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The Owners

Kopstar

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Ah seriously??
Those of us outside the city are less qualified on our feelings on the issue??
Its the age of social media and access to views and interpretations of those views like never before.
And the emotion in this debate on Sunday was palpable, so your assumption is flawed. The old "wools" nugget?? Surprised to be honest.

I hope the Echo and all those concerned are going to support the LFC staff when they are out of work in the next few months. The club were protecting the staff and ensuring their income.
Tbf, most of the non-playing staff we're talking about would be laid off come the end of May anyway, given the nature of their roles. I wonder if the club will now be placed under pressure to artificially keep them on?
 

FGred

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Haven't read all the arguments for and against on this but my gut reaction when I heard that they had done this was that it was a big mistake, regardless of whether it makes business sense or not. There's a reason why this club is held to slightly different standards than others and it's not just because it's one of the richest in the world. It's because of the history of the club, Shankly and everything he stood for and the overwhelmingly socialist outlook of the city that the club represents. At times that might be slightly annoying for people who just want to make sound business decisions but it's precisely because the club is different, and is marketed in that way, that it makes so much money in the first place. Embarrassing for the club to have to make a U-turn but at least they have listened and common sense has prevailed in the end.
I must admit when my son ran to tell me the news about the club’s decision we were devastated as before that we were holding the moral high ground we were waiting for the mountain of criticism coming our way which duly arrived the next day but in the cold light of day you have to think about the complicated issue of running a giant of a club like ours. The only thing that will bring us back together if it is not the Covid19 will be us putting our hands on that long coveted and deserved league trophy.
 

Arminius

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While I agree in principle with your post, the cost of wages and salaries (2018/19) of £276 million does not include the club's NICs contributions. NICs cost the club an additional £32.6 million. And while the clubs NICs contributions, and basic pension contributions, would have been covered by the Treasury had the non-playing staff been furloughed, there is no general NICs holiday.

Consequently, Liverpool's total employment bill, based upon the 2018/19 figures, is £309.9 million. There is nothing to indicate that this sum is not spread evenly over the year, so the monthly employment cost is £25.8 million.

The club refinanced its facility with the bank (NatWest) on 31 January this year. Assuming that this is no less than the previous facility, it is reasonable to assume that the club currently has a total facility of c.£150 million, of which £50 million has been drawn down, leaving an availability of £100 million. With the addition of the £37 million cash at bank and in hand the club had at the end of May 2019, this gives the club a total of c.£137 million in reserve.

Based upon the 2018/19 figures, the club has total cash outgoings of c.£33 million per month. On this basis, and assuming that the players' wage bill is not reduced, the available funds will be exhausted by the end of June 2020.
Yes, that it was I meant re-social security contributions. It was past midnight and I could not be arsed to figure out how they scaled for millionaires, so I simplified it with the assumption that the government would waive it for a limited time. It just makes the problem worse. Also was not sure how player contracts work, for some sports there is no pay in the offseason, so I am curious about that, but it does not radically alter the analysis.

Regarding the NatWest facility, I would expect that there are some sort of covenants in place, which the club would offside on now, but perhaps not.
 

Arminius

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Since the players' wages is the main issue, wouldn't a deferment of payments to the first team be a better course of action? Wouldn't the strain on cash reserves be reduced more on a short-term basis by a deferment than the players agreeing to a pay cut of 30%? Even with the club still having to cover NIC and tax contributions?

The club would buy some valuable time and the players could presumably afford to wait until the situation becomes somewhat normal.
A deferment is only a partial response, because the clubs have to play out the 19/20 season to avoid a major clawback. Players are still getting paid now, while it is unclear when the two months or so of games will actually happen, but those games won't produce revenue. So running up a bill is still running up a bill, even if you don't have to pay it right away.
 

Kopstar

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Yes, that it was I meant re-social security contributions. It was past midnight and I could not be arsed to figure out how they scaled for millionaires, so I simplified it with the assumption that the government would waive it for a limited time. It just makes the problem worse. Also was not sure how player contracts work, for some sports there is no pay in the offseason, so I am curious about that, but it does not radically alter the analysis.

