The artist formally known as FFP reared its head against yesterday as Everton and Nottingham Forest were charged with breaching Premier League Profitability and Sustainability Rules (PSR).
As expected, fans of both clubs have come out to slam the rules and the potential punishments. But they should be turning their anger on their owners for the poor management of the clubs.
PSR exists to protect clubs from sending beyond their means. It controls the expenditure of clubs against their income and punishes those that break its rules. Without it, clubs would be free to spend what they wish, putting their future at risk.
Whilst fans protest the Premier League for the introduction of rules, they would be protesting their owners in 2 or 3 years time if spending went unchecked and the clubs they love went bankrupt.
FFP was first introduced by UEFA in 2009 to protect clubs from owners who might look to take on lots of debt for short term success (promotion, european places, to avoid relegation), but are unable to sustain that increase expenditure in the medium-term, pushes the club into further debt and eventually administration.
The Premier League followed suit by introducing their own rules in 2013, and FFP rules in the Championship and below came into operation in in 2016/17.
The 00s were filled with clubs spending beying their means, and going into adminstration. A mixture of the ITV digital, and teams spending more than what they bought in to try and reach the promised land put our league structure in existential threat. And it was the same across Europe.
In 2010, Portsmouth were the first team to go into administration. The biggest name to “go under” was Leeds United in 2007. The pair became the poster boys for spending beyong their knees and ruining clubs.
Since 2013, just 6 teams have entered administration: Bolton Wanderers, Bury, Rhyl, Wigan Athletic, Bury (for a second time) and most recently Derby County.
From 44 clubs in 13 years, at a rate of 3.3 a year, to 6 clubs in 10 years (0.6 a year). No one can say that the introduction of financial rules limiting what clubs has spent has not worked.
Yet still fans of Nottingham Forest and Everton are moaning this morning.
Let me put something out there first – without PSR, Everton and Nottingham Forest would have spent more than they have in recent years and would both have entered administration. They would be in a worse position now if PSR did not exist.
Everton and Nottingham Forest fans should be directing their anger at their owners who both overspent to try and buy glory without caring for the risks.
I remember when Farhad Moshiri sold his Arsenal shares and bought Everton. The blue-nose Scousers celebrated like they had won the league. They expected to be bankrolled to success, at the expense of Arsenal.
Moshiri bought the club in February 2016. Over the next 5 years, they spent in excess of £500m on the likes of Yannick Bolasie, Morgan Schneiderlin, Gylfi Sigurdsson, Davy Klaassen, Theo Walcott, Cenk Tosun, Yerry Mina, Alex Iwobi, Moise Kean, Andre Gomes, Jean-Philippe Gbamin and Ben Godfrey.
This list of flops cost them close to £300m in transfer fees, and not far from that in combined salaries.
Then there were the appointment of Carlo Ancelotti, reportedly to be on between £11.5m and £15m a year. This made him the best paid manager in the world at that time. And lets not forget the recruitment of James Rodriguez on £250k a week.
Everton’s 2020/21 accounts showed a loss for the 5th successive year, taking their cumulative losses to more than £430million over the period. A year later they posted a £100m loss for their 3rd consecutive year. They simply have not been a well run club since Moshri came in (be careful what you wish for?)
Fans of Everton keep point at what Chelsea, Manchester City, Arsenal and others have spent on transfers in the last 3 years in comparison to themselves. This obsession leads them to come to an incorrect conclusion.
PSR is not just about what your transfer net spend is during the period. It takes into account all expeniture (including amortised transfer fees, salaries, agents fees and general running costs), and pitches them against the clubs income.
In 2021/22, Manchester City had an income of £619m. Liverpool £594m, Manchester United £583m and Chelsea £481m. Tottenham’s revenue for the period was £443m and Arsenal’s £368m. Everton generated just £181m.
It should be no surprise that these clubs have outspent Everton when they generate so much more. Just like it is no surprise that Manchester City outspend Arsenal.
Nottingham Forest have also been charged for going above permitted losses for 2023/24. This should have come at no surprise when they spent nearly £270m in their first season back in the Premier League, signing 30 players.
