We’ve had another cash injection; How does FFP work? and I’m looking for positives

It transpires that the club has had a Cash injection of £13 million, courtesy of Nassef Sawiris and Wes Edens, our minted owners, buying more shares in the club.

Which left me quite perplexed, to be honest.
I thought we couldn’t spend any money, because we’re going over the £39 million loss over three years, or whatever it is?

Until I had another think about what FFP is actually meant to achieve.

My take is that FFP was designed to stop clubs going into extreme, unsustainable debt to try to achieve an unfair advantage.
I won’t mention Man Utd’s £1 billion debt, but even then, they’re not at risk of going bust just yet.
You can’t risk busting your club for a short-term gain that could very easily go wrong, is the point.
I also won’t mention that smaller clubs could face going bust for 10% of that £39 million.

I have never been convinced about the whole idea, but it’s a good premise.
Reckless owners can’t come in and bust a club in the short-term, is the idea.

But there’s been good debate on here and elsewhere about how this is basically a restriction of trade, that has no basis in law and wouldn’t stand up in court.
Except QPR had to swallow a stonking fine (£12-13 million?) quite recently for breaking the rules.
Why didn’t they fight that decision in court?
Probably because it’s just easier to play the game. You don’t really want to fall foul of those that run the game, do you?
I’m sure the EPL, EFL and FA can be as vindictive as it gets.

So where does that leave us?

Well, something has definitely gone on somewhere.
We know the EFL called the club in for discussions when our new owners came in.
Christian Purslow, our CEO, said that we would play within the rules and FFP wouldn’t be a problem, even though we’ve obviously gone well over the official limits.

My take and it’s a massive positive, is that our owners have offered some sort of bond, that says they’ll cover the required amount of any debt that the club has.
Of course, we need some debt. It suits the books, after all.

If I’m right, this is a is a win-win for all parties.
The EFL sees increased investment in the game.
And the club gets to spend whatever money the owners want, because it’s all guaranteed.
This is the relevant part, that is surely what FFP is all about.
Our owners have committed 100% to not bankrupt the club and backed it with real money, not promises.

Am I wrong?
Very possibly.
In which case you can tell me how we can continue to spend.

The point is, even though I don’t expect Dean Smith to spend a fortune in the summer, he’ll still have plenty of scope to replace the majority of the squad if he deems it necessary.

And continuing with the positive vein, someone sent me the following stats about the Villa;

We have the 4th highest shots per game at 14.1 only beaten by Leeds, Norwich and Brentford.

And we are 3rd overall for passing accuracy at 79.5% behind Leeds 79.6% and Swansea 82.2%

Individually, we have two performers in top 4 – Abraham obviously but also Connor Hourihane is 4th highest in terms of assists with 9.

Okay, you long term readers know what I think about statistics.
They don’t represent the game as us fans see it.
But ALL managers and coaches have to take them into consideration, as they have far too much to oversee these days.

As much as we might not like it, the days of Sir Ron looking after 15 players, with a half time orange and a boot up the jacksie have gone.

I still think Hourihane is mostly invisible in games though.
And those stats don’t show that we’re in the bottom three in the whole professional league for conceding goals.

But hey, I’m looking for positives, aren’t I?

26 Comments

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  1. Avatar
    BristolCityFanInPeace February 22, 2019 at 9:38 am .

    Hi.

    Was looking up FFP- as I take an interest. IMO there is no way there should be any sweetheart deal between EFL and Aston Villa- we had to sell Flint, Bryan and Reid plus squad players this summer. Remarkably we are 6th and in with a chance of the playoffs but regardless of the rebuild, we had to comply- so should everyone yourselves included.

    I know you got new owners but the profit and loss scenario should keep rolling. Not their fault no but in terms of fair competition any deal should be challenged by those clubs who make big efforts and sacrifices to comply, in court if necessary.

    Debt write offs are great, undoubtedly so and I wish no ill on yourselves or other clubs but in no way should new owners be able to bail you out of FFP obligations- or anyone else for that matter. I’d say the same if it was us!

