The Championship, also known as the “wild, old league,” is back at it again with their financial mismanagement. It’s like watching a train wreck in slow motion. The poor players, staff, and supporters will suffer from this unjust decision of no deduction after breaching their historical budget restrictions. But hey, what’s new in the second tier of English football?
For the fourth consecutive season, a club’s financial mismanagement brings them relegation that could have otherwise been avoided. It’s like they enjoy being in the red, it’s a trend that they cannot seem to break. Last year, Derby County got a 21-point deduction for their descent into administration. The year before that, Sheffield Wednesday racked up a six-point penalty for breaching the EFL’s profitability and sustainability regulations. It’s like watching a soap opera, filled with drama and intrigue.
Wigan, oh Wigan, haven’t they learned their lessons yet? They have been here before, and yet they still cannot seem to figure out how to stay above water. When they were relegated to League One in 2019-20, they owed everything to the 12-point deduction they could not avoid when placed into administration by the club’s previous owners. It’s like their motto is “why learn from your mistakes when you can just keep making them?”
The uncomfortable truth is that not since 2018-19 have all three sides relegated to League One succumbed without the burden of a penalty weighing them down. The Championship has become the division of financial strain and distress. The majority of its 24 clubs are now conditioned to accept loss-making. Money spent on wages consistently exceeds the collective revenue each year. It’s like they never learned the simple concept of “if you can’t afford it, don’t buy it.”
The Championship’s wage costs for the 2020-21 season reached 125 percent of its total revenue. Meanwhile, the Premier League’s 20 clubs only spent 71 percent of their revenues on wages during the same period. It’s like a child playing with their parents’ credit card, thinking they have unlimited funds.
Fourteen Championship clubs have already shown they committed more to wages than they earned in total revenue for the current season. Kieran Maguire, a finance academic and host of the Price of Football podcast, has calculated that operational losses for last season average out at a remarkable £476,000 a week for every Championship club. It’s like they’re trying to set a new record for the highest debt in football history.
The current trend continued into a fifth successive campaign last term, albeit with only 19 of the 24 clubs so far filing their latest set of accounts. Money management is not their forte, clearly. The Championship has become a division of financial strain and distress, and the only thing that strains more than the clubs’ finances are the accountants trying to keep track of them.
Relegation is not the only consequence of these failed financial gambles. The Championship is the meat in the sandwich between the Premier League and League One and League Two. It’s like a sandwich that nobody wants, and every bite is a disappointment.
The Championship’s clubs have a significant disadvantage when trying to compete for the players they need to get promoted. Clubs like Luton Town and Millwall had wage bills that exceeded revenue last season, and Blackburn Rovers’ wage-to-turnover ratio stood at 146 percent. It’s like they’re playing a game of Jenga, and someone keeps pulling out the foundational blocks.
Birmingham City and Preston North End were at 177 and 178 percent, respectively. Meanwhile, five clubs, including Burnley and Sheffield United, received between £38 million and £45 million in funding this season, following relegation from the top flight in the last two years. It’s like they’re playing a never-ending game of catch-up.
Rotherham United is one club that decided to take a more sustainable approach. Last time they were in the Championship, they fought with a wage bill of £8.2 million, which equated to roughly two-thirds of their turnover. Unlike the other clubs that operate in the negative, Rotherham’s pre-tax loss of £800,000 would have been avoided had it not been a season played behind closed doors. It’s like Rotherham took lessons from Sesame Street’s Big Bird — “to live within your means, not beyond your means.”
The Championship’s financial ills are not easy to fix. Not only have some of its clubs faced points deductions this season, but others have also failed to meet the EFL’s financial requirements. Burnley celebrated their
Serious News: nytimes
