Premier League’s auditor awarded key contract related to independent regulator
Sources have expressed concern over a potential conflict of interest.
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Your support makes all the difference.The Premier League’s auditor Deloitte has been awarded a key contract in helping to set up football’s independent regulator, the PA news agency understands.
Sources have expressed concern over a potential conflict of interest for financial services firm Deloitte, which signed off the Premier League’s most recent set of annual accounts.
The EFL and campaign groups want the regulator to be able to review whether any new deal agreed between the Premier League and the EFL on how television cash is split meets the regulator’s stated aim of ensuring the sport’s financial sustainability.
The involvement of Deloitte has raised some eyebrows, at a time when the regulator’s precise remit is still unclear as the wait goes on for the publication of the Football Governance Bill.
EFL clubs left a meeting with Culture Secretary Lucy Frazer last week concerned that the regulator would not be given powers to correct any settlement which is agreed, something which football reform group Fair Game has said would be “unacceptable”.
Government sources say the Deloitte contract will involve the firm providing support around the design and implementation of the regulator’s operating model, and insist the firm will not be providing advice on, or developing, regulator policy.
Deloitte will look at how the regulator is structured, staffed, and its systems and infrastructure requirements, the Government source said.
They said any potential conflicts of interest would be managed in the usual way, and were considered as part of the procurement process.
If the regulator is to achieve its core objectives then it must oversee football’s finances and reward well-run clubs. Anything else and we will have a regulator that lacks the teeth to fix football’s ills
The Government and Deloitte declined to comment.
EFL chairman Rick Parry told MPs last month that his organisation was prepared to do a deal with the Premier League but stressed that the “right solution” on financial distribution and cost controls would only be reached through independent analysis by the regulator, as part of a planned ‘state of the game’ review once it is up and running.
The EFL has declined to comment following last week’s meeting as it continues dialogue with the Government, but Fair Game – which has 13 EFL clubs within its membership – insists the regulator must have the power to intervene.
“The number one stated aim of the regulator is to secure the financial sustainability of the football pyramid,” Fair Game’s director of advocacy Mike Baker said in a statement issued on Friday.
“So it is not about having any regulator, it’s about having the right regulator. The status quo is not acceptable.
“The proposed backstop powers (of the regulator) currently can only be triggered by the Premier League and the EFL authorities, and if a deal is signed now for six years the regulator will have no powers to correct it.
“That is unacceptable. If the regulator is to achieve its core objectives then it must oversee football’s finances and reward well-run clubs. Anything else and we will have a regulator that lacks the teeth to fix football’s ills.”
The deal under discussion between the Premier League and the EFL is believed to be worth an additional £900million over six years to the EFL’s clubs, but the EFL has strong misgivings over the cost control measures attached to it.
While clubs in the Championship are expected to be capped at spending around 70 per cent of revenue on squad costs, in line with UEFA’s new financial sustainability regulations, those relegated to the second tier are set to be capped at 85 per cent while they are in receipt of parachute payments.
That would mean those clubs being able to spend a greater percentage of a larger amount than non-parachute rivals. Parry believes that puts non-parachute clubs in the “horrendous” position of having to choose between being competitive and sustainable and will widen the cliff edge between the top two divisions.
Top-flight clubs are still to agree on how any extra funding for the EFL is paid for, and on a new financial system for the Premier League to ultimately replace its profitability and sustainability rules (PSR).
Premier League clubs are due to gather for further shareholder meetings on February 29 and March 11, with the latter understood to be the more likely to prove decisive in moving this issue forward.
PA understands a number of EFL clubs, even those who had been inclined to agree to the deal, are now feeling more hostile towards the process following the meeting with Frazer which some described as “a car crash”.
Accrington chairman Andy Holt took to social media to voice his concerns about it and felt Frazer was applying pressure to agree to the deal, even though the ball remains in the Premier League’s court at this stage.
Government sources have said Frazer’s position was misinterpreted and that she was advising clubs to do a deal, as has always been the Government’s position, not necessarily to accept the deal that was on the table.
A publication date for the Football Governance Bill, which has the creation of the regulator at its heart, is still understood to be some weeks away after there had been indications it could be published on Monday next week.