Premier League players told that clubs will lose £1.137 billion over coronavirus suspension
Gordon Taylor, chief executive of the PFA, said that players taking 12-month wage cuts would significantly affect the tax yield for the NHS
BySam Wallace, CHIEF FOOTBALL WRITER and James Ducker, NORTHERN FOOTBALL CORRESPONDENT4 April 2020 • 9:27pm
The Premier League is expecting to be hit hard by the loss of action and subsequent revenue due to the coronavirus pandemic CREDIT: REUTERS
Premier League players have been told that clubs estimate they could lose £1.137 billion over the coronavirus crisis suspension, as talks descended into deadlock over a 30 per cent paycut lasting 12 months which has invited staunch opposition from the players’ union.
It came on the same day that Liverpool were criticised by Jamie Carragher for becoming the latest Premier League club to furlough non-playing staff.
As the dispute over a paycut intensified, Gordon Taylor, the chief executive of the Professional Footballers’ Association (PFA), said that players taking wage cuts - for a whole year - would significantly affect the tax yield for the NHS.
The financial threat was laid out to the players in a presentation made by Premier League staff to some of the game’s big names, including Jordan Henderson and Kevin De Bruyne via video on Saturday afternoon.
Telegraph Sport has seen details and can reveal the Premier League told players:
A potential broadcast rebate package for Sky Sports (£371 million), BT Sport (£50 million) and international broadcasters (£341 million) would cost £762 million if the season could not be completed
That the league estimated the lost revenue from matchday income – tickets and related sales at the stadium – at £200 million with a further £175 million estimated to be lost from sponsorship deals that may have to be repaid
Player salaries make up around half of all costs and clubs have estimated that in a worst case scenario with a 20 per cent wage cut or deferral they would raise around £570 million in savings over a year which would cover around half the total losses of £1.137 billion.
Gordon Taylor highlighted that a reduction in players' wages could have a substantial effect on tax revenues CREDIT: PA
In response, Taylor issued a statement saying any agreement would take “a bit more time”. He criticised the Health Secretary Matt Hancock for failing to take note of what a on paycut would mean for tax yields. Taylor also told the Premier League that its £125 million advance to the Football League and £20 million donation to the NHS announced on Friday were inadequate.
The Premier League, meanwhile, are determined to press on with direct negotiations with the players, with or without the support of Taylor and the PFA. They told the players that if they accepted the paycut, clubs would “restore normal remuneration levels when health and financial conditions permit”. The cuts would be “smoothed”, the league said, over a 12-month period.
Under the terms proposed for the 30 per cent proposed wage cut, 20 per cent would be repaid if the remaining games were played behind closed doors and there was no rebate penalty to broadcasters. The players would be paid in full if all remaining games this season could be staged in full stadiums and no money was returned to broadcasters.
Under the principles of the negotiation established by the Premier League the clubs listed “protecting player and staff employment and terms, wherever possible”; “supporting low-paid personnel”; “maintaining the viability of clubs by managing costs”; “preserving academy structures” and completing the current season.
In a long statement on Saturday evening, Taylor said that his members “care deeply for those who are suffering with loss, health and hardship at the moment”. He said a 30 per cent cut would cost the public purse “substantial sums”. “What effect does this loss of earning to the government mean for the NHS?” Taylor asked. “Was this considered in the Premier League proposal and did the Health Secretary, Matt Hancock, factor this in when asking players to take a salary cut?”
Taylor said that by agreeing to discuss the paycut, the Premier League players wanted to support their own clubs, and non-playing staff to receive 100 per cent of their wages, as well as EFL clubs and those in non-league, and the NHS.
The talks came on the same day that Liverpool announced the furloughing of staff under the government coronavirus job retention scheme, a move which attracted criticism of the club, including from former players. Unlike Tottenham Hotspur who announced similar measures on Tuesday, Liverpool have not imposed any paycuts on staff, making up the 20 per cent shortfall from their own resources.
Liverpool said they had “placed some staff who are impacted by the Premier League suspension on furlough”. The club had already pledged to pay matchday staff while the league is suspended. They said that they sought “a solution that secures jobs for employees of the club during this unprecedented crisis”.
The club did not specify it was in negotiations to cut player wages but added: “There is ongoing active engagement about the topic of salary deductions during the period matches are not being played to schedule. These discussions are complex and as a result the process is ongoing.”
The former Liverpool defender turned Telegraph columnist and Sky Sports pundit, Carragher tweeted that this was "poor" from Liverpool.
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Liverpool are the fifth Premier League club to announce they are furloughing some non-playing staff after Spurs, Newcastle United, Bournemouth and Norwich City.
According to Liverpool’s latest accounts for the year to June 2019, the club employ 853 people, of which 675 are non-playing staff. The move to furlough is likely to affect at least 350 employees.
Liverpool’s wage bill for the 2018-2019 season was £310 million, the vast majority of which covers the cost of the salaries of players and coaching staff.
Five weeks ago Liverpool announced a pre-tax profit of £42m on revenues of £533 million.
Earlier in the day, Premier League club Burnley revealed they are facing a £50 million cash shortfall if the season does not resume but claim some of their rivals will be looking at losses of around double that as the club’s chairman Mike Garlick pleaded for unity. The Lancashire club say they stand to lose around £45 million in broadcast income if the season is not finished in addition to a further £5 million from lost gate receipts if their final four home league matches are not concluded or played behind closed doors.
Burnley said there were rival top flight clubs who stand to be even harder hit by the coronavirus crisis.
“It is believed that other clubs could be looking at up to a £100m shortfall,” the club said. Burnley released their latest financial accounts this week which showed a £4.3 million profit for the year to June 30.
Garlick said: “It’s now not just about Burnley or any other individual club anymore, it’s about the whole football ecosystem from the Premier League downwards and all the other businesses and communities that feed from that ecosystem.”