Premier League Set To Introduce Strict Salary Cap

The Premier League is in discussion about the establishment of a stringent salary ceiling, Crystal Palace chairman Steve Parish confirmed.

The league is looking at a number of options to maintain competitive balance, including anchoring, which would keep the wage expenditures of the richest team to a multiple of what the bottom team’s TV revenue would be. According to Parish, a pay ceiling was also under consideration. The Premier League is expected to adopt UEFA‘s new system, which would cap teams’ expenditure on salaries and transfers at 85% of their revenue rather than the current 70%.

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“Uefa’s squad-cost caps are one idea — and maybe something that is a bit more rigid than that, with a hard cap at the top, that doesn’t take turnover into account, where there are vagaries of how that turnover comes about,” Parish said [via The Times].

“There are really positive conversations going on about it. We also have to be very careful because there are also unintended consequences. Hopefully, we will get somewhere that will be beneficial. Not just to the clubs in the Premier League but to the whole pyramid and their ability to compete. We are voting for our competitors to be able to do better and challenge 

“I think everybody is moving toward it [cost controls]. Uefa are bringing in 70 per cent squad-cost caps which I think will have some effect. They do also run the risk of creating a permanence because if you have 70 per cent of a bigger turnover obviously you can spend more money.”

Parish also discussed the Premier League’s “blackout” problem, which now prevents any kind of television broadcast of the Saturday afternoon kick-offs. There have been discussions about lifting the blackout, but Parish thinks it should stay in place because it boosts attendance and generates income for lower-league clubs.

The introduction of a potential salary cap would likely face hurdles from the bigger clubs as it would affect them the most going forward.