PARACHUTE PAYMENTS: EFL chief executive wants to see changes
English Football League chief executive Trevor Birch wants Premier League parachute payments to be scrapped and replaced with a “fairer” system.
Birch, who started in the role in January, believes the English football pyramid’s current financial model is unsustainable and that the EFL should receive a bigger share of the revenue generated by the Premier League.
What can change?
“In simple terms, the football pyramid’s financial future is under threat,” Birch wrote in the Daily Telegraph.
“We need a system that can ensure EFL clubs survive and thrive without incurring collective losses of £243m pre-Covid in 2018-19 and the need for owner funding across the EFL of approximately £400m a year. Our model needs to be about sustainability, rather than philanthropy or speculation.
“In our view, the only way to achieve this sensibly is through implementation of a series of sustainability measures which includes EFL clubs receiving 25 per cent of pooled revenues, abolishing parachute payments and implementing effective cost control mechanisms across the league. Quite simply, it is no use spreading money around in a fairer way only for it to be spent as quickly as it comes in.
“Narrowing the gap between the haves in our domestic super league and the have-nots throughout the rest of the pyramid will lead to more stable ownership models and ultimately better relationships with fans.”
What are parachute payments?
Parachute payments for clubs relegated from the English top flight, based on the Premier League’s broadcasting revenue, were introduced when the Premier League was formed in 1992.
The Premier League agreed a new parachute arrangement in 2010 when relegated clubs’ payments of £48m, spread over four years, were increased to around £60m. Since the 2015-16 season this has been spread across three years.
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