Premier League to Vote Next Week on £1.5 Billion 'New Deal' for Lower-League Clubs

July 25, HUPU — Sky News has exclusively reported that top English football clubs are preparing to vote next week on a landmark ten-year agreement aimed at providing approximately £1.5 billion in additional funding to lower-league teams. Parties are striving to reach a binding deal within weeks.

Key Details of the Proposed Agreement

Sky News has exclusively obtained details of the latest version of this agreement, known as the "New Deal," which has been discussed intermittently for over three years among various decision-making levels in English football.

Over the weekend, it was revealed that several clubs — including new Premier League champions Arsenal, Aston Villa, Manchester United, and Sunderland — plan to meet next Thursday to vote on the agreement. The deal aims to establish a long-term framework to solidify the financial sustainability of professional English football.

Proposed Financial Mechanisms

Key details of the proposed agreement, whose outline has been submitted to the English Football League (EFL) board and the Independent Football Regulator (IFR), include:

• A proposal to increase the Premier League transfer levy from 4% to 6%, with the additional funds forming part of the "New Deal" payments.
• For example, Chelsea recently paid £117 million for Aston Villa and England midfielder Morgan Rogers; under the new framework, the fee would rise from £4.68 million to £7.02 million.

According to the proposal, most of the "New Deal" funding will be borne by clubs, with the allocation ratio based on the approximately 1.7:1 to 1.8:1 revenue ratio used by the Premier League when distributing some broadcast revenue.

If the plan is approved, clubs such as Arsenal, Chelsea, and Manchester City will become the main contributors to the "New Deal" funds.

Voting and Approval Process

If a vote takes place next week, the resolution will require majority support from 14 clubs to pass. Subsequently, the agreement will be formally submitted to the EFL.

However, further discussions will take place in the coming days, so it is uncertain whether the formal vote will proceed as scheduled on Thursday.

Payment Structure

Although the total value of the proposed ten-year agreement was unclear as of Saturday, sources indicate that it involves a tiered payment plan:

• Payments could begin as early as the upcoming 2026-27 season if agreed in time.
• First-year payments may be below £100 million.
• Second-year payments: over £130 million.
• Third-year payments: approximately £160 million.
• Payments would remain at that level for the remaining seven years of the agreement.

This would bring the total over ten years to around £1 billion. However, insiders caution that these figures have not been confirmed and, given the intense negotiations, the final terms may differ significantly.

Additional Key Elements

Over the weekend, a source close to the EFL described some proposed terms as "unsatisfactory" but declined to elaborate on specific objections.

It is understood that other key elements of the "New Deal" include:

• Gradually reducing "parachute payments" (three-year grants from the Premier League to relegated clubs).
• Establishing a £20 million "lifeboat fund" to assist EFL clubs entering administration.
• Requiring that 20% of the funds received by EFL clubs under the deal must be invested in infrastructure, to reduce the likelihood of the money "passing through" club accounts and ending up as player transfer fees and wages.

Background and Regulatory Context

Sky News reported last month that Premier League clubs had authorized CEO Richard Masters to negotiate the agreement with the EFL over the summer.

A football industry source not involved in the talks said the agreement was conceived "with both the EFL's interests and the regulator's position in mind."

The Independent Football Regulator (IFR), led by Chairman David Cogan and CEO Richard Monks, has repeatedly expressed a desire to reach an agreement as soon as possible. Under the legislation that provides its legal basis, the regulator has a "backstop" power to force the Premier League and EFL to implement a financial redistribution agreement.

Cogan has stated that if the IFR is forced to intervene and impose a deal, it would reflect a "complete failure" of decision-making in English football.

Speaking at an industry conference earlier this year, he said: "Looking ahead, it is in everyone's interest for football parties to work towards consensus. But if the leagues cannot reach a new agreement, the regulator will use these powers, and we will then examine issues such as the current 'relegation compensation' mechanism."

Timeline and Broader Implications

According to sources, the Premier League aims to reach an agreement by the end of August, before the IFR's initial draft of the "State of Football Report" — due in the autumn — is released. This review will assess changes in financial flows within football, including "cliff-edge" financial disparities between or within leagues.

If a bilateral agreement is reached, it will be one of the most significant milestones in English football since the formation of the Premier League in the early 1990s.

Negotiations on this latest version of the agreement come as the Premier League introduces a new financial model for clubs called the "Squad Cost Ratio," which caps club spending on football-related activities at 85% of the sum of "football-related revenue" and "net player transfer profit/loss." The new agreement may also require Championship clubs to transition to the same financial framework.

Over the weekend, the Premier League, EFL, and IFR all declined to comment.

Source: Sky Sports