Aston Villa are the latest club to exploit PSR loopholes to finance spending - so what does it tell us about the state of the game?
On 30 June, with just hours left before the end of the accounting period after which Premier League clubs must be compliant with the profit and sustainability rules (PSR), Aston Villa sold their women’s team – to themselves.
Following in the footsteps of Chelsea, who sold their women’s team to themselves earlier this year in order to avoid a potential points deduction, a 90% stake of Aston Villa Women has been sold to V Sports, the holding company which also owns Aston Villa as a whole, with another 10% sold to external American investors at a total value of £55m.
The move follows concern that Villa were at risk of a PSR breach following operating losses of around £195m over the course of the 2022/23 and 2023/24 seasons. In the short term, the deal is expected to ensure that the men’s team remain compliant with the regulations and avoid any form of penalty – but in the long term, where do such accountancy acrobatics leave women’s football?
What does it say about the effectiveness of the PSR when the rules can be circumnavigated so easily? And isn’t it all just a little bit depressing?
What the sale of Aston Villa Women means for the women’s game
In the immediate future, it’s unlikely that Aston Villa Women will experience any detrimental effects from the sale, given that they are ultimately still set to be owned and run by the same people. The external investment may even provide extra resources, not that Villa’s existing owners, billionaires Wes Edens and Nassef Sawiris, are exactly short of coin.
The worry is less about the short-term impact of the sale – although Villa Women have several short-term concerns following a challenging season in which both the manager and director of football were replaced after several key players left amid reports of dressing room discontent – but about whether being hived off from the main sporting organisation makes them more vulnerable in the future.
After all, if they are divorced from the men’s team, the stadium and the rest of the club’s infrastructure, it makes it that much easier for the team to be sold on again in the future, and that much easier for crucial funds to be diverted to the more profitable men’s team now that Aston Villa as a whole aren’t incentivised to invest by the fact that investment in women’s teams doesn’t count against a team’s outgoing for PSR calculations.
In theory, that is where outside investment can be a good thing. When Chelsea sold their women’s team to BlueCo, the parent company of both Chelsea and RC Strasbourg, for £198.7m in April, they also sold a small stake to Reddit co-founder Alexis Ohanian, who underlined his intention to bolster the club’s financial position in comments which described the eventual WSL champions as “queens of global soccer.”
If the new American investors in Villa Women come in with the right intentions and open wallets, this may all prove to be a net positive, at least for the foreseeable future. But it’s hard not to worry that it all feels a bit like another example of clubs treating the women’s teams as being subservient to the men’s.
Just recently, both Wolves and Blackburn Rovers came under fire for their treatment of their women’s sides after it came to light that Wolves chairman Jeff Shi had refused to apply for promotion to the Women’s Championship, while Blackburn withdrew from the same competition - in both cases due to increasing costs that the owners could easily have absorbed from their personal wealth had they cared to.
The sale of Villa Women isn’t quite so drastic, of course, but it could be argued as sending a questionable message when a women’s team is treated less as a valued part of the larger club than as an asset which can and will be bought and sold to service the financial needs of the men. That, ultimately, is the primary driver behind these sales, after all. If they do bring in investors who will improve the team, then that is a happy by product of the process.
It’s fair to acknowledge that Chelsea, in particular, have hardly treated their women’s team badly. They have invested heavily, broken the world transfer record to sign Naomi Girma, and the team won the domestic treble. Chelsea’s owners may have shipped the club around their own companies in order to fix the men’s financial problems, but at least they have treated the women’s team well and helped it to strengthen its stranglehold on the Women’s Super League, and there is no immediate suggestion that a theoretical change of ownership or the involvement of outside investors will derail that.
Whether Villa Women will get the same respect and investment in the long term remains to be seen, but this sale may not create any problems at all. It may even prove to be a useful step forward. It would just be nice to shake the sensation of women’s teams being used as a pawn in a men’s game that club owners often see as being not only more lucrative, but perhaps more important.
The PSR have shown us the depressing reality of the Premier League
https://www.3addedminutes.com/sport/football/aston-villa/seven-players-villa-sell-june-transfers-5184792
The sale of Aston Villa Women also raises concerns about the PSR themselves, however – both in terms of whether they works as designed, and in terms of whether they are proving to be more of a detriment to the game than a benefit.
The fundamental concept behind the PSR was, in part, to try and prevent another Portsmouth. Pompey became the first Premier League club to go into administration back in 2010 when former owner Alexandre Gaydamak ran them into the ground through extensive overspending which brought them both an FA Cup win and a ruinous tumble down the divisions. They are the cautionary tale that the Premier League is desperate to prevent from being rehashed.
