Queens Park Rangers are on course to be hit with the biggest fine in British football history, which, in a worse-case scenario, could top £60 million.
Ironically, it will be imposed because of the amount of money they are losing — believed to be a huge £80m for last season — and will compound their financial troubles, perhaps sparking meltdown.
They have racked up big debts and massive annual losses largely through signing dozens of players on huge contracts in recent seasons, including Chris Samba, Park Ji-Sung, Julio Cesar, Jermaine Jenas, Loic Remy and others, most of whom remain on the club’s books, draining their resources with contracts worth up to £100,000 a week.
If QPR are promoted this season, the fine will be levied in January 2015 by the Football League under their new Financial Fair Play (FFP) rules, which will see overspending clubs ‘taxed’ on their losses. Rangers are currently favourites to go up to the Premier League from the Championship this season. They could avoid a fine — or at least postpone it — if they fail to get promoted. In that case, they will be hit with a lengthy transfer embargo.
The mathematics are complicated, but in broad terms, Championship clubs will pay a £1 fine for every £1 they lose over £18m in the 2013-14 financial year.
Short stay: Chris Samba Spent six months at QPR to July 2013 on £100,000 a week. His 10 Premier League games cost £2.5m in wages
Sources familiar with QPR’s financial situation have told The Mail on Sunday that the club will post losses for 2012-13 of about £80m. The club are not obliged to publish those accounts until next spring and have declined to comment.
Rangers are two-thirds owned by Malaysian businessman Tony Fernandes and one-third by the Mittal family. Fernandes’s majority shareholding gives him ultimate power and it is he who sanctioned the hiring of Mark Hughes and then Harry Redknapp, allowing both to sign large groups of players.
It is expected that the club will record another massive deficit for the current season, and it is the losses in 2013-14 that will be measured to calculate any fine.
If QPR’s losses for the season are £80m, the fine will be about £62m. That would equate to roughly all of QPR’s Premier League income (if they are promoted) for next season. Even if 2013-14 losses are as ‘low’ as £60m, a fine of more than £40m would follow.
‘This is the first season in which clubs will ultimately face sanctions [for over-spending],’ a Football League spokesman told The Mail on Sunday. ‘Clubs have to submit their accounts for 2013-14 to us by December 1, 2014, with sanctions levied early in 2015. If a club being sanctioned are in the Premier League by then, the fine will need to be paid.’
QPR’s accounts for 2012-13, in which they were relegated from the Premier League, have not been made public, nor will the club confirm when they will be. Asked to comment on their expected losses last season and this season, and on the potentially destructive fines, a Loftus Road spokesman said: ‘The club will be making no comment on [these] matters at this time.’
Expensive hands: Julio Cesar signed from Inter Milan on four-year deal in summer 2012. Out of favour now, but earning £90,000 a week
The Mail on Sunday can reveal that the Football League plan to donate fines levied under their FFP rules to charity. It had previously been expected that fines paid by overspending clubs would be shared among clubs who stayed within the rules and did not lose huge amounts while trying to ‘buy’ success. But a senior FL source says giving the fines to charity is now the preferred option ‘for a number of political reasons’.
The last publicly available accounts for QPR relate to the 2011-12 season, when they made a loss of £22.6m, had debts of £89m and a wage bill that had almost doubled year-on-year from £29.7m to £58.4m.
Park Ji-Sung moved from Manchester United in July 2012 for £2m. Now on loan at PSV with QPR paying most of his £70,000-a-week wage
That huge wage bill was before they signed high-earning players like Samba, Park, Rob Green, Junior Hoilett, Ryan Nelsen, Jose Bosingwa, Julio Cesar, Stephane Mbia, Remy and Jenas.
The wage bill for QPR’s relegation season is expected to be about £90m, or, by itself, about 150 per cent of the club’s total income of about £65m. A ‘sensible’ wage ratio is closer to 50 per cent of turnover. They have cut some costs since last season, releasing or selling 11 players in the summer including Samba, Bosingwa and Anton Ferdinand.
But they also signed eight new players on permanent deals and loaned three others including Benoit Assou-Ekotto from Tottenham and Niko Kranjcar from Dynamo Kiev.
QPR’s income will also have plunged between last season in the Premier League and this season in the Championship, largely through reduction in TV money.
