Premier League Clubs Lobby for Uefa Levy to Fund EFL Deal

A growing rift within the Premier League is brewing over how to fund a new financial settlement with the English Football League (EFL), with mid-ranking clubs proposing a levy on UEFA revenue generated by the league’s top performers. The debate centers on whether the burden of supporting lower-league clubs should fall solely on the Premier League’s existing broadcast revenue, or if a broader funding mechanism involving European competition earnings is more equitable.

Talks regarding the so-called “New Deal for Football” have been stalled since the 2023-24 season, when the Premier League withdrew a proposed £880 million six-year funding package for the EFL due to a lack of support from its member clubs. The newly established Independent Football Regulator (IFR) has been tasked with reigniting these discussions and possesses the authority to impose a settlement if a voluntary agreement cannot be reached.

The core of the current impasse lies in the significant financial disparity between Premier League clubs, particularly those competing in the Champions League, and those further down the league table. This season, the six English clubs participating in the Champions League – Manchester City, Liverpool, Arsenal, Chelsea, Tottenham, and Newcastle United – are collectively projected to earn over £600 million from broadcast income and prize money. Individual clubs like Manchester City, Liverpool, Arsenal, Chelsea, and Tottenham have already secured over £80 million each for reaching the last 16.

However, the distribution of these funds is uneven. Newcastle United, despite reaching the same stage of the competition, will receive a smaller share – approximately £50 million – due to a lower score on UEFA’s “value pillar assessment,” which considers historical performance. This disparity highlights the concern voiced by some Premier League clubs that relying solely on domestic broadcast revenue to fund the EFL deal would disproportionately impact smaller clubs, effectively requiring them to subsidize their rivals in the lower divisions.

“We all want to do a deal with the EFL, but why should it be solely funded by the Premier League’s TV money?” a senior source at a top-flight club told The Guardian. “If that’s the case then a disproportionate burden will fall on the smaller clubs, who in effect will be funding their direct rivals in the EFL.”

The proposed solution gaining traction is the implementation of a levy on UEFA income, mirroring systems already in place in other European leagues. In the Netherlands, for example, Eredivisie clubs participating in UEFA competitions are required to contribute 5% of their group-stage prize money to teams that did not qualify for European competition. This percentage decreases to 3.75% during the knockout stages, with an additional 15% of UEFA revenue distributed to clubs in the second tier.

The idea is to create a more balanced funding model where the financial benefits of European success are shared more broadly across the English football pyramid. This would alleviate the pressure on Premier League clubs’ domestic broadcast revenue and ensure a more sustainable financial settlement with the EFL.

The plans are still in their early stages, partly due to the IFR’s recent establishment and its ongoing “State of the Game” review, which is expected to be published at the beginning of next year. IFR chair David Kogan has already engaged with both the Premier League and the EFL, urging them to reach a voluntary agreement. However, the IFR’s ability to impose a settlement remains contingent on the completion of the review.

The debate underscores the complex financial landscape of English football and the challenges of achieving a fair and sustainable distribution of wealth across all levels of the game. While the Premier League’s financial strength is undeniable, the necessitate to support the EFL and ensure the long-term viability of the entire football pyramid is increasingly recognized. The introduction of a levy on UEFA income represents a potential compromise that could bridge the gap between competing interests and pave the way for a much-needed financial settlement.

The outcome of these negotiations will have significant implications for the future of English football, impacting not only the financial stability of EFL clubs but also the competitive balance within the Premier League itself. The IFR’s role will be crucial in navigating these complex issues and ensuring that any settlement is both fair and sustainable.