Often Partisan

League One and FFP

Birmingham City go into Saturday’s game against Bolton with the very real prospect of dropping to the third tier for the first time since the 1994/95 season. Relegation from the Premier League cost Blues dearly and with the increasing probability of relegation to League One happening the question is how much it will affect Blues this time.

There are many variables with respect to Blues’ finances at the end of this season that are undefinable – for example, we have no idea who will own the club come the new season. I think it’s very possible that there will be some movement with respect to a sale immediately after the end of the season and I’m almost positive that by the time the new campaign rolls around we will be very much on the road to new owners. However, I am also of the belief that relegation will impact on Blues regardless of who owns us – due to the differing financial fair play regulations in League One.

Unlike the Championship where the regulations concentrate on adjusted losses made, League One operates a soft salary cap known as the Salary Cost Management Protocol (SCMP). This regulation means that as of the 2013/14 season, clubs in League One are not allowed to spend more than 60% of their turnover on wages. Clubs are required to provide budgetary information to the League at the start of the season with it being updated throughout the season. Clubs who break the cap are punished with a transfer embargo.

The last financial data currently available shows that in the 2012/13 season, Blues turned over £24.198million, and spent £22.914million on wages – a wages to turnover ratio of 94.69% – far in excess of what is allowed in League One. I have no doubt that both figures have dropped this year and I would estimate our wage bill is around £18million with a turnover slightly below what it was in the 2012/13 season.

To maintain the same wage bill of £18million I have mentioned above the club have this season in League One, we would have to turn over £30million – which I think is absolutely impossible due to the lowered commercial and TV revenues. From talking to people in football (although not connected with the club), I would estimate that our turnover in League One would be something like £18mil – which would mean that our wage bill would be capped at £10.8mil – which is some drop from where it is now.

Of course, with players like Wade Elliott, Hayden Mullins, Chris Burke and Peter Lovenkrands leaving (not to mention Nikola Zigic), Blues wage bill will drop some way – possibly close to  or just below the magical 60% of turnover figure. However, those players will need replacing and my fear is that there won’t be room within the salary cap to do so unless we move on other players as well – and this is where the scary bit comes in that no matter who owns the club, Blues may well be forced to make further cuts to the playing staff to get us within sanctioned levels – and that may well impact on any opportunity to bounce back at the first attempt.

When people say that relegation could be a good thing I’ve disagreed and this is one of the main reasons why – I’m far from certain we’d bounce back quickly having done a League One tour, sweeping all before us. For me, it’s imperative that two things happen – firstly that Blues do their utmost to prevent the drop into League One in the first place and secondly that when (not if) new investors/owners come in, that they put together a proper business plan that will see the club able to comply with regulations without decimating the playing staff further.

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73 Responses to “League One and FFP”

  • DoctorD says:

    What the regulations also mean is that it is imperative we have top-quality coaching and management staff to get the most out of what will, inevitably, be a poorer group of players. Getting the next manager right is crucial and I just can’t see Lee Clark doing any better in League One. He needs to go and a manager with a proven track record at this level brought in.

  • Thongs says:

    So the answer is to get more money in commercially. What is stopping a new owner sponsoring a corner flag for £15million, St Andrews for £15m or even the managers fish pond for £100bn?

  • mark says:

    double edged sword for Clark on Saturday the best since slice bread if we stay up or damn if you don’t…

  • kneesupmotherbrown says:

    Sounds like emotional blackmail is coming our way . ‘Please renew , all you fantastic fans , because the more of you that do the more we can improve the squad ‘ . Well , I tell you what …We stay up , I renew …We go down , I dont ..

    • Agent McLeish says:

      For me it’s new owners = renewal. BIH = no way.

      • Nick Gilbert says:

        For me it’s – I support Blues therefore renewal ST for me :)

        • Agent McLeish says:

          I agree with your sentiment but I can’t stand the thought of every bit of cash reserve this club has/had being syphoned off to HK into the grasping hands of BIH. Sometimes you just have to take a stand no matter how hard it is.

