Premier League set to introduce generous ‘spending cap’ as part new squad cost rules — report

“Salary cap.”

Aaaah!

Run for the hills!

With just three votes against, and one team, Chelsea, abstaining, the Premier League look set to adopt a “hard spending cap”. The preliminary vote on this issue was held yesterday at a shareholders’ meeting, with the full measure expected to be adopted at the next AGM in June, alongside the rejigged “squad cost” (new PSR, more akin to UEFA accounting) rules that will come into effect for the 2025-26 season.

The “cap” will serve as a “backstop” to these new squad cost rules — i.e. even if your income meant you could spend an unlimited amount, you cannot spend more than this cap.

That said, this “spending cap” looks to be fairly generous: “a multiple of what the lowest earning side receives via the Premier League’s centralised broadcast and commercial deals”. Considering that the league’s broadcasting income is already split relatively evenly between the 20 teams, and that the multiplier is expected to be 5x (4.5x at minimum), the impact, if any, will likely be quite minimal.

For example, as per The Athletic, last year’s cap would have been £518m (5x the £103.6m earned by Southampton). Chelsea were the only team to exceed this amid historic levels of spending, and only just: £539m combined spent on wages, agent fees, and amortization.

The next two sides were Manchester City (£501m) and Manchester United (£435m), who were two of the teams voting against this new limit. Aston Villa (7th in spending at £250m) also voted no for some reason.

So, not much to be concerned about here, even if it might be a first step towards a more stringent, actual salary cap. Then again, having a true, hard salary cap doesn’t really synergize well with promotion and relegation — it helps create parity in closed leagues, like every professional league in North America — so I don’t think we have to worry about that anytime soon. (Until we get the Super League of course.)