Thursday, August 07, 2008

Football League Trapdoor Slams Shut (almost)

Football League Two teams will be breathing a sigh of relief after the trapdoor to the Football Conference prematurely slammed (almost) shut – i.e. before the football season has even started. Luton Town will start the 2008/9 season on Saturday at home against Port Vale, but with a 30-point disadvantage after the Football League imposed a further 20-point deduction for failing to agree a Company Voluntary Arrangement (CVA) with creditors to add to its 10-point deduction for going into administration in the first place.

Rotherham United have now joined Luton at the foot of the Football League after the club failed to agree a CVA with its creditors. A new company applied to the Football League to replace the old club and the Football League has exercised its ‘absolute discretion under the exceptional circumstances of its insolvency policy’ to allow this to take place, as long as the club accepts a 17-point deduction and pays a £750,000 bond pledging to return to Rotherham within four years (the new club will start its season against Lincoln City at Sheffield’s Don Valley Stadium).

While there is some optimism from Rotherham’s new owners (and Leeds United’s position at the end of last season proves that deductions can be overcome), the deductions will be welcomed by the rest of the Football League Two clubs, who fear the traditional dogfight to avoid the two relegation spots to the Conference, which now appear filled.

However, these cases illustrate that the Insolvency Policy of the Football League appears to punish the club, its new owners and its fans, rather than those who have caused the damage through financial mismanagement (for example, Peter Ridsdale is now Chairman of Cardiff City, while Leeds United languish in League One, after points deductions following his exit). This is an area that the Football League needs to re-examine.

Andy Brown

 


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