Football Federation Australia (FFA) has revealed that expanding the top-tier A-League would not be feasible under its current structure, as it confirmed that discussions will begin this week over the reworking of the competition’s ownership and operating model to allow further franchises to be added in the future.
FFA has admitted that the current financial position of the A-League is such that adding two extra teams would result in net losses over the next six years.
FFA will this week begin working with A-League clubs, as well as teams in the W-League women’s competition, to develop a new ownership model that would allow for expansion in both leagues.
The organisation believes a revamped model would create a more attractive opportunity for current and prospective investors in the A-League and W-League.
FFA’s analysis found that adding two clubs to the 10-team A-League would result in the league posting net losses over the six years due to grant distributions to new sides, as well as increased operational costs.
The federation said that, because it is a not-for-profit organisation that redistributes all of its income to clubs and other areas of the sport, such losses would prove unsustainable.
FFA chairman David Gallop said: “We recently advised the clubs that we must explore a new model for the Hyundai A-League/Westfield W-League. We agree that we need to protect the value of the existing licences in which the current owners have invested.
“We want to expand the leagues but this has to happen as part of a new structure. That’s why we are now working with the clubs to determine the future structure of the leagues and the criteria for expansion.
“We will examine these issues in detail and expect this work will take months rather than weeks. We know that those consortia that have expressed an interest in joining the league would want to be part of something that is financially sustainable and attractive as a sound investment.”
The FFA is engaging a corporate advisory firm to assist with developing models for a new operating structure, and to provide advice on the financial aspects of the expansion process.
Gallop (pictured) added: “The decisions we make around the future of the Hyundai A-League/Westfield W-League will have an impact on every aspect of football in Australia. That’s why we want to work with the clubs and other stakeholders on changes that benefit the whole game.”
Gallop said further updates would be provided in the coming months, but admitted any expansion would not occur before the 2018-19 season.