Newcastle United could potentially be in line for £27m of compensation following Manchester City’s financial-rule verdict, if their appeal fails of course.
Don’t get me wrong, by no means do I believe that anybody involved with Newcastle United would turn their nose up at that sum…
But the more time you spend mulling over whether it’s an acceptable compensation, the more questions begin to arise around whether that figure actually comes close to being enough.
£27m sounds nice… but hold on
It’s worth making explicit that Newcastle aren’t owed £27m at present, that is simply an estimation of what they may have lost in merit payments during the period in which Man City were found guilty of breaking the rules.
That sum is part of a wider £500m figure across the Premier League, which accounts for financial rewards like prize money.
But, that sort of monetary gain isn’t the only thing a club gains from finishing higher in the Premier League or getting the privilege of a European campaign, which raises an interesting question about just how much the Magpies have actually lost due to City’s alleged cheating.
Newcastle competing, City cheating (allegedly…)
Obviously, Newcastle United were competing against Manchester City during the period they broke the rules.
Of those seasons, the Manchester club finished higher than the Magpies in a big chunk of them, meaning Newcastle potentially missed out on far more than just the payments attached to their final league position.
Finishing higher can bring increased commercial revenue, European qualification, greater recruitment appeal and a whole host of other benefits that aren’t necessarily captured by prize money alone.
If there was a calculation to estimate the encompassing loss of all those areas, it would probably amount to a much larger fee than anything the £27m represents.
But City’s rule breaches were occurring before Newcastle United’s takeover ever happened and, if we are being frank, there’s even a pretty valid argument that City’s cheating has impacted the Magpies even right up until today.
The takeover hangover
Under PIF, the Magpies have obviously had to adhere to all of the financial rules that are in place, some of which have been rather crippling in terms of stifling the progress that could have been made otherwise.
Part of that issue has been that Newcastle’s revenue, which is the metric that has the most bearing on their ability to catch up with the established elite, is simply not even close to the standard of the ‘big 6’, including Man City who grew theirs artificially according to the verdict.
Now, nobody can say with any certainty what would have happened had Manchester City not gained that advantage. Perhaps Newcastle’s commercial growth would have been exactly the same. Perhaps it wouldn’t.
But it is impossible to ignore the possibility that a less dominant Manchester City could have created more space for other clubs to compete, and Newcastle are one of those clubs who are now trying to break into that upper echelon.
So would £27m be enough?
In short, no.
Not because the sum isn’t a hefty amount of money, it absolutely is and would make a significant difference to the Magpies’ balance sheet. But because there are so many other things that the £27m simply doesn’t account for.
Unfortunately, those extra things would be exceptionally difficult to calculate as they are largely hypothetical, but that doesn’t mean we should all simply accept that the amount makes everything even.
And, if Manchester City’s appeal ultimately fails, there is no doubt that Newcastle United have lost more than simply a bit of Premier League prize money, as is the case with every other Premier League club too, might I add.
You can put a price on lost money, but putting one on lost opportunity is a whole different ball game. And that is the issue that the £27m figure doesn’t account for.
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