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Grimsby Town's Debt


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Its all funded by the Chairman Fenty-(economics of the madhouse though)

It was Fenty, I believe, who, along with a few other chairmen of full time clubs, persuaded the Conference not to introduce some sensible financial regulations which included prohibiting loans to clubs by directors

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So a team getting 3,500/4,000 through the gates and still losing money at this level is crazy. What are they spending it on?

Probably the same thing we were when we ended up well over £1m in debt.

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There needs to be new legislation introduced specifically for sporting clubs. Something that creates a new category of company where directors are specifically forbidden from loading up debts on the company regardless whether they can personally service the interest or not. I don't think it'll ever happen if only because the bigger clubs pay an absurd amount of tax, but much of the money generated by these clubs is sucked from the pockets of the ordinary person on the street via Sky TV and corporate sponsorship budgets, and funnelled abroad to foreign bank accounts. Something needs to be done.

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I don't agree that the government needs to legislate, there is enough legislation on businesses today. It's a football (or sports problem) and the sports themselves should set the rules of the competition to ensure fair financial dealings and compliance.

 

The football authorities control the award [and deduction] of league points, all this overspending is aimed at the acquisition of those very points!!

So anyone over spending should be deducted points, it then makes over spending rather pointless (pun). Simples.

 

Of course there are ways around these things, if it was me, I would set up a charity and employ 3 players in the charity thereby saving some of the wage bill of the club. But I am devious and no-one else would do that.

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The problem is that football clubs want the best of all worlds. They want to be treated like a business as far as tax avoidance schemes are concerned, then they want to be treated like a charity when dealing with suppliers and local authorities. Most players in the upper divisions are paid via net pay schemes, which in effect constitutes an informal agreement with the tax office that they chase the club for the PAYE rather than the players, which is all well and good until the club can't pay (a la Portsmouth). Then you throw in the football rules that all clubs must sign up to, such as all footballing creditors must be paid in full before seeking a CVA/etc., and all the rules governing player transfers, fees, competitions and everything else, until a big club doesn't like a particular rule and then they involve the civil courts. You have assaults on the field of play going unpunished while much lesser misdemeanours in the stands result in court appearances, fines, banning orders and possibly prison.

 

Clubs will play for years while technically insolvent, propped up by cash injections from fire-fighting, (probably) well-meaning directors, only for it all to collapse in on itself anyway, just at a much higher cost to the public purse usually. Other companies that do this see their directors banned from holding executive office.

 

You then have the international organisations like UEFA and FIFA who insist on negotiating specific legislation with a country before even agreeing to review their bid to host a tournament, legislation that usually provides immunity from prosecution for senior officials and a company-wide (sometimes even extending to sponsors) exemption from paying tax.

 

Football likes to pretend it plays by the rules, and is quick to hide behind a rule when it suits them, but in reality they ignore as many rules as they can get away with, and this seems to be getting worse. You only have to look at FIFA to see how 'above the law' they think they are.

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Quite simply those that run football clubs should be treated like those that own private businesses - and if they run up debts they can't pay, or refuse to pay tax then they end up going bust and have a spell in prison.

It should be made a criminal offense to run a football club insolvent and without a clear way on how it can trade without debt and those running the club should be made accountable for it.

There are too many big time charlies in the game that care more about ego and stature than there are that actually care about the clubs and grassroots. Get those that are only in it for the prestige and to line their own pockets out of the equation - and have the people in that are sensible and there to run clubs in the correct manner. Football clubs should be about community, identity and development - not a play thing for someone with a bit of money.

It doesn't help that the massive amounts of money in the game at the top level gives those owners and clubs all the power and they dictate to everyone else how things should be done - but for me it needs to boil down to people facing criminal convictions for running sporting clubs into the ground.

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