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How Brighton can ride PSR wave back to European football



Whilst Brighton suffered a downturn in performances on the pitch through March and April, the Albion announced record profits for a Premier League club of over £122 million.

Other supporters have since mocked Brighton. What does making lots of money matter if you do not win for six games, slide down the table and out of contention for European qualification?

That viewpoint though is to focus only on the here and now. Look to the future and you will see many of the teams Brighton are competing with are likely to face significant financial issues going forwards.

Profit and sustainability rules (PSR) are here to stay, even if the machinations are changing. Whilst other clubs sweat on what this will mean for them, Brighton fans can monitor developments with comparative disinterest.

We are safe in the knowledge that for as long as Tony Bloom is chairman, the Albion are in absolutely no danger of breaching any mechanism that the Premier League or UEFA come up with.

Where Brighton do hold an interest in what happens with PSR is the potential impact future points penalties, clubs needing to sell players or restrict their future spend will have on their Premier League rivals in coming seasons.

Current Premier League PSR

Current Premier League PSR remain in place for the 2024-25 season. Hence there will be two more assessments under the existing rules when club accounts are published for the 2023-24 and 2024-25 campaigns.

Clubs are allowed to lose £105 million over three years. It is difficult to assess where each club stands as costs for infrastructure, women’s football, youth development and community work can all be deducted.

But we can hazard a guess. The graph below shows the combined profit or loss across the 2021-22 and 2022-23 campaigns of clubs who could be in the Premier League next season. Only Brighton and Brentford made a profit.

The BlueCityBrain graphic below meanwhile shows the net transfer spend for each Premier League side in the summer 2023 transfer window.

Combine the two graphs and you can see which clubs may have issues. Brighton for example made an £87 million summer transfer window profit to go with their £157 profit over the previous two seasons.

Chelsea in contrast lost £211 million across 2021-22 and 2022-23. Add a net spend of £171.7 million last summer and you can see why the Blues are the focus of a lot of PSR interest.

Chelsea, Manchester City, Everton, Forest and Leicester

Todd Boehly has stated that Chelsea have met PSR, although there is some controversy about a club reducing their losses banking £76.5 million by selling two hotels to their own parent company. It remains to be seen whether the Premier League will accept this.

The football world also awaits judgement on Manchester City and their longstanding 115 charges. Premier League CEO Richard Masters has confirmed a date has been set for an initial hearing but has not publicly revealed when it will be.

Why? Masters stated: “We can’t comment on the case, the date is set. The case will resolve itself at some point in the near future. I can’t make any further comment on it.”

Everton and Nottingham Forest have already been hit with points deductions. Whilst their fans may be up in arms about them, they do appear fair.

Even with their punishments, neither club is out of the PSR woods yet. Leicester City meanwhile have a confirmed PSR breach and will face at least one set of points deductions back in the Premier League next season.

PSR and the summer 2024 transfer window

Premier League net spend in the January 2024 transfer window fell to £96 million from £780 million the previous year. This reduction was largely a direct result of PSR concerns.

Many argued at the time that spend would pick up in the summer. There must now be some doubt about this assertion with the release of club accounts showing a combined £1.7 billion loss across the Premier League in 2022-23 and 2023-24.

Who then can spend this summer? The turnover of the big six leaves them with the flexibility to be net spenders without making a huge loss.

Outside of those clubs, only Brighton, Brentford, West Ham United, Ipswich Town and Luton Town look to have the option of spending significant amounts within PSR rules.

Burnley, Bournemouth and Crystal Palace – who also spent £30 million spent in January – have used up much of their PSR headroom on transfers for the 2023-24 season.

The accounting period for the current campaign runs until June 30th. There is speculation that a number of clubs need to sell before that date to reduce their losses and comply with PSR.

Premier League clubs who need to sell before June 30th

Heading up the list of clubs who may need to sell prior to June 30th to balance the books are the usual suspects of Chelsea, Everton, Forest and Leicester.

Others may yet join them, most notably Aston Villa. Villa lost £120 million in 2022-23 and the £100 million profit received for Jack Grealish will no longer show on the books as his transfer to Manchester City moves outside the three year accounting period.

Sales of youth team products and those purchased for minimal outlay count as pure profit; transferring such players therefore represents the quickest and easiest way to reduce losses.

Selling Jared Braithwaite (Everton), Jacob Ramsey (Villa) and Conor Gallagher (Chelsea) would help their respective clubs massively.

