So, we’ve all got an opinion of Daniel Levy’s decision to furlough non-playing staff at Tottenham Hotspur, so I may as well vent mine.
Writer: Loz
First, I think we have to say that profits don’t amount to cash available. So the profit we made and what cash is available to pay players and non-playing staff and our other commitments, are two different things. Cash flow can be problematic in the short term and possibly long term, I think we need to understand that. So Levy has had to look at available cash and see what has to be paid.
Players as are contracted and he cannot break those contracts, and secondly, he cannot get Government help in their wages. Then the debt payments have to be paid otherwise we get severe penalties. Then he has to estimate how long this is likely to continue and see what cash flow he has, nothing to do with profit. It’s worth noting here, he has said this before, there is not a lot of liquidity available as most of the profit is tied up in assets, and transfers of players is always on a basis of what we old folk call ‘tick’ not cash.
As for getting 80% paid by the Government, well, while it seems bad it, isn’t as bad as it is being out to be. 550 workers some of them on higher wages, like scouting, trainers, admin, all sorts of workers, its not just the catering staff, so the cost to the club will be immense. But I would think its more about cash flow.
So the next argument is players contributing. Firstly Levy cannot stick around waiting for the players to decide. Every day without revenue has major implications on cash flow and on the club long term. The players knew the impact weeks ago, and nothing came up. They knew as Italian clubs took cuts etc so they had every opportunity to speak up and offer help. What was Levy suppose to do, sit and wait? Secondly, the problem with players helping out, do they all want to help the club, I’m not sure. Maybe many of them prefer to help the NHS directly? Either way, Levy had to act according to his cash flow and the long term impact it would have on the pitch. Let’s get it into perspective about asking the Government for 80%. A well known superstore is about to go into administration if things don’t improve very soon. That tells you about how companies are struggling regardless of profit, its about cashflow, available cash.
The next argument is our owner. Well until now, owner’s are not able to put money in due to Financial Fair Play, although I believe they are relaxing that so owners can now help out. Levy took the action before that was relaxed and I’m not sure if it’s been relaxed yet or only talked about.
Many large companies will be asking for Government help with the 80% but it won’t be publicised, but because it’s football it’s gone public. My guess is big companies will be using the Government scheme because at the end of the day, it’s about cash, but also about protecting their companies. Have MPs taken pay cuts? From a business point of view Levy is not prepared to lose out and why should he. The Government have neglected this country for a long time and they will stand after this, but businesses will fold and struggle, and businesses like football clubs who have worked their socks off to build themselves up will not see why they should lose out when it’s not their fault. It could be argued that the spread of this virus might not have been so bad had the Government had acted faster.
While it sucks that Levy has cut non-playing staff wages by 20% and used the Government scheme while players are being paid so much, and him as well, I think we have to try and see all sides and why he chose that way. Levy to me is always helping the community so he isn’t tight. He is a businessman who does what he feels is right for the club to stay viable and we have to trust him now – he is the expert. We moan he hasn’t a clue when it comes to on-field matters but don’t insult his intelligence when it comes to business, he hasn’t got to where he is without being very good and now we are moaning he is going the wrong way about it. I think he knows what he is doing even if it isn’t popular. I seriously think it’s about cash flow and availability and not hanging around waiting for others, like players, to decide if they want to help. Timing in business is crucial and he has been proactive.
I trust Levy when it comes to his decisions with regards to business and it is the right thing to do now. Those taking a 20% cut aren’t likely to be hit too hard if they are on low wage as most will be on Universal Credit and they will just get it topped up. Some might not be on UC but I bet a lot will be if wages are low. Those on a higher wage, a 20% cut won’t matter that much.
Every penny Levy saves will serve the club during and after this pandemic. I bet those who are moaning about what he has done will be those who will be banging on about spending on transfers in summer. The revenue Levy was expecting, not just from football but other stadium events, is a huge loss and it has to be clawed back and not added to by paying staff who are not working. Its perfect business sense even if it feel wrong. But the bottom line is people are looking at profit and not cash.
I think the players will give but I get a sense they want to help the NHS and I get that, but then again, it could be argued that the NHS shouldn’t be in this position, this Government austerity has crippled thems. Also, players might feel why help the club they got wealthy owners. The point is there are always different perspectives. Why should clubs be out of pocket when it’s not their doing. Why should players be out of pocket, when the Government has failed them for years. Everyone will have a perspective and different feelings.
I think no matter what Levy does he will always get jumped on. Yet he is generous and helps the community and let’s face it, while he gets slaughtered for not paying higher wages, every footballer is overpaid. Football is an emotional sport and it brings the worst out of people at times. Levy can’t win whatever he does.
I’m not saying I agree with what Levy has done. I don’t agree or disagree but what I try and do is have trust in Levy’s decisions in as much as he is doing what his expertise thinks is right for the future of the club. Morally and ethically is another question, but I don’t buy into Levy being a bad person or a tight person. He is a good guy from what I see.
This pandemic is a mess. It’s a roller coaster and it’s devastating for many who have lost loved ones and it’s also crippling business and their livelihoods. So stay safe and be kind and follow the rules of the Government to stop the spread and let’s pray we come through this sooner rather than later.
Will anyone be made accountable for this pandemic? Probably not.
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