EFL chairman, Rick Parry, has again reiterated the importance of installing a new independent regulator for football which could be in place for the 2026/27 season.
Blackburn Rovers have been in full support of the plans to install more regulation in the English pyramid. Chief Executive Steve Waggott has expressed his backing on multiple occasions in the bid to improve sustainability for clubs.
The Football Governance Bill is at the report stage, which means it is being examined in the House of Lords. A third reading is likely to take place late in March before it goes back to the House of Commons, meaning it could be passed into law by this summer, Parry hopes.
This is the result of Tracey Crouch’s fan-led review of football in England, sparked by clubs such as Bury and Macclesfield Town going to the wall. It was also in direction opposition to prevent another proposed breakaway European Super League.
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The EFL have a number of aims for the regulator and what they hope it can achieve. One is for it to provide a backstop for ongoing disputes about the distribution of wealth in the English game. The Premier League and EFL have been in discussion for years about a 'new deal for football' and no agreement has been reached.
Parachute payments are another key topic that the regulator will have the power to address. The EFL is looking to achieve 'sporting jeopardy without financial ruin'. Parry points to the fact that football hasn’t been able to solve its own problems, which in his case are topped by the financial cliff edge between the top flight and the rest.
The EFL has called for a change in how money is distributed, including a major review of parachute payments. Whilst there is no appetite to abolish them, there is a hope that a regulator can assess how to ease the drop from the Premier League to the Championship and visa versa.
The Premier League's biggest concern are that a regulator could harm the competitiveness at the elite level. Yet they are already making 2X the revenue of clubs in Spain and Germany, despite only sharing 20% down the pyramid.
"This isn’t like regulating the banking industry or bookmaking industry, there are only 116 clubs being regulated and their accounts are very straightforward. There are only two lines that matter, one is media revenue and the other is wages. This isn’t a complex financial business," Parry explains on a call with local journalists.
“The Premier League can still share money with us. Had they met our request for a 25 per cent share of media revenues, they would be giving us about an extra three to four hundred million. That would mean they are only £1.7bn better off than everyone else. They are still going to be massively competitive. That bit just doesn’t ring true at all.
“In the Championship, parachute payments and the inability to compete with parachute clubs is a major issue for us. We’ve been banging on about it for four years repeatedly and the Premier League has said they’re not prepared to change them.
"They have got to a point where the impact on other clubs makes them absolutely the cuckoo’s nest in the Championship. They started off in 1992/93 relatively small and totalled £2.25m. By 2018/19 they totalled £265m and year-long parachutes are more than double the average turnover of a Championship club.
“The big challenge for us is fixing the problems, addressing the cliff edge between the Premier League and Championship properly. Our message has been that football isn’t capable of doing it, which is why we need independent regulation and a regulator with the powers to address the problem.”
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