Premier League clubs agree to push ahead with spending cap plans

Premier League clubs have agreed to push ahead with plans for a hard spending cap as part of the “squad cost” rules that will come into effect at the start of the 2025-26 season.

The measure was discussed at a Premier League shareholders’ meeting at The Churchill hotel in London on Monday and is now set to be voted on at the league’s annual general meeting in June.

As revealed by The Athletic last week, the de facto salary cap will “anchor” the maximum permitted spending of any club to a multiple of what the lowest earning side receives via the Premier League’s centralised broadcast and commercial deals.

The concept was first brought up last year, with a multiple of 4.5 in mind, but after several clubs strongly opposed the idea, a multiple of five is expected to be implemented if the proposal passes.

The introduction of the squad cost rule from 2025-26 was unanimously approved at a Premier League shareholder’s meeting earlier this month and is expected to be finalised during June’s AGM.

The spending cap is intended to function as a backstop to the squad cost rule, which will see clubs’ spending tied to a percentage of their revenue.

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What will it look like?

Analysis by Matt Slater

If anchoring was in effect last season, the cap would have been £518million, five times the £103.6m that Southampton, who finished 20th, earned in centralised revenues, with Chelsea spending more than that on wages, amortised transfer fees and payments to agents, with Manchester City not far behind.

Unsurprisingly, the idea is far more popular with clubs further down the revenue table. They see it as a way to stop the league’s biggest earners from being able to outspend them at an ever-expanding rate. Without it, they fear the league’s already fragile competitive balance would be further eroded.

The move could be viewed as a boost for other leagues looking to close the gap on the Premier League, although rivals such as La Liga in Spain already employ their own bespoke spending cap regime.

This model though is the first tying a club’s spending to another club’s revenue with other iterations of financial fair play (FFP) rules based on a club’s own revenue.

Who is against it?

Manchester United, Manchester City and Aston Villa all voted against the spending cap while Chelsea abstained.

United are one of the clubs who pushed back against the proposal citing what they believe would be a negative impact on the competitiveness of the league.

Any move to set a ceiling on how much money an employer can pay their employees is always going to attract the interest of the Professional Footballers’ Association (PFA), the players’ trade union.

To have any chance of being introduced, the league knows it must also be approved by the Professional Football Negotiating and Consultative Committee, the body that brings the union, the Football Association, English Football League and…