More money for Championship clubs?

[silent majority]

It appears that the penny has finally dropped and the PL could hand out more money to the FL and cut the parachute payments that are currently paid out.This means the relegated teams from the PL may not go straight back up;



More cash for football clubs
Tuesday, 16th March 2010
SPORT FINANCE
STEVE DINNEEN
THE Premier League is planning a radical shake-up of its funding for the lower leagues in a bid to help stop clubs hitting the financial rocks.

Portsmouth’s woes have dominated the headlines but it is the plight of Championship sides without bumper Premier League revenues that is troubling analysts.

Now sources close to the matter say the Premier League could double the “solidarity payments” handed to each club in the three lower leagues at the end of a season.

The payments currently total between £14m and £50m, depending on how much is awarded in parachute payments to relegated Premier League teams. They are heavily weighted towards the Championship.

But the football body wants to look at ways to make the system fairer for smaller clubs at risk of sliding into administration.

Parachute payments, designed to cushion the fall from the top flight, are paid out over two years but if a club is relegated and promoted in successive seasons it does not qualify for the £12m and it is distributed to other clubs. In some seasons this means there is an extra £36m up for grabs. The shake-up could also see parachute payments cut. There has been criticism that they can give relegated teams an advantage.

The move would be welcomed by lower league clubs where there is pressure to compete for promotion but nowhere near the revenues seen at the bigger teams. Premier League clubs collect between £20m and £40m a year from the league.

Teams in financial dire-straights include Cardiff, Southend and Crystal Palace. However, the Premier League ruled out paying parachute money in a lump sum to clubs in financial trouble like Portsmouth.