Stefan Borson has stated that Leeds United will violate the Premier League’s profit and sustainability guidelines if they are promoted from the Championship this season.
The finance expert said that, due to a £20 million reduction to promotion incentives, if they increase as revenue decreases, they will break the regulations and be punished.
This is despite Kieran Maguire and Phil Hay’s assurance that Leeds has kept within the PSR restrictions due to player sales, despite a revenue fall.
Borson revealed live on talkSPORT [16 April, 11:15]: “If Leeds are promoted this season, they will fail PSR due to a £20 million hit to promotion bonuses.”
“Of course, they have not had a countervailing revenue rise; rather, they have had a revenue reduction. Ironically, by gaining promotion, they risk failing PSR and being punished in the Premier League, even if the only reason they failed was because they were promoted.”
Could Leeds United face point deductions for PSR violations?
The Premier League has deducted points from both Everton and Nottingham Forest for breaking financial rules, with Leicester risking a same fate if promoted, therefore there is no reason Leeds can not be penalized similarly.
Kieran Maguire assured fans that Leeds will not violate profit and sustainability laws due to player sales. However, the losses prior to player sales were a source of concern due to their magnitude.
Phil Hay, however, highlighted that, while the club is fine for the time being due to prior sales, promotion to the Premier League remains financially critical if Leeds is to avoid further problems caused by PSR breaches.
The Premier League has deducted points from both Everton and Nottingham Forest for breaking financial rules, with Leicester risking a same fate if promoted, therefore there is no reason Leeds can not be penalized similarly.
So the money that comes with promotion to the Premier League should provide additional stability, but the promotion bonuses would put Leeds in violation, making the scenario nearly impossible to negotiate.
