GLF 51: Some financial analysis
How Long Can This Go On?
Very few people involved with Scottish football will shed tears at Livingston going into administration.That is a harsh statement, but it is also fair.They have no history and no community to fall back on in times like these.Indeed, most of their fans were recently recruited from other teams - not the most loyal then.However, that is a digression.What is worrying about Livingston is that they were perceived as the way forward for Scottish football.They did not have to struggle through the casual scene in the 1980's,they should have been perfect for the middle - class families football wants to attract now and they did not even have to struggle with their ground.
So what went wrong ?
Essentially they made the same mistake that the rest of us did.In the never - ending search for improvement,they spent more money than they could afford.And unlike us,it was not a benefactor’s money.The three clubs currently in administration all had a notable short period of success.We finished within a point of Europe, Dundee made it and lost a cup final, whilst Livi were third one year and are now in a national final.But throughout all this relative success there has remained the same fundamental problem that not enough people care.
Trying to bring in new fans is not a modern concept.It is an idea that has existed for years but it must now be clearly acknowledged that it doesn’t work.Having open days, reduced prices, exciting signings-none of it works in the medium - term, never mind the long - term picture that ourselves and Livingston were looking at.The only way that you can even begin to increase crowds is to be successful.That does not mean being 4th in the SPL or losing the League Cup final.To attract new fans the success has to be measured in pots and trips to Europe and they have to come in each and every season.The chances of anyone outside the Old Firm doing this is remote.
So the alternative, as boring and simple as it is, is to live within your means.There can be no more speculate to accumulate.Motherwell and everyone else can only be allowed to spend what they can afford and if this has to be regulated in some way then so be it.Some people will say that if clubs cannot run themselves it is their problem, not the SFA's.This is wrong.A responsible parent would not let a child gorge themselves on sweets and crisps.The SFA is ultimately responsible for the well-being of Scottish football and that means ensuring half the top league does not go bankrupt.
The first suggestion that springs to mind is to cap wage expenditure as a percentage of turnover.Would anyone agree to this being enforced ?I honestly don’t know.But any club who is not voluntarily bringing their wage bill down to around 50-60% of turnover will be in serious trouble sooner or later.The second is to punish any club who becomes financially insolvent.Don’t wait until the administrators have to be called in.Any club who knows that taking out a loan they will never be able to pay back will mean relegation will think twice about doing so.
Whether you agree with the actual sanctions regarding administration or not, the SPL have taken a step in the right direction by at least admitting that the clubs can no longer live outside the usual financial world.It shows how bad a situation we are in that the best thing for every other club would be one unfortunate team going to the wall.We’ll see how long the silliness continues when there is space in the fixture card where ‘ Dunfermline ’ used to be.
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