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Financial fair-play rules to be discussed by Championship clubs

The Championship clubs have agreed to consider financial fair-play rules requiring them to approach breaking even by 2017, reports The Guardian. The proposal would require clubs to reduce their losses next season to £12m a year, and by 2017 reduce the permitted loss to £5m a year. Of that, £3m would have to be covered by a capital injection from an owner or investor, leaving £2m as the loss clubs are allowed to make.

The financial position of Championship clubs is particularly difficult; those relegated from the Premier League struggle with the huge drop in income yet are still able to pay their players a great deal more than their competitor clubs because they receive parachute payments for four seasons.

In 2009-10, 21 of the 24 made a loss, six of them more than £10m. Bristol City lost £12m and on Tuesday announced losses for 2010-11 of £11m. Last year Ipswich lost £15m, Nottingham Forest £12m and Sheffield United, now in League One, £19m.

The League will now draw up detailed proposed rules, to include the financial provisions by which the £5m loss will be permitted from 2017.

A League spokesman said of the meeting: "Owners and executives of Championship clubs reaffirmed their commitment to the principles of financial fair play as a means for encouraging financial sustainability at club level. After further discussions about the practical implementation of financial fair play, clubs agreed that the proposals should be finalised and taken forward to the next meeting of Championship clubs at Derby in February for final ratification."

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Dave Williams

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