Newcastle United will continue to be limited to losses of £105 million over a rolling three-year period. Richard Masters has spoken out after Premier League teams chose not to vote on a new system.
After Premier League clubs chose to postpone voting on new financial rules, Richard Masters said there is ‘no perfect solution out there’.
Newcastle United and the league’s other 19 teams appear to be sticking with the current PSR regulations next season, which limit top-flight sides to losses of £105 million over a rolling three-year period. That should not come as a big surprise; Manchester City is already at odds with the Premier League, and the Professional Footballers’ Association (PFA) has threatened legal action if a rigid salary ceiling is implemented.
Clubs will continue to try squad cost rules and anchoring in shadow, and the Premier League’s technical staff will engage with top-flight clubs’ chief financial officers to ‘iron out creases’. However, Masters was the first to recognize there is ‘no perfect system out there’ as the top-flight strive to ‘balance the competitiveness of the league…within sustainable guardrails’ in the chief executive’s own words.
“It’s still a direction of travel,” he said at the Financial Times football business summit. “We have spent the previous 18 months researching at squad cost ratio as a concept to address two issues with the present system.
“It’s not that the existing system is ineffective or horrible, but the Premier League has traditionally followed UEFA. So, whether you have clubs in Europe or the Premier League, they all follow the same structure. If you have a system that regulates income and another that regulates profits, they are not the same, thus we believe this is an aspiration that should be considered.
“Secondly, the PSR system at the moment is a look back system over three years and the squad cost ratio system that we have designed and is still in shadow as it were – we’re monitoring clubs on that basis – delivers in-season essentially. It’s an in-season test. So rather than over-spending over three years and then sanctions being in place the following year, it would happen in-season. Those are the two things the clubs, in particular, wanted to see addressed.
“We have made a lot of progress with clubs and our last meeting, which was a two-day meeting where we talked about future growth and the financial system, we agreed in all probability to PSR in 2025/26 and we will look again during the course of that season whether we’re going to make the move to squad cost ratio.”
Squad cost guidelines will limit on-field spending to 85% of revenue and net profit/loss on player sales for non-European teams and 70% for European clubs, according to UEFA rules. As part of the shadow experiment, clubs reported to the Premier League in March and October.
