Man United hit by shattering new PSR blow – Stefan Borson
Manchester United’s financial situation has come under intense scrutiny in recent months as Sir Jim Ratcliffe looks to cut costs at Old Trafford.
Man United sent a letter to fan groups last month warning them the club are at risk of breaking the profit and sustainability rules (PSR), with top-flight sides only permitted to make £105million of losses over a rolling three-year period.
It had been anticipated the squad cost ratio (SCR) system of financial control – which is currently being trialled alongside top-to-bottom anchoring rules (TBA) – would be adopted for next season.
But the PSR rules are set to remain in place for 2025-26 following Manchester City’s latest legal challenge against the associated party transaction (APT) rules.
Former Man City financial adviser Stefan Borson exclusively told Football Insider the SCR system would have been “very good” for United because it doesn’t take into account interest payments.
However, interest payments on non-stadium and infrastructure spend debt are factored in under the PSR rules, with the club in more than £700million of debt.
Man United could suffer financial hit after Premier League U-turn
Borson admitted it’s so far unclear who would benefit from a new system being adopted.
He told Football Insider: “First of all, it’s quite hard to compare because we never had details of what the squad cost control system would look like in the Premier League.
“We know what it looks like in the Uefa system and you would think it would be quite similar, but it doesn’t need to be exactly the same.
“Then there are some wrinkles around it, where we were told that the standard cap would be 85 per cent. You would have at the top of the equation your costs, and that would be first-team costs and amortisation.
“Then at the bottom, you would have revenue, profits on player sales and your ratio could be 85 per cent. It was then to drop to 70 per cent if you were in the European competitions because that’s what the limit is in the Uefa competitions.
“The problem with that is that might be fine if you’re in the Champions League because you know that in terms of your revenue, you’re going to get another £60-100million broadly by the time you’ve had your group games and everything else.
“That’s not the case if you are in the Europa Conference. If you win the Europa Conference, you’re probably doing £10million total and you’ve got a load of costs because you’ve got to fly the squad all around Europe for about 15 games, which is not cheap. People forget about how expensive this sort of stuff is.
“We don’t know what we’re going to do with that part of the rules, and that could have had a material difference to a team like Man United.
“It could have cut United’s cap from 85 per cent to 70 per cent just if they were in the Conference League, and that would have made a very big difference to them.
“The flip side is that the squad cost control likely excludes their interest cost, so that would be very good for United. They won’t have that next season because they will have the old PSR system, so it’s not clear as to who it benefits and who it doesn’t.”
Man United could have already breached PSR rules
The Manchester giants’ latest accounts for 2023-24 revealed they generated a club-record revenue of £661.8million despite recording a net loss of £113.2million.
Borson previously told Football Insider United would have breached the PSR rules last season had they not been allowed to add back certain exceptional costs.
The club’s revenue could take a hit this season due to their lack of Champions League football and struggles in the Premier League.
Football Insider revealed on 6 February United are set for a £27million hit in prize money following their disappointing campaign.
For more Man United news, follow us on Facebook or join our brand new WhatsApp Channel for instant updates to be sent straight to your phone.