Aston Villa ‘face clear penalties’ as new financial rules come into play
Aston Villa may have to sell players in order to comply with new Squad Cost Ratio [SCR] rules from the beginning of next season.
That is according to football finance expert Dr Dan Plumley who has exclusively told Football Insider why clubs like Aston Villa may not benefit from the new financial rules.
Premier League clubs voted in SCR to replace Profit and Sustainability Rules, which means they’ll be allowed to spend a maximum of 85 per cent of their revenue on squad costs.
Aston Villa have struggled to comply with current PSR rules, and manager Unai Emery has been forced to sell players before he can buy in recent transfer windows.
‘The biggest clubs will still benefit’ from SCR rules
Speaking exclusively to Football Insider, Plumley has explained the implications of the new SCR rules on clubs like Aston Villa, whilst Newcastle may also not benefit from the incoming spending regulations.
“Well, there will be a bit of a transition period, of course, and the Premier League said they won’t fine anybody until 2027. So they’ll give it, you know, a bit of time to bed in, but the penalties are clear,” Plumley said.
“That’s a positive from a control point of view. I’ve said this before, on squad cost ratio, if you run some rough numbers or thereabouts, it’s still not going to shift the dial too much in terms of what’s happening now. It’s probably a better version of PSR.
“But it’s still not going to make any huge sweeping changes to the way the finances of English football clubs work, and the biggest clubs will still benefit. Because if you look at how that’s made up, it’s revenue plus adjusted plus your net player sales in terms of ins and outs to give you an adjusted revenue figure.
“And then you’ve got all your squad cost elements and divide the squad cost by the revenue. So if you look at the revenue function of that, the only way clubs can either up that number is to increase revenue across those formats or they start selling more players.
“And so both of those are viable strategies, but they’re not easy to do. So, Aston Villa would still be one of those clubs that will be under this in the early stages, but we know they should look at PSR.”
Points deductions in place for breaking financial rules
Plumley continued to explain the new SCR rules and the penalties that clubs will incur if they fail to comply.
“Of course, their argument is, well, they’re also stopping us from competing and squad cost ratio is an improvement, but it’s not going to shift the dial. So I get where they’re coming from,” Plumley said.
“And if you look at that in terms of, right, how do we get our number down, selling players is potentially one way to do that.
“Now I’m not saying they will, but it’s a strategy you could employ. And that’s just the reality of what’s going to go into those calculations to drive the percentage, but the Premier League are now clear on the transgressions we’ll encounter.
“You know, if you get between that 85% and the 115% red threshold, you’ll get a fine, and if you go beyond one to five, it’s a point’s deduction. So good to know where they’re at, and they’re going to have to adjust.”