New Year raises pressure for landmark finance agreement between Premier League and EFL - with Government watching

Top-flight bosses recently halted negotiations with the professional football pyramid for the time being due to disagreements regarding the scale and structure of the deal, with Premier League CEO Richard Masters having told member clubs that the organisation does ‘not have a mandate’ to sign the funding agreement.

As it stands, there is no immediate prospect of the required majority of 14 clubs voting in favour of the proposals.

The agreement would effectively see an amount close to £900m being paid out by Premier League clubs to their 72 EFL counterparts over a six-year period, with the cost falling from £925m to £881m if an immediate upfront £44m payment is ratified.

But the 'big six' clubs of Liverpool, Manchester United, Manchester City, Arsenal, Chelsea, and Tottenham remain reluctant to sanction a deal due to smaller top-flight clubs being unwilling to pay a greater percentage of their revenue.

It has created an impasse with the EFL, although one leading football academic remains hopeful that a compromise figure will be reached in the new year.

Dr Rob Wilson, a football finance expert from Sheffield Hallam University, told The Yorkshire Post: “It’s always the same and always a negotiation.

"Some will want it really early (initial payment up front) as they have probably over-stretched themselves.

"Others will not be as concerned about it. They will just have to find a compromise agreement on where things are.

"If you offered anybody £1,000 today or in a year’s time, everybody should be taking the £1,000 today as they don’t know what it’s going to be worth in a year’s time and what it can be.

"So that’s where all the calls for the bigger, up front payments come from.”

Pressure has been growing since the summer for the top flight to reach agreement with the EFL over a funding plan.

A report by the Culture, Media and Sport Select Committee said that if none was reached soon, then the Government should accelerate bringing in an independent regulator.

Plans were subsequently outlined in the King’s Speech in November, with a Football Governance Bill placed on the statute books to introduce a regulator to "safeguard the future of football clubs for the benefit of communities and fans".

A strengthened owners' and directors' test was also part of the proposals alongside giving fans greater input in the running of clubs.

Earlier this month, the Premier League agreed a domestic deal with Sky Sports and TNT Sports worth £6.7billion over four years between 2025 and 2029, with the next key decision revolving around funding for the pyramid.

The latest developments regarding talks being paused is likely to be viewed dimly by the Government.

In a white paper published earlier this year, The Government said: "The current distribution of revenue is not sufficient, contributing to problems of financial unsustainability and having a destabilising effect on the football pyramid."

Under the planned ‘New Deal’, the money would be worth £190m to the EFL in the 2028-29 season, the final 12 months of the period.

The cash would be in addition to existing annual solidarity payments of £110m and other funds designated for youth development.

For the top flight, the prospect of a football regulator flexing their muscles down the line if any agreement is not reached is an added consideration for a deal to be brokered in the new year.

Wilson continued: "You have the backdrop of the government review into the financial position and governance of the game.

"I think everybody is kind of trying to throw their weight behind the independent regulator or otherwise.

"So the Premier League will be trying to say: ‘We probably don’t need an independent regulator, we can look after this.’ So payments to the EFL will probably go up a bit.”

"Because they (Premier League) can then say: ‘well, we are doing this and that’ and try and stave off that independent regulation.

"Or at least if they accept that it’s going (to happen), engineer that the regulator does not have the huge impact many think it might have."