Sunday 22 April 2018

Irish leagues should look to Europe to plan prosperous future

Robbie Benson’s first-time effort away to Legia Warsaw was stunning and grabs extra points because he produced it in a Champions League play-off. (Photo by Adam Nurkiewicz/Getty Images)
Robbie Benson’s first-time effort away to Legia Warsaw was stunning and grabs extra points because he produced it in a Champions League play-off. (Photo by Adam Nurkiewicz/Getty Images)
'Attendances in the League of Ireland's top division are down and half of its clubs are not profitable' (stock picture)
John Greene

John Greene

The scale of the challenge facing football in Ireland on both sides of the border has been laid out in stark terms in the latest UEFA report on club finances across the continent.

While the Premier League in England and Europe's other top leagues - in Spain, Germany, Italy and France - are storming ahead and showing little sign of slowing down, other countries are falling ever further behind, including Ireland. The financial gap is enormous, grotesque even.

The average income per club in the Premier League, as revealed in UEFA's report into the state of the European club game, is almost €245m; in the Republic of Ireland it is just €1.5m - and even that dwarfs Northern Ireland (€0.7m) and Wales (€0.4m). Yes, it's like comparing apples and oranges in many respects, but when you look more closely at the figures, alarm bells should still be ringing in Irish football.

Across all aspects of the game, the larger and medium-sized leagues have taken over - which ultimately is bad news for countries like Ireland, where fewer and fewer people will identify with the domestic leagues as they will increasingly come to view them through the prism of what they are absorbing from elsewhere through traditional media and, increasingly, social media, with all the glitz and glamour that entails.

This, though, does not on its own excuse the state of the game here, where all the underlying figures paint a troubling picture. We shouldn't need to take the crumbs of comfort on offer from looking at those other leagues in as parlous a state as our own, including our Welsh neighbours and other powerhouses of the European game like Malta, Luxembourg and Albania, who rely to an extraordinary extent on UEFA.

Indeed, UEFA believes the Financial Fair Play regulations have transformed football in Europe, insisting that clubs are now less reliant on donations and grants and other one-off revenues to stay in business. Gate receipts across the continent are also up, by about nine per cent, sponsorship and commercial revenue are up, and television revenue is up.

But in Ireland the picture is very different. Attendances in the League of Ireland's top division are down and half of its clubs are not profitable. It's true that club revenues are up year on year, but this presents a somewhat false picture because costs - including wages - also continue to rise, and because reliance on grants, donations and UEFA prize money remains acute when compared to other leagues. So even if revenue is up, clubs are still struggling to survive.

The European average for club revenue sees income breaking down into three distinct areas, almost equally, namely broadcasting rights, gate receipts, and sponsorship and commercial gains. According to this report, gate receipts generate less than a tenth of total revenues across many leagues outside the top 20. However, they are significant in certain northern European countries, such as the Faroe Islands, Finland, and in Ireland.

In the League of Ireland, gate receipts account for one-fifth of revenue, while grants from UEFA account for a whopping 43 per cent. It is true that attendances have declined across Europe over the last decade, but the rate of decline in Ireland is significantly greater than in England, Scotland and Wales, and indeed is greater than the European average.

In the previous year's report, income from UEFA accounted for around 15 per cent here, while income from sponsors and other commercial interests was high, a notable 44 per cent. Yet, in the space of one season, the former rose sharply and the latter fell. This is not good news. This, surely, is an unsustainable model for the game.

The situation north of the border is equally bleak. Over the same two years, clubs in the Danske Bank League earned about one-fifth of their money through UEFA, with similar levels in both gate receipts and sponsorship or commercial income. But more troubling was the heavy reliance (37 per cent) on donations and grants underpinning the financing of the League's clubs.

UEFA acknowledges that in the lower leagues its prize money is much more significant, in many cases even accounting for more than the sum of all other income streams. The worry for football in Ireland is that this is not a sound footing to base the future of the game on, given that such a significant element of last year's income is not something which can be relied upon from year to year.

Allowing for the fact that the SSE Airtricity League and Danske Bank Premiership are both a long way off the major European leagues, there are still plenty of examples of countries being able to punch above their weight - such as Cyprus, which attracts healthy revenue through broadcasting rights. Even when you combine total club revenues in both leagues (which comes to €27.6m), it is outmuscled by Cyprus (€46m), and countries like Belarus (€35m) and Slovakia (€30m).

But the stand-out concern around Irish football is that there is little or no broadcasting revenue coming into the game, and that there are clear challenges around clubs improving their ability to attract commercial revenue. In England and Italy, half of a top-flight club's revenue comes from broadcasting rights. Other countries like Romania and Turkey also do very well in this area.

At a time when football across Europe is being bankrolled through clubs' ability to earn the maximum from supporters and excite interest from television audiences, Ireland is heading in the opposite direction. Sure the League of Ireland is far from a glamorous product, but it must be worrying that it is of so little interest to Irish football fans. Which perhaps tells us that clubs are still not moving with the times and that the game here has stalled.

The efforts of Dundalk and Cork City in particular show that there is a way forward, yet so many of the League's traditional problems remain entrenched in a culture of stagnation and ultimately, you have to think, many clubs will simply run out of road. It's time to look across Europe and plot a proper route forward.

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