Rangers are paying a price you won’t see in England – yet
What has happened and is happening at Rangers is beyond a royal mess. Even ignoring the allegations of illegal payments to players from hidden contracts, the blue half of Glasgow’s football behemoth is in the kind of financial pickle that leaves us all open-mouthed.
Rangers went into administration last month over �9m in taxes unpaid since owner Craig Whyte took charge last year.
Her Majesty’s Revenue and Customs haven’t stopped there – another bill for �49m could be on its way to Ibrox if HMRC are successful in their complaint over a Rangers pay scheme, which saw players given wages through trusts rather than the usual channels that attract income tax.
If the aforementioned illegal payment allegations are true, Rangers could be stripped of Scottish Premier League titles – but the past is probably the least of their worries.
Rangers and administrators Duff & Phelps are facing up to real challenges. A bid by the playing squad to have their wages deferred has been rejected and two players have had their offers for voluntary redundancy with no pay-off accepted. More than 11 player redundancies could be needed for the club to see out the season.
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Midfielder Gregg Wylde said: “I volunteered to walk to help the other people in the club who have families, like the kitchen staff.
“At the moment I have nowhere to go and I don’t have another club. I don’t know what is going to happen next but I thought it was important to play my part in saving Rangers.”
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The likes of Ipswich, Leeds and Portsmouth (twice) have been in administration recently – remember when their players were threatened with redundancy?
No – and you won’t, because the administration rules here are unique. Only in English football are clubs and players protected – they must be paid ahead of all other creditors. The rest usually don’t get a penny – maybe one or two in the pound, if they’re lucky.
Rangers are having to face up – both off the pitch, and on it – to their excesses.
At Ibrox, it won’t just be a case of charities and small local businesses being out of pocket, or making those overpaid tea ladies and programme sellers redundant. The unfortunate players Rangers signed but effectively couldn’t afford are facing the same plight.
That’s not a good thing – but it is fair.
Meanwhile, Portsmouth are in administration for the second time in three seasons. They have just offloaded Liam Lawrence to Cardiff, who was signed by Pompey while in the Championship on a reported wage of �20,000 per week.
All this, shortly after then administrator Andrew Andronikou had barely finished uttering the words “�10,000 self-imposed wage cap” to get an agreement with non-football creditors to pay them 20p for every �1 Pompey owed.
In austere times for the rest of us, financial fair play is rightly being discussed across football.
In Scotland, Rangers’ plight left them owing Dunfirmline �85,000 in gate receipts.
It’s clear to see why English football’s unique rule is in place – imagine the domino effect here if a big club went under…
But the rule is outdated – HMRC and a Government select committee have said the special protection needs to go, while the Premier League and Football League are fighting to keep the rule in place. A judgment is expected later this week.
It is clear Portsmouth hadn’t learned from their mistakes – contracts like the one offered to Lawrence proved it.
The on-field protection afforded to English football has left us with legions of clubs overspending by millions and avoiding real punishment for it.
Wage bills at a lot of English clubs are only supported by a rich benefactor – if they are supported at all. Bolton owe �110m in debt, Wigan’s figure is more than �70m – both are in serious danger of Premier League relegation.
Should any English club go into administration, there will be uncertainty off the pitch.
But not until the reckoning really comes to the football field – in the way it looks set to for Rangers – can such financial recklessness be a thing of the past in English football.