Sources: Critical update on £300m talks as Newcastle United details emerge
The Premier League are yet to make a formal offer to the Football League regarding the proposal – opposed by Newcastle United among others – to abolish parachute payments, sources have told Football Insider.
The EFL wants parachute payments scrapped in tandem with an increased cut of broadcast revenues – 25 per cent compared to the 16 per cent it currently receives, equating to an extra £300million per year.
The two bodies, as well as the FA, have been engaged in talks about a revamp of English football’s financial distribution system for several months, with little progress made.
Meanwhile, the government Department for Digital, Culture, Media and Sport is due to announce its plans for an independent football regulator tomorrow.
It is understood that the regulator will have the power to enforce a new distribution model, and that is likely to light a fire under all three parties involved in the talks to agree a settlement on their own terms.
It has been reported elsewhere that the Premier League were willing to stretch to allow a 19 per cent cut in broadcast revenues to filter down to the lower leagues.
But an EFL source has told Football Insider that no formal offer has yet been made, sparking questions about where the reported 19 per cent figure has materialised from.
The issue of parachute payments, which the EFL believes have distorted the competitive balance of the Championship, remains a thorny issue.
Football Insider revealed earlier this month that Newcastle have sided with the rest of the Premier League against the so-called ‘Big Six’ over parachute payments.
That stance came as a surprise given that the Magpies have tended to vote with the Big Six since their Saudi-backed takeover in 2021.
The non-Big Six clubs are reticent to back the abolition of parachute payments because they are the most likely recipients, while the Big Six themselves see relegation as nigh on impossible given their financial advantage.
In other news, Newcastle United in three-club race to sign James Maddison as summer price revealed.