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When are the FFP fines going to kick in?



Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
I don't think FFP is about stopping investment. I think its primary aim is to control wages which is footballs biggest problem.

If Tony wanted to spend £150 million on another stadium and training ground then there is nothing to stop him. If he wanted to spend £150 million on transfers and wages over the next few seasons, he would be braking FFP rules.

I think its a good thing. Saying that a few financial experts seem to have reservations about the motives and set up of FFP, and I have to bow down to their superior understanding and am willing to believe that maybe it is not all that it seems and there could be a better way.

I used "investment" tongue in cheek. In my view there is a very good case that can be made to allow clubs to be funded by wealthy investors should they so chose and as long as it's done with good governence, such as ensuring that any commitments taken on such as players contracts are covered by normal revenues (including reduced revenues if relegated) plus a combination of guarantees and even cash deposits. It might not be an attractive proposition for said "investors" but it would stop the speculative stuff that has got many in trouble.

I'm more than happy to be corrected on this, but I can't see anything in FFP that prevents a club from racking up debt and going bust, they just need to do it differently
 


AZ Gull

@SeagullsAcademy Threads: @bhafcacademy
Oct 14, 2003
11,589
Chandler, AZ
I used "investment" tongue in cheek. In my view there is a very good case that can be made to allow clubs to be funded by wealthy investors should they so chose and as long as it's done with good governence, such as ensuring that any commitments taken on such as players contracts are covered by normal revenues (including reduced revenues if relegated) plus a combination of guarantees and even cash deposits. It might not be an attractive proposition for said "investors" but it would stop the speculative stuff that has got many in trouble.

I'm more than happy to be corrected on this, but I can't see anything in FFP that prevents a club from racking up debt and going bust, they just need to do it differently

You do realise that that is exactly what FFP is all about - gradually reducing how much of a loss a club can incur? In other words, moving towards a position of sustainability, where operating costs are covered by revenue?

And the reason that "racking up debt" in itself isn't restricted in FFP is that debt-funding for long-term investment (such as new stadia or training facilities - sound familiar?) can be a major factor in contributing to long-term sustainability.
 


Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
You do realise that that is exactly what FFP is all about - gradually reducing how much of a loss a club can incur? In other words, moving towards a position of sustainability, where operating costs are covered by revenue?

And the reason that "racking up debt" in itself isn't restricted in FFP is that debt-funding for long-term investment (such as new stadia or training facilities - sound familiar?) can be a major factor in contributing to long-term sustainability.

Correct me if I'm wrong but as far as I'm aware FFP limits a clubs loss ... it has nothing to do with debt. Debt normally requires a schedule of repayment which will then led to inevitable loss if revenue isn't sufficient but debt can easily be deferred, assets secured etc

Suggesting racking up debt for things like stadia, training grounds as being OK is also questionable. We are fortunate having TB but if we had commercially funded our £150M we'd likely be in the shit as the value I suspect is well below that. Also there's nothing in FFP that says a club can't rack up debt for whatever reason it wants, wages or infrastructure .. again please correct me if I'm wrong
 


andy1980

Well-known member
Feb 23, 2009
1,715
I used "investment" tongue in cheek. In my view there is a very good case that can be made to allow clubs to be funded by wealthy investors should they so chose and as long as it's done with good governence, such as ensuring that any commitments taken on such as players contracts are covered by normal revenues (including reduced revenues if relegated) plus a combination of guarantees and even cash deposits. It might not be an attractive proposition for said "investors" but it would stop the speculative stuff that has got many in trouble.

I'm more than happy to be corrected on this, but I can't see anything in FFP that prevents a club from racking up debt and going bust, they just need to do it differently
As I said I agree that I don't think its about debt, but rather a way of trying to control out of control costs on the playing side.

Tony has always said that he wants Brighton to be run in a self sustaining way. He doesn't want to put his own money in every year (or at least not millions). Surely the only way for him to do this without loosing ground with other teams is by being on the side of FFP in one form or another? Otherwise he will be competing against parachute money and rich benefactors.
 


Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
As I said I agree that I don't think its about debt, but rather a way of trying to control out of control costs on the playing side.