Regarding the NatWest facility, I would expect that there are some sort of covenants in place, which the club would offside on now, but perhaps not.
Basic salary paid throughout the year. Personal contingent payments paid as and when they're earned (well, there's an administrative delay of around a month I think). Team contingent payments are payable as a lump sum towards the end of June, from memory. Same with unpaid signing fee instalments. Image rights payments paid as agreed between club and 'company vehicle'.
 

Anfield rd Dreamer

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Yeah absolutely, that's literally my idea. In my defence, I don't usually hang out with billionaires on a daily basis, unlike some other people on here.
Dont need to know them to understand how "worth" works. A man who owns a house of 150k out right (no mortgage) and a 9k car with 1k in the bank is "worth" 160k. Another man who lives in a rented property and who gets the bus but just won 100k on the lottery is only "worth" 100k. One man is worth 50% more than the other. One has access to 1k the one worth less has access to 100k. FSG are rich because they own a lot of business enterprises that are worth a lot of money (pre coronavirus). That does not mean they have cash to resolve problems or keep bills getting paid when there is no income. We are run smartly but we can't survive without income. Like the majority of clubs the scenario were this season is voided and next season delayed (worst case scenario) would almost certainly kill our club and the "worth" of FSG would significantly divebomb.
 

Anfield rd Dreamer

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Tbf, most of the non-playing staff we're talking about would be laid off come the end of May anyway, given the nature of their roles. I wonder if the club will now be placed under pressure to artificially keep them on?
I think with the Furlough scheme that the club will have been keeping them on past the end of the summer. The consequences Moore talked about will be that all these staff will be out of work come the "end of the season".
 

Kopstar

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I think with the Furlough scheme that the club will have been keeping them on past the end of the summer. The consequences Moore talked about will be that all these staff will be out of work come the "end of the season".
Indeed. So at that point the club will come under pressure to artificially keep them on. Will fans accept furloughing them then or will they expect the club to "do the right thing" and keep on employees who they wouldn't otherwise have employed at that time anyway?
 

epsomred

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Dont need to know them to understand how "worth" works. A man who owns a house of 150k out right (no mortgage) and a 9k car with 1k in the bank is "worth" 160k. Another man who lives in a rented property and who gets the bus but just won 100k on the lottery is only "worth" 100k. One man is worth 50% more than the other. One has access to 1k the one worth less has access to 100k. FSG are rich because they own a lot of business enterprises that are worth a lot of money (pre coronavirus). That does not mean they have cash to resolve problems or keep bills getting paid when there is no income. We are run smartly but we can't survive without income. Like the majority of clubs the scenario were this season is voided and next season delayed (worst case scenario) would almost certainly kill our club and the "worth" of FSG would significantly divebomb.
This narrative ignores the fact that the clubs biggest outgoings is the wages of the players and it is not in their long term interest to bankrupt their employer. So all the players will have to take a massive pay cut to keep their clubs afloat. They won’t like it but the penny will drop eventually. It may take a seismic event like the imminent possibility of Spurs collapsing into administration but once one PL club folds I suspect all the other players and their myopic PFA union will see sense.
 

Anfield rd Dreamer

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Indeed. So at that point the club will come under pressure to artificially keep them on. Will fans accept furloughing them then or will they expect the club to "do the right thing" and keep on employees who they wouldn't otherwise have employed at that time anyway?
I dont think the club will be. I think they just set the scene to say "well we were going to keep them on for x number of months because of furlough but now we will let them see out their contracts which were due to end at the end of the season". I'm not sure many clubs will continue to employ staff over the summer, past when they would normally have finished their lengths of employment. Those that do will be diverting funds from other sources to do it as a PR exercise. We might go down that route but I am worried because at the moment many vulnerable people in Merseyside are being kept alive by the actions our club are taking behind the scenes, without publicity.
 

