Aston Villa co-owner Nassef Sawiris this week revealed he was considering taking legal action against the Premier League over profit and sustainability rules (PSR). Villa, who finished fourth in the Premier League last season and booked a place in next season’s lucrative and expanded Champions League, are reportedly one of a number of clubs who will have to move some players on this summer in order to achieve PSR compliance and avoid potential sanctions. PSR, which will be replaced at the end of the 2024/25 campaign by financial controls in line with UEFA’s squad cost ratio rule, as well as the introduction of backstop financial controls via a salary cap. The co-chief of Villa owners NSWE, Sawiris blasted PSR in an interview with the Financial Times. Said Sawiris: “Some of the rules have actually resulted in cementing the status quo more than creating upward mobility and fluidity in the sport. “The rules do not make sense and are not good for football. READ: Aston Villa ‘big issues’ with £50m Chelsea transfer scenario explained READ: Douglas Luiz lifts the lid on Unai Emery’s regime amid Aston Villa transfer links “Managing a sports team has become more like being a treasurer or a bean counter rather than looking at what your team needs. “It’s more about creating paper profits, not real profits. It becomes a financial game, not a sporting game.” Sawiris’ anger comes from the fact that Villa cannot put their pedal to the metal this summer and kick on from the success that they delivered last season through heavier investment in the summer transfer window. PSR rules allow for clubs to lose a combined £105m over a three-year period, with allowable deductions such as investment in infrastructure, the academy, the women’s game, and community project all taken into account. The impact of the pandemic was also an allowable deduction, with the 2019/20 and 2020/21 seasons rolled up into one averaged period. But from the next set of accounts that period will fall off the assessment, impacting the three-year picture. In Villa’s case, they reported a loss of £119.6m after tax forthe year ending May 31, 2023. For the current financial year, Villa opted to extend it to 13 months, with the year-end to be June 30 instead of the previous May 31. It was a move done to buy Villa a little more time to get their house in order and create some headroom when it came to PSR compliance. Villa’s loss for the 2022/23 season came on the back of a small £400,000 profit that was recorded the year before, and the averaged two-year, pandemic-impacted 2019/20 and 2020/21 financial periods where the club lost some £68m before tax. Despite losses of around £187m, Villa are able to deduct significant sums from that loss, including as much as £56m from the impact of the pandemic across the two aggregated years. According to figures presented by football finance expert Swiss Ramble , and using the allowable deduction estimates from previous seasons, Villa were squarely at the £105m PSR threshold using estimates for allowable deductions compared to previous years and the removal of the pandemic-impacted years. Douglas Luiz is one player who has been linked with a move away from the club, but for Villa it will be a case of moving on those who have a smaller book value remaining, meaning that more profit can be achieved. Selling academy graduates is the quickest way to achieving that as they represent pure profit. Villa won’t have the luxury of the other sides heading into the Champions League from the Premier League next season in terms of what they can do in the market. Without selling they haven’t got the room to manoeuvre to bring in players who can be impactful for them, and given the rigours of European football, which will have another two guaranteed games from next season as part of the new Champions League model, the club would want to operate with a larger squad. For the 2022/23 period, Villa’s wages stood at 89% against turnover, the fourth highest of teams who competed in the Premier League during that season. The three teams above them, Nottingham Forest, Leicester City, and Everton, were all hit with sanctions for breaches of PSR for that period. Villa, who failed in an attempt to raise the PSR threshold to £135m earlier this month, will know what they have to do to ensure PSR compliance by the end of the current financial year, but even after that the focus will be on trying to continue to compete while trying to drive down the squad cost ratio to around 85%, something that can be done by player trading, reducing the wage bill, and raising revenues. Revenues will rise thanks to Champions League football next season, but so too will the wage bill in line with bonus payments, and acquiring the calibre of players they seek will also be a costly exercise. The advantage for the biggest sides is already baked in due to financial controls, and there is little that a removal of PSR and changeover to new regulation will do to address the imbalance. Sawiris and co-owner Wes Edens have enormous wealth, but they are unable to execute the Villa plan in the way that they would want, and that is unlikely to change even with Champions League football.
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