Revealed: How Arsenal, Liverpool, Manchester United & Tottenham staged coup to push through new financial reforms

As clubs prepare for showdown meeting, documents show that the Premier League ‘gang of four’ outlined official intent three months ago to shackle spending of Chelsea and Man City

By Wayne Veysey

Arsenal, Liverpool, Manchester United and Tottenham first signalled their intent to stem the spending of Chelsea and Manchester City with an explosive letter three months ago.

As the Premier League clubs get ready to vote on cost-control measures at Thursday’s showdown meeting, official documents revealed to show that the owners and chief executives of the four elite clubs submitted the first of two joint papers on Wednesday, November 14.

Addressed to the governing body, it “advocated that the Premier League should adopt the Uefa financial fair play (FFP) regulations” and that wealthy owners should not be allowed to under-write any losses following a period of adjustment to the rules.

This document, signed by the quartet of breakaway clubs, was designed to put pressure on the other 16 top-flight clubs at the full shareholders’ meeting on November 15 when the issue of financial regulation was to be discussed at length.

The paper was followed by a speech from United chief executive David Gill explaining in detail Uefa FFP rules and why he was in favour of a transition period where losses would be permitted.

“The Premier League would be enjoying record levels of income from sale of its television rights, which gives all clubs the opportunity to move into profit subject to a transition period,” Gill told the meeting of shareholders, who included representatives of the 20 clubs, FA chairman David Bernstein and senior League officials.  

At the meeting, 16 of the 20 clubs asked the league to press ahead with detailed proposals for a “break-even rule”, with a view to introducing it next season.

Fulham, Aston Villa, West Brom and City opposed the introduction of a break-even rule, though for very different reasons.

A specially convened shareholders’ meeting then took place on December 18 to further discuss financial regulation.

A day before the meeting, Arsenal, Liverpool, United and Tottenham published another joint-letter which formalised the points that Gill had made to shareholders at the previous summit and why the ‘gang of four’ was in favour of a strict break-even rule.

The 20 top-flight clubs are now expected to vote on a financial fair play deal at Thursday’s crunch meeting in central London with a view to introducing it in time for the 2013-14 season, to coincide with the start of the £5.2 billion new broadcasting deal.

Fourteen of the 20 votes are required to push through reforms. At the last meeting, Arsenal, Chelsea, Everton, Liverpool, Manchester United, Newcastle United, Norwich City, QPR, Reading, Southampton, Stoke City, Sunderland, Swansea City, Tottenham, West Ham and Wigan Athletic had all indicated they were in favour of stricter financial regulation.

Under the Uefa rules, club owners can underwrite losses of up to €45 milliion (£38.9 million) over the first three seasons of FFP.

However, the definition of what the Premier League model should be, and how much clubs should be able to lose, varies widely and a compromise deal is likely to be agreed on Thursday.

While Arsenal, Liverpool, United and Spurs would like the league to stick to the Uefa model, other clubs such as Chelsea, Newcastle and QPR want to reserve the right for owners to inject unlimited funds, as long as it is in the form of equity rather than loans.

The second spending control system on the agenda at Thursday’s meeting is a wage cap to satisfy clubs fearful that the bulk of income from the new TV deal will go straight into the pockets of players and agents.
Of the three proposals tabled to shareholders in November, the most popular among the 20 clubs was for each wage bill to be limited to its current amount plus a capped percentage increase.

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