EPL and the Salary Cap.

[johntheclaret]

Unlike Aussie Rules where there are salary caps, essentially designed to keep an open competition, the EPL has a free for all leaving us in a position where a few mega rich clubs can pay whatever slaries they like / need to, to attrach the calibre of player they want.

Now there are calls afoot to introduce a salary cap. wondered what the thoughts of other are on here ????

Personally, I think it would be a good idea. Clubs are on a collision course with the credit crunch and simply can't sustain the salary levels they currently pay. In a recent survey, the EPL clubs are collectively more than £3bn in debt. Clubs like Wigan Athletic 100%, b4st4rd rovers 85% and even Liverpool with their huge earnings capacity on merchandise 44% have a wages bill disproportionate to their total income. and this percentage of total revenue, is just for the footballers, and doesn't include all other salaries, stewards, policing, admin or overheads.

Clubs like wigan with a smaller fan base and significantly less revenue through merchandising etc, are forced to operate at a loss in order to keep up with the Jones's.

[johntheclaret]

Here's what Platini thinks

Thanks to Sky.

Uefa president Michel Platini believes a salary cap needs to be introduced into football for the good of the game.

The topic of football finances has been debated in recent days with Football Association chairman Lord Triesman claiming English clubs currently owe an estimated £3billion in debt.
Triesman is pushing the idea of a salary cap to try and safeguard the futures of a number of clubs with the fear that the current economic crisis could see some teams go to the wall.

Platini has added his voice to the debate and believes a salary cap is a necessity to safeguard the game. However, the Frenchman insists a maximum level on wages will not happen for some time. "We have to speak about the number of contracts in the clubs, we can speak about salary but I am not an expert, I am an expert of football of the game," Platini told Sky Sports News. "The rest we have to learn. We have to go slowly and to look at what we can do, but it is necessary for the good of football."

League Managers' Association chief executive, Richard Bevan believes a salary cap in football is not the answer to the financial problems.
Some other sports have successfully implemented a salary cap, but Bevan says it will not work in football. "Too many people feel that salary caps is really actually about wage caps and that is actually illegal in Europe," said Bevan. "Rugby League and Rugby Union are two exceptions because they were in financial difficulties and people were keen to move into salary caps, but that is not the answer.

[johntheclaret]

Triesman adds weight to this problem

Thanks to Sky

Football Association chairman Lord Triesman has warned a salary cap may need to be enforced in English football.

Speaking at the Leaders in Football conference at Stamford Bridge, Triesman revealed English clubs face an uncertain financial future as they currently owe an estimated £3billion.
Triesman fears the current economic climate could cause major damage to English football, with it having been suggested some clubs could even go bust.

Bolton chairman Phil Gartside raised the idea of a salary cap to safeguard clubs' finances and now Triesman admits those measures may need to be carried out as he looks to resolve the game's financial problems.

Triesman believes wage levels have a damaging effect at all levels of the game in England and may no longer be sustainable in the global credit crisis. "The reason I made the point about the 12 per cent per annum growth in wages is because some of the money is flowing through the clubs inevitably, including some of the money that is in their debt package is in wages," Triesman told Sky Sports News. "I will be told in no doubt, if you want to compete at the highest levels you have got to be competitive in the wages market as well. "I just make the point there is a volume of debt which becomes very significant in those circumstances and people need to think about it. I am told by people right through the football pyramid, down in the leagues in the Blue Square Premier for example, below the Football League that the issues of working with agents, trying to deal with wages right through the system is now impacted.This is like a waterfall, the water is reaching right down to the ground-level.

Asked if a salary cap needs to be introduced, Triesman said: "People in the clubs are the only ones who will be able to judge that. I start with the general proposition that we have in this business, as in so many other businesses, we have a level of debt which should cause us to stop, think and review where we are."

[johntheclaret]

Speaking of b4st4rds and their footballers salary costs being 85% of revenue it's no suprice that they have come out in support of the idea.

Here's what thier chairman has to say, thanks to Lancashire Evening Telegraph

Blackburn chairman John Williams believes a Premier League salary cap could revolutionise football.

The Rovers supremo has backed calls for a limit to be placed on the amount clubs can spend on a total wage bill, helping to make the English top flight more competitive.
Football Association chairman Lord Triesman has announced that steps must be taken to curb the spiralling costs in the domestic game, with a wide-ranging review into football's finances set to be carried out.
Williams believes capping wages could help to restore equality, but has warned that any decision taken by the authorities must be carefully thought through before being implemented.
"I believe there are merits to bringing in a salary cap. The idea of capping to make everything equal in football really excites me, it would be like racing drivers changing cars with each other to stop the same Ferrari driver always winning," he told the Lancashire Telegraph.

"The problem with the idea of caps is when it is talked about in relation with debt and security. People say wages should be kept in relation to turnover and that would not help at all. If you said, for example, wages had to be 65 per cent of turnover, some of the bigger clubs' wages would actually have the capability to increase. People suggest capping as a financial security issue, that would make it even harder for the majority of clubs to compete in the Premier League."

