FOOTBALL NEEDS SAVING – OR DOES IT?
Premier League Largesse?
The top 8 Premier League football clubs are owned by individuals or States for whom they are rich man’s toys or trophy assets. All or nearly all Premier league football clubs pay wages to their leading players beyond the wildest dreams of the average UK citizen. A considerable number are paid tens of thousands a week; some in excess of £100,000, and in the crazy corner players such as Gareth Bale £600,000 a week, which with much publicity is being met by Real Madrid and Tottenham to whom he is on loan. Premier League clubs have, in the recent transfer season, spent over £1 billion buying players. These clubs receive the vast majority of their revenue from sources such as sponsorship or television rather than “gate receipts” on match days. An article in the Times of 24 September showed what a small percentage depends on the gate.
Against this background, that Times article reported that, while matches occur in fan-empty stadiums, Premier league clubs will be seeking ways for fans who are watching games on television, other than paid for Sky or BT, to pay for the privilege and so bolster the clubs’ revenues. Of course, so many of those fans will not be high earners, perhaps even in fear of losing their jobs in the Covid-19 (CV) economic tragedies. But their passion for their football club is for many like blood through the veins, football providing a positive outlet, an important valve when people are oppressed by the uncertainty, and possibly reduced income, created by CV.
That Premier League clubs wish to squeeze as much cash as they can from fans at this time may seem at least a bit hard-hearted, even morally questionable, demonstrating a certain attitude of disdain for the supporters. Is it not a bit surprising that the footballers, whose eye-watering wages, even during lockdown, make them among the richest in the country, have not instead volunteered to bear some pain and redirect some of their wages towards the wallets of the fans who they purport to love? Or maybe the club owners could take some pain while playing with their toys.
English Football League
The EFL comprises 3 divisions and 72 professional football clubs, in towns largely across the country. In many of those towns the club is an essential focal point of local loyalty, again a major passion for the local populace. Many of these clubs are concerned for the future and, if matches continue to be played behind closed doors, suggest they may go under. They argue for support packages from the UK Government (UKGOV) and the Premier League. While it sees no reason to prop up the EFL, the Premier league may put up £25 million, but the EFL wants £250 million.
But UKGOV clearly cannot bail out every business or industry, including sports, but rather it has to prioritise, focussed mainly on saving viable businesses which will contribute materially to the UK’s growth. The question is whether the EFL is more vital than other sectors? The clubs are arguably very important for local morale. But is it essential for them to be professional clubs, as opposed to amateur? Football is only a sport, or is it? Life and death and then there is football? Matches can be watched without all the expense of paying players. Difficult choices lie ahead as, unless there is a major change, there will be few if any fans allowed at matches for some time to come. Would it matter that much if some clubs turned amateur?
LONDON IS IN AN ICU, WITH A SERIOUS SHORTAGE OF STAFF AND REMEDIES
Before the pandemic, London was perhaps the leading all-round city in the world: perhaps the most diverse (despite the recently publicised observations of Prince Harry to the opposite); a top cultural and entertainment centre, possibly the world’s leading financial centre, and a magnetic haven for people from around the world, whether investors, tourists, entrepreneurs or leading corporations, or just people searching for a fair opportunity. London was and remains the beating heart of the UK. Luke Johnson wrote a brief article in the Sunday Times of 27 September entitled “London’s burning. Who will douse the flames?” he cites various facts to illustrate London’s importance to the UK, such as “London generates as much tax as the next 37 largest cities combined.” Also, leadership in technology will, many think, be key to the UK’s future. London is the entrepreneurial centre of technology development for the UK and leads Europe. Will the UK risk squandering London, its crown jewel?
Take the City of London, the old Square Mile, and include too the Canary Wharf district. It comprises mostly offices. The City is now like a ghost town. The hundreds of thousands of regular commuters are now encouraged by UKGOV again to work from home “if they can”. Some employers are embracing homeworking as a new acceptable option, if not for all the people all of the time, at least for part of their working week. If the City remains a working people void for too long, businesses and infrastructure which support it and yet depend on it, for which the commuter is the life blood, will disappear with significant consequences.
That, combined with the lack of tourists, could spell the end in London for many of its wonderful, and not so wonderful, leisure and entertainment venues, as well as the hotel industry. How many theatres will survive, unless wealthy individuals decide to support them as trophies or legacies? The transport system is barely operating at one third of capacity but needs to be preserved. Individual businesses, including some large concerns in the City, must look after their own interests, which is right. That will include their employees and the environments of which they are part. Perhaps many will come to realise that in order for their employees to develop and thrive, and so for the business to succeed, employees will eventually have to return to an office. These businesses, and property owners and landlords, will find ways to make their offices safe for CV purposes, and many will have done so already. They must not leave their decisions too late from a London perspective.
