Kevin Roberts | FFP: A fair and appropriate way of controlling club finances?

With Financial Fair Play rules favouring the wealthier sports clubs, SportBusiness' Kevin Roberts asks whether there is any alternative that might strike a balance and allow smaller clubs to thrive.

I recently chatted to a professional rugby player about what, he says, is set to be one of the highlights of his career.

This was not one of the game’s superstars but a youngster who plies his trade in The Championship, the second tier of English Rugby Union. His club, Ampthill, has enjoyed a meteoric rise through the rugby pyramid thanks to sound planning and backing from its sponsor. Next year they will go toe-to-toe with the might Saracens, the current European champions who will be mixing it with the small fry because of their relegation from the elite division for persistent breaches of the sport’s salary cap.

Saracens are a great team with world class players, and they didn’t cheat on the field. But their decision to play fast and loose with financial regulations gave them a significant advantage over rivals which must have helped tip the balance of power in their favour and puts a question mark over the validity of some of their recent triumphs.

Even if they keep only a handful of their global superstars, Saracens are sure to thump not only Ampthill but every other team in the Championship as they head back to where they feel they rightly belong. But – as when the giant soccer club Glasgow Rangers was forced to work its way back to the top after a massive demotion inflicted for financial irregularities – Saracens will boost attendance and provide some memorable moments for fans and players who will, at least, be able to boast of the day they shared a pitch with some of the game’s greats.

Whether Ampthill will ever cross swords with the likes of Saracens again is another matter. Although there is promotion and relegation between the Gallagher Premiership and Championship, the gap in standards has always been massive with relegated clubs generally bouncing back after a single season. That situation is only going to worsen given Premiership Rugby’s decision to more or less halve its funding of the Championship.

In short Ampthill – which prides itself on being a community club – and others of their stature are, in reality although not in theory, pretty much stuck where they are right now.

Ambition and the drive to improve are central to the ethos of sport and that’s not something confined to players. But there are issues around the way many different sports are structured which impact on mobility of clubs and teams and their ability to realise their potential.

While Saracens were getting used to the idea of slumming it in the second tier for a year, Premier League champions Manchester City were being told of their two-season ban from the Uefa Champions League and multi-million-euro fine for breaching Financial Fair Play regulations, which limit the amount a club is able to spend on the basis of its revenue over a three-year period.

This is not the place to discuss whether City were guilty or whether they are likely to succeed in their appeal. That can be left to the lawyers. It is also in no way a plea for sympathy for City.

Perhaps a more fundamental question is whether the FFP regulations are themselves a fair and appropriate way of controlling football finances.

As things stand, the FFP rules appear to favour an elite band of clubs which have already enjoyed long periods of success, built strong national and international brands, and, consequently, earn the most money across all sources.

That severely restricts the ability of newcomers make a real impact on the market by investing in talent and building teams to rival the established Big Boys club, the same Big Boys who appear to be looking beyond their national leagues to further bolster their financial fortunes.

Elsewhere in business, entrepreneurs are free to raise as much funding as they are able and invest it in pursuit of their dreams. But not in European football. There, Financial Fair Play forms a prophylactic around the biggest and longest-established club brands, ensuring that this club of clubs endures in perpetuity.

Of course, that’s a pretty bleak picture and there will be exceptions to rule. But the point is that in a sport driven by the ability to acquire and reward talent, the rules, as they stand, appear to favour the already wealthy.

Which begs the question, why not give investors a free hand but exert control through a salary cap which is easier to police than than FFP which relies, in part at least, on being able to unravel and value convoluted sponsorship and IP deals.

There is a balance to be struck between the controls required to create a truly competitive and compelling sports product and ensure clubs are run sustainably and the need to encourage mobility and the pursuit of ambition among clubs.

Manchester City and Ampthill may rarely be mentioned in the same sentence and are at opposite ends of sport’s financial spectrum, but they do have one thing in common. For very different reasons they face a barrier to continued upward mobility.