"English football's independent regulator (IFR) has confirmed 'parachute payments' to relegated clubs will be reviewed as part of "ground-breaking" analysis it is conducting into the men's professional game. The watchdog has revealed the proposed scope of its State of the Game report that it claims will "shine a light on the financial pressures, governance gaps, and structural risks" facing the industry."
"Other areas it is set to cover include "cliff-edges" between leagues, club debt and liquidity, models of ownership, the broadcast landscape, and the impact of player wages and academy development on the financial sustainability of the game. Image source, Getty Images The report will consider the Premier League's controversial multi-million pound parachute payments that are given to relegated clubs over a three-year period."
"But the Premier League says the payments are essential to give club owners the confidence to invest. The disagreement is among the reasons the two leagues have been unable to reach a new financial settlement that would see more money make its way down the football pyramid, despite years of negotiations and pressure from politicians. The regulator will have 'backstop powers' to mediate a financial settlement if the Premier League and EFL continue to fail to reach an agreement,"
The independent regulator will produce a State of the Game report examining how money flows through the top five tiers and the strength of clubs' balance sheets. The report will analyze financial pressures, governance gaps, structural risks, cliff-edges between leagues, club debt and liquidity, ownership models, the broadcast landscape, player wages, and academy development. Parachute payments to relegated clubs will be reviewed alongside EFL concerns that the multi-million pound payments distort competition and Premier League claims they encourage investment. The regulator will hold backstop powers to mediate a financial settlement if the leagues cannot agree on redistribution; a draft is due later this year.
Read at www.bbc.com
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