LORD SUGAR says English football’s finances have gone “nuts” and taken clubs to the brink of meltdown.
And the ex-Spurs owner believes the coronavirus crisis could be a ‘devil in disguise’ because the days of ludicrous wage demands from players and agents are over.
Lord Sugar fears for the future of our football clubs as coronavirus shutdown hits them financiallyCredit: Getty – Contributor
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Sugar, 73, had ten years in charge of Spurs before selling to current owners ENIC and has long hated the way salaries and fees have sent the Premier League spiralling out of control.
That’s why the billionaire tycoon believes the Covid-19 situation for top-flight football is dire.
Sugar said: “I fear for some clubs. Football has just gone completely nuts as far as money is concerned. There’s a lot of problems ahead for the Premier League. The situation is dire.
“Some clubs just simply can’t afford it. They work from hand to mouth.
“I know it sounds ridiculous, but they spend every single penny they can on player transfers and player wages and rely upon the income coming in to pay their bills.
“And if you stop the income coming in, then where are they going to get the money from?”
At the heart of the issue is how English clubs have allowed themselves to develop a business model which has left them massively exposed to any financial hit.
In the pursuit of going for trophies or just staying in the Prem, owners and executives have embarked on huge spending sprees in terms of transfer fees and wages to leave their balance sheets in a sorry state.
The financial mess is one of the reasons why Sugar now predicts a major shift in the way football operates once the country emerges from the pandemic.
Apprentice star Sugar added: “Maybe this is like a devil in disguise — and it’s kind of a leveller.
“The power of the agents, the power of the players will not be as strong as it was.
“The threat over the heads of all the clubs at the moment is, ‘If you don’t pay me, I’ll go off. I’ll go and play for someone else’.
“Certainly not in the Premier League and certainly not in Europe because they’re shut down. So there’s nowhere to go.”
Southampton and West Ham announced last week deferrals of players’ wages but the majority of top-flight teams are yet to reach an agreement with their squads.
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For some clubs there is a danger that because they have to keep forking out millions in wages, the well will soon dry up.
Burnley chairman Mike Garlick admitted last week their money will run out by August, while Bournemouth, Norwich and Newcastle have already turned to the taxpayer for help with non-playing staff.
Spurs have also taken a huge public relations hit with Daniel Levy’s decision to furlough the non-playing staff but the reality is there is no money left at the club.
While the calls for Levy and billionaire owner Joe Lewis to bankroll the club are obvious, the fact is as a business Tottenham’s biggest liability other than stadium repayments is the players’ wage bill. There are loans worth £637million to service, but the annual wage bill is £148m.
As yet, the Spurs squad have not agreed any package to defer or cut wages, and that has placed enormous pressure on the balance sheet with no revenues coming in.
Former Tottenham owner Lord Sugar says Prem spending on wages has spiralled out of controlCredit: Alamy
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That is why Sugar has sympathy with Levy for using the government scheme during the crisis.
He said: “It is the law at the moment. Tottenham have got a lot of criticism. I don’t understand the logic why. They are a company. They’ve got 500 non-playing staff, it’s no different to anyone else.
“No different to say Topshop or one of these massive big clothing retailers that have had to shut down.”
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Source: Soccer - thesun.co.uk
