Wage cap on agenda as clubs look to regulation

A WAGE cap in the Premier League could move closer to reality today when club chiefs meet in London to firm up plans to prevent an estimated £5bn television revenue windfall going straight into players’ pockets.

Other proposals up for discussion include adopting so-called financial fair play measures similar to those introduced by European bosses, and demanding owners underwrite any contract for its duration in order to stop them leaving clubs with huge liabilities.

Broad consensus among top-flight clubs has emerged that a form of regulation could not only encourage teams to be run more sustainably but also arrest spiralling wage costs.

Significant differences of opinion still exist as to which plans, if any, should be adopted, however, and it is considered highly unlikely that a final decision to implement one of them will be made today.

Rule changes require the approval of 14 of England’s 20 elite clubs, and it is expected that the meeting will see one or more proposals approved for fine-tuning with a view to a possible definitive vote in February.

It comes amid continent-wide moves to impose restrictions on clubs’ spending, with European governing body Uefa limiting losses teams can make with a view to a break-even rule, and Championship sides adopting similar measures.

The Premier League’s lack of regulation continues to make it attractive to rich investors keen to bankroll a club to success. However, only five top flight teams made a profit, with the division making a combined £361m loss despite record £2.3bn revenues, in 2010-11, the most recent season for which complete data exists.

Around 70 per cent of the clubs’ combined income – some £1.6bn – went on wages, which have historically rocketed as the league has derived increasingly lucrative broadcast deals from the domestic and foreign markets.

Television contracts set to kick in next season mean broadcast revenue is expected to top £5bn for the 2013-2016 period. Clubs received £1.2bn in total broadcast payments during 2010-11.

Arsenal and Manchester United are believed to want similar rules to Uefa’s, which they are required to abide by anyway or face bans from European competition such as the Champions League.

Sunderland are thought to have advanced the idea of capping annual wage increases at 10 per cent, while Tottenham and Newcastle are understood to oppose any form of regulation, having managed costs effectively by themselves.


■ Uefa-style financial fair play rules that would limit clubs’ allowable losses and ultimately require them to break even. Arsenal and Manchester United support this route

■ Increase in wage bills capped at 10 per cent. Suggested by Sunderland

■ Owners asked to underwrite all contracts for their duration. Current rules demand evidence of being able to meet obligations for one year only

■ No regulation; clubs sink or swim on their own management. Tottenham and Newcastle thought to be in favour