Since news broke of the plan, there has been all manner of hot takes from pundits, football club owners and fans alike.
For many it’s an unconscionable power grab by the so-called “big six” to further concentrate power over football in England. For some it’s the only plan on the table which funds lower league clubs now and helps to ensure that the League pyramid as we know it survives the financial crisis Coronavirus has caused.
I wanted to try to take a look at the individual facets of the plan with an objective eye to work out how much it benefits Birmingham City. I’m indebted to Matt Slater who explained the plan in detail in his piece for The Athletic website on Tuesday.
1) £250M “prepayment” to the EFL to cover lost revenues for last season and this season.
The EFL requested this bailout from the Premier League some time ago to help ensure that clubs can continue running this season.
With the Government u-turn on allowing fans into grounds, clubs now face an even more prolonged period without ticket revenue – which could see some EFL clubs disappear within five to six weeks according to Leyton Orient Chairman Nigel Travis on Monday.
While it’s impossible to know exactly where Birmingham City stand until their accounts are released in December, recent information released to Companies House and to the Hong Kong Stock Exchange do not present a pretty picture.
The club has factored £18million of future transfer payments from the Jude Bellingham and Che Adams transfers, which ostensibly is being used to keep the club going in the absence of revenue coming into the club. It now seems obvious that the club have had to do this as they owe Birmingham Sports Holdings in excess of £110million which hangs like a millstone around the club’s neck.
That should ensure that Blues are in a better situation than many and not as desperate for a bailout.
2) Change in League Structure
As part of the proposed plan, as of the 2022-23 season, the Premier League would be reduced to 18 teams. While automatic promotion would not be affected, only teams in third, fourth and fifth would qualify for the playoffs along with the 16th placed top-flight side.
To enable the drop down to 18 teams, it’s anticipated that four teams would be relegated from the Premier League in 2021-22, with two clubs automatically promoted. There would also be a playoff in the same manner described as above.
I think this part of the plan would be a part Blues would not like at all, as it means after this season promotion to the Premier League becomes a lot harder. There’s been a lot of talk of a “three year plan” under Aitor Karanka to get promoted, but I have to wonder how much Blues would keep that in place knowing that it’s going to be exponentially harder to get promoted after this season unless the club finishes in the top two.
The Bundesliga in Germany has a similar playoff system and so I took a look at the last ten years worth of results. Only twice has the team from the top flight lost in the playoffs, with both Werder Bremen and Hamburger SV surviving playoff games in two consecutive seasons. This reaffirms my belief that the team in the top flight have a much higher chance of remaining in place than another team being promoted.
I think that this difficulty to attain promotion would make a Championship side less of an attractive proposition for investors and it might be the straw that breaks the metaphorical camels back for some to move on. I’m going to admit it frightens me; just at a time when it looked like Blues were looking at a longer term picture a new need for short termism could be dumped on our laps.
3) Scrapping the Community Shield and EFL Cup
While I have to admit I’m am completely indifferent to the Community Shield, the League Cup holds a special place in my heart (as I’m sure it does for every other Blues fan).
I understand that the competition is now somewhat devalued; judging by the teams Blues have put out in the last few years it’s clear that it’s seen as unimportant by us, let alone the big teams.
However, I think part of the reason it has been devalued is that despite the big teams not caring so much, it’s still very much being won by those big teams. Since 2011, the EFL Cup has been won by Manchester City five times, with Chelsea, Manchester United and Arsenal all lifting the trophy once apiece. In fact, in the last 16 years it’s only been won twice by teams outside the so-called “big six”.
I understand that the Premier League teams want rid of the Carabao Cup because it gets in the way of more lucrative games in expanded European tournaments; after all, it’s more exciting playing Barcelona than Barrow.
That being said, my solution would be to remove teams in European competition from the tournament – or maybe even all Premier League teams.
I’m sure EFL teams would be happy to retain the competition if there was decent prize money and a chance to test themselves in Europe if they won it – and maybe it would throw up some different winners in future seasons to make it more interesting.
Whether Championship clubs like Blues see it the same way I don’t know.
4) Redistribution of TV Income
This is the big plus for me, and something I’m sure Blues would be very happy to see.
The idea would be that rights to all games would be sold together, rather than the Premier League and EFL selling different packages. Parachute payments would be scrapped, and instead 25% of the TV income would be distributed to the EFL – a massive rise on the current 8%.
As per the EFL statement made on Sunday, clubs in the Championshhip received £146M in EFL distributions and solidarity payments in the 2018-19 season, which is quite low when compared to £246M in parachute payments split between just eight clubs the same season.
