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Reform of parachute payments in the English Football Championship

Evans, Richard (2024) Reform of parachute payments in the English Football Championship. Working Paper. Birkbeck Sport Business Centre, London, UK.

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Abstract

Purpose: This research seeks to assess the conflicting claims of the merits, or otherwise, of parachute payments made to football clubs relegated from the first tier league of football in England, called the Premier League, and to propose an objective solution. Design/methodology/approach: The research uses the financial account of football clubs in the second tier league called the Championship together with information on parachute payments made to them for the seasons from 2004/05 to 2021/22 to assess the necessity for these payments and their effect on competition in the Championship. Findings: The research finds that the system needs to be reformed. Payments are justified for a maximum of only two years, the amounts should be reduced and the ability to abuse the system eliminated. However, the evidence does not support the claim that these payments unfairly distort the competitive balance of the Championship. Originality/value: Scant attention has been given to this issue in the academic literature but this research provides evidence and recommendations that should be of academic value with regard to the financial regulation of football and of practical value to the English Football League and any regulator that may be appointed for football by the UK Government.

Metadata

Item Type: Monograph (Working Paper)
Additional Information: Birkbeck Sport Business Centre Research Paper Series 16(1) - ISSN: 1756-8811
Keyword(s) / Subject(s): Competitive balance, Herfindahl-Hirschman Index, football finance
School: Birkbeck Faculties and Schools > Faculty of Business and Law > Birkbeck Business School
Research Centres and Institutes: Birkbeck Sport Business Centre
Depositing User: Administrator
Date Deposited: 20 May 2024 12:37
Last Modified: 25 Feb 2025 07:54
URI: https://eprints.bbk.ac.uk/id/eprint/53557

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