The Government has been urged to stump up cash to ensure that well-loved clubs do not go bankrupt as a result of lost match-day income as the pandemic continues. The lion’s share of the tax debt – £59,127,124 – is owed by clubs which play in the Championship league, with £13,637,069 due from those in League One and £4,848,583 from those in League Two. Conservative Folkestone and Hythe MP Damian Collins pushed the Government to step in, arguing it had found cash to rescue other cultural organisations.
He said: “These tax debts have grown because football clubs in the EFL have no match day income but are incurring all of the costs of playing games and paying their players and staff. You don’t need to be Lord Sugar to know that model leads to failure.
“If the clubs could have spectators back they would be able to pay their taxes, but as it stands many are on the brink of bankruptcy depriving communities of their clubs and leaving the government amongst the biggest losers financially. We need a game plan to rescue the EFL clubs.
“The Government has been saying that it won’t put in any money in to rescue professional football clubs in the EFL, but unless it gets involved we could see multiple club failures. Time is running out. The government found £1.5billion to support cultural organisations. I believe football is part of our culture and also needs help.”
Last week the EFL also pushed Culture Secretary Oliver Dowden to take action, arguing that clubs such as Rochdale, Grimsby, Mansfield and Carlisle were as important to the nation’s heritage as opera at Glyndebourne or the Royal Ballet.
However, the Department for Culture, Media and Sport wants to see a deal done between the Premier League and the EFL to ensure lower division teams are saved.
In the wake of the Premier League spending around £1.2billion during the summer transfer window, senior figures are convinced there is cash in the system and that taxpayers’ money cannot be used to bail top-level clubs at a time of stretched resources and unemployment worries.
A source said: “There is a deal to be done between the Premier League and the EFL and they just need to get on and do it.”
The department had been determined to get fans through gates again by October 1 but plans were dropped when new Covid-19 restrictions were introduced. It is still hoped that capped numbers of fans could be allowed back before the spring.
Malcolm Clarke, who chairs the Football Supporters’ Association, pushed for urgent help, saying: “Clubs are vital parts of their local communities and will not survive the current crisis without support – we back calls for a comprehensive rescue package for football clubs.
“The financial stability of clubs in the EFL has been a serious issue for a long period of time and is severely exacerbated by the pandemic: the time for governance reform is long overdue and the Government must deliver its fan-led review as soon as possible.”
Shadow Culture, Media and Sport Secretary Jo Stevens said: “These figures are indicative of football’s broken financial system. Fans are missing matches and understandably worried about the survival of their clubs.
“The government promised a fan-led review in its manifesto but hasn’t delivered.
“We know what the long-standing governance and financial issues are and the pandemic has made them even more stark.
“Our national game needs clear leadership and yet again the government is missing in action.”
The Football Association expects a £300million deficit as a result of the pandemic but expects to invest £45million in grassroots football during the 2020/21 season.
A Government spokeswoman said: “Having spent £1.2billion in the recent transfer window, professional football has the means to support clubs through the pandemic. Clubs can also benefit from the government’s Covid business support schemes. We urge the EFL and Premier League to finalise a deal as soon as possible.”
