[Note: If you’re arriving here from WSC then feel free to copy/paste elsewhere – there’s an Excel file at the bottom of the post with all the info in it. I have no doubt there are errors in the list below – I’d appreciate it if you pointed out any glaring omissions.]
Attempting to make sense of the financial state of English football.
It’s almost eight years since the ITV digital collapse brought chaos and financial meltdown to the lower leagues. By pulling out of their deal to pay £315million over three years for the right to screen fixtures such as Chesterfield vs Barnet they provided us with some great anecdotes (heard the one about the Tuesday night match where it would have been cheaper to drive every viewer to the ground in a limo, put them up in a hotel and give them £500 rather than pay the costs of televising the game?) and the perfect bogeyman to blame for all the problems at England’s provincial football clubs. As with Setanta’s later decision to screen Conference games on pay-TV the benefit of hindsight makes the ITV deal seem, at best, horrendously naive. Even on the most optimistic projections the Football League rights were a matter of corporate prestige and the search for a flagship product rather than financial logic.
But while the loss of such a vast sum of income was unprecedented and pushed many clubs over the edge it’s too easy to ascribe all the clubs’ problems to this particular loss of income. Many of the these clubs had always been badly run, had suffered from falling crowds for years and were in a state of decline. Charlatans such as John Batchelor and Darren Brown were around before ITV Digital and the collapse of the broadcast deal only served to expose their earlier misdemeanours.
Football clubs playing in the top five divisions of English football who have entered administration/a Company Voluntary Arrangement (CVA):
Red dot = has been in administration.
Disclaimer: Red dots are more prominent that the white ones – be aware that that adds emphasis. Any club that has been relegated from the Football League but is not currently in the Conference is listed – all have been in administration. Both MK Dons and Wimbledon are listed as having been in administration, along with a few other quirks.
Over the past decade the lower league ‘crisis’ has moved from being a single great collapse to being a fact of life. There has been no let-up in the cycle of administrations, new owners, broken promises, CVA deals with the taxman and last-minute saviours willing to take over the smaller clubs. Read the BBC Football site or pick up any When Saturday Comes from the last five years and you’ll see at least one account of a club about to go the wall and strike a deal with creditors. I’ve been trying to work out the scale of this problem and put it in some sort of context – I’ve struggled to find data on a lot of these financial crises and this is my first stab at collating information on the collapse of English clubs.
No surprise to discover that lower league clubs are in worse shape – but many of those can trace their problems to relegation from a higher division.
It’s worth remembering that amongst the 100+ full time professional football clubs in England it’s healthy for a few to be in dire straits at any one moment. If businesses didn’t take financial risks and try new tactics then there’d be no innovation. Applied to football, the lower leagues would be even more stagnant than they currently are. The downside of this is that this allows mismanagement and fly-by-night sugar daddies to sneak into the system. But in every area of entertainment, governance and commerce there are some places that get it right and some that overspend, under invest and suffer the consequences. The problem is that we can’t treat football clubs as other businesses – the emotional bonds mean that some lifelong fan is almost always willing to step in at the last moment and take on the £300,000 tax debt run up by the previous administration rather than let the ‘essence’ of the club die. The heart triumphs financial sense and provides a safety net for even the most indebted football club. The end result? Wounded clubs limping along at the bottom of League Two (or worse) struggling to pay the interest on historic debts.
Aside from the ITV Digital spike there’s generally a steady stream of one or two clubs resorting to a CVA each season. Perhaps that’s actually healthy?
I’m not in favour of salary-caps, over-regulation and an attempt to create a level playing field financially. Clubs should learn to spend what they can afford to pay as part of basic business practice (even if it’s funded by a rich benefactor) and forcing them to limit wages to an arbitrary amount would be difficult and costly to police. It would also take away the prized independence of clubs and scare away investors. But the current cycle of bust-and-bust is just untenable. Points deductions don’t work and despite some promising starts there has been no shift to fan ownership in the Football League, with a few notable exceptions. The map at the top of the page shows the scale of the problem – but right now the only solution that I can imagine would be the complete liquidation of a number of high profile clubs. Are there any Portsmouth fans willing to let their club die for the sins of the others? Nah, thought not. There’ll be another saviour along soon enough.
