DCMS signs £40,000 contract for advice on redistributing Premier League millions

Oxera Consulting will earn a fraction of top stars' weekly pay for policy proposals to aid smaller clubs
Premier League title winners Manchester City received £164m in prize money and TV revenue last year. Photo: PA/Alamy

By Tevye Markson

22 Jul 2022

The Department for Digital, Culture, Media and Sport has agreed terms with a consultancy to provide advice on potential policy proposals for how to better redistribute Premier League football income.

The two-month deal with Oxera Consulting, worth £40,000, was agreed on 22 June and will end on 21 August.

The fee is one-tenth of the weekly pay packet of Manchester City midfielder Kevin De Bruyne, the second highest earning Premier League player after rivals Manchester United’s Cristiano Ronaldo. Ronaldo reportedly earned £510,000 a week at United last season,  making the Oxera contract worth less of his time than a morning training session.

Earlier this year Manchester City reported 2020-21 turnover of £569.8m, from which it made £2.8m profit. Manchester United reported a £36.9m operating loss on revenue of £494.1m in its most recent annual report, covering the year to June 30 last year.

The 72 English Football League clubs, made up of three leagues below the Premier League, currently receive around £350m in total from the top flight. Meanwhile, last year's title winners Man City alone received £164m in television receipts and prize money.

DCMS posted the completed ”Football Distributions Support” deal on Contracts Finder on July 13.

The agreement followed the department’s search for “expert consultancy advice to develop and assess policy proposals and recommendations in respect of redistribution of Premier League income”.

Oxera describes itself as an economics and finance consultancy “that inspires better decisions, helping you solve complex challenges and build stronger strategies”.

The consultancy has worked with other parts of government, recently completing a review of the root causes and costs of supplier failures in the UK energy retail market, commissioned by regulator Ofgem. Oxera was also asked to make recommendations to improve Ofgem’s performance as part of the process.

Much like the rise in football transfer fees and wages in the Premier League, DCMS' consultancy spending has risen hugely in the last few years

DCMS’ contract with Oxera follows a fan-led review of football governance, chaired by former sports minister Tracey Crouch,  which was launched in April 2021 after a daring attempt to create a European Super League caused shockwaves in the football community.

The review, originally been promised in the Conservative Party’s 2019 election manifesto in response the demise of Bury FC, was pushed forward due to the super league threat.

The goal of the review was to address long-standing concerns about club ownership and financial sustainability in the English game.

Published in November, the Crouch review called for the government improve how the huge sums made by Premier League teams are distributed in throughout England. It said the Premier League should make "additional, proportionate contributions" to support the game through fairer distribution of money.

All of the review’s suggestions, including creating an independent regulator for English football, were accepted by the government in April this year.

One of the recommendations was to introduce a levy on Premier League clubs’ transfer fees, which have reached nine-figure sums in recent years, such as the £100m fee Aston Villa received from Man City for England star Jack Grealish last summer.

However, DCMS said football authorities should first be given a free kick at solving the issue of redistributing football wealth more fairly.

Currently, a small percentage of money from television rights is redistributed from Premier League teams to those in the three professional divisions below through parachute payments  and solidary payments, with teams relegated from the Premier League in the last three years getting the biggest sums. The EFL wants to instead sell broadcasting rights jointly with the Premier League and receive a 25% split of the revenue.

Sports minister Nigel Huddleston said football authorities should press forward with action “to tackle issues currently facing the game such as the issue of fair distribution of finances throughout the football pyramid and giving fans a greater say in the running of their clubs”.

He said the government wants to press the Premier League to come up with its own solution first, but added: “The message to the Premier League is quite clear – they need to act sooner rather than later because, otherwise, [a settlement] will be forced on them through the regulator.”

Huddlestone said in April that the government would “work at pace to establish a strong, independent regulator” and publish a white paper this summer.

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