Tony has always said that he wants Brighton to be run in a self sustaining way. He doesn't want to put his own money in every year (or at least not millions). Surely the only way for him to do this without loosing ground with other teams is by being on the side of FFP in one form or another? Otherwise he will be competing against parachute money and rich benefactors.

We are competing against parachute money and FFP only makes the gap wider.

I fully accept and agree TB doesn't want to continually chuck his money down a deep hole but if he did, or if others did then they should be able to, as indeed they could with any other business.

And it is about debt. Where it's gone wrong in the past is clubs going out signing players on long term contracts which cannot be honoured on the current revenue stream and so promotion is vital to the so called sustainabilty. So even though so called "rich" owners have come in no, or very little cash, has come in. So the club then build (more) debt, albeit part deferred but it's a debt. On top of this clubs have also sold off their entre assets to fund the interim increase in cost so that when month 1 of not being able to pay wages comes the whole lot caves in.

It's the same for clubs coming down as much as it does those trying to go up

FFP does not address this, Its approach is too simplistic and one dimensional. It's also restrictive and I think will prevent money being injected in the lower tiers which (with proper governence) could be put to very good use.
 




Blue Valkyrie

Not seen such Bravery!
Sep 1, 2012
32,165
Valhalla
FFP and Parachute Payments are an unholy alliance with the aim of keeping the same teams in the Premier League. When it doesn't happen, they just increase the parachute size.

Scrap one or the other !
 


Creaky

Well-known member
Mar 26, 2013
3,835
Hookwood - Nr Horley
As I said I agree that I don't think its about debt, but rather a way of trying to control out of control costs on the playing side.

You're right, it isn't all about debt - but it should be!

What's often forgotten is that the FFP rules are decided on by the club chairmen, the very people that 99% of the time are those who cause clubs financial problems. They are not going to vote for a system that would genuinely help protect a club by limiting the amount of debt the club can hold - they want to be able to 'invest' in a club but still have a get out clause by loaning the club money rather than genuinely investing and buying equity.

The Bank of England is trying to protect the economy by insisting lenders stick to sensible loan criteria, specifically the borrowers ability to repay - they aren't however trying to prevent people from spending if they can afford it, quite the reverse.

The League could impose a similar system on clubs as regards majority shareholders making loans to their club.
 


Triggaaar

Well-known member
Oct 24, 2005
49,989
Goldstone
FFP seeks to punish clubs who spend too much money by fining them money. Thus worsening their problems (if they have any).
No it doesn't.

It seeks to punish clubs who 'win' at least £120,000,000 by taking a chunk of those winnings in fines
From our division, but at the top of the league the clubs breaking FFP rules have been fined.
 




Triggaaar

Well-known member
Oct 24, 2005
49,989
Goldstone
What's often forgotten is that the FFP rules are decided on by the club chairmen, the very people that 99% of the time are those who cause clubs financial problems. They are not going to vote for a system that would genuinely help protect a club by limiting the amount of debt the club can hold
Not all chairmen want to spend big to win, a lot of them would like a more stable model across the leagues, so many of them would (and did) vote for such a system.
 


Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
Not all chairmen want to spend big to win, a lot of them would like a more stable model across the leagues, so many of them would (and did) vote for such a system.

True. But I'm also (partly) aligned to the comments of [MENTION=25402]Blue Valkyrie[/MENTION] above. Even though it was a FL voted in thing "we've" shot a frigging huge great big hole in our foot. A third or more of the teams in the same league have a massive advantage over the others for no better reason than the chums payments they've received from the PL. So what do the FL do? They introduce a financial constraint to the others to make it even more difficult to compete!

I think the money in football generally is abhorrent but if it's to be then don't constrain anyone from wishing to compete. If TB (or anyone) wants to put cash into a club to fund wages to make a team more competitive then let them, I don't particularly like the idea but I'm realistic enough to recognise there's no turning back the clock (thanks Sky and PL breakaway!!) It needs governance and it needs to be real money, not guarantees or unrealistic revenue projections but real cash and that (imo) is where it has all gone wrong in the past and FFP is a friggin absurd remedy.

Rant over ... sry!
 


