Premier League will bail out EFL... but at what cost? Strict conditions expected on support package worth up to £250m

Premier League clubs are resigned to having to bail out the English Football League - but with strings attached.

Members of the world’s richest league are expected to impose strict conditions on a support package worth up to £250 million to their lower-league counterparts.

They are prepared to make a take-it-or-leave-it offer after the Government made clear it would not be rescuing the professional game from collapse following the coronavirus crisis.

Premier League clubs had been holding off agreeing to underwrite losses of up to £22m a month being posted by EFL sides until after the planned return of crowds to the game a week today, in the hope both competitions could start generating some ticket revenue.

But Boris Johnson destroyed those plans on Tuesday by announcing a new wave of lockdown restrictions that could force professional and semi-professional football behind closed doors for another six months.

The Prime Minister and his cabinet are determined to hold the Premier League to one of the conditions of the competition resuming this summer in Project Restart after football was suspended in March, which was its clubs supporting the wider football family.

Those clubs, who have already made some contribution to that effect despite losing millions of pounds a week themselves, are now reluctantly ready to go further by bailing out the lower leagues.

However, any rescue package is likely to be limited to underwriting lost gate receipts, with EFL clubs needing to provide clear evidence to that effect.

Premier League clubs have no intention of bailing out teams already at risk of going bust before the pandemic due to poor ownership or other self-inflicted issues.

The league also wants the EFL to agree to support some of its own strategic objectives in exchange for the cash, including post-Brexit quotas on overseas players and on its yet-to-be-agreed curtailment rules.

EFL chairman Rick Parry has been resisting these latter conditions during negotiations over a rescue package but may be forced to accept them if he wants the cash, with Government sources telling The Daily Telegraph it has no intention of dictating what terms are applied to any bailout.

The EFL has been exploring taking out a commercial loan but clubs have told The Telegraph that borrowing money would simply delay their demise.

Parry has already said teams could go bust by Christmas and he reiterated the urgency of a bailout on Wednesday in a statement questioning the Government’s decision to scrap the return of fans.

“Of course we recognise that the UK is facing a significant public health crisis and that sport has to play its part in helping the Government manage the spread of the virus at this difficult time,” he said.

“This is why over many months we have helped the Government devise, refine and pilot stringent stadium protocols designed to keep supporters safe. Staging professional football matches is one of the most heavily regulated areas of crowd management and any supporters attending EFL fixtures, in vastly reduced numbers, would have been required to adhere to social distancing and the rule of six.

“Therefore we are deeply frustrated that we will not be able to continue this work and, in doing so, gather the evidence to show that crowds can return safely to football and become an important financial lifeline for our clubs.  Therefore, as a matter of urgency we now need to understand what the Government’s roadmap is for getting supporters back into stadiums as soon as it is deemed safe to do so.

“With extended measures introduced, it is imperative that the financial issues facing our clubs are addressed quickly.  EFL clubs lost £50m last season as a result of playing matches behind closed doors or curtailing the season and stand to lose a further £200m in 2020/21 should we be required to play the whole season without supporters in grounds.

"I am encouraged that the Government has recognised the need for urgent financial assistance for sport and discussions will continue with DCMS and the Premier League.”

Wednesday also saw the community leisure sector urge the Government to fast-track immediate financial help while the Premier League and EFL continue to thrash out a deal.

Around one third of public gyms, leisure centres and swimming pools have been unable to reopen, even since Covid-19 restrictions were eased in July, because of lost revenues during the initial lockdown and on-going restrictions on numbers.

Around 6,000 permanent and casual staff have already lost their jobs and, having first asked for Government support last month, numerous facilities are at risk of permanent closure in the coming weeks.

“That’s impacting communities across the whole country, and that is impacting the health of those communities – there is a real urgency there now and we humbly encourage government to find resolution,” said Huw Edwards, the chief executive of ukactive, which represents public and private sector gyms and leisure centres.

Sport England research recently found that, for every £1 invested in community physical activity, there was a return of £4 in improved health and social incomes.

Edwards is arguing for a package that does not only include core funding, but which could also encompass stimulus like VAT cuts, an extension of business rates relief and initiatives such as extending the Cycle to Work scheme to include gym membership or equipment.

He is also adamant that there is an overwhelming economic, as well as health and social case, for the request.

“There is no trade-off between health and the economy when it comes to investing in our sector,” he said.

“You are making savings across health care, across social care, a massive impact on major NHS issues like diabetes and dementia, and you are reducing tens of millions of GP visits. Where are you going to find a sector that bridges that physical, mental and social wellbeing agenda so emphatically? There is such potential but, to provide those solutions, we need to survive.”