Secret talks between the Premier League and EFL have taken place to discuss the removal of the controversial parachute payout system, with alternatives to be offered to top clubs for consideration.
Discussions continued throughout the Covid period on how best to organize financial redistribution. While the EFL has targeted parachute payouts as a major issue, the Premier League has remained defiant of the current system – citing the Â£ 1.5bn it is transferring to the leagues over a period of three years.
This position has changed, with a number of alternative proposals developed and debated among executives. The pressure is to make these changes a reality.
Parachute payments are made to relegated Premier League clubs to cushion the blow of lost revenue leaving the top flight. The EFL argues that this creates a distortion of competition, with other clubs spending money that they don’t have to follow.
One of the Crouch Review recommendations, published last week, said the Premier League and EFL should find a solution to the parachute payments problem by the end of the year, with outside voices being invited. to advise on the change if not. a solution can be agreed.
Although discussions are advanced, ideas have not been presented to Premier League clubs or the EFL board. On Monday, the Premier League board agreed to hold an emergency shareholders meeting this week to discuss the Crouch review.
Under the terms of the national television deal approved by the government this year, the parachute payments are to remain in place for another three years. Premier League chief executive Richard Masters on Friday suggested softening his tone on parachute payouts. “If there is a way to unite the clubs in our league and the clubs in the championship with a new proposal,” he told the BBC, “we should be driving for that and we are happy to be working at the pace of this project. “
The new ideas are likely to divide Premier League shareholders, with parachute payments providing a safety net for clubs engaged in big top-flight spending.
Several Premier League leaders have spoken out on Crouch magazine, with West Ham vice-president Karren Brady vocally defending the parachute payment system. Arguing that the clubs would go bankrupt without the money, she written in the sun that Tracey Crouch had “fallen into the benefactor’s trap” by proposing reform. “Maybe Tracey and [EFL chair Rick] Parry confuses competition with fairness, âshe wrote.
Brady was joined by Aston Villa CEO Christian Purslow and Crystal Palace chairman Steve Parish in speaking out against Crouch magazine, which is part of a group of ascending clubs that have growing influence in the league since the failure of the European Super League. conspiracy among the “big six” clubs.
On Monday, Parish warned against setting up an independent regulator for football, Crouch Review’s main recommendation. Debating this point with Gary Neville on Twitter, Parish said, âRegulators are there for governments to control markets or companies within a framework that they define and can change. Regulators are instruments of government and they are independent [sic] until the execution of the current mandate which can be modified at any time by a new law. Football will therefore be – under this plan controlled by the government. “