FFP latest predictions

symyjym · Nov 6, 2014

"They will be allowed to lose up to £15 million in total between 2016-17 and 2018-19 without specifying how the loss will be funded." (An invite to money launder a few million without any questions?)

"The permitted loss rises to £39 million subject to additional regulation, including evidence of secure owner funding and future financial information." (Back to square one apart from having to prove you can afford to lose money ?)

Sounds like it has been a complete waste of time writing the elaborate FFP rules in the first place instead of sticking to the basics from the start.

KZNSeagull · Nov 6, 2014

Goldstone1976 said:
Yes, exactly. From 16/17, the new framework (profit and sustainability) is introduced, with new (as yet unspecified) precise rules, but with the ability to lose up to £39m over 3 years (£13m pa). As a transitional measure the FFP rules will remain place for next year, but the acceptable loss increases from £4m to £13m...

But the existing FFP framework for 2015/16 is max permitted loss of 5m. On the one hand they are saying we have this season and next on existing rules, then they say effectively this season only on existing rules.

I dunno - will have to wait for Mr Barber's essay on the matter.

El Presidente · Nov 6, 2014

symyjym said:
Sounds like it has been a complete waste of time writing the elaborate FFP rules in the first place instead of sticking to the basics from the start.

What basics are you referring to?

Goldstone1976 · Nov 6, 2014

KZNSeagull said:
But the existing FFP framework for 2015/16 is max permitted loss of 5m. One the one hand they are saying we have this season and next on existing rules, then they say effectively this season only on existing rules.

I dunno - will have to wait for Mr Barber's essay on the matter.

I think the disagreement between us revolves around the word "framework". You seem to be interpreting it as including the specific loss number (btw, I thought next season's acceptable loss was £4m, not £5m, but I could be wrong), whereas I think it just means the specific rules (for example what costs are and are not included), and not the acceptable loss number.

As you say, no doubt PB will put pen to paper in some way...

EDIT: You're quite right about the acceptable loss for next season before today's vote - it's £5m not £4m

KZNSeagull · Nov 6, 2014

Goldstone1976 said:
I think the disagreement between us revolves around the word "framework". You seem to be interpreting it as including the specific loss number (btw, I thought next season's acceptable loss was £4m, not £5m, but I could be wrong), whereas I think it just means the specific rules (for example what costs are and are not included), and not the acceptable loss number.

As you say, no doubt PB will put pen to paper in some way...

Yes, that is our disagreement - I reckon the 13m starts 2016/17, you reckon it effectively starts 2015/16.

We will wait and see what PB says - I would imagine he is penning his essay now before the awards tonight!!

Gordon Smith's Paperboy · Nov 6, 2014

KZNSeagull said:
Yes, that is our disagreement - I reckon the 13m starts 2016/17, you reckon it effectively starts 2015/16.

We will wait and see what PB says - I would imagine he is penning his essay now before the awards tonight!!

According the The Argus (!) it starts next season

SAC · Nov 6, 2014

TWOCHOICEStom said:
The only punishment they could hand out to the teams that have so far ignored FFP is to prevent promotion. Everything else is a relative waste of time if you ask me. ESPECIALLY if the rules are to be relaxed in 2 years.

If the accounts are not submitted until 8 months after the season ends, it's impossible to prevent promotion. I don't really agree with FFP, mainly as it excludes debt as if this isn't a problem for clubs, but I do think the punishments (a fine if promoted and a transfer embargo if not) were as fair as possible.

Diego Napier · Nov 6, 2014

El Turi said:
They are on the football league site. I misread it as clubs can now make an aggregate loss of £39 million over a 3 year period, which is still a very different principle to the original FFP rules.

How do you work that out?

The principle is exactly the same; a penalty is imposed for overpend. The time period and penalty have simply been varied.

Diego Napier · Nov 6, 2014

Everest said:
Read the report.
The new rules come into force for the 2016/17 season.
The existing Championship FFP framework will remain in place for the 2014/15 and 2015/16 seasons.
Any sanctions for accounts relating to the 2013/14 season will continue to take effect as intended (and in accordance with the amounts specified at the time).

Everest, well done.

You've done a valliant job on this thread continually pointing out the obvious to those who haven't the patience/sense to read the facts or apply some logic before they sound off!

El Turi · Nov 6, 2014

Diego Napier said:
How do you work that out?

The principle is exactly the same; a penalty is imposed for overpend. The time period and penalty have simply been varied.

The previous FFP rules were about clubs reducing the losses each year whereas clubs are now allowed to make big losses again.

halbpro · Nov 6, 2014

Diego Napier said:
How do you work that out?

The principle is exactly the same; a penalty is imposed for overpend. The time period and penalty have simply been varied.

