"Entering Administration" and Point Penalties Questions

Discussion in 'Other Divisions' started by EvanJ, Jan 17, 2010.

  1. EvanJ

    EvanJ Member+

    Manchester United
    United States
    Mar 30, 2004
    Nassau County, NY
    Club:
    Manchester United FC
    Nat'l Team:
    United States
    To a person who doesn't know English law, what does "entering administration" mean? How do you feel about point penalties? Is it fair to punish the players on a club for mistakes or financial wrongdoing by the club's ownership? http://soccernet.espn.go.com/tables?league=eng.5&cc=5901 says Chester City in Conference National has -3 points and on a points per game basis is on pace for 15 points (40 minus the penalty). Has a club at the top level (either before or after it changed names to the Premier League) ever gotten a point penalty for financial reasons?
     
  2. JackBastard

    JackBastard Member

    Jan 21, 2007
    Bridgend
    Club:
    Swansea City AFC
    Nat'l Team:
    Wales
    I don't think any Premiership club has been deducted points for entering Admin, but it's very possible that Portsmouth will be the first this season.

    Administartion is essentially when a business is insolvent, and the Administrators are brought in in an attempt to save it, usually in the case of football clubs by getting players off the wage bill.

    The rule was brought in a few seasons ago when Leicester decided to go into Administartion to clear their debts by paying creditors next to nothing, then winning promotion to the Premiership.

    As for being in favour of it, absolutely I am. I'd take it further though and make it punishable by a relegation. If you finish in the relegation zone you go down two divisions, and if you would have been promoted you stay where you are. Clubs who live widely beyond their means should be punished appropriately.

    And yes I am aware that we would have been a Conference club in 2002 with this rule, but there we go.
     
  3. RichardL

    RichardL BigSoccer Supporter

    May 2, 2001
    Berkshire
    Club:
    Reading FC
    Nat'l Team:
    England
    I agree. It was brought in in the early 1990s I believe, with Northampton being the first club to go into administration.

    At first it was a good idea, helping out clubs that found themselves in trouble. Northampton had been hit hard by safety measures introduced a few years earlier, having their entire main stand condemned, barring the paddock at the front. As they shared with Northamptonshire Cricket Club, their ground only had two and half sides as it was, so that was something of a blow. Efforts to try and move to a new ground were a drain on resources.

    Administration was a safety net, which was the exact idea behind it.

    Unfortunately some clubs started to view it as a "get out ouf jail free card" and would gamble on success, knowing they could fall back on administration if things went bad.

    The trend seems to be more and more towards clubs "speculating" rather than living within their means - look at Portsmouth, massively in debt and trying to take the premier league to court to allow them to spend a few more million they don't have on players to try and stay up. Or Ipswich, who have already been in administration once, who are massively in debt, and yet spent well over £5 million in the summer in a bid to get promoted.

    If they were just harming themselves, it would be OK, but the fact is that if clubs spend more than they can afford, it puts clubs who are trying to live within their means at a disadvantage, which in turn leads to other clubs spending more than they can afford, as they feel they need to.

    I think cases need to be judged on their merits. If clubs are seen to be doing everything in their power to pay their bills and keep costs low, i.e. the debt is unavoidable, then they should be treated leniently.

    If, on the other hand, they gambled on a push for glory, they deserve to be relegated with all their players' contracts cancelled.


    The sad thing is, you get younger fans these days, who have only known the last 5-10 years, and they really believe that spending money hand over fist regardless of the outcome is the only way to run a club. In the summer of 2005, a year before Reading made it to the premier league, many fans were really slating our chairman for his penny-pinching attitude*, saying they'd wish he'd either just spend his own money to get us up, or gamble the clubs future on going up, as there was "no point" in just being an average championship club.


    * funnily enough, because he is pretty rich man, a lot outside the club seem to assume we got promoted because he bankrolled the club with signings we couldn't afford, even though the team was largely made up of budget signings.
     

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