Football: A club in turmoil: How Palace operated under Goldberg
Saturday 31 July 1999
ENORMOUS PLAYER contracts with lucrative loyalty payments and six-figure signing-on fees have contributed to Palace's financial problems. The club's contractual liabilities stood at pounds 14m at the end of March, according to a statement of affairs.
A perusal of the wage deals done during Mark Goldberg's tenure demonstrates how the bills mounted. The defender Craig Moore (pictured) was signed from Rangers on a four-year contract with a weekly starting wage of pounds 10,705. The deal entitled him to an additional loyalty bonus of pounds 250,000 in his second and third years at the club and pounds 125,000 in the fourth and final year. He has moved back to Rangers.
The Israeli international David Amsalem was put on a three-year contract paying pounds 6,500 per week and Gordan Petric on a four-year deal at pounds 5,000. Three other players, including the Chinese Fan Zhiyi and Sun Jihai and Mattias Svensson of Sweden, were given four-year contracts, all on starting wages of pounds 3,500 per week. Fan Zhiyi and Sun Jihai were given staggered signing-on fees worth pounds 25,000 per year, while Svensson's deal entitled him to pounds 345,000 in signing-on fees over four years and a loyalty bonus of pounds 150,000 in his first season. His weekly wage was due to increase to pounds 6,000 by the fourth year. He spent most of last season injured.
The club's highest earner, Attilio Lombardo, was signed before Goldberg's takeover, but Goldberg was involved in brokering the deal that saw him paid more than pounds 14,000 per week. Among the other signings made under Goldberg were the Australian Craig Foster (weekly wage pounds 3,000, rising to pounds 4,000, plus an annual loyalty bonus of pounds 100,000), and the goalkeeper Fraser Digby, signed from Swindon on a three-year deal worth pounds 2,403 per week.
FROM THE moment that Terry Venables was paid pounds 135,000 just to talk about becoming the Crystal Palace coach, Mark Goldberg should have realised that the former England manager would end up costing him a fortune. What he did not envisage was that Venables would be at the club for little more than seven months (from June last year to January) and that he would cost almost pounds 1m per month for that time.
Goldberg faces his personal creditors on Monday in a meeting that could see him end up bankrupt. One of his largest creditors is Venables, who, according to documents drawn up by Goldberg's solicitors, is owed pounds 6.9m from the five-year deal that he personally agreed with the Palace chairman when he took over.
"Mark made the astonishing statement that he didn't want anyone to think that he couldn't afford Terry Venables," Jim McAvoy, Palace's former chief executive, wrote to his fellow directors in March when explaining the circumstances that had led to his own departure from the club. "Mark's relationship with Terry was very private and pretty much a no-go area," McAvoy wrote. "It was becoming clear that having Terry outside our group [of Palace officials who met weekly to assess the state of the business] was not too good for the club, not too good for the business or for Terry himself... Mark wanted to please Terry and Terry didn't know how bad things were."
According to one director, who spoke to The Independent on condition of anonymity, Venables' contract could have been terminated after a year. "What we were not told," the director added, "was that only Venables had the right to terminate it."
THE VENABLES DEAL
pounds 135,000 fee to enter into talks about the manager's job, payable whether Goldberg actually completed the purchase of Crystal Palace or not.
pounds 750,000 salary per year after tax, to be paid annually in advance.
An unsecured pounds 500,000 interest-free loan.
A house, costing pounds 650,000, in which Venables would retain the equity interest.
A Mercedes car.
10 per cent pension contribution.
pounds 20,000 relocation expenses.
Transfer funds of pounds 10m for the 1998-99 season and pounds 5m in each of the two subsequent seasons, excluding proceeds from the sale of players.
Five per cent bonus on amounts not spent on transfers.
pounds 10m salary budget in 98-99.
The right for Venables to remain as a consultant to the Australian Football Association. He had previously held the position of Australian national coach.
Six per cent royalty on the use of his image.
THE PURCHASE of Gordan Petric (right) from Rangers was typical of the illogical thinking behind some of Palace's transfer dealings under Mark Goldberg. Nobody doubted the Yugoslav international defender's credentials, but Goldberg sanctioned his pounds 300,000 purchase - not to mention a pounds 5,000- a-week contract - at a time when Palace's financial problems were beginning to emerge and when the club had at least nine other senior players who could play in central defence: Craig Moore, Paul Warhurst, David Tuttle, Andy Linighan, Dean Austin, Fan Zhiyi, Hayden Mullins, Sagi Burton and David Woozley.
As the financial crisis deepened, Petric soon became one of those players the club badly wanted off the payroll, and last month he left for AEK Athens on a free transfer. Two more Goldberg signings, David Amsalem (pounds 800,000) and Walter Del Rio (pounds 187,500), had their contracts unilaterally cancelled in the spring; they had started a total of eight first-team matches between them.
Lee Bradbury was signed on a big contract from Manchester City for pounds 1.5m only a month after another (and arguably better) centre-forward, Neil Shipperley, had been sold for the same sum. Matthew Gregg, a young goalkeeper, was signed from Torquay for pounds 400,000 but has not yet played for the first team. Paul Harries, a free signing, was soon being loaned out to Stevenage Borough.
