Football League set for crunch talks
It may have received little fanfare, but Thursday's emergency meeting of the Football League's 72 clubs in Leicester could be one of the most important in the game's recent history.
On the agenda are new Premier League plans to reform the way it distributes money to the lower divisions. Thanks to a bumper overseas broadcast deal, the Premier League board has drawn up a proposal that offers to increase the amount it shares over the course of the next three seasons. The Football League will discuss and vote on the plans, which, if approved, will be ratified at the Premier League's AGM in early June.
Parachute payments, the monies handed to relegated clubs to soften the financial shock of the drop, would more than double from £22m over two years to a massive £48m over four years, music to the ears of recently relegated Burnley, Hull and Portsmouth, who will all now enjoy a significant advantage over their Championship rivals in the coming seasons.
The background to these changes is widespread concern at the financial inequality between football's elite in the Premier League, who enjoy billion-pound TV deals, and the rest of football, who do not. This gulf, many believe, encourages clubs to engage in irresponsible spending in a desperate bid to stay in the lucrative top flight, leading to record levels of debt, excessive player wages and, in the case of Portsmouth and Hull, the brink of financial ruin.
Under the new proposals, solidarity payments - the money the Premier League hands out to the 'have-nots' of English football, partly to keep the Government off their backs - would also increase across all three divisions. Championship clubs would receive a considerable £2.2m per season, three times the £830,000 they have been given over each of the last three years and almost as much as they will receive from the Football League as a result of their own broadcasting deal.
Billion-pound TV deals have changed the face of football
But clubs in Leagues One and Two stand to earn much less out of the Premier League's distribution plan. League One clubs would get just £325,000, while League Two clubs would receive £250,000, moderate increases on their current handouts. The fear at these clubs is that the new proposals affect the competitive balance of the Football League, handing Championship clubs, especially those fortunate enough to have spent time in the Premier League, an artificial financial advantage that will perpetuate success in the same way that the Champions League has created the so-called 'Big Four' at the very top of the domestic ladder.
One League Two chairman, who wished to remain anonymous, told me: "This does not represent a levelling out of the playing field, quite the opposite, and we will be voting against it. It's not fair, it's all about self-interest. It could cause a rift through the Football League and effectively creates a Premier League Two by stealth, while locking many of us out of the party. The Premier League is right to give this money but it's being done in the wrong way. It should be spread out more evenly so we can compete."
The meeting represents a serious challenge to the leadership of new Football League chairman Greg Clarke, with many smaller clubs set to vote against the proposals. Some Championship clubs are also unhappy that, in return for more money, the Premier League have attached some strings.
In effect, because of the natural overlap between the two leagues, with clubs constantly passing between each, the Premier League wants the Football League to bring their regulations closer to their own. This standardisation includes a demand that the Football League promises to reveal the identity of all owners, a transparency that could affect a club like Leeds United, where the identity of the club's shareholders remains a mystery.
The Premier League privately believes it is being reasonable with its requests and generous with its cash. Some would argue that the top-flight umbrella deserves credit for redistributing its money at all, especially when one considers that some of Europe's top leagues refuse to share any money to their lower leagues, France's Ligue 1 being a significant exception.
However, others would point to the vast sums that Premier League clubs enjoy, on average around £40m each per season thanks to the staggering new broadcast deals worth £1.782bn (domestically) and £1.4bn (overseas), despite the recession.
They suggest that these clubs should be more generous to those lower down the footballing ladder, especially considering that before the Premier League's creation in 1992, the Football League shared its TV money much more equitably, with as much as a quarter of the total income given to the bottom two professional leagues. Today that would equate to hundreds of millions of pounds. Instead, the Premier League proposal offers a total of £7.8m a year to League One and £6m to League Two.
Generous? It depends on your perspective.
UPDATE 1500 BST:
I'm at the meeting at Leicester City's Walkers Stadium now waiting to discover if the Football League have voted in favour of the proposals. All 72 clubs have been locked in talks all day and I'm told there is plenty of concern, especially at the size and duration of the parachute payments.
Many clubs feel this is a case of the Premier League simply protecting their own - smoothing the effect of relegation and giving them a built-in advantage, leading to the kind of 'yo-yoing' between the top flight and the Championship that we've seen from West Brom in recent seasons.
The fear is that this will make promotion for a club like Blackpool, who haven't benefitted from a parachute payment, almost impossible to achieve in the future. There is also fear that the sovereignty of the Football League is under threat due to the conditions the Premier League is insisting on.
If the Football League votes against this deal, it will be the first major fall-out between the two. I'll keep you posted.
UPDATE 1720 BST:
I'm now on the way back from Leicester and can digest the Football League's "unhappiness" at the Premier League's funding proposals. If not outright rebellion, this is certainly the first major fall-out between the richest and oldest leagues in the world.
All 72 Football League chairmen rushed out of their emergency summit to their executive saloons, mobiles pressed to their ears, with many wearing worried expressions. Even the usually buoyant Barry Fry and Pete Winkelman looked perturbed.
No wonder they appeared concerned. They had just decided NOT to accept what, on the face of it, seems an incredibly generous offer from the Premier League - a doubling of the parachute payment to relegated clubs and a trebling of the solidarity hand-outs to those in the lower leagues.
Football League chairman Greg Clarke told me the clubs are "unhappy" and fear the Premier League's proposals could "distort competition". In reality, the Championship clubs are broadly behind the plan. Those in Leagues One and Two are not, so new fault lines are appearing in the English game.
However, the whole of the Football League is concerned that the Premier League is trying to throw its weight around by issuing a number of conditions. Clarke already has a tough job trying to keep so many clubs of widely varying wealth together. Now he has to go back to Premier League chief Richard Scudamore and ask him to tweak the deal. I don't envy him.
PS. You can hear more on this issue on 5 live at 1920BST and see the Clarke interview on this website later.