Wage Restrictions in CL [Rangers]

[chilledbear 16]

Interesting the difference between Rangers and them. I am a bit surprised.

 

 

Clubs competing in the Champions League will learn on Tuesday if they are to face stringent restrictions on spending on wages.

 

The European Clubs' Association (ECA) are meeting in Geneva where they are expected to come up with proposals to limit the proportion of a club's income that they can spend on salaries.

 

Karl-Heinz Rummenigge, the chairman of Bayern Munich who heads the new clubs' body, is pushing for a 50 per cent limit of turnover going on wages.

 

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Among English clubs, Chelsea would have the most to fear from such a ruling - they spend 71 per cent of their turnover on salaries. Liverpool, according to the most recent figures available from 2006, would also be affected with 57 oer cent of turnover going on salaries.

 

Manchester United would have least to fear - they have made a policy of prudent spending on wages, and their current level is 43.6 per cent. Arsenal's proportion is also comparatively low at 45.4 per cent, although this rises to 49 per cent if the income from property sales at the old Highbury stadium is discounted.

 

Rummenigge said of his plan: "The 32 participants [in the Champions League] would have to meet certain conditions. Only 50 per cent of the club's total revenues could be invested in wages."

 

Chelsea chief executive Peter Kenyon is on the ECA board, as is his Liverpool counterpart Rick Parry, and they are likely to argue for a less drastic limit such as 60 per cent or even an initial 70 per cent with clubs being given several years to cut their wage bills.

 

A 50% ruling would not trouble the Old Firm in Scotland too much - Rangers only spend 43 per cent of turnover on wages, while Celtic's figure is a less comfortable but still acceptable 50 per cent.

 

Rangers vice-chairman John McClelland is also on the ECA board.

 

UEFA president Michel Platini is keen on imposing limits and he has already met with Rummenigge for talks on action.

 

Speaking in London last week, Platini used Manchester City's �£100million bid to sign Kaka as an example of why some restraints were needed.

 

Platini said: "Clubs have to operate within their income.

 

"How one guy can cost 150million euro is ridiculous from a social, football and financial point of view.

 

"It's why we have to do something to have a transparency and a fairness in football. It's not good for the popularity of football."

[Frankie 8,552]

Good news... a step in the right direction to promote competition...

[Super_Ally 0]

I echo Frankie's sentiments to a degree.

 

Though with our massively reduced potential for income, does this really in anyway level the playing field?

 

In fact arguably might it make it even more difficult for us compete, though with the caveat of perhaps making smaller clubs (in terms of income) more responsibly run?

[Bluedell 5,614]

I can't see how this will work properly. Celtic have probably around �£13m of turnover from the sales of strips etc, whereas we have �£4.5m due to the JJB deal, but we probably make more money from it.

 

If you outsource parts of your business, it can have a detrimental effect on the turnover but improve your profit.

 

It's a very unfair rule unless they somehow take account of this kind of thing which would be virtually impossible. That's the problem when you have football people trying to do something who don't understand business.

[Gribz 846]

Id like to know what some of the big euro teams like Madrid and Milan have. These type of things risk the threat of the bigger clubs breaking away and forming there own Euro league.

[calscot 0]

I can't see how this will work properly. Celtic have probably around �£13m of turnover from the sales of strips etc, whereas we have �£4.5m due to the JJB deal, but we probably make more money from it.

 

If you outsource parts of your business, it can have a detrimental effect on the turnover but improve your profit.

 

It's a very unfair rule unless they somehow take account of this kind of thing which would be virtually impossible. That's the problem when you have football people trying to do something who don't understand business.

 

That's what I was thinking. We could be handicapping ourselves with the JJB deal and outsourcing catering.

 

Supposing Abramovich transfered an oil company to Chealsea ownership and made it part of operations. Would that turnover count?

[calscot 0]

PS Maybe they should make the limit 100% of season ticket sales which would make it far fairer for us.

[chilledbear 16]

Id like to know what some of the big euro teams like Madrid and Milan have. These type of things risk the threat of the bigger clubs breaking away and forming there own Euro league.

 

I think there would be a big risk of a breakaway League.

[calscot 0]

The ironic thing is that it's for the good of the clubs and the fans and for the sake of competition.

 

They may breakaway but they would have a finite lifetime before they all go out of business. The business model that many clubs are working under is totally unsustainable and under the same lines as Gretna but just in a much bigger way.

 

Chelsea rely on Abramovich like Gretna did on Mileson.

 

Football to me, is becoming more and more stupid. It's just becoming a one of those pyramid systems where all the money from the many at the bottom is shunted up to the few at the top.

 

It's going to get to the stage where it's not fans or customers any more, just mugs - being mugged.

 

Maybe we should hope they breakaway, go bust and leave us near the top of the pile again...