Kieran Maguire issues ‘huge’ warning after talks with Leeds United chiefs
Leeds United and other relegation-threatened clubs will struggle to recruit top-class players if parachute payments are abolished.
That is the opinion of finance expert Kieran Maguire, who exclusively told Football Insider that the Premier League would suffer a dip in quality if parachute payments are scrapped.
As reported by The Athletic last Wednesday (29 March) the Premier League and EFL continue to disagree over parachute payments.
Parachute payments are paid over three years to recently relegated clubs to help minimise the financial impact of demotion.
Teams that are relegated after one season in the Premier League currently get £44million in their first season back in the EFL and £35million in year two, but those figures have come under question.
It was proposed to Premier League CEO Richard Masters during a conversation with the Digital, Culture, Media and Sport select committee that parachute payments could be scrapped.
However, Maguire believes scrapping parachute payments could cause a dip in recruitment quality for lower-table Premier League clubs.
“Through conversations with Chief Executives and Recruitment Directors of clubs in the other 14, including Leeds United, they state that they can negotiate deals with players even in the January transfer window,” Maguire told Football Insider.
“These deals usually include modest pay cuts in the event of relegation.
“Players at that level usually look for around £50,000-per-week deals, and the player would be willing to take a pay cut of around 25 per cent.
“If you abolish parachute payments. clubs would have to insist on wage cuts of around 80 per cent in order to try and balance the books.
“Should that happen, both players and representatives would laugh at any proposal and no deals would be signed.
“The Premier League as a product would suffer a huge dip in quality as a result – clubs in the lower half of the table would not be able to recruit the calibre of players required to compete.”
In other news, Leeds United plotting to sign 25-year-old striker after development in last 24 hours