Is the Premier League’s £3bn spending cause for concern?

A widening gap?

Fifa praised “the continuing expansion of international player mobility and the growing scale of the global transfer system” on Wednesday, adding that England had “consolidated its position as the leading global investor in talent”.

However, the fact that Premier League teams spent more than those in the Bundesliga, La Liga, Ligue 1, and Serie A combined raises major concerns about competitive balance.

Indeed, after Florian Wirtz and Nick Woltemade chose Liverpool and Newcastle United respectively over Bayern Munich this summer, the German champions’ honorary president Uli Hoeness spoke out.

criticizing their English rivals’ “completely crazy” buying spree, warning that it “can’t end well”.

After a slew of other great players departed the Bundesliga for England this season, Bayern head coach Vincent Kompany criticized the difficulty of competing with even the lesser Premier League clubs.

Sunderland, for example, had the highest net spend (£118 million) of any team in continental Europe, except for Real Madrid.

Even in the Championship, Wrexham’s £30 million summer investment resulted in a larger net spend than Barcelona, AC Milan, and Borussia Dortmund.

At a time when Spain’s La Liga and Italy’s Serie A already want to hold regular season matches abroad because they are potentially lucrative, will the current imbalance create even more incentive for others to do the same?

Could it lead to European clubs pressing for greater expansion of the Club World Cup, despite worries about player welfare, or perhaps an attempt to resurrect the Super League?

For former Liverpool managing director and Aston Villa chief executive Christian Purslow, the Premier League’s spending is merely “a reflection of the huge success of a competition that has a level of media income that dwarfs those of its main rivals overseas”.

Purslow is struck more by the gap with the EFL, and that after two straight seasons in which the three promoted clubs from the Championship were immediately demoted, “the huge leap required” to cross the gap between divisions “seems to be getting wider”.

But he appears to be most worried with a widening disparity within the top division, with another season of profit and sustainability rules (PSR) that limit financial losses and force more clubs to sell more players to conform, as well as the league’s elite talking edge.

“While it’s always been true that the biggest clubs come for players of ‘middle-ranking’ teams, that trend has become much more mainstream and is causing more of a polarisation between the winners and losers,” Purslow, of BBC Sport, explained.

Purslow was reflecting on a transfer window in which his former club Aston Villa transferred Jacob Ramsey, one of their few remaining senior academy products, to Newcastle United, who then sold homegrown Sean Longstaff to Leeds.

“Not only are we seeing the unintended PSR consequence of a perverse incentive to sell homegrown talent [because clubs’ own academy products are counted as ‘pure profit’ in their accounts when sold], in general, the most likely buyers are often the so called ‘big six’ clubs, who are benefiting from more Champions League revenue than ever,” noted Purslow.

“It’s a deadly ‘double whammy’ that is escalating. I believe most fans dislike it. They enjoy seeing the spine of their squad having a link to the local community, and watching such players leave has a special resonance.

“Fans understand that owners are selling not because they lack financial resources, but to comply with the rules.” So I believe there will be increasing pressure to liberalize those restrictions as more supporters see something wrong with sides like Newcastle and Aston Villa being compelled to sell players.”

Manchester United and Tottenham Hotspur finished narrowly above the relegation zone last season, while Brighton, Bournemouth, and Brentford achieved top ten status and Crystal Palace won the FA Cup, the biggest clubs appear to have used this window to try to reestablish their previous dominance by targeting domestic rivals’ talent.

Indeed, a record £1 billion was spent by Premier League clubs, £200 million more than the previous year.

Purslow believes that this strengthens the case for modifying PSR to encourage teams to retain their native talent while also allowing owners to invest more and cover losses.

“You have to have some level of control, but at the moment it’s skewing the competitive landscape,” he told me.

“Why are there rules that encourage us to sell native talent? Let’s simply make academy players’ pay non-deductible for FFP. It would change conduct overnight, allowing clubs to maintain those players.”

Kieran Maguire concurs that the summer has accentuated the “major concern that the owners of the aspirational and ambitious clubs, such as Nottingham Forest, Aston Villa, Newcastle, and so on, are constrained in terms of their ability to spend in a way that didn’t exist when Roman Abramovich acquired Chelsea [in 2003] and Sheikh Mansour acquired Manchester City [in 2008]” .

Maguire went further: “They’re on the wrong side of history because the PSR rules, regardless of their intent, has created a glass ceiling and has prevented owners being able to subsidise the clubs to the level they would like.”

Despite criticism from some teams, the Premier League has backed PSR, claiming it is necessary to prevent overspending.

