Points Deduction

 

Yesterday, we heard the consequences of our breach of the Premier League’s Profit and Sustainability Rules (PSR). We have been deducted 4 points leaving us in 18^th place just one point behind Luton on 21 points.

 

Here’s the breakdown: 3 points deducted for the initial breach of the PSR, a further 3 points for the extent of the breach and -2 points for our cooperation throughout the process. 4 points is half of what the Premier League wanted to charge us, however, the 3-man panel came their own conclusion of our deduction.

 

The Reds submitted their accounts for the year end the 30^th June 2023. The Premier League collected this data in the December of that year. Originally, the deadline was the 31^st of March but Everton kept getting away with breaches and not getting relegated that same season, so the rules changed to make it fair. It was found out we had overspent by £34.5 million as we are only allowed £61 million in losses over three years because we were in the Championship for two years (£26 million) and the Premier League for one year (£35 million).

 

In comparison to Everton, they have been in the Premier League all three of these seasons allowing them to make £105 million in losses. They overspent by £19.5 million. This may lead you to think: if Forest breached the rules more than Everton, why do they have a higher points deduction? Well, Everton got the same 6 point deduction as Forest for the initial breach and the extent of the breach. However, Everton weren’t transparent about their breach so the panel decided they weren’t cooperating and kept their deduction.

 

In September 2022, Forest’s finance director Thomas Bonser, told the club’s hierarchy that they were heading into a ‘significant breach’. He explained that the breach wouldn’t stop Forest from bringing in new players but told them they needed to be more careful with spendings in the near future. The original breach was £6.9 million. Reds’ fans do have the right to be annoyed as owner Evangelos Marinakis and ex-chairman Nicolas Randall, have always been open about the clubs spending and have always said we comply with the PSR rules which have turned out to be false.

 

Many rival fans will say that Forest spent their money ‘stupidly’ or ‘recklessly’ but this is not the case. When we won promotion, five of our squad were loanees so they needed replacing. Our squad was also not of a Premier League standard, costing £12 million in transfer fees which is uncompetitive against the £1 billion squads of Manchester City and Chelsea. Maybe, we spent some of our money on the wrong players e.g Jonjo Shelvey and Remo Freuler, or in the wrong areas but that money alone wouldn’t have been enough to send us over the permitted amount.

 

People will also be thinking about how Fulham and Bournemouth didn’t spend their money the way we did. However, both these sides have been in the Premier League in the last five years so will have players of this level e.g Dominic Solanke and Alexender Mitrovic. Both clubs were also permitted to lose £83 million so could therefore spend much more than us if they wanted to. They both had parachute payments which they received in their relegation to the Championship to boost them further. The Cherries squad had the closest squad value to us with £151 million.

 

In my opinion, the PSR rules are not fair. It makes the league anti-competitive as the teams who have a high income through sponsors, stadium revenue etc. like Manchester United can spend a lot more money than the teams of the bottom of the league who don’t get much income. If these rules continue (and we see it now), the same teams will challenge for the league title and top 4 every year which as fans makes football more boring as we already know the outcomes. These rules were created in 2013 which was 11 years ago making these out of date. The Premier League haven’t taken into consideration inflation in more recent years. Research shows that losses should be up to £200 million now with the cost of everything increasing.

 

It's unfortunate that we have this deduction which obviously places us into the relegation zone and makes our challenge of survival much harder.  However, it could be worse. We now have one week to decide if we would like to appeal and gather our evidence which will likely include our journey of selling Brennan Johnson. In my opinion, we shouldn’t appeal and we should just take the deduction and move forward.