Premier League Clubs Back New Spending Cap; Manchester City, United, and Aston Villa Dissent

The Premier League clubs have agreed in principle to a new overall spending cap to be implemented in future seasons, despite resistance from three clubs. Sixteen clubs gave a thumbs-up to the guidelines, Chelsea decided to abstain, while the votes against came from Manchester City, Manchester United, and Aston Villa.

The plan incorporates an “anchoring” or “tethering” concept, where clubs' outflows on salary, transfers, and agents' fees will be tied to the broadcast revenue received by the league’s lower-ranking clubs. Effectively, this measure will put a hard cap on clubs' outlays in these areas.

The proposal aims to curb the expanding financial disparity between the league's top-tier and bottom-tier clubs. It implies that wealthier clubs will not gain additional spending power from lucrative sponsorship deals if their income already exceeds the anchored amount linked to the least affluent sides.

The clubs have agreed to replace the current Profitability and Sustainability Rules (PSR) by 2025-26. The new cost controls will restrict club expenditure on salaries, contracts and fees to 85% of total revenue.

The Premier League AGM in June necessitates agreement from at least 14 of the 20 clubs for a proposal to be passed. The football world awaits further developments following this significant decision by the Premier League.