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Business of Sport debate calls for clubs to re-consider player wages

Wed 3rd Mar 2010 | Football Industry Events

In a televised debate broadcast live on the BBC News channel from the Soccerex European Forum last night, experts called for football clubs to consider more performance-related bonuses and lowering the basic salaries of players.

Click Here to watch the video on BBC's iPlayer

Dan Jones of advisory firm Deloitte called on clubs to look again at how it remunerated its stars.

"There's no bonus culture. It's the same, win lose or draw. Why is that allowed to persist?" he asked.

BBC chief economics correspondent Hugh Pym cited City banks such as HSBC and Barclays that were profitable and so paid their key executives bonuses which were several times higher than their salaries.

However, he pointed out that such payments, linked to success, were not replicated in football.

"The thing about high player wages is they are often at loss-making clubs. There seems to be a mis-match there which you don't see in other parts of business," he said.

Wages paid by top-flight English sides in 2007/8 - the latest season for which figures are available - grew by 23% from the previous season, to £1.2bn.

Chelsea, Manchester United, Arsenal and Liverpool had the highest wage bill in that report.

However, while these clubs are seen as well-resourced, panellists on the debate suggested that smaller teams would especially benefit from changes to player pay structures.

West Ham co-owner David Gold said that high wages were a threat to some clubs, especially if they were subsequently relegated and lost out on cash from television rights deals.

Portsmouth last week became the first Premier League club to be pushed into administration - with its wage bill one of the key reasons behind its £60m debt.

"I don't disagree about players receiving due reward for amazing skills, what I don't want to see is that wage structure take clubs into administration," Mr Gold said.

"You have players earning £60,000 or more a week. Then a club gets relegated and that club is locked into a contract with players."

Sheffield Wednesday chairman Lee Stafford said his club had suffered those problems after slipping out of the Premier League in 2000.

"It almost guarantees a downward spiral because you have players that aren't going to want to move on, and clubs aren't going to want to sign them.

"So your debt builds up, the spirit in your club breaks, the fans see nothing to be optimistic about and the players are not motivated properly because they know they're going to struggle," he said.

"We feel massively disadvantaged by other clubs that are racking up debts... paying players that they should not be and getting further up the league. It's not a level playing field and we need governance in the game to improve."

Chief executive of the Professional Footballers Association, Gordon Taylor, said that players "did not hold a gun to the heads of clubs" when it came to wages being set.

And they almost always would continue to play if their club was struggling to pay wages on time, he added.

Earlier, at the Soccerex event, it emerged that Europe's top clubs had succeeded in delaying the full introduction of UEFA's new financial fair play rules.

The rules will apply in 2015 instead of 2012 and will govern the amount of debt clubs can accrue, with European bans a possible punishment if they are broken.

 

Listen to the full broadcast on BBC iPlayer http://www.bbc.co.uk/iplayer/episode/b00r35t4/5_live_Sport_Business_of_Sport/

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