The headhunter was calling me about a CEO role at a top six Premier League club. He was building his long list of possible candidates. One of the lures was that half the salary would be paid outside the UK in a low tax jurisdiction, ostensibly for services rendered directly to the club’s overseas owners. It smelt off and anyway I didn’t hear from him again.
But then in April this year, German media outlet Der Spiegel published a list of allegations about Manchester City’s finances which included the suggestion that former manager Roberto Mancini had benefited from what it described as a “fictitious consultancy contract”. It turns out split employment might actually be a thing in football after all.
City was fined £9m in 2020 for failing to cooperate with a Uefa investigation into possible breaches of financial fair play regulations. The club, which has called the claims a campaign against them, previously managed to overturn a European ban.
Put a ceiling on spending in elite sport and you can be sure that it will be tested in the search for success. The scandal at Saracens which led to their relegation in 2020 centred on off-the-books payments to key players which circumvented the Premiership salary cap.
Last month Uefa fined eight European teams a minimum of €26m for financial breaches – tokenism by comparison with Sarries’ punishment, given football’s far greater wealth.
With rugby clubs financially stressed, carping that a lower salary cap post-Covid has made the Premiership uncompetitive in the market for talent has suddenly ceased.
The chatter in the paddock at the Formula 1 Grand Prix in Singapore last weekend was of two teams alleged to have broken the sport’s new budget restrictions. This framework has been credited with bringing much-needed financial stability to teams up and down the grid.
Fingers have been pointed at Red Bull for a major breach of the regulations and Aston Martin for a minor one, which both teams deny. The outcome of the FIA’s scrutiny of all 10 teams’ books is said to be imminent, with possible sanctions to follow. For now, we have the latest chapter in the Toto Wolff-Christian Horner soap opera.
It’s hard to envisage Red Bull being deducted points from last season, thereby overturning what was already a hugely controversial championship victory for Max Verstappen. And any deduction for this season would likely be irrelevant given how far the Dutch driver is ahead in the race for the title.
The FIA has given itself a headache by taking far too long to comb the figures. Any self-respecting business should be able to hand over a set of unaudited December management accounts by the end of February. These would be sufficient for a regulator to start its work, with final verdicts being reached on the back of audited results provided by, say, the start of May. This would be early enough for any penalty – financial or sporting – to have genuine impact on the current season. And if retrospective, to reset the previous year’s outcome while it still lived large in the memory.
As to possible penalties, it would be easy to concoct a meaningful schedule but far harder to implement it given how lengthy and difficult the process to agree F1’s financial regulations in the first place. My starting suggestion? A current season points deduction equal to the percentage spending overrun in the previous year. So, 10 per cent overspend means that 10 per cent of points won are wiped out in the subsequent year. In addition, a team’s budget for the season after that is reduced $ for $ in line with their previous overspend. Together, quite the disincentive to take a bite of the forbidden apple.
F1 could look to American team sports for reassurance that spending caps can be implemented effectively. Yes, boundaries are tested, but closed-league structures mean that deep down all owners realise the value of their product ultimately lies in the collective. The NFL even stipulates a minimum spend on player salaries as well as imposing a cap, to ensure everyone invests to maintain the quality of competition. Major League Baseball “taxes” over-spenders, redistributing some of the proceeds to under-spending franchises. Much harder to achieve budgetary compliance in “open” sports where relegation and promotion are at stake.
No need for Wolff and Horner to dial down their hissy fits and finger jabbing though. So much of F1’s global value lies in such melodrama.
W for wipe-out?
On the subject of motorsport, the W Series is said to be in financial difficulty. The overall budget for the 10-race competition for female drivers is far less than that of a single F1 team. It is highly reliant on the backing of its chair Sean Wadsworth, who might possibly be tired of dipping into his pocket while waiting for Liberty Media, F1’s owner, to wake up to the value to be had from splicing the two race series more closely together.
Right now Liberty probably reckons that F1 sells itself each race weekend and doesn’t need to own the women’s races. The cliched, glamorised imagery used to promote W Series has at times verged on the uncomfortable but, this minor quibble aside, the venture deserves more road.
How do you view Denmark’s kits for Qatar 2022, their logos bled into the background colours, including the third-choice black strip declared by manufacturer Hummel to be “the colour of mourning”? A masterful political statement about the World Cup host’s human rights record, or a cynical marketing exercise? Me, I’m all for it.
If you’re thinking you might fancy darting over to Qatar to catch a match, the Fifa website is showing every fixture as “currently unavailable”. Although I’ve always thought stadia would be filled (even if it meant bussing in migrant workers, a trick used for athletics in Qatar), I find it hard to believe that’s true. Denmark’s black shirt would set you back €89.95 online if you fancy taking a punt on last minute ticket availability and making your own show of solidarity in Doha.
A pie and a pint
To the (actual) cottage at Fulham’s Craven Cottage to speak at a conference on the preparation of students for careers in the sports industry. The club’s imposing new stand hanging out over the River Thames still can’t outdo the iconic building in the corner that gives the ground its name. I was especially taken by the cottage’s football-themed stained glass in the doors leading out to the seats. Reminded me of Coronation Street’s pub, the Rovers Return. Fancy one of Betty’s hotpots with your pre-match pint?