It is a well-known fact that the financial situations facing many English clubs these days is pretty dire. I believe the solution to the unrelenting financial decline of football clubs is inspired by German football. The 50+1 rule. But before we start talking about how the 50+1 rule could help England’s most financially stricken clubs, as well as putting a stop to the reoccurrence of this issue, we will first discuss the plethora of examples of clubs struggling financially. Let’s start with Bolton. Arguably the biggest club that has come hours away from extinction. Going from the heights of European and Premier League football, to certain relegation to the fourth tier of the English Football League. The story of Bolton’s financial plight can find its roots back in March 2016, when now former owner Ken Anderson took over the football club as part of a consortium led by their former striker Dean Holdsworth and took over Eddie Davis’s controlling stake in the club. And so, once Anderson had bought out Davis’s stake, he now had majority control of one of the founding members of the football league. It is a wonder, if you think about it, that the EFL still gave him the green light to take over the football club, even after he was disqualified from being a company director back in 2005 for eight years after his company Professional Sports International Ltd, as well as seven other of his businesses had folded. Granted, his ban had ceased by 2016, but the question is, did the EFL take this fact into account before allowing him to take control of one of its 72 clubs? Perhaps they did. This should have been a stark warning for what Bolton’s future could, and has gone on to hold. As a result of their ongoing financial problems before this current season, Bolton were given a 12 point deduction from the start of the campaign which almost guaranteed that Bolton are to slide into the bottom tier of the EFL. There was some light at the end of the tunnel though. Bolton were saved in the eleventh hour by Football Ventures who also stopped Bolton from being expelled from the English Football League. There is also a very human effect of this financial crisis. It is known that Bolton staff had to use food banks and find other means of financial help as a result of unpaid wages. The silver lining is though that they haven’t found themselves in the horrific situation that Bury Football Club find themselves in. Bury Football Club’s situation is by far and away the direst of recent times, with the club’s very existence being on a knife edge, with yet another hearing in court over a winding up petition by HMRC, with the club unable to pay staff or players. What possibly makes this situation even worse is that it comes after a hugely positive campaign last season ending in promotion to League One. However, this has been overshadowed by the every growing financial crisis and unlike Bolton, Bury could not avoid expulsion from the football league following failed attempts to save the club. Bury are now in a sort of void – existing, but outside the football league and the football world a situation I wouldn’t wish on any football club, with the impact it has on staff, players and the community. Otherwise another winding up petition may be drawn up, unless the latest one succeeds. This would mean that Bury Football Club would be wound up and cease to exist. So, how did this sorry tale start out? The current situation began when owner Steve Dale bought a controlling stake in already financially stricken Bury for only £1 in December 2018. However, debts still spiralled out of control even despite promotion leading to wages not being paid and numerous winding up petitions, with the club’s existence in the balance. What makes the whole situation worse is the famous quote that Steve Dale said live on the radio; "I never went to Bury, "It’s not a place I frequented. So for me to walk away from Bury and never go back is a very easy thing to do. I don’t do anything up there. "I didn’t even know there was a football team called Bury to be honest with you. ‘I’m not a football fan.” These words speak for themselves. Let Bury and Bolton’s stories be a lesson for the future. I think there is though, a solution which could save clubs from finding themselves in situations such as Bolton’s and Bury’s. The German Bundesliga’s 50+1 rule. Let’s start with explaining what the ‘50+1 rule’ is. Basically, it ensures that the majority stake in a club is always with the fans. This means that 51% of the football club is owned by the fans, whilst 49% of the club is in the hands of another party. This rule has stopped German clubs from situations that some English clubs find themselves in, with the clubs interests always being at heart, due to the fans always holding majority control over the club. This, in my opinion is a great solution to stop clubs becoming insolvent, as you have a combination of passion and business acumen, so that clubs are always cared for, as well as having investment to help keep the club afloat. This means that a third party cannot put their own interests over the interests of the club and its fans. In 1998 private ownership of any kind was prohibited. The 50+1 rule was then introduced, to keep clubs financially stable. There is however, an exception to this rule. If a third party investor has held a stake in a club for more than twenty years, they can apply for a majority stake in the club. However, this has been rare, with only a couple of cases, with Hoffenheim, Hannover and RB Leipzig. It is no coincidence that attendances at German football clubs are amongst the highest in Europe. Source: @Bundesliga on Twitter (2017) Overall, the 50+1 rule is an amazing concept, as it ensures that the interests of the club are always held by the fans, the majority. This is the way forward for clubs in England. I do think that authorities should take a look at implementing England’s own 50+1 rule, in order to have a great chance of avoiding more clubs falling into financial oblivion.
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ARTICLE WRITTEN BY ADAM HOLT |