        • Andrew says:

          I wont give any more money to HK jail fund so im not going again until it changes

    • LoyalSupporter says:

      If that’s your attitude please don’t bother renewing regardless. I understand non-renewal due to owners, but not due to Division. No time for fair weather “fans”

      • mike b says:

        think you are being a bit harsh….we had fantastic support on tuesday against wigan….about 20,000 they all were supporters….ok probably not as fanatical / loyal as the ones going to bolton but still bluenoses…
        personal i have been going for 20 years….sponsored stans boots for 3 years…..i go to be entertained and we certainley have not had that for a long time….so at 70 i doubt i will renew if we go down…..sorry.. mike b………

  • kneesupmotherbrown says:

    Sounds like emotional blackmail is coming our way . ‘Please renew , all you fantastic fans , because the more of you that do the more we can improve the squad ‘ . Well , I tell you what …We stay up , I renew …We go down , I dont ..

  • mark says:

    good to see the true supporters on Saturday turn up what ever the difficulties…..and i a salute our away fans again magnificent 3500 which will again roar our support on saturday at Bolton……….kro

  • mark says:

    good to see the true supporters on Saturday turn up what ever the difficulties…..and i a salute our away fans again magnificent 3500 which will again roar our support on saturday at Bolton……….kro

  • motozulu says:

    Wolves appear to have flouted the L1 rules and have got away with it scot free so far….

  • bluesbot says:

    lets just hope the board have learned from at least one costly mistake and have placed relegation clauses into all new contracts – if they haven’t then it could be trouble ahead as Dan has stated

  • pierre says:

    pierre

    if we do go down i think Dean Smith would be a good shout, knows the division,and working with a tight budget.

    • DoctorD says:

      Who’s Dean Smith? You mean the Walsall manager?

    • The Flying Pig says:

      Dean Smith is a good shout and is a Great Barr lad; however, Mr Smith is of the pink and baby blue persuasion – can we live with that?

  • Art says:

    Dan…good article.

    I’m assuming the Wolves must have faced the same issues but have achieved promotion?

  • Cozy says:

    Don’t get me wrong, I would love to stay in the championship but I disagree that it would be a terrible thing to get relegated. I understand your point in reference to getting promoted again but I am not particularly worried about coming back up. Firstly, I think we deserve to go down and, secondly, I beleive spending 3/4 seasons in league one with a healthy business plan, new owners (hopefully part-owned by fans) would do the club a world of good. Personally I do not understand why people want their clubs to get promoted in this current climate – everything I hate about modern-day football awaits clubs in the higher leagues. I remember the 94/95 season in division 2 being one of my most memorable seasons as a blues

    • Dave Partridge says:

      True, it hasn’t done Southampton any harm. Swansea too.

    • stu123456789 says:

      Cozy, my thoughts exactly. Lets go down, rebuild and give our own young players a chance. This would make me return to St Andrews on a regular basis

  • Colin Carberry says:

    Presumably Wolves’ turnover would have been boosted by the parachute payments? That may be why they could afford to keep what is essentially a Premiership core to their team without breaking the FFP play rules.

  • Puddleglum says:

    Good post and a reminder that we need owners who not only care about the club but also know something about the football business.

  • Dave Partridge says:

    there’s the extra Johnstone Paint Trophy games to take in to account – worth a couple of extra quid?

  • bluenose08 says:

    I think season ticket sales will only be good if we have a new manager in place and new owners for the start of the season. kro.

  • Richard Granfield says:

    Since Jan 1st. in the league we have won 4, drawn 3 and lost 15. Is it a coincidence that this bad run coincided with experienced players Mullins, Ambrose and Elliott leaving and inexperienced players Ruznak. Blackett, Thorpe, Ibe and Huws arriving?
    When you are in a relegation dogfight you need experienced players not loanees who, as Robbo said, have let the club down and will return to their respective clubs without looking back.

    • bluenose08 says:

      watching huws the other night I thought he gave a 100 %.