Anfield rd Dreamer

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Indeed. So at that point the club will come under pressure to artificially keep them on. Will fans accept furloughing them then or will they expect the club to "do the right thing" and keep on employees who they wouldn't otherwise have employed at that time anyway?
I dont think the club will be. I think they just set the scene to say "well we were going to keep them on for x number of months because of furlough but now we will let them see out their contracts which were due to end at the end of the season". I'm not sure many clubs will continue to employ staff over the summer, past when they would normally have finished their lengths of employment. Those that do will be diverting funds from other sources to do it as a PR exercise. We might go down that route but I am worried because at the moment many vulnerable people in Merseyside are being kept alive by the actions our club are taking behind the scenes, without publicity.
 

Anfield rd Dreamer

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This narrative ignores the fact that the clubs biggest outgoings is the wages of the players and it is not in their long term interest to bankrupt their employer. So all the players will have to take a massive pay cut to keep their clubs afloat. They won’t like it but the penny will drop eventually. It may take a seismic event like the imminent possibility of Spurs collapsing into administration but once one PL club folds I suspect all the other players and their myopic PFA union will see sense.
Delays the inevitable. A reduction just buys time. A void of this season would apparently cost us 100 million overnight. We might not survive much past that even if the players have reduced their income by 70%. Take into account too the whole issue of this in first place was around 700k of tax payers money coming to LFC. How much income tax does the government lose if players take a pay cut.
 

Kopstar

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Delays the inevitable. A reduction just buys time. A void of this season would apparently cost us 100 million overnight. We might not survive much past that even if the players have reduced their income by 70%. Take into account too the whole issue of this in first place was around 700k of tax payers money coming to LFC. How much income tax does the government lose if players take a pay cut.
More than £700k per month, a point I made previously.

It's worth bearing in mind that players' wages are already significantly reduced simply by the inability to currently earn performance-related variables.
 

Quicksand

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Imagine a union having the temerity to attempt to protect its members rights.
The police should tool up with the shields and batons maybe.

Players taking pay cuts assists the club and reduces tax income. Whilst the notion of pay cuts is laudable, the cost effectiveness may be a little skewed.
The Government has done a nice job stitching up footballers, whilst other high earners go a bit unnoticed.
 

Arminius

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Delays the inevitable. A reduction just buys time. A void of this season would apparently cost us 100 million overnight. We might not survive much past that even if the players have reduced their income by 70%. Take into account too the whole issue of this in first place was around 700k of tax payers money coming to LFC. How much income tax does the government lose if players take a pay cut.
I don't think there is a scenario here that sees the government getting that income tax either way.
 

Cologne-Liverpool

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Dont need to know them to understand how "worth" works. A man who owns a house of 150k out right (no mortgage) and a 9k car with 1k in the bank is "worth" 160k. Another man who lives in a rented property and who gets the bus but just won 100k on the lottery is only "worth" 100k. One man is worth 50% more than the other. One has access to 1k the one worth less has access to 100k. FSG are rich because they own a lot of business enterprises that are worth a lot of money (pre coronavirus). That does not mean they have cash to resolve problems or keep bills getting paid when there is no income. We are run smartly but we can't survive without income. Like the majority of clubs the scenario were this season is voided and next season delayed (worst case scenario) would almost certainly kill our club and the "worth" of FSG would significantly divebomb.
Yes, if there won't be any football for a very, very long time, this would kill most football clubs. Regardless of yesterday's decision.
 

Arminius

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Yes, if there won't be any football for a very, very long time, this would kill most football clubs. Regardless of yesterday's decision.
I think we can more or less move on from that. On the scale of things involved in the survival of clubs, it is irrelevant window dressing, perhaps 2 days of the playing staff wages.

One of the perverse things about this situation is that the PL clubs have a much more complicated problem, because of the potential clawback of TV revenue for unplayed matches. For Championship clubs, that would be a much more survivable blow.
 

Kopstar

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Imagine a union having the temerity to attempt to protect its members rights.
The police should tool up with the shields and batons maybe.

