December 2, 2021

EFL bailout: The five key questions

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EFL clubs in League One and League Two are set to learn the details of the Government’s lockdown tier plans on Thursday with different teams facings different scenarios based on which tier they are placed in.

Fans will be allowed to return to football grounds in tiers 1 and 2 when the national lockdown ends on December 2 but not in tier 3 as many clubs remain in serious financial trouble after suffering from a lack of gate revenue.

The EFL have agreed in principle to the £50m Premier League package, which would include a mixture of loans and grants, however the final make-up of the deal is yet to be approved by clubs.

Clubs will find out on Thursday which tier their local area will be in – which will determine whether or not they can allow supporters back into matches and provide much-needed income – with 4,000 allowed in tier 1, 2,000 in tier 2 and no fans in tier 3.

The money will support League One and League Two teams with Championship clubs having to agree a separate deal.

We spoke with five League Two officials to address the five key points to the bailout.

Grimsby Town 1:03
Grimsby Town chairman Philip Day says the League Two club entered lockdown with ‘a fairly healthy bank balance’ but will have ‘next to nothing’ by the end of the season

What are your most immediate concerns financially?

Phillip Day (Grimsby Town): “We are perhaps not the ordinary club in League Two, in that we don’t have immediate financial concerns because we came into lockdown with a fairly healthy bank balance.

“We had £740,000 in the bank, but we have used that money, and come the end of the season, we will have next to nothing in the bank and a close season to get through with no income and wages to pay.

“So the financial pressures as far as we’re concerned are long-term rather than short-term. We’re up to date on all of our tax but we can see around the corner there are substantial financial pressures.”

General view of Port Vale's Vale Park 0:53
Port Vale chief executive Colin Garlick says the government ‘passing the full responsibility’ of an EFL bailout package to the Premier League ‘is not the answer’

What type of support is needed? Should it be loans, grants or something else?

Colin Garlick (Port Vale): “We’re getting some central funds and we’ve had some season-ticket and merchandise money. We’ve also been lucky that our owner has supported us but people haven’t been able to come into grounds.

“That’s the income we need back. Where does it come from? I’m in the camp that the Government passing the full responsibility to the Premier League is not the answer because there are other industries where that’s not happening.

“It is the Government who are stopping fans coming into the grounds, who pressed the pause button in September or October and so I think for them to pass it completely to the Premier League is wrong.”

Newport County players enter the pitch for their Carabao Cup tie against Newcastle United at Rodney Parade 0:32
Newport County chairman Gavin Foxall says the Government should step in to help clubs affected by the decision to stop fans from attending matches

Who should bail out League One and League Two clubs?

Gavin Foxall (Newport County): “The Government have made a decision that the largest part of our revenue is fans through the turnstiles and the Government have said that fans can’t come in.

“Where they’ve made decisions in every other sector, they’ve provided a bailout package but bizarrely they’ve decided not to do that with football.

“I personally think that’s wrong and unacceptable and they need to play their part as opposed to pushing all of it onto football. I think both parties have an important part to play.”

Oldham Athletic director Barry Owen says he is confident discussions between EFL clubs will lead to the right ‘formula’ being found for the distribution of any bailout money

How should the money be distributed?

Barry Owen (Oldham Athletic): ” I’ve got confidence in our EFL executives. One thing that’s happened during the pandemic, there’s been a tremendous amount of consultation between the clubs, and somewhere along that line comes a solution.

“I think that’ll get discussed and the right formula will come out of that with regard to distribution.

“You’ve got to be sensible about it, if you do it on a basis of loss of revenue, or gate receipts, than some clubs would be entitled to a bigger share.

“But really, the costs of running a football club aren’t just about wages and gate receipts, it’s about things like floodlight repairs, maintenance of stadiums and staff.

“We work on a minimum staff basis at Oldham, we haven’t made redundancies over the summer over. But none the less wages have to be paid, so there is a whole raft of considerations for that bailout.

“Beggars can’t be choosers and I would be glad just to see some assistance.”

A general view of Brunton Park, home of Carlisle United 1:10
Carlisle United chief executive, Nigel Clibbens says that rules around ownership of football clubs should be changed in the future

What long-term changes are needed?

Nigel Clibbens (Carlisle United): “In reality you could buy a League Two club with no experience in football, you could show you have proof of funds from previous business experiences.

“You could show you have success, then take it over for a pound and off you go, not training, no experience. And what happens? We see it all the time.

“This is part of making owning clubs harder at the start and educating people.

“Maybe the owners need training. But the owners that I’ve come across, they feel like they’ve got all the answers and that they can learn through mistakes. So that again, is really difficult.

“But what you do find is new owners come in, and they have the answers to all the problems, they think they can solve everything and have lots of money.

“The money then attracts people that can tell them how to spend it and take if off them very quickly, and off you go, it’s a recipe for problems.”