    • LoyalSupporter says:

      I half agree, Richard. Mullins didn’t play many before January (and was terrible when he did), Elliott was mostly used as a sub and Ambrose has 7 league appearances in total since 2012. What made the difference was a settled defence players like Murphy (how badly have we missed him??), Burn and Bartley (both loanees might I add).
      The issue was both the desire and quality of the loanees. Blackett has been awful, Thorpe lightweight (although unlucky with injuries).
      By contrast, Macheda looks a much better signing than Lingard and clearly shows a desire to score goals and win matches.
      We have enough experience with players like Spector, Burke, Zigic. The problem is finding a formula that works with the players we have. That has been missing since January.

      • Roy Flowers says:

        What is even more annoying is that since they were recalled Burn has only played 3 times for Fulham s and Bartley hasn’t played at all for Swansea!

    • Chas says:

      Robbinson has let the club down far more than anyone else. He has been a disgrace for getting himself booked so often. If Zigic had done that, Posters would be saying that he was swinging the lead.

    • stu123456789 says:

      it did coincide with a change of players but it was not Mullins, Ambrose and Elliot. it was more the fact we lost Burn and Bartley who were good enough centre halfs at this level and were not adequately replaced. This is the problem with the loan system, players that do perform are often recalled by their parent clubs

      • Chris W says:

        And apart from a couple of cup appearances they have been left twiddling their thumbs when they could have been playing for us….
        KRO+DNM

      • Andrew says:

        NO this is the problem with having no finances to buy players or even if we had paid a loan fee they WOULDN’T have been able to recall them! i said at the start when we loaned two Center backs in it would lead to trouble. bcfc is in the problem it is in because we don’t have the money for this level, simple.

  • Chris W says:

    Good points Dan. Do relegated Championship clubs qualify for any parachute payments?
    My worry is if we stay in the Championship then BIHL will be determined to sell for the ridiculous asking price and only sell in tranches. We will also retain the inept Lee Clark as he isn’t going to walk away without a hefty pay-off.
    If we drop into Division One BIHL would be forced to sell or take Administration, any potential buyers will hold the upper hand in negotiations given the financial situation in Hong Kong.
    Along with that we now have a core of young experienced players who can only improve, with a couple of experienced along with the up and coming academy players I would expect with the right manager we can still do well and be in the mix for automatic promotion.
    KRO+DNM

    • LoyalSupporter says:

      Never fear – Clark is on a 12 month rolling contract so no hefty pay-off. Only worry is if the new/current board decide to keep him on!!

      • Chris W says:

        I thought a rolling contract meant just that, it rolls on… Therefore my understanding is he would be owed 12 months salary no matter what day he was sacked…
        I may be reading it wrong
        KRO+DNM

      • Andrew says:

        yes exactly! i dont know where all this clark worry hes here for the long run has come from, we haven’t had a manager on anymore than 12 month since eck left us

      • beegeeblueboy says:

        If they keep Clark on then there could be a significant number of ST non-renewals. Will they want to risk that? They won’t get my money if Clark stays.

    • NickyWicky says:

      Apparently they’d only get £5 mill if Blues dropped down!

  • Agent McLeish says:

    It’s been confirmed that the Bolton game will be the feature highlight game on the BBC’s Football League show this weekend.

  • Andy W says:

    I can see what you’re saying Dan, but I think if we do stop up, little will change in the short term as the takeover discussions will be lengthy and involved with no prospect of real investment for the new season. I believe that by the time that is all sorted we will be sitting at the bottom of the table in any case, with a real prospect of going down anyway. If I trusted more in the manager being able to acquire and motivate the players we need to avoid that, I would be more positive, but I’m afraid I can’t. It’s going to be rough whatever way we look at it, and you are right, we will have no divine right to bounce straight back again. I just feel that it is a time to clear the decks, start afresh and build for a solid future, both in terms of finances and on the pitch. At least the youngsters have a better chance in League 1?

  • Zuluwell says:

    Dan, how have Wolves managed to maintain the majority of their squad that was relegated from the championship and steam roll league 1 without breaking the FFP rules?

