Spiralling wages crippling football

Football is plummeting towards a financial crisis, according to a major new report.

The research shows that just 10 Premier League clubs and five Football League clubs made an operating profit in the 1999/2000 season.

Deloitte and Touche's 10th annual finance report also reveals that wage costs are spiralling out of control after rising by 21% over the same period.

  Operating profit for 1999-2000

1 - Man Utd £29.1m

2 - Arsenal £8.9m

3 - Chelsea £7.5m

4 - Tottenham £7.5m

5 - Leeds Utd £7.4m

6 - Aston Villa £5.4m

7 - Bradford City £5.3m

8 - Watford £5.0m

9 - Sunderland £1.0m

10 - Man City £0.8m

Many clubs are running up huge losses even though English football now receives more than £1bn from television rights.

The gap between the Premiership and the Football League continues to grow.

The report provides further evidence for those believing that its financial bubble is about to burst.

Since the 1980s, with poor attendances and crumbling stadiums, the game has experienced an incredible renaissance.

Revenue from television has continued to drive record income levels.

Premiership clubs experienced a 15% rise totalling £772m while the 72 Football League clubs had a 9% increase at a total of £306m.

  Operating loss for 1999-2000

1 - Blackburn £15.7m

2 - Fulham £10.4m

3 - Liverpool £7.8m

4 - N'ham Forest £5.7m

5 - QPR £4.7m

6 - Charlton Ath £4.7m

7 - Bolton £4.2m

8 - Huddersfield £4.2m

9 - Norwich £3.6m

10 - Reading £3.5m

However, the chasm between the top division and England's three lower leagues is as wide as ever.

Last season the Premier club's average income was £38.6m, with Division One at £7.7m.

And the report suggests the gulf will continue to rise.

"The importance of promotion and relegation between divisions is more financially significant than ever," said Gerry Boon, head of Deloitte & Touche Sport.

The staggering rise in wages and salaries means that seven out of every 10 clubs have now got a total wage bill in excess of 70% of their income.

Total wage costs increased to £747m - Division One had the biggest climb of 35% - but more worryingly was that 16 clubs across the Leagues had wage bills exceeding 100% of their turnover.

"A viable future means spending what you can afford. Managing your long-term wage bills is the key to financial strength," said Boon.

The report forecasts that the Premiership clubs will share almost £1bn more income than Football League clubs in the 2002/03 season.

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Report's highlights:

Premier League clubs generated 15% more income in the 1999/2000 season, up £103m to £772m

All 72 League clubs generated 9% more income, up £25m to £306m

Overall operating costs for the clubs increased by £188m

Operating profits of Premiership clubs was £53m

Football League clubs suffered losses totalling £112m

Annual average growth in wages and salaries continues to outstrip turnover growth in every division - up to 6% in the Football League and 8% in the Premiership

The average Premiership club is five times the size of its Division One counterpart in terms of income

The average income difference between a Premiership club and a Division One club will grow to over £60m in the 2002/03 season