Triggaaar

Well-known member
Oct 24, 2005
49,989
Goldstone
Even though it was a FL voted in thing "we've" shot a frigging huge great big hole in our foot. A third or more of the teams in the same league have a massive advantage over the others for no better reason than the chums payments they've received from the PL.
One issue is that they've changed the rules since the clubs voted. The fines were supposed to go to clubs that are following the rules, and now they don't, which is ridiculous IMO.

Financial Fair Play is a poor choice of words. It's not at all fair. If the intention was to stop clubs going bust, then it should concentrate on the rules regarding debt. If it's to operate along the lines it currently does, I think clubs should have to hand in quarterly accounts, so that sanctions can be applied sooner. They should also impose limits on what clubs are allowed to do with their parachute payments (in terms of how their used in FFP calculations).
 




Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
One issue is that they've changed the rules since the clubs voted. The fines were supposed to go to clubs that are following the rules, and now they don't, which is ridiculous IMO.

Financial Fair Play is a poor choice of words. It's not at all fair. If the intention was to stop clubs going bust, then it should concentrate on the rules regarding debt. If it's to operate along the lines it currently does, I think clubs should have to hand in quarterly accounts, so that sanctions can be applied sooner. They should also impose limits on what clubs are allowed to do with their parachute payments (in terms of how their used in FFP calculations).

I couldn't agree more - talk about draining money out of football from the clubs that need it the most!

They could even go to monthly management accounts and if it were found they were frigging them when year end submissions were made they really get dumped on. Even with quarterly submissions and "real time" scrutiny, penalties like points deductions could be introduced.

In saying that I am still opposed to the notion of not allowing real cash to be put into a club if the "benefactor" wishes to do so

For me FFP is the predictable result of a bunch of out of touch old farts who sit in the so called governing bodies of football
 


Triggaaar

Well-known member
Oct 24, 2005
49,989
Goldstone
For me FFP is the predictable result of a bunch of out of touch old farts who sit in the so called governing bodies of football
The alternative ways of implementing a form of FFP have been debated more on NSC than they were by those that implemented them.
 


Rugrat

Well-known member
Mar 13, 2011
10,212
Seaford
The alternative ways of implementing a form of FFP have been debated more on NSC than they were by those that implemented them.

:thumbsup:

Gerald: "How do we stop clubs like Portsmouth, Croydon and Leeds going bust and causing us aggravation?"
Derek: "I'm not really sure I'm not a financial man, can't we just tell them they mustn't lose money?"
Gerald: "Good idea, another G&T?"
 




drew

Drew
Oct 3, 2006
23,007
Burgess Hill
FFP seeks to punish clubs who spend too much money by fining them money. Thus worsening their problems (if they have any).

Absolute farce. Those who came up with FFP have lost any idea of why they did in the first place. To save clubs from bankruptcy? Those fined so far being Man City and PSG?! Ha!

Why not just wait until clubs do get in trouble and then help them and enforce regulation at that stage?

If a rich benefactor wants to spend money on transfers and wages what's the problem?

Platini and the established top clubs didn't like the idea that clubs could be funded to progress to the top in swift fashion rocking the status quo. That's what it sought to restrict. Unfortunately if you have bottomless pockets you won't give a $hit whatever fines are dished out. Blocking entry into competitions such as the Champs league or relegating teams would probably be the only tangible punishment for the richest of clubs.

Transfer embargoes are an option but that doesn't seem to be stopping Barca at the moment!

I suggest scrap FFP, and put a fund aside from the TV deals cash to assist clubs and enforce regulation if they do get into serious problems.

Unbelievable that after everything that has been posted about FFP, the information available on other sites, people still haven't a clue as to what sanctions will be imposed! For your information, Man City and PSG have been fined under a totally different governing body and under different rules.

Does FFP prevent a club from racking up massive deferred debt, or taking on forward commitments that it might not be able to fulfill? I may well be wrong but I don't think it does either, in which case FFP doesn't guarantee much at all (other than perhaps limiting much needed "investment" further down the food chain)

We are competing against parachute money and FFP only makes the gap wider.

I fully accept and agree TB doesn't want to continually chuck his money down a deep hole but if he did, or if others did then they should be able to, as indeed they could with any other business.