From a Brighton perspective, it may mean the Albion are able to land Kiernan Dewsbury-Hall from Leicester having shown interest in the midfielder in January.

UEFA Financial Sustainability Rules

To take part in European competitions, clubs have to comply with UEFA’s own Financial Sustainability Regulations (FSR).

UEFA currently requires clubs to spend only 90 percent of their income on their playing squad. This covers transfers, wages and amortisation. For next season, the amount which can be spent will drop to 80 percent and then 70 percent for 2025-26.

Every English club to date has met this requirement. That could change though should Chelsea qualify for the Europa Conference.

A precedent already exists for clubs spending above the limit. Fiorentina were admitted to this season’s Europa League in place of Juventus, who failed FSR.

If Chelsea do fail to meet the 80 percent ruling, it could mean the club who finish eighth in the Premier League qualify for Europe ahead of the Blues.

The UEFA reduction from 90 percent down to 80 percent and then 70 percent may, however, pose a challenge for English clubs going forward.

Football finance expert (and Albion fan) Kieran Maguire has produced the graph below showing how only six current Premier League clubs would currently be eligible for Europe under the 70 percent rule.

Of those currently challenging for European places, Chelsea, Villa and Newcastle all need to significantly reduce their spend.

And which club has the flexibility to increase their spend the most in a bid to challenge for European football? Yes, Brighton.

Proposed changes to Premier League PSR rules

The Premier League is set to adopt new PSF rules similar to UEFA’s FSR. Many have expressed concern this will only serve to further exacerbate the advantage of the big six and Newcastle by setting an absolute link between allowed spending and income.

Whilst the ultimate target of FSR is 70 percent, the Premier League are considering a higher allowance of 85 percent spend to revenue. Also included is a proposed cap on spending, likely to be around five times the income of the poorest club.

The Athletic compared the cap with published 2022-23 Premier League accounts. Only Chelsea with their absurd transfer spend would fail PSR under the cap.

If applied, it will effectively set no limit at all on the richest clubs… unless they happen to have a mad American owner.

Brighton and PSR

Financially, there can be no doubt Brighton are the best run club in the Premier League. A transfer profit of £87 million last summer contributes towards £134 million in profit over five years.

The Albion could even exceed the Premier League record £122.8 million profit shown in their 2022-23 accounts when the 2023-24 numbers are published, which will include the £115 million received for Moises Caicedo.

All of this should be taken into consideration when reviewing the Albion’s performance across the 2023-24 season.

There was a degree of understandable disappointment following the poor form of March and April. But it is far from the ‘disgrace’ some fans labelled it.

Only Brentford and Bournemouth have squads costing less to put together than Brighton. And the vast majority of Bournemouth’s transfer spend came last summer.

The Cherries paid out over £100 million. Combined with the shrewd appointment of Andoni Iraola, Bournemouth are now eyeing up a top 10 finish.

When you combine transfers and wages, clubs like Villa and Newcastle are spending twice as much on their squads compared to Brighton.

The Albion continue to punch above their weight whilst reducing their reliance on Bloom. 2022-23 saw the amount Brighton owe Bloom drop to £373 million. The publication of the 2023-24 accounts will likely make that figure lower yet.

That investment from Bloom has financed the Amex Stadium, the training ground, seen the club through Covid-19 and taken the Seagulls from League One relegation battlers to established Premier League outfit.

The future looks bright for Brighton

Brighton’s financial performance means that supporters can look to the future with more expectation than most Premier League clubs.

The struggles of recent months on the pitch have been a perfect storm of selling Caicedo and Alexis Mac Allister and the worst injury crisis the Albion have suffered in over a decade. But the experience will prove invaluable to a young side packed with star potential everywhere you look.

Bart Verbruggen, Jack Hinshelwood, Jan Paul van Hecke, Valentin Barco, Carlos Baleba, Facundo Buanonotte, Simon Adingra, Julio Enciso, Evan Ferguson and Joao Pedro all have the ability to carry Brighton back into Europe.

And that is before you add in any new additions at the same time as the rest of the Premier League are hamstrung in the transfer market by PSR and have to cut their cloth accordingly.

Inevitably as fans, we look at the profits and the injury list and think Brighton should spend more. This would seem to be the opinion of the manager too.

But in truth the Albion model is working perfectly. This season might not have panned out how we all wanted, but it potentially sets Brighton up to ride a PSR wave back towards Europe.

It is all about perspective. Anyone for Bill Archer, Greg Stanley and David Bellotti?

Peter Finn

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