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League One Salary Cap a Step Nearer
Wednesday, 17th Jun 2020 14:37

Salary caps at League One and Two levels have moved closer with an EFL annual general meeting yesterday reducing the number of clubs required to vote in favour of the move.

Last month, it emerged that the EFL’s Financial Controls Working Party had recommended wage caps of £2.5 million for League One and £1.25 million for League Two.

At yesterday’s meeting a resolution was passed which means it would take a two-thirds majority rather than 75 per cent of clubs to make changes to divisional Financial Fair Play rules.

It’s understood clubs in Leagues One and Two are generally in favour of implementing new regulations due to the financial issues created by the coronavirus pandemic. Championship clubs are less keen but with discussions continuing.

According to The Times, the £2.5 million and £1.25 million limits would include all player costs including agents’ fees. Firm proposals are set to be voted on before the start of the new season.

Currently, League One clubs have to adhere to the division's SCMP Financial Fair Play rules, which stipulate that player wages can’t be any more than 60 per cent of turnover, 75 per cent in the first year down from the Championship, although with three-year contracts signed before September of the relegation year and those of young pros aged under 21 not counting towards the cap.

Town backed the introduction of Financial Fair Play when it was brought in by Championship clubs in April 2012, although owner Marcus Evans was critical of more recent developments which saw the limits greatly increased at second tier level.

The Blues are less likely to be fans of the current League One proposals, which are lower than many anticipated and would require Town to cut their wage bill significantly.

In their last season in the Championship the Blues’ overall wage bill was £18.95 million with player wages understood to have made up around £11 - £12 million of that figure.

After relegation, many players’ salaries dropped as a result of clauses in their deals, by as much as 60 per cent in some cases, however, the Blues’ player wage bill is almost certainly more than double, perhaps three times higher than the proposed £2.5 million limit and will be one of the largest in the division.

Also at yesterday's meeting, EFL clubs formally rubberstamped the appointment of Rick Parry as chair on a three-year term until June 2023, having been appointed by the EFL board earlier in the season.

Photo: TWTD

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ITFCsince73 added 15:04 - Jun 17
So the club will have paid about 4m in player wages come Sept. Without 1 paying supporter through the door. Add Lambo and his staff to that. Austerity at the club, like never seen before.
I’ll say goodbye to Downes and the Woolf many of our better players leave remains to be seen. The clubs greedy playing staff unfortunately to blame.

muccletonjoe added 15:10 - Jun 17
Pity the cap doesn't include managers salary

hoppy added 15:25 - Jun 17
I guess that would mean a definite no to Garbutt joining on a permanent deal, rather than the 'I wouldn't rule it out' that he's quoted as having said, wouldn't it?

TJS added 15:43 - Jun 17
Just need to add the inevitable exemption for clubs relegated from the Championship and our fate will be sealed.

runaround added 15:55 - Jun 17
It’s the only way to save clubs from financial ruin I guess but it’s going to hit ITFC hard. Clubs & players will have to adjust to it & it won’t be easy.
Going forward I can see players contracts even more being based on what division they are playing in. The top players will continue to get very big money but for those outside the premier league I think the gravy train will be considerably slower!
I also suspect clubs will be looking at finding loopholes in any salary caps although I’m not sure selling your ground every 5 minutes like Derby do will help in this case!

leftie1972 added 16:00 - Jun 17
So it would then follow that the Championship and Premiership should have wage caps of roughly 10-20 million right? 🤣

heathen66 added 16:51 - Jun 17
If there are to be wages cap then this should be an EFL decision and not Just L1 and L2.
However as we have seen with the likes of Wolves Leeds and Derby there are always ways around it...and here is the important bit....if you want to.
However as we have seen there are also different EFL rules if you are L1and L2 as opposed to the Championship where their seasons will be completed and ours won't
The EFL rules should apply to all 71 clubs, not just as select few.

heathen66 added 16:55 - Jun 17
What this does mean is that many clubs will have to manage their finances better and there will be clubs even in the championship what will have lost £ms during the pandemic and will be offering players free. Also if there are wage caps then many players will be wary of not having jobs / team places and will perhaps come for a lot less.
It is a real shame we have used up much of our budget on aging has beens !!!

Cloddyseedbed added 17:42 - Jun 17
Without the Premier League and Championship following it will just make things worse. It must be implemented in all leagues in all Countries. Players wages and transfer fees are not in proportion to what clubs can earn, what other business can run like that and keep going?

Saxonblue74 added 17:53 - Jun 17
That should lead nicely to more and more bench warmers in the higher leagues then! Money seems far more important to players than actually trying to forge a career on the pitch! Won't do a lot to add to improve the fortunes of our national side either.

fistpumpfury added 21:19 - Jun 17
We’ll never ascend from this league now. Championship and PL will be laughing as it cements a certain stability to them forever. We are now, officially, a league one club for the foreseeable future. What an utter shame and humiliation has now befallen us.

runningout added 22:04 - Jun 17
We got ourself in this mess. Onwards and ..

