Football's financial gap turns into chasm

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The Independent Online

The gap between Premier League and First Division football revenues could widen to unprecedented levels, Deloitte & Touche will claim on Tuesday.

A study published by the consultant will say that the revenues generated by Premier League clubs are expected to grow from £39m for last season to as much as £65m for this coming season. The report predicts that First Division revenues will increase from £7m to £12m.

The divide between the team at the top of the First Division and the club that achieves promotion to the bottom of the Premier League at the end of the coming season will be worth at least £15m. "This divide means Football League clubs see the prize that is on offer, and some are prepared to spend beyond their means," said Paul Rawnsley, Deloitte & Touche's sports business consultant

Top-performing teams such as Manchester United and Leeds United will continue to grow their revenues, but the clubs at the bottom of the division and in other leagues may spend beyond their means to avoid relegation or achieve promotion. This trend is expected to lead to a rise in the number of loss-making clubs, the report will say.

Deloitte & Touche is also expected to highlight that the divide between the leagues will widen to further extremes when contracts for television rights are renegotiated. The present agreements will bring £1.5bn to the Premiership over the next three years, through deals with BSkyB, ITV and NTL.

But, says the report, the football industry is likely to come under increasing pressure to negotiate contracts for television rights on an individual basis.

"This is potentially good news for the big clubs with large followings but perhaps not so good for the smaller clubs," said Mr Rawnsley.