League aids crisis clubs

The collapse of ITV Digital has affected many clubs

The Football League is set to relax its strict rules on insolvency to aid cash-strapped clubs affected by the ITV Digital crisis.

The league is expected to allow clubs in administration to start next season as normal.

And it is unlikely to set firm deadlines for clubs to come out of administration.

The League is currently keeping an open mind with regard to its insolvency policy

Football League spokesman John Nagle

It is estimated that up to 20 clubs face the prospect of beginning the 2002-03 campaign in administration if ITV Digital do not pay the £89.75m they are due to pay on 1 August.

"The League is currently keeping an open mind with regard to its insolvency policy," said the Football League's head of communications John Nagle.

The League does not have any cash reserves to set up a fund to help struggling clubs.

But Nagle confirmed the League was looking at a scheme where any new owners of clubs are forced to provide a cash bond which is held by the League in case of emergency.

"The League is looking at the future and thinking of establishing a bond scheme," said Nagle.

"Any potential purchaser of a club would lodge a bond with the League which would be available if a club went into administration to ensure the club could complete that season."

The scheme would also ensure prospective owners of clubs had substantial funds of their own.

There have been cases recently when an owner has borrowed cash for the purchase and then attempted to use the club as a means to make money.

There has been no movement in the stalemate between the League and Carlton and Granada, the joint owners of ITV Digital.

The League hold Granada and Carlton responsible for paying the £189.5m still owed from the £315m television deal.

But the media companies deny liability for the debts. The dispute is likely to end up in the High Court.