Complete list of football clubs that have entered administration or a CVA in the last 25 years*:
Newport County 1989
Exeter 1994, 2003
Bournemouth 1997, 2008
Darlington 1997, 2009
Chester 1998, 2009
Portsmouth 1999, 2010
Crystal Palace 1999, 2010
Oxford Utd 1999
Swindon 2000, 2002
Notts County 2002
Port Vale 2002
Lincoln City 2002
Swansea City 2002
Halifax Town 2002, 2008
MK Dons 2003
Crawley Town 2006
Rotherham 2006, 2008
Leeds United 2007
Boston United 2007
*Teams currently in the top five divisions of the football pyramid (and former Football League clubs) that have entered administration or a CVA in this period to the best of my knowledge/Google. This is the best list I’ve been able to come up with – please correct any mistakes. A raw data Google Docs spreadsheet file that I used is available here – use in any way that you want.
And remember – this data uses ‘administration’ or a CVA as evidence of serious financial gloom. You can argue that Salisbury entering administration to clear a small debt and earning a mention is less cause for concern than the massive debt at Liverpool, Man Utd, Watford, etc. Non-League is even worse: a majority of teams in Conference North have been in some sort of serious financial crisis within the last few years.
Doncaster are shown in white; should be red.
Sheffield Wednesday are shown in red; should be white.
Thanks for that. I’ll update the map when I get home. Any other additions/clarifications are appreciated.
And since you commented I might as well add another notch to the list – congratulations to Crystal Palace for being the first club to go tits up in this brave new decade.
As a rangers fan i the old firm go on about moving south there are a lot of clubs in trouble so why not spend money buy club and get to the premier league even buying portsmouth or palace would be rewards instantly as I dont think theyd win championship straight away but feel they would finish in top 6. The big question is why clubs are going into administration. Simple Answer PLAYERS. I dont grudge anyone make a decent living but how many footballers have lost their jobs after the bosman ruling, yes the players at the top are getting megaloads of money but this needs to stop and not only that the fans are being ripped off due to these idiots ruining football, the PFA both north and south of the border should be looking into this and protecting all there members in being paid a great amount of money. Real Mallorca were thrown out of Champions league cos they were 60 million in debt but man utd, liverpool, chelsea, barcelona, real madrid all have huge debts UEFA take a stand and give clubs 5 years to get back in black not allowed debt at all, think maximum players should be paid is £10,000 a week give game back to fans, yes clubs should make money not players but not at expense of fans, let me know what you think of my outburst sorry guys but cheers
Swansea City went into administration in 2002.
Excellent map, interesting stuff.
I knew football finances were in a bad way (my club Cardiff City could well turn red on your map pretty soon) but I hadn’t realised just how many clubs had taken the admin route!
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Very informative stuff. You don’t seem to have Maidstone on the map. Even selling Warren Barton couldn’t save them. I have done a rough count of Scottish league clubs and the relative numbers do not seem as high, which I guess has to do with relative costs as the amount of money owed is often in the tens of thousands and as such is pennies to anyone with cash.
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You seem to have missed out Luton’s other two insolvency events. They went into administrative receivership in 1999 following a power struggle between Cliff Bassett and David Kohler, and administration in 2003 in order to remove John Gurney from the club before he destroyed it.
Not wanting to be pedantic, but you’ve included various clubs which have been in other forms of insolvency. There’s a significant difference between CVA, administration, administrative receivership and liquidation (not just the legal form, but in terms of how you got into it – ie who “did it to you” or if you did it yourself; cost; duration; intention; outcome).
