Two more wins. That’s all Liverpool needed to claim the most prestigious title in English football, the Premier League trophy, for the first time in 30 years. But then the coronavirus struck. All games in England have been suspended until 30 April; a suspension that’s likely to be extended. Liverpool will just have to keep on waiting.
Many words have been written, in newspapers and especially on social media, about how this situation should be resolved. Just hand Liverpool the title? Play the remaining fixtures in the summer? Or perhaps even void this season altogether?
But, really, what should consume football fans’ thoughts is what’s happening far below Liverpool, in England’s lower leagues. For smaller clubs, the coronavirus isn’t about titles or no titles. It’s about something far more fundamental – survival.
Three leagues sit under the remit of the English Football League (EFL): the Championship, League One and League Two. The EFL’s chair, Rick Parry, suggested on the radio, last weekend, that he doubts whether the current season will be completed in June and whether the new 2020/21 season will begin in August. He also said that the effects of the coronavirus on the game may last for 18 months.
Just consider what those missing months mean: no ticket receipts, lower incomings, and all while paying wages to both playing and non-playing staff (although perhaps now everyone counts as non-playing). This represents a huge financial hit for even the rich Premier League clubs, although their sheer size should keep them from hitting the floor. The further down England’s footballing ladder you go, the more devastating the damage will be.
Even before Covid-19, several teams in League One and Two have been struggling financially; most notably Bolton and Bury, with the latter being expelled from the EFL in August last year. At the moment, the club is at risk of liquidation.
With Covid-19 – as Dr Dan Plumley, an expert in professional sport finance, explains to me – a bad situation will be made much worse. “There are a number of clubs that are already close to the wall, financially…. Those clubs further down the league system, relying on income from match days to drive their short-term cash flows, will be most at risk. It’s very much hand-to-mouth and day-to-day. That’s just the nature of lower league football.
“To give you some rough figures for context: if you look at average annual revenue, it’s about £30m for a Championship club, £6m for a League One club, and £4m for a League Two club. The majority of that money – potentially in the region of two thirds for some clubs – will be from match-day income, so there’s quite clearly a serious issue.”
These clubs are not without support. Towards the end of last week, the EFL announced a £50m fund for all of the teams under its purview. Championship clubs will get around £800,000 each, with the option to apply for up to £584,000 in interest-free loans. For League One clubs the equivalent figures are £250,000 and £183,000. For League Two clubs it’s £164,000 and £120,000.
This is essentially the equivalent of all the outstanding TV money for the rest of the season. The different totals for the different leagues are explained by their different pulling powers. Normally, there’d be higher attendances at Championship clubs, generating more income from match days, more season tickets, and slightly higher costs due to the increased security – and, so, they get the lion’s share of the fund.
Plumley points out that, while that £50m is probably enough in the short-term, it’s less certain what will happen beyond then. “We don’t know if there’s another pot of money. This money will keep the clubs going for so long. Fast-forward to seven or eight weeks’ time and, depending on where we’re at with the situation, some clubs will still be in financial trouble.”
The football journalist – and Tortoise contributor – Ian Ridley reckons that “of the 46 teams in Leagues One and Two, about 60 to 75 per cent of them will be in some kind of trouble”. As well as writing about the sport, Ridley has been involved in football at the sharp end, having served as chairman at both Weymouth and St Albans City. These are “non-league” clubs which sit below the EFL in the national system. Such non-league clubs are, at the moment, in an even more precarious situation.
Last week, National League side Barnet FC put their non-playing staff on notice of redundancy. Meanwhile, Dagenham and Redbridge’s director, Steve Thompson, has said that the government should give the league somewhere in the region of £20m to help it survive.
Why call in the politicians? Because non-league clubs are in a peculiar and tricky position. They sit outside the remit of the EFL and are instead presided over by the Football Association (FA). And a national governance body like the FA is a not-for-profit, with the majority of its revenue going back into grassroots football. So there isn’t a ready supply of cash for non-league teams – unless someone (say, Boris Johnson) steps in.
And the supply of cash is crucial, as Ridley explains. “The problem lower down is that very average small town teams are a bad risk [for banks]. Because most of them have a poor credit history, because a lot of them have struggled in the past to repay loans or gone into administration, it’s very hard for them to borrow money. So cash flow is the king.
“I remember when I was part of a consortium that bought Salisbury FC. It had gone bust in its previous guise, as Salisbury City. When we reformed it, the bank wouldn’t give us any overdraft whatsoever. It was tough enough to get an account, let alone an overdraft…”
This isn’t just about whether 11 people can play football on a Saturday afternoon, with a few dozen cheering them on. It’s about the fabric of society. “At Salisbury, they went a year without a football club, and people down there have told me it was a really miserable year,” says Ridley. The hum of crowds and cash registers goes quiet. Restaurants, pubs and clubs lose revenue. A town literally becomes poorer.
But there’s something beyond money; something that, according to Ridley, can’t be quantified. “A local club gives your town an identity and a bit of national pride. Your name is out there. When it goes there’s just this emptiness.”