    • OftenPartisan says:

      a) they had to get rid of a load of players at the start of the season
      b) they had a much larger parachute payment as they were only in their 2nd relegation year
      c) they have bigger crowds and bigger commercial revenue than us.

  • Nose22 says:

    Personally I think relegation would be a complete disaster, there’s no way we’d do a Wolves, actually I honesty believe we’d be fighting another relegation battle, we’d be the team to beat so it be like a cup final to any other team in the division cos, unlike Wolves we will be financially screwed

  • Oldburyblue says:

    For the past few years the worry has been as to who we will have to sell next. The barrel has long been scraped and there are no jewels left. Therefore if we have to cut the playing staff further, so be it. A robbery victim who has had his car, Rolex watch, gold necklace and diamond ring stolen does not worry whether his hanky has gone too.

  • Eric says:

    What about Wolves…

    • NickyWicky says:

      what about the wolves

    • Nose23 says:

      I think Wolves have a strict astute wage cap and probably most the players had a relegation clause in their contracts which would of complied with the rules of the FFP.
      Their CEO runs the club on a tight budget so in contrast there financially sound

  • Andrew says:

    We will be fine, even if relegation happens. it wont matter even if we dont come straight back up. we will at least have entertaining football back at st andrews

  • Max Rogers says:

    Sean O’Driscoll for me. Plays football, worked with a tough budget. I can remember his Doncaster team passing us to death, totally outclassed us. He had a tough ride at Bristol City, but improvement in the football quality is imperative.

  • Tony says:

    Carson and Pannu have done so much damage, were so naive, but I believe had the best of intentions at the start and I must admit to a pang of sympathy for their plight.Iike everyone else on here I cant wait for their demise as owners of our club, but of all their many flawed decisions the one to appoint Clark has cost them most dear.
    Almost any other manager would have kept us up,with all the financial benefits that would bring but they went for the cheap option a chancer prepared to have a go but never with any chance to do the job, a man tactically inept,with woefully poor man management skills. and body language akin to a man an hour from execution.a man who will hang on come what may.
    He cares only for next months salary all his crocodile tears mean nothing, he has an awful lot to answer for I hope he reflects on this on his journey back up north .

    • Oldburyblue says:

      Pang of sympathy for their plight?? THEY took money out of the Club (legally or otherwise)….not LC. IF all our money from transfers, parachute payments etc has gone on player’s wages as claimed….who authorised those contracts? Who exactly gave Clark a rolling contract so that he will pick up a full year’s salary whenever he is inevitably sacked?

      • Tony says:

        LC TOOK US DOWN

        • Oldburyblue says:

          I don’t like Clark and will be glad when he has gone. He depresses me, even when we win, so what effect does he have on the players? I ask again…why have you got a pang of sympathy for the plight of the owners??

          • Tony says:

            Because they made a monumental mistake in appointing Clark, Any other manager would have kept us up, thereby saving us millions. As for the other stuff according to Dan no money has been syphoned of to HK but has gone to pay wages for players and staff. Under Carson this cub had its most successful period in its history, he was naive, stupid even .
            (Let yee among you without sin cast the first stone) that lets me out for sure.

  • alex hurley says:

    If we can we can spend £10 mil on wages, surely we are laughing? Thats £200k a week. 20 players on £10k a week, should be better than our current crop of 5k a week journeymen by some considerable distance.

    (Alternatively we could re sign zigic amrose mullins lovenkrands and burke and enter a 5 aside league)

    • OftenPartisan says:

      I can see your logic but it is flawed. That would be just 20 players, 20 first teamers with no academy players, no reserve players. An injury or two, or a couple of suspensions and you wouldn’t be able to fill a complete matchday 18 – ask Portsmouth how they coped with just 20 players in League One.

  • Dino Tiltoni says:

    We are going to know our fate well before 5pm. If we go down the sale price of the club will be cut. That might enable more investment and the current owners will get less.

  • […] 20 odd years in all honesty. The implications of relegation are not yet fully understood by us, this piece on Thursday on the Often Partisan website threw another problem in the mix that I don’t think […]


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