Blue041273 added 22:08 - Jun 17
I am not as pessimistic as some! A salary cap will level out the playing field and will in the fullness of time see a greater emphasis on building a team through good coaching and inspiring man management. Squads will be smaller and contracts on offer will be shorter! A new meritocracy will evolve where player reward aspirations will be achievable only if they can earn a contract with a club in a higher division with more leeway salary wise! In such an environment, with an enlightened manager with a much larger pool of unattached players to draw from augmented by a productive academy, we should be capable of being competitive! Lots of ifs and buts but that is what Sir Alf achieved in the days of the maximum wage!

MickMillsTash added 23:52 - Jun 17
What it means is that owners of well supported clubs can pocket lots of money by missing out on promotion year after year.

If Fair play was administered properly surely this isn't needed.

WeWereZombies added 07:02 - Jun 18
At least the required majority for this change, which is significant but not fundamental and only affects football, is still set at two thirds; unlike another more consequential and far reaching vote that was allowed to be put in effect with scarcely more than a simple majority with a lowish turnout on a fifty/fifty basis of those who did bother to vote.

d77sgw added 09:43 - Jun 18
Don't be silly, this is far more important than driving the economy over a cliff in the name of nostalgia - this is football!!!!!

cornishblu added 10:12 - Jun 18
I am with the not so negative .Salary caps will mean a level playing field and demand greater financial control.
Premier clubs who are hoovering up talent will think twice as there will be little scope for loaning back and recouping the inflated wages , unless they are prepared to support by paying a significant part .If they do this the risk becomes more theirs than the receiving clubs . Premier clubs will want even their home grown talent to go on loan so again lower player cost for lower clubs .
Will also prevent old journey men getting their last pay day and then relaxing , our club have had too many of those over the years draining resource that we could ill afford and of course then blocking the way for taking a risk on youngsters .
Rewards will come through performance , promotion , cup runs etc (remember those !!) ....
Down side , there will always be a Saracens of the football league that seek to exploits loop holes , just need the EFL to be as determined as their rugby counterparts and enforce the rules .

....just how many Bury supporters would have anted this years ago...they may still have their club !

......anyway if we don’t like it best we get promoted !! COYB

Razor added 10:48 - Jun 18
I guess this will make it fairer for everybody and create a level playing field.

If anything we will actually lose out as we do have an owner with money who could more in if he ever wanted, now he will not be allowed to do so.

So get your cheque book out now Marcus and get your spending done

Monkey_Blue added 13:36 - Jun 18
I fear this will create an even bigger gulf between league one and the championship. Teams being promoted will be so far adrift in quality of squads staying up will be incredibly hard, similar to promotion to the premiership. I know the budget would go up if you were promoted but it could require a huge squad overhaul and that’s not easy to manage in one off season.

Monkey_Blue added 13:45 - Jun 18
English football should be working towards closing the gap between the divisions not making it bigger.

Bergholtblue added 13:50 - Jun 18
I can see the merits in this but can also see potential problem areas that need to be addressed.

1. It will only work successfully as long as Championship sides are signed up to it.
a) A salary cap would make developing good young talent through the youth system essential, but such players would be off at a drop of a hat if salary differences between Championship and L1/L2 cubs become vast.
b) If they don't sign up to it, the disparity between Championship and L1/L2 clubs would be so great that it would become like the Premier league, where it is so difficult for a promoted club to assemble a squad talented enough to compete at the higher level.

2. Like the current FFP rules, some clubs will try to bend the rules, exploit loopholes, etc. There must be adequate auditing of the accounts and impose proper penalties on any club transgressing.

3. £2.5 m doesn't seem very much if you have to include all player costs including agents fees. If our wage bill is £11-12 m, as suggested above, we would have to loose half of our playing staff and not be able to buy anyone else in.

TimmyH added 15:46 - Jun 18
Should have a salary cap in the Premiership and Championship as well which would make the leagues far more per the NFL.

Bert added 18:34 - Jun 18
In principle a salary cap is right but it can only work if it is fair throughout. This won’t happen unless FIFA make it obligatory in every country.

rabbit added 18:49 - Jun 18
Sadly I think this is going to play squarely into the hands of the very large teams, lower division sides will effectively become feeder clubs almost just reserve teams for them.
In essence this has been on the cards since the inception of the Premier League and whilst the English League remains the most popular world wide the sponsorship will dictate what happens.
A great shame in my opinion.

istanblue added 20:16 - Jun 18
Bit of a misleading headline tbh.

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