Bailout fund critical for EFL and National League survival
LINCOLN, ENGLAND - FEBRUARY 11: A general view of LNER Stadium, home of Lincoln City prior to the Sky Bet League One match between Lincoln City and Milton Keynes Dons at LNER Stadium on February 11, 2020 in Lincoln, England. (Photo by Chris Vaughan - CameraSport via Getty Images)

Battered and bruised after a series of blows, this one could be fatal.

Boris Johnson yesterday announced that the return of supporters to football grounds will be delayed indefinitely, potentially for up to six months, and the implications for the English game are dire.

The pandemic has left club finances decimated by the absence of matchday revenue, chiefly those lower down the pyramid that are more reliant on movement through the turnstiles. The plan was for fans to return to grounds at 25-33% capacity on October 1, but with coronavirus cases rising, the Prime Minister was left with little option but to push the date back. Announcing new restrictions in the House of Commons on Tuesday, Johnson said: “We have to acknowledge that the spread of the virus is now affecting our ability to reopen business conferences, exhibitions and large sporting events.

“I recognise the implications for our sports clubs which are the life and soul of the communities, and my right honourable friends the Chancellor and the Culture Secretary are working urgently on what we can now do to support them.”

More than 100 sports organisations recently signed a letter requesting a financial support package from the government. Johnson, however, is yet to commit to anything after the arts industry was granted £1.6billion in July. Further talks were held with the Secretary of State for Digital, Culture, sports and media, Oliver Dowden, on Tuesday, with EFL clubs standing to lose around £200 million if stadiums remain empty throughout the winter, while the Premier League revealed in a statement that it is currently incurring losses of more than £100million per month.

It is in the National League, though, where the stakes are highest. With the league having been in hibernation for six months, October 3 was slated as their day of salvation, the day that both football and fans would return. The new restrictions, however, have torn the plans to pieces.

The “elite status” that the National League applied for in June has barred clubs from hosting matches with reduced capacity crowds, as it has meant that the leagues are now governed by the same rules as the Premier League and the EFL. Clubs are at an impasse as to whether they should carry on with the season regardless, given the lack of substantial revenue outside of gate receipts. With the furlough scheme coming to an end and the government yet to issue a rescue package, the big question is how clubs will source the money to pay their players, many of whom are full-time.

The growing feeling among club chairmen and secretaries is that, without significant intervention, this will not be possible. Ken Wright, chairman of National League North’s Chorley Town, told The Athletic: “We rely totally on gate receipts and sponsorship. It’s getting increasingly difficult to keep our head above the water. And it can’t go on indefinitely.”

Insolvency has become a very real prospect and for some, it is imminent. The demise of Macclesfield Town, although not entirely Covid-related, is a case in point.

Nigel Travis, the owner of League Two side Leyton Orient told Sky Sports News: “They [the government] have not been very helpful to sports at all, they are incredibly inconsistent with their approach and I think it’s time for Boris Johnson to put some money behind us.

“There’s a lot of clubs in League One, League Two and the nine levels of football below us. The government needs to do more. They need to step up and give football and some other sports some support.

Joey Barton, the manager of League One side Fleetwood Town, believes part of the responsibility lies with the high earners at the top of the game. “People are getting discarded and made redundant, and clubs are being closed. That is just wrong,” he said. “I have been at the top of the table and I have earned loads of dough, and I didn’t complain when I earned it. But when you see players earning £300,000, £400,000, £500,000 a week and we have got clubs here that are struggling to keep the electricity on, clubs that are struggling to pay and have enough players to complete fixtures, it is just wrong. We have to protect the game from itself.”

It’s a sentiment shared by many in the game at the moment - the government themselves appeared to single out the Premier League as an organisation that should be doing more to help out the rest of the industry. There is, after all, a case to say the league is partly responsible. Wage inflation at the top of the game inevitably trickles its way down, and now, in this time of crisis, the clubs with disproportionate levels of income are feeling the full effects.

The Premier League has incurred no shortage of losses either but, unlike the clubs lower down the pyramid, its teams can depend upon alternative revenue streams. Matchday revenue constituted just 5% of Burnley’s total income in 2018-19 but provides around 90% of the money for National League sides, leaving a chasm in their finances.

Chelsea, who have just spent more than £200million in the transfer market, made the kind gesture of paying for Barnsley’s coronavirus tests ahead of their Carabao Cup tie on Wednesday, and head coach Frank Lampard echoes the government’s belief that the division should be doing more to support those in need.

“I think it’s important that the Premier League as a collective looks at supporting the EFL, the leagues below and grassroots football, absolutely,” he said. “I can’t go too political because I don’t know enough about the numbers, but I do think clubs in the Premier League and the Premier League themselves have a heart. They understand and I’m sure as we move forward they’ll be making positive moves on that front.”

Lampard rather conveniently left out the part about his side’s summer splurge, and that according to the EFL, £200million would have ensured all 72 football league clubs survived. And you can’t blame him. They, after all, can not possibly be held accountable for other sides’ struggles, can they?

No, is the answer, according to Sean Dyche. Comparing the football industry to others, the Burnley manager thought it unreasonable for the Premier League to be expected to bail out others.

“If you are going to apply it to football, you must apply it to every business across the country and then you have a balanced and fair look at things,” he said. “If it’s right for football, then other incredibly successful businesses should spread their wealth around.”

It’s an interesting point, and whether the Premier League actually has enough spare “wealth” to distribute is another debate. The league has not been immune from the financial impact of the pandemic, reporting losses of £700million last season, and has already provided the EFL and National League with £125million.

Although in a less precarious position than others with their broadcasting billions, the clubs are clearly fighting their own battles. And the governing body made no secret of its ire with the government’s announcement on Tuesday night, believing fans could have been safely accommodated.

A statement was released this week warning of the “devastating impact” of the decision to its clubs, but Steve Brine MP, who sits on the digital, culture, media and support committee, hit back on talkSPORT, giving the notion of a Premier League support package short shrift. “We are not going to be bailing out football clubs that pay stars £600,000 a week,” said Brine on talkSPORT. “But there is no question the government needs to start thinking about helping lower league football clubs.

The battle between government and league is unlikely to end any time soon. And it can be distilled into a simple question - who will step up? As the months pass by and the money taps refuse to turn on, lower league clubs edge closer to the precipice. A rescue package appears the only escape route, and yet neither party appears committed to supplying it.

The inertia, as Ken Wright said, “can’t go on indefinitely”.

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