Is There No Money At Newcastle Or No Willingness To Spend It
If there is no money to spend at Newcastle United, there is no money to spend. If there was one positive from Sunday's night bleak official club statement, at least we know where we stand.
But that really was about it. The rest was just depressing. Newcastle will not be spending any money because Ashley has decided he wants to clear debts more than he wants to make sure United stay in the top flight. Oh and nobody on the board will ever feel the need to explain themselves ever again!
Balancing the books is more important, apparently, than the rather more pressing concern of making sure the squad is good enough to stay in the top flight. The business needs to be sorted out and the team can fend for itself in the meantime.
I do not know exactly how much extra money will be generated through promotion and I'm not an accountant, but I do know that there will considerably more money coming in over the next 12 months.
Nobody at Newcastle is denying that as such, although they are not exactly being up front about it either. All of that extra money, apparently, is needed to cover running costs and clear debts. But to whom?
Ashley has previously boasted Newcastle are debt free, except to him. So, in other words, he wants his money back. Are the bank also demanding the overdraft is cleared?
Ashley has spent more than £300m on Newcastle United. It's a huge sum and he simply isn't willing to bankroll it anymore. I can understand that. What I can't understand is why he has to take so much back, so quickly.
The club reduced the overdraft from £50 to £20m last summer, now they seem to want to clear it completely. Fine, good idea, but if you can't afford to clear your debt surely it isn't sensible to do so.
I've got a credit card bill I'd rather not have, but the debt is manageable and I'm paying it off gradually so that I can survive on my monthly wage. Why aren't Newcastle content to do the same?
Surely, in my opinion, it would have been better to have released a limited amount of cash for Hughton to spend.
Put it this way, if Newcastle had said in the statement there will only be a very small amount of money for transfers because of the financial situation, we could have understood it and probably accepted it.
If Newcastle signed two players for an undisclosed fee, another on a free transfer and a couple of loan players, we would have been happy with that.
We know Newcastle were making the best of a bad situation, but at least they had made steps to strengthen where they could.
Now we know they do not plan to strengthen at all, based on a misguided belief a squad which won the Coca Cola Championship is automatically good enough to survive in the Premier League.
It might well be, but for all of the examples of Wolverhampton Wanderers and Birmingham City who stayed up this season there are plenty more who have tumbled straight back down to the Championship, complaining about the gulf in class between the two.
Burnley, for example, didn't spend much last summer and look what happened to them! And how many teams, in the history of the Premier League, have come up from the Championship and not spent a bean on the team? None I reckon.
Football is tightening its belt and Newcastle are feeling the squeeze just like everyone else.
It's just a shame those that run the club have chosen to handle the news with the delicate touch of a sledgehammer on a raw egg.
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Luke Edwards - is Chief Sports Writer of The Journal and uses his blog to give a unique and entertaining insight into events at Newcastle United and Sunderland.
Luke,
I see he hasn't learnt his lesson.
Is this a sly way of putting the club up for sale?
There must be somebody out there looking for a football club!
'No plan for new capital outlay on players' does not mean no new players. It means Hughton can (a) bring in free transfers (b) bring in players on loan (c) sell players he chooses to and reinvest the proceeds (d) all three. There's no mention in the statement of no plan for new operational expenditure, so an increased wage bill is presumably OK.
The clear implication from the statement 'no organisation can be successful until the financial position has been stabilised' is that he's prepared for NUFC to be unsuccessful as long as the money's pouring in and we're getting back on an even financial footing. If that means yo-yo-ing between divisions for a few seasons, I suspect he sees that as a price worth paying. Course, the problem is that one season we drop and don't bounce back up.
Not sure why anyone would expect anything different from this regime. He runs the club like he runs his shops. We're just one in a long line of once premium brands he rapes for his own financial gain.
And there'll still be 50,000+ 'loyal members of the Geordie nation' at the first game. Idiots. The lot of us.
1. who does MA's PR -the third riech?
2. he knows nobody will buy the club as it is with 100m owed to him, so hes taking it back and yes i would agree the club is on the market, in fact its never really been off.
