james debate
james debate

Sunday 9 May 2021

With everything else going on in the world, and indeed in the sport of football, it is easy to have overlooked that we are approaching a fairly significant anniversary. The coming year will mark one decade since the implementation of UEFA's Financial Fair Play rules, one of the most major and far reaching reforms in the history of the world's biggest sport. Ten years on seems like an appropriate time to look back and ask ourselves, has the regime worked? Was it truly a good idea in the first place? That is what we will be discussing today.

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Let's begin with a quick recap for those who do not follow football as religiously as I do. Financial Fair Play (FFP) was a broad set of regulations implemented by European football's governing body, UEFA, ostensibly to protect football's solvency and hold back the encroaching influence of money on the game. 

Admirable though these goals may sound, there were some voices at the time (this very blog included) that vociferously opposed the rules as written, and dismissed them as little more than a disingenuous power grab by football's ruling elite, masquerading as a populist and noble undertaking.

At the time, my (and others') objections were largely criticised. As a Chelsea fan, my views were often dismissed as being fuelled by football tribalism, seeing as the prevailing view at the time held that FFP was intended to restrict and punish clubs such as Chelsea. Of course, this is not and was never the case. In fact Chelsea, along with most of Europe's big clubs, have likely benefitted massively from the rules.

FFP's headline feature is a limitation on the net spend of football clubs. Subject to certain exemptions, football clubs can not spend more money than they raise in revenue. On the surface this is supposed to protect the solvency of clubs, preventing situations where a club spends recklessly and ends up going bankrupt when things don't work out as intended. Slightly below the surface, this is intended to stop wealthy oligarchs like Chelsea's Roman Abramovich from coming in and buying his way to the top of the game, and thus in theory protecting the sanctity of the game from the corrupting influence of money. But, as these past ten years have clearly shown, even further below the surface these rules are intended to do one thing only: enshrine a permanent elite of football clubs whose hegemony can not possibly be challenged by upstarts except in the most rare of circumstances.

The reasons for this seem pretty clear. In retrospect, it is surprising that it was not clear to so many others. By linking the spending limitation to a club's revenue, the rules clearly hand a massive institutional advantage to the game's wealthiest football clubs. How can, for example, Real Betis ever hope to challenge Real Madrid, when their spending is limited to a mere fraction of what the larger club is allowed to spend? The answer is that they can't. Even more damning is the "billionaire" loophole, which states that a club with a wealthy owner is allowed to expand the spending limit, so long as the owner takes on that extra spending personally. It's pretty clear who these rules were intended to benefit.

The idea of FFP was sold to the masses based on a fantasy where footballing success is not necessarily linked to wealth (paradoxically so, considering the proposed means to achieve this fantasy was by limiting spending), but in reality this is not so. Money is directly correlated to on-the-pitch success and always has been. Just ask Herbert Chapman's Arsenal of the 1920s and 1930s, Leeds in the 1970s, and countless others during the 1980s and 1990s global expansion of the game. The only thing that this limitation has achieved is making it practically impossible for any small, upstart club to compete at the same level as those already fortunate enough to sit at the summit of the game. 

If there was any ambiguity left as to whom these rules were written to benefit, we need only look at how infringements of the rules have been handled over the past decade. FFP allows UEFA to hand out punishments ranging in severity from a fine to an outright ban from UEFA competitions. Full competition bans have been handed out to the likes of Malaga, Rapid Bucuresti, and Metalurh Donetsk, for infringements that amounted to a difference of tens of thousands of euros. By contrast, Manchester City and PSG both made headlines in recent years for blowing well past their spending limits and attempting to cover it up with above-market "sweetheart" deals with their own private companies (essentially an illegal owner cash injection disguised as a legitimate sponsorship arrangement). The magnitude of these infringements was in the hundreds of millions of euros. Their punishment? A fine and a slap on the wrist. Ask yourself why there is this disparate treatment.

In retrospect, it's actually a little spooky just how accurate my piece from a decade ago proved to be. I warned that FFP, and the institutional advantages it afforded the elite clubs, would kill competitiveness in European football. Accordingly, the decade since has seen three of Europe's biggest leagues, the Italian Serie A, French Ligue 1 and the German Bundesliga, turn effectively into one-club leagues. 

The difference before and after FFP really is shocking. The previous decade saw 5 different Italian champions, 6 French champions, and 5 German champions. The decade following FFP has seen just one club (Juventus and PSG) win 9 out of 10 seasons in Italy and France and one club win 8 out of 10 (Bayern Munich) in Germany.

The other major prediction from this piece was the revitalisation of German football. The FFP rules were written in such a way as to confer a clear preference to the German economic model of football and I predicted that this lack of restriction would allow the Bundesliga, and Bayern Munich in particular, to really break into that top level of European super clubs. Even aside from their domestic domination, the results speak for themselves. Bayern Munich have reached the Champions League final on four occasions in the past ten years, having only reached it twice in the previous three decades.

The bottom line from all of this is that FFP was never about making football fair, or equal. It was never about what was best for the fans or the communities. It was simply UEFA picking and choosing its preferred clubs and giving them a massive advantage. Why do this? It's obvious. The big clubs are UEFA's money makers. When they do well, UEFA does well. By protecting their elite status, UEFA ensures that a) the game's power-brokers are happy, and b) the money train keeps rolling. 

The fact is that FFP, even in theory, was always a bad way to achieve its stated goals. A football club, like any other business, needs to be able to spend and take on risk in order to grow. All those elite football clubs? They already did that, years or even decades ago. If it backfires and the club goes into financial difficulty? So be it, the club takes that risk at their peril and the more conservative institutions are free not to do so. There is nothing wrong with allowing a club to take that risk, in fact that is the basis for our entire economy. If businesses were not allowed to engage in debt spending, no one would ever be able to succeed without the financial backing of a more established company, the result would be the mega-corporations of the world monopolising industry.  Right now we are seeing the equivalent of this in the football world. Football's elite pulled up the ladder behind them and received a full backing from UEFA to do so, under the pretence that it was all being done to help "the little guy".

It is an especially appropriate time to be discussing this in the wake of the recent European Super League scandal, in which twelve clubs attempted to form a breakaway league with the express purpose of enshrining their permanent elite status and killing off any legitimate form of competition. This essentially would do what FFP has already been doing for years now, albeit in a more explicit and risk-free fashion. If this piece accomplishes anything, I would hope that it is a reminder that UEFA are no better than these clubs.

The Super League was met with global condemnation and protest, imploding spectacularly over night. Where was this outrage a decade ago with FFP? I blame a naive set of football supporters who had not yet learned of the abject corruption in football's global authorities, as would become spectacularly clear in the years following. But more than that I blame a media who, at the time, was obsessed with portraying the upstart nouveau-riches clubs of Chelsea and Manchester City as the villains in the game, while turning a blind eye to the monopolistic practices of the elite clubs.

I can forgive people ten years ago for not wanting to believe the worst about UEFA and FFP. But now, ten years later and with abundant confirmation of these facts, it is time for us to accept the reality of what has happened in the game and speak out about it. Let's use this anniversary as an opportunity to admit our mistakes and right this wrong. The defeat of the Super League shows how much power the fans have, we need to keep this momentum going and challenge all the other institutions that prevent the beautiful game from taking place on a fair and equal playing field.

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