Academic journal article The International Sports Law Journal

Football Finances: German Bundesliga Outperforms English Premier League

Academic journal article The International Sports Law Journal

Football Finances: German Bundesliga Outperforms English Premier League

Article excerpt

With the kick-off on 11 June of the 2010 World Cup in South Africa comes the latest news of the finances of the 'beautiful game' proving that football is not only the world's favourite sport but also its most lucrative one.

In 2009, the turnover of FIFA, the world governing body of football, amounted to more than US$1 billion and the profit for the year was US$196 million. In addition, FIFA has assets (equity) of US$1.061 billion. Impressive figures indeed!

At the same time, the Sport Business Group of the international accountancy firm Deloitte's has just published its latest Annual Football Finances Review. Again, some very impressive figures!

Here are some of the highlights of this Review:

Perhaps the most important fact to emerge from this Review is that the operating profits of the English Premier League fell by more than 50% to [pounds sterling]79m - their lowest level since the 1999/2000 season; whilst the German Bundesliga overtook the English Premier League to become the world's most profitable football league - at least, for the moment!

Nevertheless, the English Premier League continues to be the world's most popular league, drawing world-wide audiences of several billions in total. Naturally, the Deloitte's Review concentrates on the financial fortunes of the English Premier League, where the wages bill continues to be very high and is causing concern in football and government circles.

According to Dan Jones, the Editor of the Review: "For every [pounds sterling]100 that comes into Premier League clubs [pounds sterling]67 goes on wages, and that's too high."

In fact, soaring wages are threatening the stability of the English Premier League clubs, according to a recent report into football finances in the UK.

English Premier League clubs spent 67% of their revenues, or [pounds sterling]1.3 billion, on player wages during the 2008/09 season; with Chelsea again topping the wages bill, at [pounds sterling]167 million, whilst Manchester City's wages bill rose from [pounds sterling]54 to [pounds sterling]83 million!

The wages bills of the top English Premier League clubs in the 2008/09 season were as follows:

* Chelsea - [pounds sterling]167m ([pounds sterling]172m)

* Man Utd - [pounds sterling]123m ([pounds sterling]121m)

* Liverpool - [pounds sterling]107m ([pounds sterling]90m)

* Arsenal - [pounds sterling]104m ([pounds sterling]101m)

* Man City - [pounds sterling]83m ([pounds sterling]54m) (2007/08 season wages bills in brackets)

The UK Sports Minister, Hugh Robertson, has described the rise in wages as "very worrying" but has also stated that the Government should not intervene, but rather be looking to put pressure on football governing bodies to improve financial practice:

"The concern is that the operating profits have halved and the wages bill has increased and we will be pushing football's regulatory authorities very hard to take some action. …

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