The number of Scottish football clubs in financial distress has fallen dramatically from last year but the industry continues to face challenges from the pressure on fans' discretionary income.
The March 2024 Football Distress Survey, which has been conducted by business recovery specialist Begbies Traynor since 2012, shows there were just three clubs in Scotland’s four top leagues showing signs of financial distress. That was down by almost two-thirds from a total of eight clubs a year ago.
The peak of Scottish football distress was in October 2020, when a total of 14 clubs showed early signs of financial distress.
The data also shows that financial distress in the English Football League is at an all-time low, now affecting just two of the 72 clubs in the EFL, down from 22 a year ago and the record high of 34 in October 2021.
Ken Patullo, head of Begbies Traynor in Scotland and Northern Ireland, said recent high-profile points deductions, ongoing investigations into breaches of the Financial Fair Play (FFP) rules, and the Premiership’s profitability and sustainability regulations have all contributed to the lowest levels of distress recorded in the EFL in the 12 years that the data has been published.
“Historically our clubs have been insulated from some of the spending pressures of those in the English leagues, but every business in the UK has been impacted with similar trends in rising costs, from energy and wages to food and other operational expenses,” he said.
While there was a slight increase in the number of Scottish clubs under pressure when compared to the last snapshot in October 2023, Mr Patullo said this could be the result of seasonal pressures such as the timing of ticket sales.
“There is obviously a gulf between the revenues of most Scottish clubs and their English counterparts, but that also means we don’t have the pressure to compete in an ever-rising wage market," he said. "We have only just seen some control gained in those leagues by the more common use of penalties and consistent enforcement of regulations in the Premier League and Championship in particular.
"Scottish clubs that still have the cost of Covid loans, and who are competing for a dwindling discretionary budget in most households, will continue to see a challenging environment next season, but from a position of generally better fiscal management in the Scottish leagues, it should hopefully be business as usual for most clubs."
UK inflation remains steady for second consecutive month
UK inflation held steady in June as price rises across the county stayed at the Bank of England’s target level for the second month running, according to official figures.
The rate of Consumer Prices Index (CPI) inflation remained unchanged at 2% in June, the Office for National Statistics (ONS) said. It means that prices are still rising but at a rate that the central bank is comfortable with, after nearly three years of above-target inflation fuelling the cost-of-living crisis.
Read the full story here.
Forth Green Freeport reveals its first chief executive
Forth Green Freeport, the public-private consortium set up to regenerate a huge swathe of east and central Scotland blighted by industrial decline, has unveiled its first chief executive.
The freeport has appointed economic development specialist Sarah Murray to the role shortly after it officially opened for business in June, when it secured approval of its outline business case from the Scottish and UK Governments. Ms Murray, who is currently director of the Local London economic growth partnership, takes up her new post on August 27.
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