Rovers currently sit towards the bottom of the Premier League's hall of shame when it comes to club debt, but are still £20million in the red.
The club also operates with a wage bill which uses 80 per cent of their annual turnover, meaning a value-related salary cap would see them fall even further behind the Premier League elite.

Williams added: "I love the concept of introducing it to increase competition though. My crusade is to increase competitiveness and not have a procession of a Premier League. A salary cap on equality would be the most fantastic thing and would lead to great sporting competition. But of course there are problems, football is a global game and bigger clubs say they would be disadvantaged. There are the practicalities of how you would do that as well. If you say players are contracted for three to four years, at what point do you bring it into action? Generally speaking if you flash the wage bills of all the Premier League clubs in a mirror, the league table would flash back at you. I think a balance needs to be struck, we have to retain that equality on a Saturday afternoon."

[JK]

Sorry Johnny I haven't read through all of those articles, but I think a salary cap would probably be a sensible idea, however it would have to apply to all leagues.

Could you imagine a Man U side trying to compete in the Champions league capped at say $200mil against a free spending Real Madrid?

[johntheclaret]

Agree, it would have to be a global agreement. and that's probably where the problem lies. Aussie rules doesn't have the global problem, neither does Rugby in the same sense as soccer.

No worries. I only post them in case anyone is interested.

[Dirko]

Interesting stuff the salary cap.
I think what the problem is, is that the EPL, is convinced it has to be the best league in the world, and therefore out compete $$$ value with the Bundesliga, Serie A, La Liga etc.
So one way to ensure the league stays at the top of the tree in regard to Champions League etc, is to ensure that the clubs can buy who they need to succeed (except Tottenham).
The winner of the Champions League, probably has bragging rights of being in the best league.
If they bought in a salary cap, it'd have to be a FIFA/UEFA ruling to ensure that the other big leagues follow suite and enforce salary caps as well. BUT it'd have to be a World ruling, as you could see the Arabs, packing up and going home, and then enticing Ronaldo, Rooney, Eto'o, Messi etc to go and play club football in Qatar for massive coin. I'm not convinced the players would say no, because at the end of the day money talks.
There should also be a quota of local bred players for each team also, say 75%, which would well and truly **** up Arsenal. This would allow the clubs without the cash to develop and get English footballers playing in the EPL...

As a point on interest the A-League has a cap of 1.9 m, and can also play a "marquee" player outside of that cap any amount. So United played Bunyodkor a couple of days ago and they reportedly pay Rivaldo 7 m per year, plus unknown amounts for the rest of the squad which comprises half of the national Uzbeki team. Fair call that Adelaide beat them 3 nil with a seventh of what they spend on players. The J League spend more.
Hard to compete on the big stage when teams you play have unlimited funds.....

[Bully]

interesting but i would never see a salary cap over there. also in regards to everyone saying arsenal is in major debt over player payments etc, think everyone is forgetting they recently moved to a new stadium and are paying that off which is more of a debt then player payments for us. once the new stadium is payed off then i think you will find that arsenal will find more money, hence the reason that Arsene doesnt spend big up on players, which in the long term will be better for the club seen the recent finance problems around the world. cant say the same for man united, not sure what they are doing seen as i dont spend my time on there web site and talking about them.

[devilsadvocate]

interesting but i would never see a salary cap over there. also in regards to everyone saying arsenal is in major debt over player payments etc, think everyone is forgetting they recently moved to a new stadium and are paying that off which is more of a debt then player payments for us. once the new stadium is payed off then i think you will find that arsenal will find more money, hence the reason that Arsene doesnt spend big up on players, which in the long term will be better for the club seen the recent finance problems around the world. cant say the same for man united, not sure what they are doing seen as i dont spend my time on there web site and talking about them.

I don't think anyone thinks it's Arsenal's wages bill that's the problem. As you say, it's the new stadium that's giving the club finance problems, but they certainly aren't in the worst position. But don't expect the new stadium to be paid off anytime soon!

The Arse are fortunate to have built their stadium when they did. Look at Liverpool, Everton and Spurs - new stadium plans are on hold probably for the next 3-4 years now due to inability to find sufficient funding.

[johntheclaret]

Don't forget the commercial property prices have crashed. what was a £400m stadium is prpbably only worth £300m now. That must have an effect on thier balance sheet if not on liquidity.

[devilsadvocate]

Best possible scenario:

Gooners walk away from their debt after seeing the value of Degenerates fall below their debt levels and hand the keys back to the bank. Move back to an overgrown park in Woolwich where they belong and their throng of bandwagon jumping 'fans' bugger off up the M1 to 'support' Man U over a prawn buttie.

The new North London Derby becomes Tottenham v Leyton Orient, in which we have an unprecedented run of success.