Financial Fair Play: Should any of the big spenders of EPL worry about it?

Financial fair play regulations were introduced amid concern at the heavy spending of a number of professional clubs across Europe. It was hoped that the regulations would eventually lead to a more ‘level playing field’ by preventing clubs with very wealthy owners who make substantial cash gifts to their club from gaining an unfair advantage over other clubs who are run on a more sustainable business model, and in so doing encourage lower levels of spending. The financial fair play (FFP) regulations provide for sanctions to be taken against clubs who do not spend within a set budgetary framework over several seasons.
The UEFA president Michel Platini felt that these regulations are necessary as 50 % of the clubs were losing money & there was a need to stop this downward spiral. Clubs had spent more than what they had earned in the past and haven’t paid their debts.
Recent research has shown that the Premier League clubs spent a mammoth 52% of the total investment on players across the top 5 leagues in Europe this winter. Premier League spending topped €150 million compared to €53 million in French Ligue 1, €42 million in Italian Serie A, €33 million in the Bundesliga and just €12 million in Spanish La Liga. The confidence given from the new collective broadcast deals for English clubs is highlighted by the fact that the spending is also spread across more clubs in England than any other in Europe. Whilst Chelsea and Manchester United top the European spending, with €52.8 million and €45 million respectively, Fulham (€16.3 million) and Hull City (€15.2 million) also feature in the top 10 of the biggest spenders in Europe. Interestingly 7 of Europe’s biggest names, Arsenal, AC Milan, Real Madrid, Juventus, Manchester City, Bayern Munich and Barcelona made no investment during the winter window.
The big spenders like Chelsea, Manchester city (irrespective of making any deal in winter) should keep a keen eye on the financial fair play. City, in its financial report for the year 2012-2013 showed an annual wage bill of £233 million – £639,000 a day. If City fails to meet FFP, any affected party will have a chance to appeal against them & City can be banned from the Champions league. The same logic goes for Chelsea.  Given Chelsea’s superrich owners it has always been in the eye of FFP regulations. Recent disclosure of Chelsea states that they incurred a whopping loss of £49.4m but they still meet FFP norms. Some say that Chelsea acted very smartly by selling off some players and thus is saved from the actions of FFP. Manchester United, though being seen on the side of FFP will also have to balance its books as the club has also had record sources of funding in its previous years and also some major transfers in the previous seasons.
So, whatever be the current position of the teams, they should realize one thing that FFP is here to stay and they cannot easily escape from those regulations. The spenders of those teams should realize that those times are gone when pumping money would increase your chances of winning trophies. Here are the days when doing so now can cost you your entry in the league.