Compare Derby County, whose parent company was placed into administrative receivership by its secured lender and then bought back in a pre-pack sale of the operating company, with Leeds United, which put itself into administration, and Maidstone United, which went was wound up by a creditor, placed into compulsory liquidation and was kicked out of the league.
(ok, that was a little pedantic)
PS another for your list – Swansea went bust in 1985 (liquidation)
Pedantry is good. This is a stab at showing at the extent of the problem, mainly sourced from Google and official site histories – hardly authoritative or reliable when it comes to the exact form of the financial crises.
A clear message remains: pretty much every team has been, will be or currently is financially screwed.
Comments much appreciated…cheers.
Maidstone United were NOT put into compulsory liquidation, they went into voluntary liquidation…a subtle difference, but an important one. Neither were they ‘kicked out’ of the Football League, but declared themselves unable to fulfill their fixtures, and thus withdrew.
The Chairman at the time, almost immediately formed a new club, Maidstone Invicta, putting £10,000 of his own money up for use and after 6 years paid £6,000 to adopt the name of Maidstone United (the legal waiting period to adopt liquidated company names), and this new club continue to use the name to this day.
Your website part answers the question the Clubs in Crisis website failed to respond to but what do people think of my suggestion ?
” Following a recent pub quiz question and much debate amongst my footballing mates (especially those who stand on the terraces of Bristol Rovers) do you know how many Football League clubs have entered administration (like our rivals Bristol City) or been declared bankrupt during their history ? Do you possess such a list ? To my mind it would be interesting compiling one.
For some time now I’ve campaigned to try to get the BBC to bring out ‘ Restoration Soccer ‘ which could showcase current clubs in trouble and the public could vote for the most deserving, thus raising valuable funds to help save that club. Many people think it a good idea, The Sunday Mirror fully endorsed the idea in their Letters Page (with the Editor immediately nominating Millwall because of their strenous efforts in the community). I’m sure it would pull in the viewers. It could devote a whole hours episode to Portsmouth couldn’t it – and that would make compelling viewing.
Anyway going back to that pub quiz. They say over 50% of the current 92 have ‘ gone under ‘ at some stage in their lifetime. Can this possibly be true ?
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Great piece. Do you think this is an inevitable cycle or is there a solution?
Football is a professional business. I don’t want it to go back to some boring Corinthian ideal – and it never will. Good.
My problem is trying to square support for a struggling lower league football club with my libertarian views. Football is pretending to be a business but one that’s completely skewed by emotion.
If it were a genuinely competitive market where people made logical decisions, with entrepreneurs investing and building up businesses in order to make a living then you’d see something along the lines of what happens with shopping: a handful of dominant players that have grown enormous over time, taking over medium-sized rivals and a specialist, ultra-local end.
ie. You’d have the Premier League and you’d have twenty semi-pro regional leagues, with nothing in between. In most areas of business this would be ‘A Good Thing’. For understandable reasons this isn’t really palatable to football fans.
What we’re currently doing is letting these market forces run wild while arbitrarily and ineffectually trying to control them on minor issues.
Business logic would create a load of ‘Thames Valley Royals’-esque teams, much as small firms merge to compete in bigger markets. The crazy and brilliant world of emotion (because, thank god, there’s a bit more to football than supermarket chains) means that Swindon, Oxford and Reading are all struggling to maintain their own stadiums, profiles and expensive squads.
They CANNOT fail. Their business models may be screwed, their stadiums too expensive and their support dwindling but someone (a philanthropist, a fraudster, the fans) is always to step in. You can’t have a competitive market place with such security! A market place where every business is expected to invest, take risks and grow…but all without any of those businesses ever failing, merging or making a profit.
It’s crazy. Either you want a cash-heavy league of brilliant professionals and constant improvement or a stagnating but stable competition. We’re trying to take the middle road at the moment and it doesn’t work.
And there’s the final issue…it’s one thing for a private individual to let a business fail due to reckless decisions: the only people affected are them and their employees. Problems arise when it affects the 1,000s of irate supporters.
