Monday, May 5, 2014

UK News Summary 2: Financial Fair Play Against Manchester City

1.       The first ever Financial Fair Play (FFP) sanctions against football clubs are set to be imposed by Uefa. One of the teams being investigated and negotiated with is Manchester City, one of the more popular teams in the Barclay’s Premier League. The FFP rules are designed so that a team can only pay what they make. These rules were instituted to make sure teams were only spending what they earn while paying their taxes and debts on time.  The issue is that within the rules there appears to be a lot of grey area, and the teams are allowed to haggle over their punishment. Manchester City is now haggling over their punishment and whether or not it should even receive one. http://www.bbc.com/news/business-27219134
2.       These FFP rules are another example of a league limiting player salaries in the name of more equal competition. Teams with higher revenues can afford to go a bit into debt in order to sign a better team, then, after becoming more competitive, revenues will catch up and they can pay off their debts. The question is, does this actually increase the competitiveness of play or is the main function to reduce player salaries.

3.       From the reading it suggests that team owners trying to limit salaries is the cause of this problem. A solution could be to take the control of policies away from the owners and give them to a third party governing body that has the goal of promoting equal competition.

No comments:

Post a Comment