    1. Avatar
      Hitchens60 February 22, 2019 at 12:34 pm .

      I don’t think anyone is suggesting that Villa should be made an exception, however there are (have been) questionable decisions made by EFL particularly over Wolves transfer dealings last season.

      If we are honest, none of us fully understand how FFP works and there have been challenges in court which resulted in the rules being relaxed in 2015.

      The question being asked is whether substantial shareholder funds which demonstrate that losses (debt) are fully covered / affordable should be taken into account.

      You will also find that there are discussions on here over what we will be able to do in the summer and whether any of our prize assets will have to sold to fund any acquisitions.

      1. Avatar
        Badger123 February 22, 2019 at 8:44 pm .

        BristolCityFanInPeace,

        Hitchens60 is right.
        No one is asking for an exception as such.
        It’s more looking at why FFP was brought about.
        I’m suggesting the main reason is to stop clubs going bust.

        But you do have a valid point in that if the main reason is just to stop clubs gaining an unfair advantage, there should be no allowances for any club.

        The part that confuses me is that both reasons are similar, because if you have massive debt, above the limits, it implies that you increase the risk of going bust as well as having an unfair advantage.

        The fact remains that our CEO, who was on the comittee that created the FFP rules is insistent that we won’t have a problem, even though we’ve easily exceeded the limits.

        To my mind, there must have been some sort of understanding reached, as I can’t see how else we’d evade punishment.

        I suppose the only other option would be to change FFP rules and replace them with some sort of cap on spending, but how would that work?
        A percentage of a clubs income, perhaps?
        Either way, the bigger clubs would have an advantage.

        Say, a £100mill per season?
        Same applies.

        There’s also the point that a club with a massive spend/debt may have everything quite happily in control and can pay it off quite easily.
        In which case, FFP is a restiction of trade, simple.

  2. Avatar
    Bill Pearson February 22, 2019 at 12:18 pm .

    If true or not? It’s being said that Chelsea have a ban on two Windows with the FFP, to me that would put the damper down on buying Tammy. anyone heard if that’s true.

    1. Avatar
      Hitchens60 February 22, 2019 at 12:28 pm .

      Bill, it’s a two window ban in regard to breaking rules over youth players. Haven’t bothered to read the whole article – just quoting BBC headlines.

  3. Avatar
    Bill Pearson February 22, 2019 at 1:11 pm .

    Thanks Hitch , you pointed me to that news. It’s BBC sports news.
    Chelsea have been banned from signing players in the next two transfer windows for breaching rules in relation to youth players, Fifa has announced.

    The ban, until the end of January 2020, does not prevent the release of players and will not apply to their women’s and futsal teams.

    The Premier League club have said they will appeal against the decision.

    Chelsea have also been fined £460,000, while the Football Association (FA) has been fined £390,000.

    It comes following a Fifa investigation into Chelsea’s signing of foreign under-18 players, including former striker Bertrand Traore.

    The world governing body says it found breaches in 29 cases out of 92 investigated.

    “We welcome the fact Fifa has accepted that there was no breach in relation to 63 of these players, but the club is extremely disappointed that Fifa has not accepted the club’s submissions in relation to the remaining 29 players,” said a statement from the Stamford Bridge club.

    “Chelsea acted in accordance with the relevant regulations and will shortly be submitting its appeal to Fifa.”

    The FA has been told by Fifa that it must “address the situation” regarding the international transfer and registration of minors.

    A spokesperson for English football’s governing body said it had “co-operated fully” with the investigations and had “raised some concerns” regarding Fifa’s disciplinary processes.

    A statement said: “The FA intends to appeal against the decision. We will, however, continue to work with Fifa and Chelsea in a constructive manner to address the issues which are raised by this case.”
    It also gives you how it happens..

  4. Avatar
    Badger123 February 22, 2019 at 8:18 pm .

    Either Real or Barce appealed against a similar thing and the ban ws put back for a year, I think.

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