New Premier League spending cap could see PSG and Real Madrid blow rivals out of the water
A new Premier League spending cap could see PSG and Real Madrid blow rivals out of the water… as Europe’s heavyweights already splash over the £402m mark
- Premier League clubs are reportedly considering introducing a wage cap
- The cap would set a wage limit linked to the bottom club’s television revenue
- The introduction of a cap is seen as a way to help ensure competitive balance
Premier League clubs are reportedly considering introducing a spending cap linked to the bottom’s television revenue.
The times reported that clubs are considering a proposal that would anchor player wage spending to the amount the bottom team receives in television revenue.
The proposal is seen as an attempt to ensure competitive balance in the top flight, while keeping costs around wages, the biggest expenditure of Premier League clubs, under control.
It has been argued that the move would also serve as a ‘safety net’ to prevent the financial gap between the Premier League’s top sides and the rest of the division from widening.
Concerns had been raised about an increasing gap due to available revenue from the expanded Champions League, which comes into effect from 2024/25.
Premier League clubs are reportedly considering introducing a pay cap linked to TV revenue
The limit would be linked to television revenue received by the Premier League’s bottom club
The FIFA Club World Cup is also expected to generate additional revenue for the Premier League’s top clubs should they qualify for the tournament in 2025.
According to the Times, the introduction of the anchoring system would have capped wage costs to £402.4 million for the 2021-22 season if the cap had been set at four times the television money paid to Norwich, who received £100.6 million for the end at the bottom.
If passed, the spending cap could give an advantage to European rivals, with the likes of Paris Saint-Germain and Real Madrid able to offer higher wages to star players.
Both sides’ wage costs would have been much higher than the cap that would have been imposed on Premier League clubs during the 2021-2022 season.
Football Benchmark’s European Champions Report reported in January that PSG’s wage bill was £645 million from the season onwards.
The figure saw the French champions record the highest bill for a professional football club.
Real Madrid’s wage bill for the season reached £458 million after the Spanish giants paid out bonuses for winning the Champions League.
The anchoring proposal, reportedly opposed by some top clubs, will be discussed by clubs at the Premier League’s annual general meeting this week.
The Premier League’s wage ceiling is said to have been well exceeded by continental rivals PSG
The Premier League is updating its financial controls, which are expected to be in line with UEFA’s new financial sustainability regulations.
The UEFA regulations were approved last year and replaced the Financial Fair Play system.
The Financial Sustainability Regulations link a club’s expenditure in areas such as player salaries and transfer fees to turnover.
Next season, these expenses may not exceed 90 percent of turnover and fall to 70 percent in 2025-2026.
UEFA president Aleksander Ceferin has also raised the idea of a continent-wide salary cap after creating a group to look at new cost controls in European football.
