Curb spending or risk losing it all again, insists financial guru

DAVID LOW knows how easy it is for clubs to go bust — and how hard it can be to show the strength to avoid it.

Back in 1994, he was the man who came up with the plan which allowed Fergus McCann and his partners to save Celtic from bankruptcy, when the Bank of Scotland were about to put the club into receivership because the then directors had gone over their £5million overdraft limit.

With Low as his financial advisor, McCann sacked the board and began the process of building a new 60,000 capacity Parkhead.

Meanwhile, Walter Smith’s Rangers were on their way to equalling the nine successive championships won by Jock Stein’s Celtic and McCann had to ignore pleas from fans who wanted him to break their budget in order to stop them.

Brendan Rodgers’ resurgent champions are on track to make it eight in a row this season and that has piled the pressure on Rangers to react. They have brought in Steven Gerrard as manager and allowed him to make 15 signings.

However, that has come at a cost. Rangers posted annual losses of over £14m this week — announcing their results minutes before their game against Kilmarnock kicked off on Wednesday night.

The club descended into administration and liquidation in 2012 and Low fears a repeat unless chairman Dave King and his directors adopt a more sensible approach.

‘Rangers have failed to make a profit since they imploded six years ago,’ he said. ‘By my reading, their losses since then have totalled £38.6m — and that’s just madness.

‘Never mind the football side of this, as a financial guy looking at their accounts, their business model makes no sense. Spending more than you earn year after year… how do they get their money back?

‘Their cash is due to run out again early in the New Year and they’ve admitted another £4.6m in loans will be needed, with another £3m required next season. Yet Steven Gerrard is talking about signing more players in January.

‘However, after those horrendous accounts, I imagine the only way he’ll be able to do that is by wheeling and dealing, shifting some players out in order to bring others in.

‘But that’s easier said than done — plus Carlos Pena and Eduardo Herrera are still under contract and due to return in January.’

Low revealed that McCann was under the same pressure 24 years ago as King finds himself in now. Low added: ‘When Fergus took over at Celtic, a lot of fans didn’t like how he dealt with Rangers being on top. They wanted us to go into the red to strengthen the squad but he refused to do that.

‘He told me: “I can’t get hung up on this ninein-a-row thing. We have a stadium to build and a long-term plan we need to stick to. This club is going to be around for the next 100 years and I’m not going to put that at risk just to stop Rangers reaching 10”.

‘As it happens, we were lucky enough to be able to stop them doing that under Wim Jansen but it was never the be-all and end-all for him and Celtic are reaping the rewards of that now.

‘They are currently responsible for generating two-thirds of Scottish football’s GDP; Rangers and the other 40 clubs provide the remainder.

‘Celtic’s turnover was over £100m last year and they have £27m in the bank. The financial gap between the clubs has never been bigger.’