In addition, foreign tourists and businesspeople need to be coming to London. Making that attractive and practical should be a prioritised project. It is encouraging to read in news in early October that testing for CV at airports may be sanctioned soon, at least to get quarantine periods down. But, as things stand, visiting London is a challenging option. These potential visitors may be getting accustomed to going elsewhere.
If London remains a ghost town and ceases to be a thriving world leading city, the UK will be devastated. Yet, as Luke Johnson observes, nobody is championing London or the City: “The Mayor of London, Sadiq khan, is wholly unfit for office even during normal times. Given the current crisis, his occupancy of City Hall is a travesty…. he and local councils are busy virtue signalling by introducing cycle lanes, while the city they are meant to be governing is metaphysically on fire”. Where is the voice of the Lord Mayor of London, the supposed mouthpiece of City commerce and development? Not a word from him. Where are the panels of business leaders, whether retail, hospitality, financial services, or professions such as lawyers and accountants, shouting out for the London they rely on? And there seem to be no organised residents’ voices either? Some champions are desperately needed: business leaders and local authority leaders need to work in combination. Forget party politics, but instead London MPs are silent. Meanwhile Sadiq Khan calls for London lockdowns – London’s health system has capacity for CV cases while also being open to treat non-Covid patients; why does he wish to deal death blows to the city he is supposed to nurture?
UKGOV perhaps should have a clear strategy for London, or is it concerned with the risk of criticism of looking after the South not the North? Perhaps, UKGOV cannot afford to bail out London, in which case London commerce should perhaps be exploring ways to do that itself? At the moment, the lack of an organised campaign and voices to construct a plan may mean one will never emerge, and London will burn until someone wakes up. For the sake of the whole of the UK, London needs to start a rapid revitalisation, and maybe one thing is certain – that it is more important than the English Football League, which has no shortage of champions.
ECONOMIC FORECASTING – A CLIMATE OF CONFIDENCE IS EVERYBODY’S RESPONSIBILITY
A headline of the Times of 1 October reads “Don’t talk economy into a catastrophe pleads Bank expert” – the expert being Andy Haldane, Chief Economist at the Bank of England. He said, “My concern at present is that good news on the economy is being crowded out by fears about the future.” He recognised that there is bad economic news, but there is also good, in terms of for example consumer savings and the rebound generally such as in retail. Although of course unquantifiable risks still exist – such as CV, unemployment in sectors like hospitality, and a Brexit trade deal or lack of one.
As always, economists and other forecasters vary enormously in their predictions, and their solutions! Some, such as Simon Nixon in the Times, remain driven it seems by their dislike of Brexit and/or UKGOV led by Boris Johnson or of Boris Johnson himself. So, their writings reflect that “Business is about to be thrown under the bus by ill-thought out Brexit deal.” His message is a criticism of an underprepared UKGOV and underprepared UK, and that there seems no strategy for the UK to be attractive to investment after 2020. He cites no pluses whatsoever. And the Brexit deal is not yet publicised or even done.
At least one economic commentator in the Sunday Telegraph forecasts unemployment of 12% at the year end, and the Daily Telegraph of 1 October referred to 7.5%. It will be regrettably high but there is no consensus. Jeremy Warner on 30 September bemoans UKGOV incompetence. David Smith of the Sunday Times of 27 September recognised an economic rebound but not matched by consumer confidence, and on 1 October observed the potential of a comeback given the amount Britons have saved during the pandemic – if they choose to spend it, they will give the economy a kick. Andy Haldane highlighted consumer savings as a plus. The savings ratio is normally between 5% and 10% of disposable income. In the second quarter of 2020 it was about 30%. GDP is not far behind pre pandemic levels, according to Andy Haldane.
As reported in Sherbhert, see https://sherbhert.com/covid-is-not-an-existential-threat-so-why-trash-the-economy/ the much predicted cliff edge when furlough finishes at the end of October should, most think, be avoided due to UKGOV recently announced support measures and certain continuing measures, though unemployment will go up (but nobody knows by how much and for how long). That is the big point perhaps: the uncertainty around how CV will develop and its impact is matched by considerable uncertainty over economic outcomes. Confidence is key. Uncertainty can destroy confidence, or economists and others can work to ensure confidence is built up, without creating false dawns. Even where a forecaster genuinely is pessimistic for good reasons, the potential upside needs to be recognised if certain conditions are met. The media propensity to focus on what is failing needs to have the brakes applied: if CV is kept within limits as seems to be happening, albeit with some restrictions on liberty in place for now; if a Brexit deal materialises; and if the rebound continues rather than stalls, the longer term prospects for the UK may be more positive than many dare now contemplate. At least perhaps the media commentators can listen to Andy Haldane’s plea and not talk the UK economy into catastrophe.