Players taking pay cuts assists the club and reduces tax income. Whilst the notion of pay cuts is laudable, the cost effectiveness may be a little skewed.
The Government has done a nice job stitching up footballers, whilst other high earners go a bit unnoticed.
Protecting their rights and acting in their best interests are not always the same thing.
 

epsomred

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Protecting their rights and acting in their best interests are not always the same thing.
I agree. The PFA are leading their members over a cliff. The players wont get any compensation if their refusal to take a wage cut bankrupts their club and once this is all over there could be a lot of players unexpectedly out of contract and in the market looking for a new employer. 50% of a real multi million wage is better than 100% of nothing.
 

Anfield rd Dreamer

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More than £700k per month, a point I made previously.

It's worth bearing in mind that players' wages are already significantly reduced simply by the inability to currently earn performance-related variables.
My take was the club had only gone for furlough on half of its 700 none playing staff meaning a maximum of 700k a month as it is capped at 2500 a month. All of them would be 1,400,000 but that's if all those staff usually earn 2500 a month or more which is unlikely as many only work match days. In reality it could have been less than 500k a month.
 

Billy Biskix

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I must admit when my son ran to tell me the news about the club’s decision we were devastated as before that we were holding the moral high ground we were waiting for the mountain of criticism coming our way which duly arrived the next day but in the cold light of day you have to think about the complicated issue of running a giant of a club like ours. The only thing that will bring us back together if it is not the Covid19 will be us putting our hands on that long coveted and deserved league trophy.
I don't underestimate the complexity of running a club like us for a second, particularly at a time like this, but the amounts involved are piffling and it was patently the wrong decision, as evidenced by the fact that the club has now reversed it. That really should be the end of the matter but I know there's not much else to discuss right now. Roll on some actual football to talk about.
 

richieh10

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Don’t understand how anyone can criticise the owners.

open dialogue with fans and
Mistakes they’ve made along the ways have been pretty rapidly sorted out and corrected.

when you look at 90% of the other owners out there we’re onto a brilliant thing and don’t understand how people can still be pissed off.

some people however can win the lotto and would still complain that their ticket was pink. FFS
 

richieh10

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Dont need to know them to understand how "worth" works. A man who owns a house of 150k out right (no mortgage) and a 9k car with 1k in the bank is "worth" 160k. Another man who lives in a rented property and who gets the bus but just won 100k on the lottery is only "worth" 100k. One man is worth 50% more than the other. One has access to 1k the one worth less has access to 100k. FSG are rich because they own a lot of business enterprises that are worth a lot of money (pre coronavirus). That does not mean they have cash to resolve problems or keep bills getting paid when there is no income. We are run smartly but we can't survive without income. Like the majority of clubs the scenario were this season is voided and next season delayed (worst case scenario) would almost certainly kill our club and the "worth" of FSG would significantly divebomb.
best post i’ve read in a while tbh
 

Quicksand

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Protecting their rights and acting in their best interests are not always the same thing.
I agree, but it is their representative body, and is charged with negotiating for them.

The idea that pay cuts will save jobs is age old and a tactical weapon in times of austerity. It was successfully utilised by Irish Government to shore up the bank bail out. As private sector workers lost jobs a campaign to make public service workers the pariahs was mounted, sufficing to ensure that no support was available for industrial action when public service pay was slashed.....

Anyway, cutting wages isnt the be all and end all here. Revenue loss from income tax is surely a consideration fir the government?? And why are the Government involving themselves in the running of clubs all of a sudden? Its not like there is assistance when clubs hit hard times.

The propaganda war is levied against highly paid players? What about Lewis Hamilton, Rory McIlroy or Anthony Joshua?? All high earners and no word about taking income from them? Why was there no furore over Formula One furloughing staff? Multi billion dollar industry......

There are many facets to seeking pay cuts from highly paid people, and there is Tory history concerning trade unions, which us one great reason to baulk at the proposal.

Football can and should sort its own issues, clubs can discuss contracts etc without interference from people who know fuck all about the sport. Whether Taylor and the PFA are good or bad at their job is really a side issue in all of this.