The atmosphere within St James’ Park has a fresh sense of urgency, driven by the new CEO, David Hopkinson, who is actively fostering a “relentless” culture focused on continuous improvement.
The new rallying cry across all operations is simple: revenue is king. Newcastle United has kicked off a comprehensive 100-day review of all off-field activities, sending a clear, simple message to staff: secure those deals and stop making excuses.
This aggressive internal drive for commercial success is perfectly timed. Next week, the Premier League is bracing for one of its most pivotal meetings in years, where clubs will vote on what amounts to the most significant shake-up of spending regulations in a decade.
The current Profitability and Sustainability Rules (PSR) are on their last legs, but what will replace them remains a source of intense debate and division. With rumors of clubs being fundamentally split and even potential legal action being threatened by the Professional Footballers Association (PFA), the upcoming vote on November 21st is poised to be an explosive one.
The clubs are being asked to consider three distinct regulatory systems. The first is called the Squad Cost Rules (SCR). This proposal aims to cap a club’s total expenditure on player-related costs specifically, wages, the amortized fees for transfers, and other related recruitment and retention expenses to 85% of its total revenue.
The shift to an SCR-like system is logical because UEFA already enforces a similar model for European competitions. For English clubs involved in Europe, including Newcastle, a stricter 70% limit is already in effect.
The Premier League is offering a slightly more lenient 85% threshold to give aspiring clubs, who naturally generate less revenue and have less spending power than the European regulars, enough flexibility to remain competitive.
According to football finance expert Kieran Maguire, the general consensus is that SCR will pass “fairly comfortably,” but he suggests it won’t be a revolutionary change. He views it as “rearranging the deckchairs on the Titanic, replacing PSR with SCR.”
His analysis is that this new parameter primarily benefits the existing “elite” clubs by helping to solidify their position, meaning he doesn’t foresee any significant short-term advantage for ambitious, upwardly mobile clubs such as Aston Villa and Newcastle in moving to this new system.
The second strand of proposed reform is the truly controversial one: Top-to-Bottom Anchoring (TBA). This system proposes a ceiling on the spending of even the league’s wealthiest clubs.
The limit would restrict their outlay to five times the amount of broadcast revenue and prize money earned by the club finishing last in the Premier League. Supporters of anchoring argue it is essential for maintaining the competitive balance of the league, especially given that the top clubs earn huge windfalls from regular Champions League participation and the future, expanded Club World Cup.
However, critics are vocal, arguing that anchoring will ultimately stifle the ability of the biggest Premier League clubs to compete financially with major European rivals like Real Madrid. Furthermore, the PFA has threatened legal action, fearing that this spending cap could negatively depress player wages across the board.
Maguire readily admits that “Anchoring is going to prove more contentious.” He points out that some smaller clubs worry the continued global growth of the established giants will lead to them accumulating greater matchday and commercial revenue, and anchoring disregards this growth.
He anticipates strong opposition from clubs like Manchester United, Manchester City, and Liverpool, asking, “Why would you agree to a set of rules which means you can generate revenue but can’t spend it?”
The third, less-detailed proposal relates to general sustainability and is expected to be closely linked to the introduction of the new independent regulator.
Despite the complexities and the widespread contention, The i Paper understands that Newcastle United is prepared to vote in favor of both the SCR and the TBA proposals. For SCR, while the benefits might be marginal in the short term, the club views it as a sensible change, especially since their transfer business this past summer was already conducted with an eye on meeting UEFA’s stricter 70% limit.
As for the controversial TBA, the feeling within the Newcastle boardroom is that if you filter out the surrounding noise, the rule actually introduces a measure of much-needed rationality into the transfer market. Importantly, the club is also confident that they are highly unlikely to breach the proposed anchoring limit anytime in the near future.
The management at Newcastle is taking a philosophical approach to all the regulatory changes. They realize that the new rules, much like the old ones, are not going to simply remove all spending restrictions.
This is precisely why revenue generation has become the club’s “obsession,” fueling the new focus on rapidly finalizing commercial deals and providing stable, long-term support to Eddie Howe as he works to build a winning team on the pitch.
According to Maguire, “The rules are there to prevent the nouveau riche like Newcastle and Aston Villa from competing with the existing rich.”
Newcastle does have certain advantages it can leverage, such as the potential for massively increased corporate income and matchday revenue from a new or expanded stadium. However, this is a long-term project, and the need for growth feels immediate.
Despite some supporter calls for the PIF owners to take a more aggressive stance against the financial rules, the reality is that navigating these regulations will continue to influence spending in the upcoming transfer windows, and no legal challenge is currently being discussed or planned.
