Premier League to Championship gulf is widening and clubs are in danger, warns EFL chairman Rick Parry
In the week that the Football Governance Bill was given a nudge towards passing in the King’s Speech - a “step in the right direction” in the eyes of Parry - the Football League supremo has reiterated just how pressing the matter has become.
While stopping short of expressing fears that football could follow rugby union which has seen four clubs go bust in the space of a year, Parry did cite the number of Championship clubs struggling to make ends meet as they chase the Premier League dream as a going concern.
Sheffield Wednesday chairman Dejphon Chansiri’s decision to ask fans to help settle running costs of £2m last month, that he himself later cleared, was used by Parry as an example of the game being “broken financially”.
This season, all three teams promoted from last season’s Championship - including Sheffield United - reside in the Premier League’s bottom four, while Leeds United and the two other teams relegated from the top flight last term, all sit in the top four in the Championship.
“We’ve been talking about the cliff edge for over three years, the fact that the gap between the bottom club in the Premier League and top of the Championship in terms of the revenues they earn is round about £100m,” Parry told The Yorkshire Post.
“It’s a difficult gap to bridge, not just on the way down but on the way up. We’re definitely seeing it this year, although of course the three previous seasons the three promoted teams stayed up so it’s a bit early to call it a trend.
“But it’s a difficult step up and difficult step down.
“We want a rich variety of teams going upwards. The pyramid is massively important.
“Luton is a fantastic story - when the Premier League was formed, they were round the table voting on the constitution of the Premier League because they were part of the old First Division.
“They never made it, got relegated, slid all the way and have come all the way back up again.
“To see them climbing up again is a great story, but we don’t want that to be an exception, we want it to be realistic for clubs to rise up the pyramid, because at the end of the day the pyramid is what sets England apart, the strength of it, the need to preserve it.
“It’s all about sustainable clubs, not being dependent on owners for funding, but clubs living within their means, having the right amount of revenues and having the right level of financial regulation to make sure they don’t overspend.”
Parry and the EFL have been lobbying hard for a number of years for a financial regulator.
The collapse of Bury, then of League Two, in 2019 was the catalyst. The Football Governance Bill that was part of the Conservative’s election manifesto, was included in the King’s Speech this week.
The legislation would ensure the operation of a licensing system for professional clubs in the top five tiers of English football, with the key objective of ensuring clubs are financially sustainable, responsibly run and accountable to their fans.
The importance of clubs to the communities they serve was underlined in an EFL impact report published by the league in January, which showed more than 840,000 people engaged in EFL club community activities over almost 580,000 hours across the 2021-22 season, delivering over £865million worth of social value to towns and cities across the country.
“The King’s Speech was a big step, clearly it’s been quite a long time in coming,” said Parry, speaking at Barnsley FC where EFL title sponsors SkyBet were launching their Building Foundations initiative in which they give £10,000 to all 72 clubs for community projects as part of a six-year, £6m investment.
“We had the Tracey Crouch review, then we had the white paper, we’ve had four changes of secretary of state in the last couple of years, so it’s not been without challenge.
“It doesn’t make it a certainty but it was 100 per cent another big step in the right direction.
“The issue now is will they be able to get legislation passed before we have the next general election?
“We hope so, we’re hoping we’ll see something tangible come from it within the next 12, 18 months, certainly by the end of 2024.
“We’re convinced this will be a big step, a very positive step. Not just the EFL, but for the whole of football.
“It is a bill that will attract a lot of attention.”
On whether he fears another club going out of business, Parry replied: “Do we think we’re likely to see a repeat of what’s happened at rugby union? Frankly, no, because there’s a lot more revenue within the game and we hope the measures we’re taking at the moment will keep people alive and solvent, but definitely there are challenges at Championship level and that’s where the major pressures comes on the clubs.
“So we do our damndest to make sure they survive, but the system is broken.
“With the regulator we have a once-in-a-lifetime opportunity to reset it and that’s what we’re committed to.”