Football Parry determined to end parachute payments

EFL chairman Rick Parry insists the governing body remain committed to eradicating the “evil” of parachute payments and installing greater financial controls, including a soft salary cap, to ensure the long-term sustainability of the three divisions below the Premier League.

However, the EFL’s proposals are predicated on England’s top-flight embracing reforms laid out in the Independent Fan-Led Review of Football Governance which was published a year ago today, amid considerable optimism, but is still waiting on formal and decisive action from the Conservative government.

Parry has been lobbying for changes to the way money is redistributed from the Premier League since appearing before a Select Committee in the summer of 2020, in the wake of the pandemic. With Championship clubs, on average, spending 125 per cent of their turnover on wages, and losses throughout the division, in the main, completely unsustainable - both due to Covid-19 but also considerable financial mismanagement - Parry believes English football faces a “once in a lifetime opportunity” to reform.

It’s pertinent from a Bristol City perspective given the club released their accounts for 2021-22 last week, publishing losses of £28.5 million, and although wages have been reduced by £5m they still make up 102 per cent of income.

Of chief concern, and something that is steadfastly supported within the corridors of power at Ashton Gate, is the abolishment of parachute payments - the money clubs relegated from the Premier League receive - to a more merit based system which would not only reduce the “cliff edge” between the top two divisions, but also spread wealth more evenly throughout the 92 clubs which make up the professional pyramid. Parry has called for 25 per cent of TV revenues in the Premier League to be shared and a merit-based system, on league position, to replace parachute payments, something which has reportedly been discussed within the top-flight as part of their own ‘New Deal for Football,’ albeit with no contact yet initiated with the EFL.

“Our purpose as the EFL is making clubs sustainable at every level, not just within the EFL but right through the pyramid,” said Parry. “We’re very conscious that we’ve got clubs joining us from above and from below and there are 100 to 120 clubs who are potential EFL members. It’s about making all of them sustainable.

“Sustainable means not dependent on owner funding, which is one of the greatest challenges we have. That doesn’t mean we want to stifle ambition or we’re preventing owners from funding clubs, that’s a complex debate, but we don’t want every club to be dependent on owner funding for survival.

“In order to make clubs sustainable it needs two things; redistribution of revenues and better regulation. We’re completely committed to both of those and the two are inseparable, you can’t have one without the other. You need redistribution to make the clubs solvent and you need better regulation to make sure they don’t waste the extra money.

“We’ve been trying to address the redistribution piece for two-and-ahalf years. We are still waiting for an invitation to join it. We are getting nowhere and the reason we are getting nowhere is that we don’t have any negotiating strength, we’ve got nothing to trade

– all we can do is to plea.”