All the players recruited during Goldberg's reign were signed before the departure of Terry Venables. Goldberg lays the responsibility for the signings firmly at Venables' door, saying he had merely been following the advice of the former England coach.
Yet in spite of everything, Goldberg's transfer dealings actually show a profit of nearly pounds 8m. This serves only to underline his calamitous record in other areas, most notably in the extravagant contracts handed to Venables and a number of players. Moreover, Goldberg has left behind a squad much weaker than the one he inherited a year ago, which included the likes of Matt Jansen, Attilio Lombardo, Paul Warhurst, Marc Edworthy and Sasa Curcic.
STAFFING LEVELS rocketed at Palace under Mark Goldberg and increased the club's financial problems. "As far as I'm concerned the worst thing ever to happen in the history of Palace was Goldberg," said Pete King, the publications manager at Selhurst Park until he was made redundant in April. "Until he is out of the picture, Crystal Palace will go nowhere and achieve nothing."
When Goldberg took over, said King, he made a series of appointments at Selhurst Park that seemed to him completely unnecessary. "The club was staffed economically before he arrived, with perfectly adequate numbers of people to run it," he said.
Goldberg appointed a broadcasting manager, an IT manager, a human resources manager, an Internet specialist (to promote the club in China, primarily) and a variety of other public relations executives, on annual salaries estimated between pounds 30,000 and pounds 50,000.
"Goldberg made terrible mistakes by bringing in his own people above the heads of people who had been there years," King said. "After years and years at the club, we were told to like it or lump it."
As the club's financial problems became apparent earlier this year, the Goldberg appointees began to leave, realising they would not be paid. On 1 April, 46 long-time members of staff, including King, club shop workers and administration staff, were sacked.
The situation at the club's Streete Court training ground was similar. Before Goldberg arrived, according to one former employee, the club had had a small team of physiotherapists and two administration workers at the training ground. "Then Mark came in and his dream was to provide every ingredient he thought would help build a team of world-beaters."
Cost was no obstacle, and Goldberg put no ceiling on the budget he was prepared to spend to get the facilities in place by July last year. Hundreds of thousands of pounds were spent on furniture, computers and training equipment, said the insider, but the biggest expense was staff, including a full-time doctor (estimated salary pounds 100,000), a fitness expert and team of three personal trainers, a nutritionist (estimated salary pounds 100,000), five physiotherapists, a masseur, extra office staff and a cook.
Within six months they started to leave, knowing they had no future at Palace, and now there are fewer staff at the club.
AGENTS WORKING for Crystal Palace in the months after Mark Goldberg took over were paid more than pounds 1m in fees, according to Palace's former chief executive, Jim McAvoy.
"Negotiations with agents and the manner by which players were being identified, brought to the club on trial, was completely unprofessional," McAvoy wrote to his fellow directors after leaving the club.
He added that the club sometimes dealt with more than one agent on some deals. "The club incurred over pounds 1m in agency fees," McAvoy said. "I have no doubt we were seen as an easy touch. All of this undermined the credibility of the club." When asked at a fans' forum earlier this year about the pounds 1m in fees, Goldberg failed to provide details, but said: "Your figures are wrong."
McAvoy was specific, however, in the case of three Argentinians, Pablo Rodrigues, Christian Ledesma and Walter Del Rio. "The Argentinian escapade cost pounds 448,769 in agent fees and pounds 187,000 in transfer fees," McAvoy wrote. "We got one player - Walter Del Rio."
Del Rio's contract was terminated in March after one first-team start and one substitute appearance; Rodrigues and Ledesma were never signed.
INS AND OUTS UNDER GOLDBERG
D Austin (Tottenham) free
D Amsalem (Beitar Jerusalem) pounds 800,000
N Rizzo (Liverpool) pounds 300,000
F Digby (Swindon) free
C Foster (Portsmouth) free
Fan Zhiyi, Sun Jihai (Dalian Wanda and Shanghai Shenhua) combined pounds 1.35m
W Del Rio (Boca Juniors) pounds 187,500
P Harries (Portsmouth) free
C Moore (Rangers) pounds 800,000
M Svensson (Tirol Innsbruck) pounds 200,000
M Gregg (Torquay) pounds 400,000
L Bradbury (Man City) pounds 1.5m
A Turner (Portsmouth) free
G Petric (Rangers) pounds 300,000
TOTAL pounds 5,837,500
D Gordon (Middlesbrough) pounds 900,000
R Quinn, D Boxall
(Brentford) combined pounds 50,000
M Edworthy (Coventry) pounds 1.2m
N Shipperley (Nottm F) pounds 1.5m
H Hreidarsson (Brentford) pounds 750,000
A Folan (Brentford) pounds 100,000
B Dyer (Barnsley) pounds 700,000
V Ismael (Lens) pounds 1.2m
M Padovano (Metz) free
P Warhurst (Bolton) pounds 800,000
M Bent (Port Vale) pounds 350,000
M Jansen (Blackburn) pounds 4.1m
A Lombardo (Lazio) free
C Moore (Rangers) pounds 1m
D Amsalem released
W Del Rio released
A Turner (Wolves) free
S Burton (Colchester) free
S Curcic (New York Metro All Stars) free
G Petric (AEK Athens) free
Sun Jihai (Dalian Wanda) pounds 800,000
TOTAL pounds 13,450,000
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