In a stunning development in the on-going Sevco saga, an SFA source has confirmed to The Daily Record that as things stand right now Sevco will not meet the qualification criteria to receive a license to play in European football next season, should they make it.
The Dave King revolution looks dead in the water.
This website has been predicting an outcome like this.
The UEFA licensing criteria is pretty straightforward, in that clubs cannot make losses upon losses year in year out. Over a three year timeframe they will allow clubs to lose no more than £4.2 million; the only exception is in circumstances where the losses are serviced with a debt-to-equity switcheroony … that is the avenue that was completely closed off when they lost Resolution 11, which is perhaps why this issue has suddenly come into the light.
But it’s fair to say that this wouldn’t be getting discussed at all had the Internet Bampots not raised this over and over and over again. I can confirm that aside from Celtic, other clubs are watching this time, because they will be the ones disenfranchised here, and are not going to take any effort to bend the rules lying down.
Resolution 12 put this matter in the public domain, whether the SFA or media wanted it there or not. The work on this site and others to keep highlighting Financial Fair Play and to push clubs towards taking this seriously has been another major step forward.
This was always going to be a problem for King and his board.
I’ve been writing about it for nearly three years and this site raised this issue last season, when Sevco reached the Scottish Cup final and their fans were talking about who they might get in the draw. We told them not to run out and buy suntan oil, because although the SFA had steadfastly refused to comment on the issue the numbers didn’t lie.
Sevco’s losses for the last three years – as confirmed in their accounts – stands at over £18 million.
They were in breach last season – by miles – and they are in breach now.
The “SFA source” says that UEFA will “probably” grant them a special dispensation.
Oh really? I very much doubt it, and there are numerous reasons why. The Resolution 12 issue will be fresh in a lot of minds over there; that and the coverage FFP is now getting prevents the SFA trying to rig the game, and it gives UEFA an incentive to make an example.
In order to even apply for the special dispensation – and the minute the SFA refuses the license it becomes an issue between UEFA and the club; don’t underestimate the magnitude of that – Sevco will have to supply the European body with everything they ask for and all of it will need to be backed up by hard numbers.
Do you believe they can meet that requirement?
Sevco’s entire business plan is based on getting European football; that’s not going to count in their favour. Quite the opposite in fact. The argument “grant us the license, give us European football money and we’ll qualify in three years” isn’t going to cut any slack.
This is exactly the kind of “business plan” financial fair play rules were created to block in the first place.
On top of that, Sevco has to show how they will reduce losses without European money. Their business plan has to be robust enough to survive scrutiny. They have to show how they are turning it around, when every utterance out of the club from “we will overinvest” to “we have to spend to catch Celtic” screams the absolute opposite.
We’re talking about a club here with the second highest wage bill in Scottish football. It’s not going to be difficult to argue against the need for that; if they were to say that this was necessary to survive the SPL that would be one thing … but they’ve had the second highest wage bill in the game here for the last four years, all of them spent in the lower leagues.
Two of the three years losses for the licensing period were spent outside the top flight.
How in the Hell are they going to justify that?
The only circumstances in which UEFA would accept such losses being incurred, and grant special dispensation, would be where the club had invested significantly in infrastructure projects required by UEFA licensing standards. Which is to say, if the money had been spent on getting their stadium up to par, or in investment in a youth academy or some other such scheme there would be a case for granting some leniency.
But Sevco’s money has gone out on players. It’s gone out on assembling a squad of dross, 20 odd footballers in total and signings like Barton, Kranjcar and others. No-one will convince a UEFA Finance committee that this was necessary.
Sevco’s prospects of playing in Europe already looked bleak.
Their league form has been abysmal and the next few weeks might see slip out of the running for one of the places, but that place was never going to be handed to them on a plate anyway, when they were posting these dire financial results year in and year out.
This year they are going to require further external funding to get through the season; UEFA will view that not only as proof that this is a club living out with its means but one that’s virtually trading whilst insolvent. The integrity of their club competitions is of paramount importance to them and they will simply not allow a club to spend its way through four divisions and into Europe at the expense of those who play by the rules. It is a non-starter.
The problems facing that club didn’t get worse today, but we’ve now seen the first tacit admission out of Hampden that they are aware of trouble on the horizon.
They are late to that party, but I suppose we should give them credit for even arriving at all.