The Premier League plans to implement new financial controls starting from the 2025/26 season. Aston Villa, a club with aspirations, is on the verge of Champions League qualification for the first time since 1982/83, following their recent 3-1 victory over Bournemouth. Under the ownership of V Sports, Villa benefits from significant financial backing. However, despite their ambitions, complying with the Premier League’s profit and sustainability rules (PSR) has been challenging, especially for clubs outside the traditional ‘big six’.
Villa’s heavy investment in the playing side resulted in a pre-tax loss of nearly £120m for the 2022/23 period. Although allowable deductions helped them stay within the PSR limits, their financial position will likely restrict their activity in the upcoming transfer market, despite potential Champions League revenue.
PSR violations have become a concern, with Everton and Nottingham Forest facing penalties, and Leicester City potentially starting with a points deficit if promoted. The PSR will be replaced by UEFA’s squad cost ratio rule next season, with a 70% ratio limit for European competitors and 85% for others.
For Villa, achieving Champions League qualification would signify progress under V Sports’ ownership. However, their lack of regular high revenues compared to the ‘big six’ could still pose challenges in meeting the new regulations.
Football finance expert Kieran Maguire highlighted the potential impact of the squad cost ratio on Premier League clubs, indicating that while the big six are well within the spending constraints, others like Villa face significant challenges, especially in competing for a top-four spot.
Meeting the 70% threshold will be difficult for Villa, given potential additional costs associated with Champions League participation. This puts them in a position where they must navigate regulations more cautiously than their competitors.
Overall, the new regulations are unlikely to level the playing field for clubs like Villa seeking to disrupt the established elite. They may need to rely on improved commercial deals, prize money, or player trading to bridge the gap, as the regulations may not significantly alter the competitive landscape.