FA faces financial troubles

The Football Association is facing a series of financial challenges.   Some of these are not of its own making, including the collapse of Setanta and the general condition of the economy.   However, there is also no doubt that there has been poor decision-making at the FA which has been widely criticised as a dysfunctional organisation.    In partcular, the pursuit of the Wembley project may have been at the expense of grass roots

The Football Association is facing a series of financial challenges.   Some of these are not of its own making, including the collapse of Setanta and the general condition of the economy.   However, there is also no doubt that there has been poor decision-making at the FA which has been widely criticised as a dysfunctional organisation.    In partcular, the pursuit of the Wembley project may have been at the expense of grass roots football development.


The FA’s accounts reveal a £3m loss overall in 2009 which is an improvement on the £12m loss in 2008.   Although the FA’s turnover was up £52m on 2008 to £313m, the collapse of Setanta left the organisation needing to cover a £60m shortfall in television income in the 2008-12 period.


Staff costs rose from £30.1m to £34.7m with the increase almost totally accounted for by the difference in England manager Fabio Capello’s slary compared to that of his predecessor Steve McClaren.  Capello’s annual salary is £6m while McClaren was on £2.5m a year.


Wembley Stadium


Wembley’s finances appear to be improving with losses down from £31.1m to £15.6m.  There were 38 events during the year, although this contributed to the pitch problems with the pitch being ripped up for concerts.  Wembley’s business plan relies on concerts and other events to boost the bottom line, but this has brought a conflict of interest over the stadium’s primary purpose as a world class football venue.  


 It is hoped that the new ‘Desso’ surface which mixes natural and artificial fibres will solve some of the pitch problems.   It is also planned to erect the stage off the playing surface for future concerts.


The £9.6m operating profit on the stadium, up £3.7m over the previous year, was wiped out by interest charges on loans of £23.6m, leaving an overall loss of £14.2m after tax.   The aim is to break even by 2014 and to make a small contribution to FA finances after that.   However, there is a risk of Club Wembley clients failing to renew their seats and boxes.   Premium seats account for 21 per cent of group turnover.


The National Football Cenrre


There is a £10m shortfall in the funding of this prestige project.   Work started in 2001 but it will be a race against time to complete it for the 2012 Olympics deadline.  It is now thought that the overall cost will be £100m which requires finding commercial partners to support the coach education and sport science initiatives.   There is an additional complication of a legal challenge from local residents to the building of 28 houses which is part of the FA’s planning application.


Soho Square


The FA struggled to find a replacement tenant for its former offices in Soho Square after its move to Wembley in 2009 and finally had to conclude a severance deal with the landlord.   This was supposed to lead to a reduction in staff, but the total has risen to 568, although a major cost cutting programme is under way.


With the search for a lead sponsor to replace Nationwide still on, none of this inspires great confidence in the guardians of the national game.