Forest are the perfect example of an owner outspending the clubs means, which can potentially put them into future trouble – what happened to Leeds and Portsmouth. and all to stay in the Premier League.
And if they went into administration, you would see similar scenes to Derby County – the last side to go into adminstration back in 2021.
One argument is that PSR punishments are “unfair on fans” who are “punished” for their owners decisions. But what these fans ignore is that their owners rule breaking is unfair on those fans who support clubs that stick by the rules and get relegated.
Last season, Forest finished 16th and Everton 17th – 4 and 2 points ahead of 18th placed Leicester City respectively. Is it fair that the likes of Leicester, Leeds and Southampton saw their clubs relegated whilst spending within the rules, whilst Everton and Nottingham Forest broke the rules spending to stay up?
So yes, it might be “unfair” on fans of Everton that their club could be facing a 2nd points deduction of the season. But it is even more unfair on Leicester City fans who saw their club relegated whilst not breaking any rules…
Fans of Newcastle have also jumped on the bandwagon by stating that PSR rules are restricting their spending, and create a “closed shop” at the top of the league.
Now whilst I do get this argument, Newcastle’s issues this season has not been because they have not spent enough.
They have had 4 transfer windows since the Saudi Public Investment Fund bought the club in October 2021. In that time they have spent nearly £400m on new players. Chelsea are the only Premier LEague club to have a higher net spend during this period. Newcastle currently sit 10th in the table.
Last season, the broke into the top 4. This would have seen their income increase in excess of £50m/ The extra income allowing them to spend more within the rules.
They spent £130m in the summer on Sandro Tonali (suspended), Harvey Barnes (average), Tino Livramento (prospect) and Yankuba Minteh (who). The issue is not that they did not spend enough, it is that they bought a bunch of players that have not improved them.
Newcastle fans are complaining that they are unable to spend more this winter. They see the solution for bad recruitment as just “spending more”, probably one further average players.
Spending money poorly to make up for previous poorly spent money. They should be calling on their club to spend better, not spend more.
Ultimately, whilst PSR might not be perfect, it does protect clubs. Without it, we would still be seeing 3-4 clubs a year going to the wall.
Chasing promotion or remaining in the league in the short-term is not worth the risk of administration and the long term ramifications.
Portsmouth spent 7-years in the Premier League before their administration in 2010. They have since been relegated 3 times, spent 4 seasons playing in the 4th tier of English football, and have now been out of the Premier League for 14 years.
Leeds United returned to the Premier League in 2020 for the first time since their relegation in 2004. Like Portsmouth, they were relegated on numerous occassions. The club is still clearly fragile and after 3 years back in the Premier League, they were relegated again.
Both Everton and Nottingham Forest have been sactioned for spending well beyond their means. It is not the Premier League’s fault that everton lost over £430m up to 2021 since Moshri took over. Nor is it the Premier League’s fault that Nottingham Forest’s owner sactioned 30 signings, spending £270m.
These owners are putting the future of their clubs at long term financial risk.
Fans need to stop blaming the Premier League and PSR when punished (or if they are unable to spend to remain within the rules). The anger needs to be turned towards their owners and those running the club.
Keenos
She Wore A Yellow Ribbon 
So true. I’ve always had a small soft spot for the old toffees, for me they’re one of England’s great clubs. Whenever people talk about the big 6 and don’t include Everton, I just laugh at them. However, listening to their fans moaning makes me laugh even more, they’ve basically cheated their way to survival. They could have easily balanced the books by selling Lewin or Pickford or not signing an endless stream of average/half decent players but they knew that would likely mean relegation. That was their choice and now they’re paying the price.
As you say, Leicester are one of the real victims, Chelsea, City have cheated them out of champions league football over the past few years and now they’ve been relegated because Everton have been cheating. Fucking disgraceful and the club might never fully recover from it.
Mind you, if Everton are rightfully being hounded, it makes you wonder what lies in wait for Chelsea and especially City.
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