Top clubs ‘on furlough’ claiming up to £40m

Leeds United and Newcastle United faced fresh scrutiny over summer transfer spending last night after it emerged the top two tiers had claimed tens of millions of pounds in government furlough support.

The two Premier League clubs claimed six-figure sums from the job-retention scheme in December, despite having committed a total of £130 million between them on transfers last summer.

A £13million total was obtained from HMRC following a freedom of information request from ITV. It accounts for the first four months of claims by the top two divisions. The overall figure for the past year could triple that up to around £40 million.

Julian Knight, chair of the Digital Culture Media and Sport select committee, told the broadcaster it was a “a staggering sum for football clubs to claim from the public purse”. The majority of the money was extracted by the Championship, but Knight said “the Premier League clearly has questions to answer and should be held accountable”.

According to bands of payouts within the HMRC data for December, Newcastle and Leeds both claimed between £100,000 and £250,000. The payouts come despite Leeds spending £95million in the summer transfer window and Newcastle £35 million. The other two Premier League clubs named were Burnley and Sheffield United, who applied respectively for £25,000-£50,000 and £10,000£25,000.

Leeds and Newcastle, who declined to comment on the figures, avoided staff redundancies, unlike at Arsenal, who made 55 staff positions redundant despite borrowing a combined £295million with Tottenham through the Bank of England’s “Covid Corporate Financing Facility”.

The mood in the Championship – where the majority of the furlough cash was claimed – is at an all-time low as clubs warn they are perilously close to collapse. The EFL has been left with few places to turn as the Treasury blocked a £100million-plus loan due to demands that clubs should announce freezes on pay and bonuses.

Championship clubs were given just 48 hours notice last month that the Treasury was blocking an expected payment that would amount to £8.3million for every club in need. Relations between Rick Parry, the EFL chairman, and Nigel Huddleston, the sports minister, are tense, and Whitehall is yet to offer guarantees that stadiums will be full by the start of next season.

Whitehall insiders allege that Parry had previously told the Government the EFL had private finance options, and it was unclear why this has not since materialised. That version of events is denied by EFL sources.

The mood within the EFL has been described as going from bad to worse and on to “apoplectic” in the past week as ministers announced another £300 million support package for other sports, while also offering to fund extra matches at Euro 2020 and back a 2030 World Cup bid.

Tottenham and Liverpool previously reversed decisions to take part in the furlough scheme, which now totals around £54billion in help for all sectors.