Some would say that a secondary aim was to entrench the existing elite’s position in the footballing hierarchy, although it seems needlessly cynical to suggest that the primary purpose of the PSR was to protect clubs that have existed for over a century from owners who may not take the best care of their finances. It was expected that the threat of a points deduction would be enough to disincentivise the recklessness of another Gadyamak in an era in which the fastest way to bridge the gap towards the top teams was to spend heavily, and perhaps outside of a team’s means.
Still, the PSR has certainly made that gap even harder to get across, to the frustration of some supporters who see the top of the game as being more distant than ever.
The first phase of the PSR’s life was one in which teams failed to take them seriously. Both Everton and Nottingham Forest picked up points deductions, either because they didn’t think the Premier League would have the guts to dish out the more significant of the threatened sanctions for breaches, or because they simply hadn’t wised up to the ways in which they needed to manage their money in the new reality.
The second phase, however, is one in which the creative accountants have come to the fore. Instead of taking the hint and reining in their spending, many clubs have instead been incentivised to find ways to exploit the system - and they’re getting smarter and smarter as to how that can be done.
So we get Villa and Chelsea selling their women’s teams to themselves, we get teams including Newcastle and Nottingham Forest trading players between each other for potentially inflated transfer fees. We get clubs selling home-grown players to make ends meet, regardless of the tactical needs of the team, and we get Leicester City dodging what appeared to be a certain points deduction when their lawyers worked out that the rules had a glaring loophole in them - because their promotion to the Premier League technically meant that they weren’t under the jurisdiction of the either league or the EFL for the entire accounting year.
In short, the PSR have failed in their stated purpose. Teams have not moved towards steadier finances and sustainable spending, but have simply started figuring out new ways to bend the rules while the Premier League runs around playing whack-a-mole, sending out warning letters and closing loopholes the size of barn doors months after the horses have bolted.
The PSR are, in any case, on their last legs. Premier League clubs voted to kill them off at the end of the 2024/25 season and they have only been left in place for another season because the teams have yet to agree on what should replace them. Hopefully, it will be something which a team of lawyers have looked over properly before it’s published. The Premier League certainly didn’t think hard enough about potential workarounds when they last drafted a set of financial regulations.
Whatever replaces the PSR will probably be less stringent, and that may not be a good thing for the balance of the sport or for the fiscal safety of teams going forward. As any number of EFL and National League teams have demonstrated in recent years, clubs do indeed need a degree of protection from the degradations of terrible or thoughtless owners. Premier League sides may have more money to play with, but that just means that when the wheels come off, the crash can be even more dangerous.
Perhaps the PSR’s lasting legacy won’t be the protection of historic football clubs or a more stable financial outlook for the game, but simply to have made football a little more depressing. It has, after all, created a world in which teams flog academy products and play around with the ownership of their women’s teams rather than contemplate, for one moment, building a more sustainable financial base for their sides.
Aston Villa weren’t in a PSR hole because the rules were unjust, but because they couldn’t stop themselves from overspending their allowance in the hope of reaching their goals even when they knew the potential consequences – this, after all, is a team that found itself fretting about a points deduction despite a Champions League run worth over £100m and the lucrative sales of Douglas Luiz and Jhon Durán. It’s a reflection of the way Villa (and of course Chelsea) are run but not a problem unique to them, by any stretch of the imagination. They have merely been blowing along with the prevailing wind.
What the PSR have done is shine a light on the fact that Premier League owners are, in many cases, simply not all that interested in the financial sustainability and long-term viability of the clubs they own. Careful management and judicious fiscal conservativism doesn’t qualify you for the Champions League, doesn’t make headlines, and doesn’t make you famous or simply richer as a result of on-field success. And all of that is more important to many owners than preserving community institutions that have existed for generations.
We’re in a free-spending, hyper-commercialised era of football, and there will eventually be more big clubs that crash and burn chasing a dream that costs hundreds of millions to achieve – with no guarantee of success. The PSR didn’t put the brakes on that as they intended, they just highlighted how far down that road we’ve already travelled, and moved us into an era in which contracting the right accountancy firm is just as important as buying the right new full-back.
We now watch a sport in which the exploitation of regulatory loopholes and the cunning amortisation of costs seems to be as crucial to a club’s success as the on-field management or their scouting and recruitment. That’s the world we live in now, one in which teams would rather find ways to bend and break the rules than risk losing a step on their competitors.
Let’s hope the next set of financial regulations are a little more carefully thought through - but given that they would have to be voted in by a majority of those very same clubs that spent so much energy worming their way through the PSR, it would be more than a little optimistic to expect that.
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