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Last Updated: Wednesday, 30 May 2007, 23:01 GMT 00:01 UK
Premiership wages 'to top 1bn'
John Terry and Frank Lampard of Chelsea
Hands up if you get well paid.... Chelsea has the highest wage bill
Premier League wages are set to break the 1bn barrier for the first time in the competition's history, a report from Deloitte has said.

Salaries and bonuses will increase next season as a 1.7bn television deal for top-flight games comes into effect, the report says.

Deloitte's annual review of football finances showed Premier League wages rose 9% to 854m in 2005/06.

Chelsea's outlay totalled 114m while four other clubs paid more than 50m.

The new TV revenue - including domestic and international rights - equates to about 300m extra per season over the lifetime of the current three-year deal.

Whilst wages will rise, clubs do have the opportunity to increase the importance of performance related pay structures
Paul Rawnsley
Sport Business Group, Deloitte

However, Deloitte said the wave of new owners at clubs, including Aston Villa and Liverpool, was likely to result in more restraint in spending, with servicing debt and investing in stadia being other key priorities.

"A lot of these new owners have had sporting success but also considerable financial success", said director of Deloitte's Sports Business group, Alan Switzer.

"A decent chunk of the money will still flow through to the players, but we don't think it will be the same proportion that flowed through previously."

Four Championship teams paid more in wages than they made in revenue
Premier League and Football League clubs paid about 50m in agents fees
France's Ligue 1 made a profit for the first time since 2000
English professional football paid about 650m in taxes
Chelsea's pre-tax losses fell from 140m to 80m

While spending on transfers is set to exceed 300m this summer, Deloitte's Paul Rawnsley said it was not viable for clubs to simply throw money at players.

"Whilst wages will rise, clubs do have the opportunity to increase the importance of performance related pay structures," he said.

"This will both insulate the business in future when on-pitch results are not so good, and also help motivate and reward players and management for winning."

Graph showing where revenue is made

The report confirmed that the Premiership was once again the top-earning league in the world.

Its 20 clubs generated 1.4bn in turnover on 2005/06, a figure expected to rise to 1.8bn in 2007/8.

And the report pointed out that the increased revenue - alongside cost controls - should almost double combined operating profits to 260m next season.

Manchester United was once again top of the English revenue league, making 167.7m.

The club was followed by Chelsea on 152.8m, Arsenal on 133m and Liverpool on 121.6m.

Chelsea - 114m
Manchester Utd - 85m
Arsenal - 83m
Liverpool - 69m
Newcastle Utd - 52m
Source: Deloitte

Arsenal's revenue is expected to have soared in 2006/07, with its income from gate receipts and corporate hospitality boosted by its first season in the 60,000-capacity Emirates Stadium.

Only nine Premiership clubs, however, actually made a pre-tax profit - down from 14 in 2004/05.

Wages paid to players in England again outstripped their European counterparts.

The total wage bill in Italy, the second biggest in Europe, was 35% below the English level at 806m euros (548m) while clubs in the much-admired Spanish La Liga shelled out 739m euros (502m) to their stars.


Although Italy was also the second highest earning league in Europe, falling matchday revenue was likely to see it slip behind Germany and Spain in the 2006/07 report.

The "big five" European leagues generated 53% of the total 8.6bn European football market.

Revenue generated by clubs in the Championship - the second tier in England - grew 4% to 312m, reaffirming it as Europe's sixth biggest league.

Top league revenues 05/06
England 1.4bn
Italy 1.0bn
Germany 0.8bn
Spain 0.8bn
France 0.6bn

Last month Deloitte said promotion from the Championship to the Premiership this season would be worth about 60m for the successful clubs - Sunderland, Birmingham and Derby County.

And the report highlighted the financial chasm between the two divisions.

The gap between revenue at the average Premier League club and Championship side hit a record 56m in 2005/06 and was tipped to grow to 70m next season.

Graph showing wages in Europe's "big five" league

How fortunes have changed in world football

Premiership entry 'is worth 60m'
02 May 07 |  Business
Man Utd drops down wealth league
08 Feb 07 |  Business
First fall in Premiership wages
01 Jun 06 |  Business

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