Article written for Total Football magazine.
Parachute payments are a contentious subject but unfortunately for most clubs they are now an accepted part of English football. That was until last week.
Step forward Barnsley manager Keith Hill, who asks the question how long will the Premier League keep ‘rewarding failure?’
Hill’s angry outburst came after Barnsley’s 2-1 defeat at Ewood Park to recently relegated Blackburn.
The source of the manager’s frustration is the perceived unfair advantage that clubs like Rovers and Bolton Wanderers have over other Championship clubs when they receive millions of pounds from the Premier League following relegation.
After the Blackburn match the Tykes boss told BBC Radio Sheffield: “I’ve never been rewarded for doing anything wrong or being relegated.
“Clubs that get relegated get rewarded financially, how does that make sense?”
Hill was outraged about the cost of Blackburn’s squad in comparison to Barnsley’s, in particular their ability to sign Jordan Rhodes from Huddersfield Town for £8m, a sum of money the Yorkshire team can only dream of.
Although Brighton and Huddersfield lead the table, the Lancashire club and fellow relegation companions Blackpool and Wolves are close behind.
So, is it time to redress the imbalance of vying for a place in the Premier League?
The price of ‘failure’
In 2010, all English Football Leagues agreed to a new compensation package for teams relegated from the Premier League.
The ‘parachute payments’ consist of a four-year deal totalling £48m for each relegated club, £16m for the first two seasons and £8m for the subsequent two years.
Leagues One and Two both objected to the deal initially, fearing that it would widen the gap between the Championship and the lower league clubs.
If a relegated club is promoted back to the Premier League within this four-year period, then the parachute payments are forfeited but as promotion is worth in the region of £90m (figures calculated by Deloitte), I’m sure these clubs won’t mind missing one or two payments.
Last season there were eight Championship teams receiving parachute payments.
Two were promoted and three out of the four play-off contenders were all collecting money from the Premier League.
However, three other clubs finished mid-table and the remaining club, Portsmouth were relegated to League One.
Burnley, Hull City and Middlesborough are all examples of underperforming teams with Premier League pounds in the bank.
It begs the question does this money make a promotion winning team?
The merits of modest spending
Money doesn’t always make a team perform. It is sometimes the team that has the strongest bond that achieves the most.
Take Reading for example, during their record breaking season in 2005-2006.
Then manager Steve Coppell was notorious for not paying over the odds for players and refusing to be involved in escalating the price of average players.
Coppell put together a team of virtually unknown players but who had the work ethic and skill to play as a unit. The Royals didn’t require the money to gain promotion.
The same can be said of Ian Holloway’s Blackpool in the season prior to their play-off final win.
It is possible to create a winning team without the deep pockets of an oligarch or the compensation of a season of failure, as Barnsley proved at the weekend.
The Tykes beat former Premier League team Birmingham City in a comprehensive 5-0 rout at St Andrews.
This type of performance, without financial backing, is rare but it isn’t impossible as Barnsley proved.
It’s difficult to find a football fan who agrees with the parachute payment method but it’s harder to find one with a solution to stop the widening gap between the Championship and the Premier League.
Until there is an enforced cap on Premier League spending or an equal share of television revenue spread between the leagues, the monetary playing field will remain as it is and in all likelihood, it will be the same clubs who are rewarded for their perpetual failure who will yo-yo between the leagues.