1. Salary cap: I don’t want it. If I won the lottery, why can’t I spend York City into the Premier League? Everyone would just spend their time trying to get around it. A level league is no fun.
2. Supporters Trusts: York, Stockport (and to an extent Notts County) show these don’t always work. Volunteer committees are fine for non-League but aren’t good ways to run big businesses. It worked at Exeter – once they cleared the debts with that lucky FA Cup draw.
3. Benevolent dictators: Well, we all can hope. But to a certain extent that’s what happens at Crewe, Rochdale and Altrincham. Sensible guys putting in sensible sums – ie, showing business acumen as market forces should dictate rather than letting too much emotion get in the way.
4. Same old, same old.
5. Completely centrally controlled franchising, call in the communists.
Essentially we need to decide: are we happy with crazy spending private businesses that we choose to support, enjoying the highs and knowing that some massive lows are likely? Or do we want to have a direct interest in low-level clubs that are genuinely community enterprises.
“My problem is trying to square support for a struggling lower league football club with my libertarian views. Football is pretending to be a business but one that’s completely skewed by emotion.”
This is exactly the dilemma that I have seen cropping up time and again in covering football/business issues on my blog, essentially how to keep football as a business dynamic without subjecting supporters to the whims of reckless management teams.
can you please explain why premier league clubs get deducted 9 points and football league clubs get 10 points taken off ?
I believe its do with the number of games (i.e. teams in the league). The number of points reflects the number of games a team must play. The premier league has less teams so therefore less points are deducted.
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Or in the case of my club, Dundee, who have just been deducted 25 points today by the SFL ( Scottish Football League ) for entering administration ( 2nd time in 7 years ), is this a record points deduction ?
No, Luton Town got deducted 30 before getting relegated to the Conference.
it was a fucking joke qpr got fined no points cause they are now a prem club and they football leauge couldnt be bothered to take the time to give the championship to the team below and the team below them automatic promotion its a farce luton have lost in excess of 2million in the few years we have been down there 750k fine would have been fine by us fans but the thing was that the people who did these deals were off spending there cash and living their lives somewhere else ir mike newell was at grimsby so the only people punished was the fans and that is always the case with point deduction!!
maybe im wrong and im too emotioally involved being a luton town fan but im just saying ;)
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perhaps like the american way of selecting new players ,were the lowest team gets the first pick and so spreads the talent round to create A more exciting game and of course some money ajustment because of the teams current posistion.
You actually make it seem so easy with your presentation but I find
this matter to be actually something that I think
I would never understand. It seems too complex and extremely broad for me.
I am looking forward for your next post, I’ll try to get the hang of it!
We are a gaggle of volunteers and opening a brand new scheme in our community. Your site provided us with valuable information to work on. You’ve done a formidable task and our entire group might be thankful to you.
Update: Portsmouth took a third bite in May 2012
I strongly disagree! I am stunned this keeps happening time and time again in modern day times. I was glad I was sat down. We are coming to terms about things moving forward. I will want to know what is happening in the future.
I strongly disagree! I still am startled that this really went on in todays world. I was happy in the fact I was sitting down for this. The gaffers help answer about the future. I am going to keep an eye on the change and going forth.
I totally agree! I’m really startled that this keeps happening time after time these days. I am so glad I am not jogging. The Owners need to know about things in future I need to keep an eye on what is going on moving forward.
out of the 92 clubs we have, how many clubs are actually in the black..???..man u -600m…chelsea -734m..barnsley have made a profit and they are the only club so far to go into the new wages bill which comes out next season..not sure about sunderland .. i cannot see many premiership teams in profit,,,please prove me wrong,, as it seems the lower you are the better the clubs finances..!!!!!!
You can see the clubs in this infographic here http://footballclubsinadministration.com/
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Hi , I just wondered in the database why some clubs are under the league ‘other’?