Ciderspace News Page : League Two Chairman Warns EFL Funding Plans Could Destroy Their Own League
20 September 2017 : League Two Chairman Warns EFL Funding Plans Could Destroy Their Own League
Some of the detail behind what the Football League's new television rights deal has been made public. The new deal was announced by the Football League earlier this month and commences from the 2019-20 season onwards, giving Sky Sports a further five years worth of broadcasting rights on top of their current arrangements. The League promoted the new deal as providing a 36 percent increase in funds for the 72 member clubs, and an overall package of 600 million over a five year period.

Accrington Stanley Chairman Andy Holt is one of the more transparent (and often outspoken) people amongst the 72 representative Chairmen, and he has raised his concerns about the growing gap between the Championship division and League One and League Two in terms of the amount of money each club gets from television and sponsorship deals, as well as solidarity payments made by the Premier League. Holt makes reference to an agreement set up between the Premier League and the Football League for the way that funds are distributed, with Championship clubs receiving 80 percent of each package, whilst League One sides receive 12 percent, with League Two teams getting 8 percent.

That split had been agreed at at time when revenue figures were much lower. However, because it is deemed to be a constitutional issue within the league, it requires a 75 percent majority for the ratio to be changed. Holt points out that means that even if all League One and League Two clubs vote for change, that will still only give a 66.6 percent majority, meaning that a small number of Championship clubs would need to vote for change. The question came up at the Football League 2013 AGM, but reports at the time claimed that Yeovil Town - as a newly promoted Championship club - voted against change; a decision they may be regretting now.

Holt calculates that the new Football League broadcasting deal with Sky Sports will give member clubs 1,050,000 for each Championship club per season, with League One sides receiving 157,000 whilst League Two teams will get 105,000 per season. That's only a small slice of the pot, with sponsorship deals with Sky Bet, Carabao and Checkatrade boosting it further, whilst there are payments made by the Premier League - dubbed Solidarity Payments - that were recently renegotiated as part of the formation of the EPPP Youth Academy structure, and the subsequent transfer system associated with it.

The Accrington Chairman has also published a ten year income plan showing how the overall distribution of funds is expected to affect each Football League division. The data is in bar graph form which means you have to estimate the exact figures, but it shows Championship income growing from 7 million in 2017 to 13 million in 2027. However, for League One clubs this will grow from around 1.75 million to just over 2 million in the same timeframe. Meanwhile League Two clubs will change from around 1.5 million to around 1.75 million. As can be seen, whilst Championship clubs will see their income almost double, the growth for League One and League Two will barely keep up with inflation.

Holt's problem is that either explicitly, or implicitly, the income changes will eventually create a second Premier League style division, where clubs trying to get promoted from League One into the Championship will find it almost impossible to stay there, because initially their income for their first year would be based on their League One promotion season. Similarly, any club relegated from the Championship into League One would still be receiving the tail end of their income for second tier football, which would give them the ability to leapfrog back quickly. Holt wants the issue raised at a Chairman's meeting tomorrow and warms that the growing gap between the second tier and third tier could 'destroy' the Football League, as it is currently constituted:

"An idiot can see that unless you join the Championship soon, the gap will grow so big as to make it impossible. The governing bodies know this (if they didn't they do now) and yet deliberately pursue a policy that will break away the Championship. My opinion is there will be PL1 (Premier League 1) and PL2 (Premier League 2) that is it. The rest will wither and fade. There will be little hope of generating enough income in a football league of 48 clubs. The funding formula deliberately decouples the Championship from League One and League Two. It's really as simple as that. So the only topic of tomorrow's (Thursday's) meeting should be the funding formula. Nothing else matters. This is what will destroy the Football League. It's shocking that members of the EFL have allowed the Championship to get ten times (that of) League Two clubs of the income generated."

Holt is also scathing about the League's plans to change the Summer Transfer Window for the Football League to align it with a new format agreed with the Premier League earlier this month. He questions which clubs have been calling for the changes to be made, and infers the motive may be to ensure that the Championship division rules stay closely aligned with the Premier League. His view is that this is not a priority for League One and League Two clubs, although views from other Chairmen and Managers, including Yeovil Town's Darren Way, would suggest this isn't a universal opinion. This is due to be on the agenda for tomorrow's meeting.

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