Monday, 24 October 2011

What impact will the abolition of the Tribunal System system have on Pompey and football in general?

Anyone who’s read my previous blogs on football finance will know it’s a subject close to my heart. So when last Thursday a deal was struck to overhaul youth football in the football league it will come as no surprise to those regular readers that it’s set my fingers off and running over the keyboard once more due to the damaging nature of the deal that was struck and it’s possible ramifications for many clubs who ply their trade outside of the football league. Whilst the main headlines were about a potential threat of scrapping relegation in England’s top tier, it seems the shouts being made by the football world enabled this story to escape past the noses of many fans up and down the country. Pretty much in the same way that politicians and the government manage to do on a daily basis with faux pas’ they have made and don’t really want any attention drawn to.

Last Thursday the Football League Clubs undertook a vote in which they voted in favour of proposals that could result in clubs from the Premier League being able to pick up the best young talent from lower leagues for a fraction of what they would currently pay at present under the current systems. Of the 72 member clubs, 46 votes were in favour of the proposal, 22 against, 3 no shows and 1 abstention. When you read the changes afoot you’ll be aghast at the numbers that voted in favour of such a move, but its felt that many of the yes votes were made by clubs who felt they had no choice but to give the rule changes consent after the Premier league threatened to withdraw over £5 million of funding that they currently give to lower league clubs each year for youth development.

The new system will be tied in with the Elite Player Performance Plan (EDPPP) which will see a four-tier academy system introduced into the English game. The new deal will see every club receive an increase in their funding for a four year period. The actual amount will vary from club to club based upon their academy status. The aim of the EPL is to implement the EDPP P for the start of the 2012 – 13 season and its aim is to ensure the best players are developed by the best coaches using state of the art training facilities. All sounds good so far. The idea being that the most-talented youngsters will realise their full potential which will benefit not only the clubs the players are at but also the England team as well. The EDPPP has itself widespread support from the football league level and many clubs believe the new system will succeed in many of its aims.

So what’s the key issue then? Why is it so damaging to football league clubs? The new set up has been combined with an overhaul of the tribunal system currently used to determine a transfer fee when two clubs have reached a stalemate and cannot agree a fee for a home-grown player. After two years of discussions between the football league and the EPL about how the system should operate, the final offer was put on the table;

There will be a fixed tariff dependent on how long a player has been at the selling club. For example, the fee is fixed at £3,000-per-year for a player's development from 9 to 11 years old. The fee from 12 to 16 will depend on a club's academy status but will range from £12,500 to £40,000. Such a change will obviously see English Premier Clubs having to pay large fee’s for the best home grown players from lower league clubs. One example made was Chelsea paying MK Dons an initial £1.5 million for 14 year old Oluwaseyi Ojo last week. With the new system Chelsea would have been able to buy him for less that £150,000 however additional bolt-on amounts will be given to the selling club if the player is a success. It’s this part of the deal that the EPL insist makes it a fair one from their point of view. This however is obviously dependent on the player going onto to achieve success with a Premier League Club. For those at the top of the game gambling on paying £100,000 for unproven players will appeal on the basis that as long as some succeed, those who don’t make the cut won’t have cost them the fee’s that they’re currently have to pay under the current tribunal system.

There is however a very large and real possibility with the big clubs hovering around to sign the best players from 9 to 16 years of age that rather than the EDPPP creating a new generation of stars and talent, it could well have the opposite effect when young players at the top clubs find themselves far removed from first team action and sent back out on loan to lower league sides to gain experience. The other flip side is that the extra funding is over a fixed four year term. With only two sides out of 72 in the football league not having an academy– those of Hereford and Morecambe, when the current increase in funding is removed it’s felt that many sides will fold their academies claiming the outlay and time to develop young talent, won’t be adequately compensated should the big guns come knocking at their door.

So how will this affect clubs long term? Well several sides survive on the basis of producing good youngsters and then selling them off for big fee’s to offset costs, two good examples of which would be our nearest rivals Southampton and fellow Championship side Crystal Palace. John Bostock was sold aged 16 to Tottenham Hotspurs from Palace having made his Palace debut aged just 15. The initial fee for the deal was £700,000 with an extra £1.25 million set to follow dependent on appearances for the first team. Since his move he has yet to make a single first team appearance for Spurs in the Premier League and has spent subsequent time out on loan to Brentford and Hull City. When Alex Oxlade-Chamberlain departed for Arsenal in the summer the move was rumoured to have been for a down payment of £12 million with the fee set to rise up to £15 million with extra add on clauses and incentives. Chamberlain followed in the footsteps of Theo Walcott who joined Arsenal for an initial fee of £5 million which is set to rise to £12 million with additional add on clauses inserted into the deal. For a club like Crystal Palace who aren’t long out of administration and still have a CVA to service albeit a much smaller one in part than Pompey’s, the change in deal could be catastrophic for them in terms of long term future stability. Pompey certainly won’t be exempt from the change either and could feel long term ramifications when the current system is replaced.

Although admittedly some way behind the current production line of fellow south coast rivals Southampton, under the tutorage of ex-Pompey legend Andy Awford, the club’s youth system is starting to finally flourish. The names of Sam Magri, Ashley Harris, Lewis Stockford, Matt Gledhill, George Colson, Lewis Tallack to name but a few will hopefully be gracing the hallowed turf of Fratton park for many seasons to come. But should a big name club come in from anyone of a group of talented youngsters the club will pretty much be powerless if the player wishes to move on. We saw this to our detriment in the summer when Nadir Ciftci left the club to sign for Kayserispor in the Turkish league. Whilst the club did receive £100,000 compensation for the player, this would have been much lower under the new system. Losing one player on search terms is bad enough. Losing an entire crop of home grown potential stars is unthinkable especially when new owners CSI announced their five year strategy for the club with such a large emphasis being placed on the academy system. For an established power house in the English Premier League such as Chelsea to have looked at the way Sam Magri played during the England Under 17 World Cup Finals this past summer for example and decided that paying under £100,000 would be a great investment for someone that could become the next John Terry for club and country, then Pompey would be pretty much powerless to stop such a move happening if the player wished it to come to fruition even if it meant the player having to see out the remaining part of his contract which was the case with Ciftci.

It’s great to read that the academy holds such an important part of the next five years for CSI, but you have to wonder who much it will be in their plans if they are no longer guaranteed a big money fee if they produce the next Alex Oxlade- Chamberlain from the south coast for example and that player wants to take a chance at signing for a larger club. With falling attendances meaning less revenue coming into the club and a CVA still to finance which was far greater than the one the new owners at Crystal Palace inherited, you’ve got to question what the change will have brought about in the new owners approach to handling the club will be.

Because let us not forget Vladimir Antonov was very specific when he first brought the club - it was so he could make money from it. So with the potential of golden windfalls from academy players coming through now gone, what happens next for CSI? I guess only time will tell.

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