Hunt: Premier League clubs have to learn to control their debts
Thursday 04 November 2010
Culture secretary Jeremy Hunt wants football's authorities to impose tighter controls on prospective owners using loans to buy clubs. Hunt is alarmed at the amount of debt that has been built up around Premier League clubs.
He said: "My hope is they bring in rules that make sure we only have sensible amounts of leverage when people buy football clubs, because we all know what happens when debt gets out of control.
"The football authorities have taken some steps. There is a lot more transparency; they have strengthened the fit and proper person's test. They are moving in the right direction but it is obviously something that is a concern to a lot of people. The reason it is a concern is because clubs do not just have a responsibility to their owners, they have a responsibility to their fans as well; they are part of their local communities.
"They are different to other types of businesses and that is why this is a very important issue. The Premier League understands this and that it does not do them any good if a club goes under."
Asked whether it was right that the Glazers had been able to fund their purchase of Manchester United by borrowing hundreds of millions of pounds, Hunt said: "It is one of the things that worries me a lot. The lessons the rest of the country have to learn about the overdependence on debt seemed not to have been learnt by some of the people who are running our Premiership football sides.
"But that is not to say there is not a role for debt. Arsenal borrowed a lot of money to build the Emirates Stadium and businesses need to borrow money to expand. It is a very important part of the economy. Let's not forget that foreign owners have brought huge amounts of money into the Premier League, which has meant a couple of things. It has made it the best Premier League in the world and it has meant a huge amount of money has been invested in the UK in grass roots football.
"I would hope, as the person responsible for sport, that they learn the lessons of what has happened in the rest of the economy. Sports are in a much better position to regulate themselves than government. It is not just what has happened at Manchester United but also Liverpool and Portsmouth. The Premier League understands something has to be done."
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