IFR report warns of financial crisis across English football

The Independent Football Regulator (IFR) has published a concerning report on the financial state of English men’s football, warning of an impending crisis across the sport. The comprehensive 250-page draft, titled "State of the Game," was presented by IFR chair David Kogan and chief executive Richard Monks in Manchester. The report highlights widespread financial losses, mounting debts, and a heavy reliance on financial support from club owners.

According to the findings, 94% of the 116 clubs in the top five tiers of English men’s football are experiencing losses. The situation is particularly dire in lower divisions, where over 60% of clubs in the English Football League (EFL) and National League are technically insolvent, meaning their liabilities exceed the recorded value of their assets.

Many clubs are struggling to survive without fresh funding from their owners, with almost a third reporting they could not last more than 30 days without additional financial assistance. In some cases, clubs would remain unprofitable even if they ceased paying player wages.

One of the report's key concerns is the increasing use of transfer financing, a practice that allows clubs to access early cash by borrowing against future transfer payments. This practice has surged dramatically, rising from £55 million in the 2020-21 season to £779 million in the 2024-25 season. The total net transfer debt now stands at approximately £3.3 billion, while clubs are owing £4.8 billion in transfer fees, expecting to receive £1.5 billion. This debt burden is contributing to the financial instability of the sport.

The financial gap between the Premier League and the Championship has widened significantly over the past three decades. Currently, the average top-flight club generates 8.7 times the revenue of an average Championship team, compared to a ratio of 2.7 in 1992-93. Within the Premier League itself, the "Big Six" clubs account for 56% of total revenue. The report also points to parachute payments as a contributing factor to rising player wages, as Championship clubs may be tempted to overspend in an effort to compete.

The IFR has the authority to intervene if the Premier League and English Football League (EFL) fail to reach an agreement on revenue distribution. The Premier League has proposed an annual £180 million over a decade, while the EFL seeks £207 million annually, with a review after five years. The regulator can also assess the suitability of club owners and directors, with powers to remove directors from club boards and, in serious cases, require owners to sell their stakes.

These powers could have significant implications, particularly for high-profile clubs like Manchester City, who were recently found guilty of breaching financial rules. However, the broader concerns raised in the report revolve around the overall financial sustainability of English football.