Parachute payments for relegated clubs to increase

With the phrase “doing a Leeds” having entered the popular lexicon – it even has its own Wikipedia page – English clubs from next season will first be subjected to the Financial Fair Play rule. But with today’s increase in parachute payments for teams relegated from the Premier League, the concern must focus instead on the effects it could have on the second tier of football.

Parachute payments for relegated clubs to increase

Posted by

Andy

April 16th, 2013

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Leeds aimed high, squeaked into the Champions League, aimed higher and were bankrupted; but this happened without that extra £12 million over four years that relegated clubs are now set to receive. Since 2010, relegated clubs have received £48 million – paid in two years’ worth of £16 million and two more years of £8 million. The new deal will see these payments increased even further – although the more pressing issue of solidarity payments has yet to be finalised.

Solidarity payments are those paid from the Premier League to each team in the Championship, basically to keep the peace amid the wealthier clubs who will begin life in the league below anew and financially flushed. It’s not known if these payments will increase; however, the danger of relegated clubs spending beyond their means in an attempt to reach the Premier League as quickly as possible is one quelled by the FFP – even in the Championship, where the figure that clubs must not be losing in a rolling three-year period is just a shade under the £105m quoted for Premier League clubs – almost £100m less in fact.

One thing is for certain; the increase in parachute payments also spells the widening gap in quality between England’s top two leagues.

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