In February, its clubs decided not to replace it with a new UEFA-style’squad cost ratio’ (SCR) financial control system, which allows them to spend a fraction of their overall revenues on team-related costs and is presently only being trialled.

The nine Premier League clubs that have qualified for European competition will have to follow Uefa’s SCR criteria, which are tighter than PSR and limit player pay and fees to 70% of revenues – down from 80% – in 2025.

“I think investment in squads is generally a good thing so long as everyone stays within the rules,” Premier League chief executive Richard Masters told BBC Sport last month.

“Squads will be strengthened, which increases the competitive factor. It’s a fantastic blend of international superstars and domestic talent.”

Money due may be ‘potentially contagious’.

While the Premier League’s overall net spend in the window was £1.36 billion due to nearly £2 billion in player sales, Maguire also emphasizes the number of agreements completed on credit.

Even before this opportunity, the outstanding deferred transfer instalments were more than £3 billion. Now there will be much more.

“This is a relatively new phenomenon as transfer fees have increased,” Maguire told the BBC.

“It is now normal for deals to be split into three to five annual installments. As a result, clubs have accumulated enormous transfer debt.

Maguire cites Manchester United, where transfer payables have risen from £34 million in 2013 to more than £400 million this year.

He pointed out: “This has created a new satellite industry in football where clubs who are owed money for transfers sell the debt to financial institutions and get cash early.”

In the event of a club’s failure to pay, the Premier League has the authority to remove cash from central payouts and redirect them to football creditors, while all teams are required to provide financial statements in order to reduce their risk of default.

Nonetheless, Maguire remains cautious: “It will only take one club to have a financial problem for that to be potentially contagious and that could cause a huge ripple effect upon the senior clubs in both English and European football.”

Loans and Player Power

Aston Villa signed Harvey Elliott and Jadon Sancho on loan on deadline day – with an option to make Elliott’s deal permanent

Another striking development this summer has been the proliferation of loan packages that include options or commitments to buy.

While this may be beneficial to the player, it can also “help clubs from a PSR point of view as it can delay the cost of player purchases for 12 months,” according to Maguire.

However, with so many players on loan to different clubs, the ephemeral nature of such deals risks diluting team identities.

In the midst of a cost-of-living crisis, some people are already concerned about the amounts of money spent on transfers, player pay, and agent fees, as well as the formation of so-called ‘bomb-squads’ of undesired players.

On top of that, this summer saw a perceived lack of loyalty surrounding two of the biggest transfers, Alexander Isak and Yoane Wissa, who refused to train with Newcastle and Brentford, respectively, and published statements seeking switches.

Viktor Gyokeres was also disciplined by his old club Sporting for neglecting to attend pre-season training while pursuing a transfer to Arsenal.

“I didn’t think it was a good look,” Purslow remarked when asked about Isak’s agitation for his record-breaking move to Liverpool after an emotional parting was finally resolved on deadline day.

Newcastle has denied Isak’s claim that he had previously been promised the opportunity to depart.

“Anyone who’s worked in the game knows that if a club makes a promise, a player would get that in writing,” Purslow told ESPN.

“In this scenario, that would have meant an escape clause, and there would have been no argument; his transaction would have taken place far earlier. So a player effectively forcing a move was not a good precedent.

“We should acknowledge that clubs often want and need to sell players, so it does cut both ways, but those conversations would happen in private.”

In stark contrast, England defender Marc Guehi, who had continued to train and play for Crystal Palace, saw his dream move to Liverpool thwarted despite being universally acclaimed for his professionalism.

Some will consider the potentially destabilizing influence of so many trades – including those that failed – and conclude that the window should close before the start of the season.

Others will be afraid that by granting Isak’s wish, more players would actively want to force a shift in the future.

Regardless, with legal action recently filed against FIFA over its transfer restrictions, some believe players could soon be permitted to terminate their own contracts without paying compensation before those accords expire.

Ticket Prices

Another concern for many will be the possibility that teams will try to recuperate part of their record spending by raising ticket costs.

Nigel Clough, manager of League One Mansfield Town, has warned that the Premier League’s spending has become nonsensical and threatens “pricing fans out”.

And, with 13 of the 20 clubs raising season ticket prices last season, Football Supporters’ Association chair Tom Greatrex told BBC Sport that “there is no case for further increases”.

“Matchday income generates a small proportion of a club’s income, the vast majority comes from media revenues, so squeezing loyal fans further raises little extra money,” according to him.

“Clubs should listen to their supporter groups who have, across the board, backed our Stop Exploiting Loyalty campaign which calls for a freeze on ticket prices.”