Lord Sugar Lifts the Lid on Crazy World of Football Finance13:16 - Tuesday 10 May 2011 - In Categories Sport, UK Videos
On Sunday, celebrity tycoon and former Tottenham Hotspur chairman Lord Sugar presented an exhilarating documentary exploring the reasons why collectively England’s Premier League football clubs owe more than £3 billion, writes insolvency and business rescue expert Peter Murray.
His findings support what we’ve been saying for months on our blog: the legislation surrounding football bankruptcy must be changed if the game is to survive.
Recently, Premier League head Richard Scudamore attempted to defend the football creditors’ rule, following a lawsuit filed by Her Majesty’s Revenue and Customs (HMRC).
The taxman, quite correctly, says the rule on paying soccer creditors first is ‘unfair, unlawful and unacceptable.’
However Scudamore insists the directive is necessary to prevent one team’s financial problems from destabilizing the entire league.
He said: ‘We will defend it on the basis of the chaos that will ensue if we don’t have it. We are a closed system: we trade on a closed basis between each other.
‘The idea you would put an administrative blockage of a due diligence; it’s a place we just wouldn’t want to go.’
His comments highlight just how manifestly unjust the football creditors’ rule is.
Nowhere in either the Enterprise Act 2002 or the Insolvency Act 1986 does it state that football clubs should receive special protection, so it’s laughable this issue has found its way so far to the high court.
Apparently, Sir Alan agrees. Click here and watch him explain why on Lord Sugar Tackles Football, until Wednesday 18th May.