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Sports organisations act as coronavirus financial impact bites

Storm clouds at Big Bash League match between Sydney Thunder and Perth Scorchers (Photo by Jason McCawley - CA/Cricket Australia via Getty Images)

Sports organisations around the world are making pay cuts and offering staff temporary contracts, among other money-saving measures, as the coronavirus shutdown squeezes cashflow.

The European Club Association, which represents European football clubs, is reported by Reuters to be in talks with Uefa about relaxing the governing body’s licensing and Financial Fair Play rules to help clubs weather the storm. In a letter to its members, the ECA warned of the “existential threat” posed by the shutdown of European football.

ECA chairman Andre Agnelli, president of Italian Serie A club Juventus, said in the letter: “As football is now at a standstill, so are our revenue flows on which we are dependent to pay our players, staff and other operating costs. No one is immune and timing is of the essence. Meeting our concerns will be the biggest challenge our game and industry has ever faced.”

The Spanish football federation is making €500m ($552m) in loans available to help LaLiga and Segunda Division clubs that run into financial difficulties, the Press Association has reported. The federation has also created a €4m fund for non-professional clubs.

Reuters reported that Fifa’s Coronavirus Working Group has recommended that current contracts for players and coaches should be extended until the end of delayed seasons. Contracts usually finish at the end of a given season. It is also recommending clubs and players work together to find solutions to salary payments, that transfer windows be adjusted to fit with new season dates, and that Fifa use its new ‘Fund for Professional Players’ to help clubs.

The working group is also planning to examine the issue of clubs’ responsibilities to pay their staff when leagues are suspended.

The 500 or so players in Australian rugby league’s NRL have been told they may have to take pay cuts of up to 87 per cent, according to newspaper The Guardian. Talks between the league and players about the pay cut are to take place today. The league said the higher-paid players had expressed concern about their lower-paid teammates. The league itself has put 95 per cent of its staff on leave for three weeks, and clubs are working with skeleton staff.

Meanwhile, a call by Peter V’Landys, head of the Australian Rugby League Commission, for the government to divert funds from the building of a new stadium in Sydney towards helping the NRL and other sports, has fallen on deaf ears. Australian media reported that the government considers the stadium construction will provide valuable job opportunities at a difficult time for the economy.

Yonhap news agency reported that the South Korean football federation (KFA) is cutting salaries for its senior executives by 20 per cent from this month. The federation said it has entered “an emergency management system”, and the pay cut may remain in effect until the end of the year.

The KFA expects revenue to fall by KRW5bn ($4.1m) this year due to cancelled home international matches.

This week it has been reported that sports marketing agencies Mediapro and Endeavor – owner of IMG – are making staff redundant, at least partly as a result of the impact of the coronavirus on their businesses.