Aston Villa have £140m problem as Premier League decide future of PSR

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Adam Williams – Head of Football Finance and Governance Content for GRV Media – has now shared a financial update on Aston Villa.

The Villans have been living dangerously in recent times, with a wages-to-revenue ratio of 91% for the financial year of 2024 a sign of poor financial management at Villa Park.

Aston Villa have managed to avoid any points deductions in the Premier League, but Adam Williams has now explained the £140m problem hanging over the head of Unai Emery.

Exclusive: Aston Villa have work to do as PSR set to adopt model closer to UEFA

The Head of Football Finance and Governance Content for GRV Media told TBR Football: “It has been the worst-kept secret in football finance for some time now, but the Premier League is going to move away from PSR towards a system that looks more like UEFA’s Squad Cost Ratio rules. Under PSR, you’re not allowed to lose any more than £105m over a rolling three-year period, with allowable expenses like academy and infrastructure investment exempt from that calculation.

“Per their last few sets of accounts, Villa are losing in the region of £140m at the operating level every single year. Even with European income and PSR-exempt costs, that’s a big shortfall you have to make up to comply with PSR.

“Under UEFA’s system – which the Premier League intends to mirror – you’re not allowed to spend more than 70% of annual turnover plus a three-year average on player sale profits on wages and transfer-associated costs. The Premier League’s proposed system is an 85% cap that follows the same principle.

“Will Villa be better or worse off under this new system? It’s hard to say, not least because we don’t have access to their most recent financials and won’t do until the spring. However, I think that’s largely immaterial because, for as long as Villa are playing in Europe, they have to get within UEFA’s 70% limit anyway. And, while there is a bit more flex under the European system, repeat offenders are going to be hit with financial and sporting sanctions.

“The problem at a macro level for Villa isn’t what they spend, it’s what they earn. If the Premier League and UEFA distributed money more evenly, Villa would have more headroom under PSR and wouldn’t be as prohibited by it. And while that doesn’t account for the vastly bigger commercial and matchday income that the ‘Big Six’ generate, the NFL and NBA have got around that problem with revenue-sharing systems that ensure competitive balance.

“I just don’t see how football can ever get to that sort of position, though. Everyone operates in self-interest, including Villa. And the Big Six aren’t going to give up revenue that they understandably feel belongs to them. As long as that culture remains, Villa are always going to be subordinate to the real predators at the top of the English and European football food chain.

Aston Villa have potential £12.9m UEFA charge hanging over them

Unlike in the Premier League – where Nottingham Forest were docked four points back in May 2024 for overspending – UEFA operates differently, negotiating settlements with those who have breached their financial rules.

Aston Villa were found guilty of breaching UEFA’s SCR (squad cost ratio rules) for the 2023/24 campaign.

After talks with UEFA, it was decided that the Villans would pay a £9.5m fine, with a further £12.9m to come if Aston Villa failed to comply with financial rules across the next three years.

Evidently, there is still work to do at Villa Park to make the financial situation a bit more manageable.