In the light of the Rugby Union Club Saracens getting relegated for breaking a salary cap, I thought I would look at footballs equivalent. It seems to me that FFP is more about making losses than any salary cap, so if the owners can legitimately pay the club money for advertising say to cover losses, clubs like Man City can pay what they want. The richest club will win the most trophies. Recruitment bans seem another kettle of fish, with Chelsea and Barcelona falling foul of those rules, but does not stop them having loads of under 23 and academy players sending most out on loan. Football seems a mess... Financial fair play: All you need to know about how it works We are hearing more and more about financial fair play (FFP) in football, with clubs across Europe already facing punishments for breaching its rules, but how does it work? BBC Sport explains why it was brought in and how clubs in breach of the regulations can be punished. 1. What exactly is FFP? It wasintroduced by Uefato prevent clubs that qualify for its competitions from spending beyond their means and stamp out what their president Michael Platini called "financial doping" within football. Platini believes the big spending of some clubs is ruining the game and feels that the level of debt carried by many is unsustainable. 2. What must clubs do to comply with FFP? Uefa made its first FFP ruling in April based on club accounts from the 2011-12 and 2012-13 seasons. Clubs can spend up to 5m euros (£3.9m) more than they earn per assessment period, although, under this monitoring period, total losses of 45m euros (£35m) were permitted as long as clubs had owners who could cover such amounts. From now on, the assessment will be made over a rolling three-year period. For 2014-15, losses will still be limited to 45m euros (£35m). For 2015-16, the monitoring period will again cover the previous three seasons, but the limit will drop to 30m euros (£25.5m). The pattern is repeated in 2016-17 and 2017-18. In the following years the limit will be lower, with the exact amount still to be decided. Clubs are also obliged to meet all their transfer and employee payment commitments at all times. 3. What is covered by FFP? Clubs need to balance football-related expenditure - transfers and wages - with television and ticket income, plus revenues raised by their commercial departments. Money spent on stadiums, training facilities, youth development or community projects is exempt. 4. Who polices the regulations? The Club Financial Control Body (CFCB) was set up by Uefa to oversee the application of the its Club Licensing System and Financial Fair Play Regulations. 5. What are the possible sanctions for clubs in breach of FFP? "The atomic bomb is a ban from European competition," saidJean-Luc Dehaene,the first chairman and chief investigator of CFCB, back in 2011 (Dehaene died in May 2014). The CFCB's investigatory chamber can offer clubs settlement agreements, with potential punishments including warnings, fines, withholding prize money, transfer bans, points deductions, a ban on registration of new players and a restriction on the number of players who can be registered for Uefa competitions. 6. So how does that affect big European teams? Nine clubs were found to have breached the FFP criteria in the first assessment period, most notablyManchester Cityand Paris St-Germain, and a range of fines and sanctions were imposed. City were fined £49m, £32m of which was suspended, had spending restrictions imposed and could only name a 21-man Champions League squad for 2014-15. 7. Can punishments be overturned? We will see. Jean-Louis Dupont, a lawyer who helped win the landmark Bosman case, haslaunched a legal challengewith the European Commission, claiming that FFP breaches European competition law. Anindependent Manchester City supporters' club,which has 15,000 members, has voted to back the complaint. Clubs could also appeal to the Court of Arbitration for Sport. 8. And why are Liverpool being investigated? Because they posted losses of £49.8m in 2012-13 and £41m in 2011-12 and areback in European competitionthis season having qualified for the Champions League. 9. Is there just one form of FFP? No. The Premier League has brought in its own form of financial regulation which is not as stringent as Uefa's FFP. Clubs cannot make a loss in excess of £105m across the 2013-14, 2014-15 and 2015-16 seasons (as with FFP, investment in infrastructure and youth development is exempt). Any club that posts losses in excess of that figure could face severe penalties, including a points deduction. A loss between £15m and £105m has to be guaranteed by club owners. The league has also introduced a short-term cost control measure in which clubs are restricted in the amount of increased PL central funds that can be used to improve player wages. The increase in wages from the fund was limited to £4m in 2013-14, £8m in 2014-15 and £12m in 2015-16 (wages can be increased from clubs' own commercial revenue). 10. Any clubs at risk of failing this test? Most notably, QPR. They posted losses of £65.4m, with a wage bill of £68m, in their 2012-13 accounts. Chairman Tony Fernandes has indicated he would appeal against a fine from the Football League, which would be around £54m if losses for Rangers' promotion season matched the 2012-13 figures. There is a sliding scale on the next £10m of losses, with a maximum fine of £6.681m. Once losses exceed £18m, the fine is imposed on a strict pound-for-pound basis. If there is an overall loss of £30m, the fine would be almost £19m. If it was £50m, the figure would be nearly £39m. If the club don't pay, the league can block entry to its competitions, which theoretically could force QPR down to the Conference if they were relegated from the Premier League in 2014-15. 11. And what about Leagues One & Two? These clubs already have a limit on spending as a percentage of turnover. Any club that is deemed to have breached the permitted spending threshold can be subject to a transfer embargo.
Fining clubs half the amount of the losses they have already declared surely makes it worse for the clubs? Or am I missing something here... Just going from one of your last paragraphs.... "Should there be an overall loss of £30m, the fine would be almost £19m. If it was £50m, the figure would be nearly £39m." So instead of losses of 30m and 50m... these clubs would then have to post losses of 49m and 89m??? Where does the money from these fines go?
On the face of it, as in Rugby, having a salary cap, would promote more of a level playing field for competition. IIRC i think Formula 1 has been trying to put limit on what teams can spend to make the racing fairer and more exciting, Ferrari I believe do not want to see this and have threatened to pull out f it occurs. They spend the most and want to keep that advantage. The rules that football have, as you indicate , seem to have the opposite effect since if you make loss, trying to keep up with the big spenders, then you could be financially punished, making losses bigger, and suffer relegation, point loss? Of course the argument is that this means clubs will have to keep their income and expenditure in line, so small clubs with low turnover will never be able to compete with the bid spending clubs who have a high turnover.... hardly a level playing field, as it were, and certainly not financial fair play!
This is exactly what I was thinking, it does in all honesty make it look like FPP is there to keep the those that are rich, rich and make the poor, poorer.... For those that are already a global brand mostly derived from the last 30yrs (Man U, Liverpool, Arsenal, Spurs, Man City, Chelsea) financially it would look as these would always be set up for success given the money that they make outside of the PL. Lets take say MK Dons.... has a multi billionaire with endless spending power and the ability to put 10billion quid into the club each year (without actually spending it) It will NEVER be able to compete for their spend will always be more than their income as they will I guess be unable to become a global brand to cover the spend... subsequently... youd need to absorb fines year on year, even if you won the bloody PL. Ergo... you need to be a popular draw outside of the PL/UK to bring in the additional income to cover your spend.... If you replaced the aforementioned 6 teams with, MK Dons, Grimsby, Bury (rip), Halifax Town, Dover Athletic, Salford City as the top 6 premier teams.... not one would be sustainable due to the fines imposed upon them AND the fact internationally they would never get the same sort of revenue streams any of those clubs previously mentioned can pull in. Im making myself quite depressed about it all really