And it is about debt. Where it's gone wrong in the past is clubs going out signing players on long term contracts which cannot be honoured on the current revenue stream and so promotion is vital to the so called sustainabilty. So even though so called "rich" owners have come in no, or very little cash, has come in. So the club then build (more) debt, albeit part deferred but it's a debt. On top of this clubs have also sold off their entre assets to fund the interim increase in cost so that when month 1 of not being able to pay wages comes the whole lot caves in.

It's the same for clubs coming down as much as it does those trying to go up

FFP does not address this, Its approach is too simplistic and one dimensional. It's also restrictive and I think will prevent money being injected in the lower tiers which (with proper governence) could be put to very good use.

I think too many are expecting FFP to be the cure all for every ailment in the football league. Yes, parachute payments considerably unbalance the fairness but those payments don't always ensure that a club goes back up. I don't know but I suspect that the current FFP will be the first step. Stop clubs making huge losses and that will slow down the escalation of debt. I do agree with Rugrat in that people with money should be allowed to spunk it away on anything they want. However, most don't, they convert it to loans so it becomes debt when they get fed up with their pastime and move on.

One issue is that they've changed the rules since the clubs voted. The fines were supposed to go to clubs that are following the rules, and now they don't, which is ridiculous IMO.

Unfortunately, that was never a rule, just a proposal that needed ratification from the Premier League. Ratification that never came hence the money now is due to go to charity. It would have been better for the PL to support the original proposal as it would further incentivize clubs to meet FFP. Wouldn't it be good to have a sizeable chunk of the fine likely to be handed out to QPR!
 


Triggaaar

Well-known member
Oct 24, 2005
49,989
Goldstone
Unfortunately, that was never a rule, just a proposal that needed ratification from the Premier League.
I don't believe it really NEEDED ratification. The clubs would be fined for what they did when in the football league, so the fact that they're now in the PL doesn't change anything from a legal perspective. The FL just want to keep the PL happy.
 


drew

Drew
Oct 3, 2006
23,007
Burgess Hill
I don't believe it really NEEDED ratification. The clubs would be fined for what they did when in the football league, so the fact that they're now in the PL doesn't change anything from a legal perspective. The FL just want to keep the PL happy.

The point is that when the fine is actually levied, they will not be under the governance of the Football League (ie, not members of the FL) hence the need for the Premier League to agree. I don't like it but that's the way it is.
 


Triggaaar

Well-known member
Oct 24, 2005
49,989
Goldstone
The point is that when the fine is actually levied, they will not be under the governance of the Football League (ie, not members of the FL)
I'm not sure why that should matter, it's a fine for what they did when in the FL. If that's not the case, the FL should just make club put there accounts in earlier.
 




drew

Drew
Oct 3, 2006
23,007
Burgess Hill
I'm not sure why that should matter, it's a fine for what they did when in the FL. If that's not the case, the FL should just make club put there accounts in earlier.

Of course it matters. As soon as the club is promoted the FL effectively have no jurisdiction over them hence the need to for some sort of agreement with the PL. They could wait until the club are relegated again then penalise them then but that might not happen for a number of years if at all! With regard to the accounts, it doesn't really matter when they are submitted as long it is before the next transfer window. Ideally they would be submitted before the close season window but then you are requiring clubs to submit accounts immediately the season has ended which is not practicable.
 


Triggaaar

Well-known member
Oct 24, 2005
49,989
Goldstone
As soon as the club is promoted the FL effectively have no jurisdiction over them
The FL are allowed to have rules. To be in the league, your club would have to agree to those rules. If those rules are that you can be fined if you spend too much, then you can be fined according to those rules, regardless of the fact that you're no longer in the league. You will have signed to say that's ok.

With regard to the accounts, it doesn't really matter when they are submitted as long it is before the next transfer window. Ideally they would be submitted before the close season window but then you are requiring clubs to submit accounts immediately the season has ended which is not practicable.
I actually don't think it would be that impractical. Clubs will be sorting their accounts out for the current season before they know what business they can do in January. It really doesn't take a lot of effort to show these accounts as they're filled in.
 



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