Leicester could now land points deduction after apparent escape – Stefan Borson
Leicester City will be close to a profit and sustainability (PSR) breach for 2023-24 if their allowable losses limit dropped following their relegation to the Championship.
That is the view of finance expert Stefan Borson, who exclusively told Football Insider the Premier League rules are unclear whether their limit will be £83million or £105million.
Leicester have avoided a points deduction for 2022-23 after successfully appealing against the Premier League’s right to charge them with a PSR breach.
But they are also believed to have been close to breaking the spending rules last season, where they secured promotion back to the top flight.
Premier League clubs are permitted to lose £105million over a rolling three-year period – £35million per season – but Championship clubs only have a £13million limit.
Leicester potential PSR breach depends on allowable losses
Borson revealed Leicester will be close to a PSR breach for 2023-24 if their allowable losses limit dropped to £83million following their relegation.
He told Football Insider: “The rules don’t seem to be that clear on whether the limit will be £83million or £105million.
“We always talk about the £105million, but the £105million assumes that the team has been in the Premier League each year.
“There are some Premier League rules that reduce the £35million per season limit down to £13million, reducing it by £22million per year.
“That is typically used as it was in the Nottingham Forest case for teams that have spent part of the assessed period in the Championship.
“Nottingham Forest had two seasons in the Championship and, therefore, their maximum cap was £13million, plus £13million, plus £35million, which is £61million. That meant when they had a loss of something like £95million, they breached by around £34million.
“It’s not clear from the rules what happens in the first season back because the rules appear to say that you only take £22million off the £35million per annum cap where that season in the Championship was the season before last or two seasons back.
“We will have to see how that pans out, it’s not clear to me whether it’s £105million or £83million. But if it’s £83million, then I think it is safe to say that Leicester will be very close to breaching.
“They obviously will have the chance of not breaching for 2023-24 if they have the £105million cap, but it’s going to be close.
“If you were to do the analysis of what their numbers would have looked like for 2023-24, you will see that it’s going to be very hard for them to make the requisite level of profit and that’s even after the player sales of Harvey Barnes, Kieran Dewsbury-Hall and the compensation they got for Enzo Maresca.
“Even then, they will have a challenge making PSR for 2023-24.”
In other news, Everton fans stunned after Leicester points deduction news.
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