The sorry state of FC Barcelona’s remains one of the biggest stories in world football.
With rumours flying about Barcelona trying to sign anyone and everyone, from Borussia Dortmund’s Erling Haaland to “apparently-every-guy-Bayern-is-interested in,” Bayern Munich fans have been left wondering just where is Barcelona getting the money to do all of these deals?
The financial experts at La Liga are wondering the same thing.
While UEFA’s Financial Fair Play system remains effectively suspended while it is redesigned for a post-pandemic world, La Liga’s financial restrictions remain firmly in place and yesterday they announced the spending caps available for each team.
Barcelona’s financial wizardry has left them with a spending cap of -144 million euros.
Yes, you are reading that right: FC Barcelona’s spending cap is NEGATIVE one hundred and forty-four million euros. That is a drop of over 200 million euros from their spending cap for last year of 98 million euros. For comparison, Real Madrid’s spending cap will be 739 million euros.
The reason for this tragically low cap is that Barca continues to operate with historic losses and, in fact, their losses were 242 million euros more than anticipated for last season. Those staggering losses show that not only can their management team not run a fiscally sound club, but they are unable to even understand just how badly their own choices are harming them. The level of these losses are absolutely stunning when you consider that they removed the world’s most expensive player from their payroll last year. The historically powerful club continues to hemorrhage money at an alarming rate.
Where does this put them in the signing world? How can they spend any money with a negative cap?
La Liga has a special rule to allow clubs to try to remain competitive while their finances are underwater. You can think of it as something like a pity or “football welfare” rule for the most destitute of teams. It invokes a 1:4 ratio for emergencies like this. If you create savings of 10 million euros you are allowed to spend 2.5 million euros. Without a massive influx of new money, thus to pay a projected Haaland salary of say 25 million euros a year, Barca would have to find sayings of 100 million euros. Easy, eh?
Even before they ran themselves into a negative allocation, Barca had to slash savagely to get any deals done. Take for instance, the signing of Ferran Torres in January. In order to get only half of that deal done (it came half way through the year so it only counts half on that year’s allocation) they had to lose promising prospect Yusuf Demir (which worked out very well for SK Rapid Wien), Sergio Aguero had to retire, they had to offload Philippe Coutinho’s massive salary, and get Samuel Umtiti to agree to a significantly restructured contract. Simple enough.
The other solution to Barcelona’s problems of course could lie in generating significant new sources of revenue. They are apparently in talks with Spotify to try and ink some sort of content/broadcasting deal. In addition some of their assets including at least partial ownership in one of their content companies, Barca Creative, are thought to be up for sale. The team is even considering joining in the financing program that the league has created through CVC, which they were initially vehemently opposed to.
La Liga’s director general Javier Gomez was asked directly about the possibility of a Haaland-to-Barcelona deal at the announcement on Monday and responded: “To make signings, Barcelona have to reduce the costs they have now or bring in more income. There’s no other way. Barcelona’s losses are greater than their capacity to bring in income. That’s why [the spending limit] is negative.”
At this point, Barcelona’s signing and registering of Haaland would seem to be a very tough mountain to climb.