take risks and end up failing that is their business, there is no one to police their activities. Similarly if a company receives a large cash injection from a stakeholder than their ambitions can change. Why does football have to be different? Leeds were badly run and paid the price and are now languishing in the lower leagues as a result, risk v reward and all that. However, if tomorrow they are taken over by a billionaire who wants to invest his (or her, could be a woman) cash into fast tracking them to the promised land of the Premier League or even Champions League why should an artificial regulation be there to stop them? That wouldn’t happen in the real world so why does it have to happen in football? And is it right that UEFA should be appointed the gendarme of finances for football clubs?

FFP is not about establishing fair play which is a quixotic notion at best, it is about maintaining the status quo. The G14 clubs have an iron grip over UEFA and effectively act like a cartel ensuring UEFA pushes their agenda. We only need to look at the forming of the UEFA Champions League as evidence of this. The classic European Cup was long established as the premier tournament to decide the best team in Europe. There was nothing wrong with that format but the G14 decided they all wanted a piece of the pie every year so threatened to leave UEFA and start their own league – those old enough will remember this as the “Super League” that the red tops prophesied would end football. The outcome as we all know is that the European Cup slowly morphed into the UEFA Champions League – the Super League in all but name and one which has stealthily established itself as THE tournament to win with the poor old Cup Winners Cup becoming collateral damage in the process.

If you’re not familiar with the FPP, in a nutshell, clubs will be obligated to balance their books or break even over a period of time. Essentially clubs cannot continue to spend more money than they generate in revenue. The whole thing is a lot more complicated but if you have the inclination and the time check out all 90+ pages here (http://www.uefa.com/MultimediaFiles/Download/Tech/uefaorg/General/01/80/54/10/1805410_DOWNLOAD.pdf). I will concede that there are some good concepts introduced as part of the FFP such as protecting smaller clubs who rely on income from player sales to actually get paid on time though why on earth UEFA was not already doing that is anyone guess. City fans can at least accept this one is not aimed at them – I dare say Sheikh Mansour doesn’t struggle to pay his bills on time!

However the policing of clubs spending and their ability to take risk with their strategy is ridiculously prohibitive. Circling back to the obvious work around to the expenditure/revenue ratio, if Etihad want to sponsor Manchester City’s kit to the tune of £800m (Dhs 4,480 Billion) isn’t that a legitimate form of income? Here FFP gets all subjective, UEFA may not count such revenue (or a part of it) if it exceeds a similar deal that other clubs have with their sponsors (e.g how much Manchester United are paid by AON). While this satisfies the naysayers who think FFP can’t be applied, it leads to more questions of its legitimacy. Who decides what the benchmark for a kit deal is? Imagine being offered £1m for your house where the average price in the neighbourhood is £200k only to be told by your local council that you could only keep £220k due to fair play regulations!

All of this is designed to protect the interests of the established clubs, FFP will mean that the following clubs have the most power in the transfer market (in order of revenue income in 2011 (Deloitte):
· Real Madrid
· Barcelona
· Manchester United
· Bayern Munich
· Arsenal

These clubs you will be surprised to know are all part of the G14 cartel, as are all bar 2 of the top 10 clubs by revenue. This policing of football clubs under FFP will lead to the same inequities we’ve always had in the game but ensure the same old names stay at the head of the table. If UEFA truly care about fair play they should be looking at an NFL style draft system of players where the worst performing teams get to choose the best young players or better still keep their noses out of the whole thing altogether.