Because, in principle, it lets you front load a bunch of costs into one season if so wished. Gamble on one season, with the only punishment being that you have to reign it in if you fail.

Goldstone1976 · Nov 6, 2014

I've just spoken to PB, who said the following:

1) the club voted in favour of the change. The principle reason why the club did is because since the original acceptable losses under FFP were agreed, the parachute payments for clubs being relegated from the PL have increased by c50%, thus dramatically penalising clubs without parachute payments. The club would have preferred the increase in acceptable losses not to have been as high as it turned out to be, but decided to vote in favour "for the greater good".

2) the acceptable loss next season will now be £13m, not the £5m it was previously agreed to be. He described the additional acceptable loss of £8m as "massive", which of course it is.

3) he declined to answer my question concerning whether TB would be prepared to fund a loss of as high as £13m next season (citing commercial sensitivity and the fact that the Board will need to discuss the outcome of today's meeting first - which is entirely reasonable. I was a bit cheeky asking, tbh) but stressed the following:

a) By agreeing to an increased acceptable loss, TB has the opportunity to fund losses of up to £13m next season if he is prepared to go that high.
b) the club's ambition remains to be promoted to the PL and the club's policy will continue to be to have a squad that is competitive.
c) the club took the decision to vote in favour, taking due cognisance of the possibility that, after promotion, we may, "God forbid" be relegated at some point thereafter.

4) rumours of TB becoming disinterested in the club or of intending to sell are "nonsense".

5) as previously stated, he expects the club to have met the FFP limit of £8m loss last season. Further, the club is "on track" to meet the maximum loss of £6m this season.

He reiterated his prior statements that he wishes to be as open with fans (yes, that was the word he used) as possible, hence agreeing to answer my questions.

He knows I'm making this post.

symyjym · Nov 6, 2014

El Presidente said:
What basics are you referring to?

Just by keeping a rigorous check on the owners credibility, whether current or with future takeovers. FFP rules have been a complete overkill for a solution in reaction to bad club ownership, and in 3 seasons time it will be much the same as it was but with validating affordable losses. It is pretty much a complete U-Turn on something that took many years in the planning.

It looks like people have just been blowing fairy dust to make it look like their salaries look like good value. A bit like Greg Dyke spending time to come up with a proposal to implement a B League.

Diego Napier · Nov 6, 2014

El Turi said:
The previous FFP rules were about clubs reducing the losses each year whereas clubs are now allowed to make big losses again.

I think you'll find that the FFP rules or their principle addresses clubs sustainability and responsibility and tries to prevent them rooking over the hundreds of large, medium and small businesses that are impacted if they go into administration. The implementation of the rules is through a stepped reduction in allowable deficits which will now remain until 2016/17. The changes agreed today are still impacting implementation and not principle.

Diego Napier · Nov 6, 2014

halbpro said:
Because, in principle, it lets you front load a bunch of costs into one season if so wished. Gamble on one season, with the only punishment being that you have to reign it in if you fail.

That is practice not principle.

jgmcdee · Nov 6, 2014

Goldstone1976 said:
a) By agreeing to an increased acceptable loss, TB has the opportunity to fund losses of up to £13m next season if he is prepared to go that high.

Is it just me that thinks this is a horrible situation for TB? He either puts in a lot more money next season or he watches everyone else do so and end up with stronger squads.

Can't say that I'm a fan of either outcome.

seagullsovergrimsby · Nov 6, 2014

Can we buy back Ulloa for £8M next season ?

El Presidente · Nov 6, 2014

jgmcdee said:
Is it just me that thinks this is a horrible situation for TB? He either puts in a lot more money next season or he watches everyone else do so and end up with stronger squads.

Can't say that I'm a fan of either outcome.

You're assuming there are 23 other clubs in the Championship who have owners willing to spunk £13 million on a gamble to get promoted. I don't see that myself.

Goldstone1976 · Nov 6, 2014

jgmcdee said:
Is it just me that thinks this is a horrible situation for TB? He either puts in a lot more money next season or he watches everyone else do so and end up with stronger squads.

Can't say that I'm a fan of either outcome.

I'd agree with your analysis of TB's options, but presumably he was aware of them before giving the go ahead to PB to vote in favour? If so, the implication is that TB will be prepared to fund increased losses, at least in the short term, though whether his appetite will extend to the full £13m is debatable, especially as the club would have preferred the increase to have been lower...

El Presidente · Nov 6, 2014

Diego Napier said:
I think you'll find that the FFP rules or their principle addresses clubs sustainability and responsibility and tries to prevent them rooking over the hundreds of large, medium and small businesses that are impacted if they go into administration. The implementation of the rules is through a stepped reduction in allowable deficits which will now remain until 2016/17. The changes agreed today are still impacting implementation and not principle.

Businesses go into administration due to cash, not profit, issues though.

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