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EDITORIAL Gulf stream The Premier League and EFL are once again at an impasse over proposals to redress their vast imbalance Anew record may be set in the Championship in 2023-24, but not one that most clubs and their supporters will want to celebrate. All three teams who came down from the Premier League (PL) last season look well placed to bounce straight back. The gap in standards has never seemed more stark. At the time of writing, only last season’s League One runners-up, Ipswich, are splitting the relegated trio. Leicester are ten points clear at the top, while Southampton and Leeds are third and fourth, with 12 points separating the latter from the fifth-placed club. As ever the parachute payments for clubs dropping down to the Football League (EFL) are having a major effect. During this season the three will receive 55 per cent of the broadcast income paid to PL clubs, with the share dropping over the next two seasons if they fail to get promoted, down to 20 per cent in the third year. In 2023-24, this will mean over £50 million per club. The annual revenue generated by the other 21 Championship teams averages out at around £20m, with some making far less than that. The team finishing 20th in the top division invariably earns several times as much as the title-winners at the second level. This imbalance was meant to be addressed, finally, through the New Deal for Football, a set of proposals for reforming the game’s finances. While this only acquired its title in 2023, the two leagues and the FA had begun discussions during the pandemic when many clubs feared for their survival. The EFL’s principal suggestions were that parachute payments be scrapped altogether and that they should receive a significant share of the higher league’s revenues from domestic and overseas broadcasting (representing around £925m to the 72 League clubs over a six-year period). The PL has not been able to agree to either proposal. This despite having recently arranged a four-year TV contract from 2025-26 worth £6.7 billion, which was trumpeted on their social media as “the largest sports media rights deal ever in the UK”. I M A G E S G E T T Y Chief executive Richard Masters continues to defend the Premier League’s grip on football’s purse strings Speaking to parliament’s Culture, Media and Sport Committee on January 16, EFL chief executive Rick Parry told MPs that the PL “could have made an Masters was unable to offer convincing reasons for the deadlock between the two leagues, but we can assume that the key one is the wealthiest clubs’ dogged resolve to maintain the financial gulf between themselves and the rest offer at any time over the last 30 years and they haven’t”. Parry can speak with some authority about the attitudes likely to prevail among PL chairmen, having been the organisation’s chief executive for the first few years after it was created in 1992. The present incumbent, Richard Masters, also spoke at the meeting and by common consent did not make a good impression. He was unable to offer convincing reasons for the deadlock between the two leagues, but we can assume that the key one is the wealthiest clubs’ dogged resolve to maintain the financial gulf between themselves and the rest, both at home and abroad. When accounts for 2022-23 are published, the difference in annual turnover between the top English two divisions is expected to be around £5bn; the PL’s annual wage bill is currently around £2bn more than any of the other big five European leagues. As the changes to UEFA’s club tournaments from 2024-25 will involve extra matches, Masters’ employers want to reduce domestic fixtures by scrapping FA Cup replays and making League Cup semis into one-off games. According to Parry, the EFL would accept this if the trade-off involved their extra funding. With that in place, there would no need for the parachute payments, described by Masters, in one of his more risible statements at the DCMS meeting, as “a critical part of the Premier League system”. The PL’s counter-proposal, which we’ll have to assume was made in good faith, would retain the parachute money and allow relegated clubs to allocate 85 per cent of their revenue to wages, with a limit of 70 per cent for the other Championship clubs. This would mean the three teams coming down being able to spend around five times as much as their divisional rivals, which is more than they can now. The impending Football Governance Bill will create an independent regulator able to impose a financial settlement on the warring leagues. But that will be diligently resisted by the PL, who are always going to have plenty of money to lavish on lawyers. WSC 5

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