3. this man would shake you with one hand and stab you in the back with the other.
4. prime opportunity for th NUST to step up!
5. i'm going to trust CH to bring in at least 2 players. chris if it wasn't for the loads of money you're on up there my heart would go out to you, don't let the B*****ds get you down...
1. who does MA's PR -the third riech?
2. he knows nobody will buy the club as it is with 100m owed to him, so hes taking it back and yes i would agree the club is on the market, in fact its never really been off.
3. this man would shake you with one hand and stab you in the back with the other.
4. prime opportunity for th NUST to step up!
5. i'm going to trust CH to bring in at least 2 players. chris if it wasn't for the loads of money you're on up there my heart would go out to you, don't let the B*****ds get you down...
And no coincidence that the Premier League have just agreed to increase parachute payments to relegated clubs ... now £48 million over 4 years (up from £16 million over 2 years I think).
Why would MA care if we're relegated, he gets his bunce regardless.
And what no-one seems to have clarified yet is whether MA funnelling all of our new PL income into his greasy fat poke actually reduces the clubs debt to him ... or does the £100+ million debt to him continue to hang over us while he creams off the top? Break-even just means trading figures, not capital restructuring.
The timing of this announcement is appalling and, as usual, the attempt is to show the figures in as bad a light as possible. MA and DL really do need to go on some sort of PR course on how to communicate with your supporters (oops, sorry, should that be customers).
The fact is the figures they quote for losses are not the final 'bottom line' figures. The actual loss for 2008/9 was £14.5 million (after taking account of profits on player sales) and similarly 2009/10 'bottom line' losses will be a lot lower than the figures they quote as we have made an £18million profit on player sales this year.
If we aren't going to spend any money next season then the profits will be substantial with the extra money coming in with no additional outgoings except (hopefully) some wage increases for some key players (Carroll etc.)
With the announcement of the additional parachute payments the temptation is there for him not to worry too much about relegation.
I wonder if his 5 year plan assumes we are in the premiership for all those years. What's the point of asking - noone apparently is going to answer any questions anyway.
Thanks for the clarification big Mike. Good to know you read this blog and made the time to answer my question about our debt and creaming off income!
I have been a supporter for 40+ years. I know we have always lived on dreams – always unfulfilled. Glamour signings, huge wage bills, gutless mercenaries. Then nothing. The one moment of near-glory (Keegan) ended in agony and was totally unsustainable anyway. It was only ever going to last until Keegan spit his dummy out. Dalglish comes along and starts to build on proper lines (Given, Speed, Dabizas etc) and would have won things. The only thing he did wrong was sell Ferdinand the day before Shearer got crocked. Then we sack him and get Gullit – the sexy football we all wanted. Absolutely typical. Now, at least, we have an owner who is prepared to make sensible, grounded decisions. Notice the very positive reaction from the financial experts. Football is a business now like it never has been in the past. Irresponsible management (Portsmouth, for example) can lead to absolute unmitigated disaster, possibly irrecoverable. And Portsmouth won the Cup, which is more than we ever did. Granted his PR is unbelievably bad, but there are a growing number of people who believe that we might look back on Ashley’s regime with gratitude. Some very big clubs will be disappearing down the plug hole and we will still be around, and probably doing alright. Ranger, Vukic, Kadar etc will be worth millions (might have been sold for millions) and we will all be looking back at Denis Wise and telling ourselves what a good chap he was. We always liked him. Keegan was right when he said it would take years to catch up with the top four. What Ashley has announced this week represents the only way to do it. Of course, we will all hate it and demand superstar signings and we will hate grinding out boring 1-0 wins, and getting periodically murdered by Arsenal, Chelsea and Man Utd. We will also hate finishing 13th in the premiership every year for a while – but then we will reflect that that is a whole lot better than most recent seasons. Of course, it has to be said that during those seasons we were privileged to be able to enjoy the skills and commitment of Owen, Boumsong, Marcelinho and Luque. £40 million well spent. Surely there are more like that out there somewhere.