In comparison, the new distribution would see the EFL receive something like £758M, which would be split between the Championship, League One and League Two on a 75/15/10 basis. 85% of the money Championship clubs receive would be split equally, with the remaining 15% split via merit payments.
That would mean Blues would receive around £23.6M based on an average finish, something like £15.6M more than the £8M they received in 2018-19. The balance sheet at BCFC would then potentially be much healthier, while the lack of parachute payments would hopefully make for a more competitive division financially.
However, it’s worth noting that the £250M bailout would be a forward payment from the new distribution of finances, so it might be a little while before Blues got all of that new shiny distribution.
5) Cost Controls
This is where it starts getting ugly. There is no way that Blues or any other team is going to receive any kind of bailout unless there is some more regulation put in place to stop clubs over spending.
The idea in Project Big Picture would be to impose hard salary caps on clubs in the Championship, along with adopting the much harsher FFP rules that UEFA have in place, including an annual cap on “related party transactions”.
This would mean annual losses allowed would drop to £9M from the current £13M mark, and that even if owners have deep pockets they wouldn’t be allowed to splash the cash; even through sponsorships on shirts and stadiums.
While I do think that clubs need to be more sustainable, I’m also conscious that these kinds of rule reinforce the pecking order of clubs and ensure the oligopoly at the top remains. However, I don’t think any of us have ever seen Blues possibly challenging for a place at the big boy table so I’m less annoyed at this than a fan of a more deluded club (for example the one across the expressway) might be.
6) Academies and Loans
As one can imagine, the big six want to put in place more mechanisms to ensure that they get the best talent as young as possible. This is essential to them now, as it’s much harder to sign foreign talent at under 19 levels due to the impending conclusion of the Brexit transition period, and players must spend one year under 19 with a club to be considered “Home Grown”.
Teams below the Championship would see their academies scrapped if they have one, while clubs will be allowed to loan out as many as 15 players, with up to four going to one club. Loans in would be unlimited, and there would be incentivised payments based on how on-loan players performed.
There would also be changes to allow under-23 players to be loaned for shorter periods of time, and for them to be recalled if there is a change of manager.
To me, this is bad, bad news. We saw with Jude Bellingham how vital an academy can be to a club – and while I know that generational talents are just that, bringing players through to sell on is the way I saw Blues building themselves up into a better and more sustainable outfit.
7) Infrastructure payments, Fans and Matchday Experience.
As part of the Big Picture plan, clubs in the Championship would receive £2million each year to support the maintenance of their stadiums and training grounds.
This for me is a huge plus. Money to improve stadium experience for fans has to be a good thing, and I think it would incentivise clubs to make bigger plans for improving their infrastructure.
There is also a proposal to cap away ticket prices at £20 in the Premier League, with minimum away allocations of 3,000 fans and subsidised travel along with the opportunity to introduce safe standing pending government approval.
I’d really like to see some sort of version of that put into place for Championship clubs too. Too often I hear fans complaining of rip off prices, while more equitable away allocations (especially if they don’t force clubs to risk not having sale or return) would go down well with the hardcore who travel everywhere with Blues.
This is the big one that has got everyone’s back up, because it would change the voting system at the Premier League to concentrate power in the hands of the big clubs.
Right now, the Premier League is run on a one club, one vote basis with 14 votes needed to pass a resolution. The change would see this remain in place, except for decisions on election to and removal of members of the board, sale of media rights, changes to cost-control regime and approval of new owners made by “long-term shareholders” using “special voting rights”.
In layman’s terms, this would mean all the big boy decisions would be purely in the hands of the big clubs – potentially giving them control over the whole football pyramid, while allowing them to nix any potential uppity owner from buying a Premier League club.
A part of me is very much against these changes as it goes against everything I stand for in life. However, having seen the shitshow the EFL have been in recent times, I can’t help but wonder how much worse having the big clubs run things would be. While it does open the door for B teams and all that horrific kind of nonsense, I think the way things are going those kinds of things could happen anyway.
There has been reports that EFL clubs have broadly been in favour of these proposals, although some chairmen have refuted that on Twitter already.
Of course, it would be helpful if we understood how the hierarchy at BCFC views the idea, but unfortunately things at Blues are a bit more complicated than a local journo dropping an email asking for a comment. Maybe we’ll get lucky and we’ll find out in GIF form what Blues CEO Ren Xuandong thinks of the idea in the coming days.
With no sign of the coronavirus abating, I think time will be of the essence for some clubs who desperately need the cash – and while some negotiations would probably be nice, it might be that clubs have to accept the fait accompli as the alternative is unthinkable.