Cost-cutting ahead as central funding is slashed for A-League clubs

A-League clubs face significant cost-cutting ahead of their next season after a significant reduction in the funding they receive from leagues’ operators.

The Australian Professional Leagues (APL) have told clubs they’ll receive $530,000 from the organisation’s central distribution for the 2024-25 season, down on A$2 million provided last season.

The income compares with the $3.6 million distribution in 2018 before the league was unbundled from Football Australia, to be run by APL.

Clubs now have to find ways to bridge the shortfall in budgets as they are required to spend a minimum of A$2.25 million on salaries, and not exceed a salary cap of A$2.6 million.

Main photo: APL chair Stephen Conroy … ‘The league ran too fast and spent too much money.’

APL chair Stephen Conroy said the reduction central distribution was anticipated by clubs.

“While clubs are obviously hurting by the size of this reduction, no one gave any indication they have that level of problem in the meeting at all,” Conroy said.

“I can only report to you what they reported to us.

“They obviously weren’t dancing a jig, but no one said ‘right, that’s it, we are shutting the doors’.”

The A-Leagues have been under financial pressure since gaining independence from Football Australia in 2020.

As well as coping with the COVID-19 pandemic, APL has run into problems meeting targets required by broadcaster Network Ten for the broadcast rights which they hold till the end of the 2025-26 season.

APL invested heavily in its KEEP UP website and digital channels, which led to reported losses of more than A$40 million and a significant reduction in services after staff lay-offs late in 2023.

“The league ran too fast and spent too much money,” Conroy said.

“The ability to dip into a capital reserve to fund losses just doesn’t exist.”

Photo credit: Natural Light Photography Company.

Chairman’s statement to A-Leagues fans

Following the news of the reduced central distribution funding, Conroy released a statement addressed to A-Leagues fans:

“Further to my update in January, and recent media speculation, I wanted to update you, our fans, about the latest board decision that was taken this morning.

“The board, comprising myself, four club representatives; and board representatives appointed by Silver Lake and Football Australia agreed to reduce the annual club grant.

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“The decision, which has been under discussion with league and board representatives over the past few months, aligns with the board’s commercial review of the A-Leagues since the original three-year strategy came to an end.

“This is not a decision we have taken lightly. We understand the challenges this will present to clubs in the short term, and we will work closely with all clubs to support them through this period.

“We are committed to right-sizing the A-Leagues which is why we’ve been focused on cutting costs across the leagues, growing our core football product and uniting the football pyramid to support the growth of our game.

“The board, the leagues and the clubs are committed to continuing to deliver the best football possible. We have our eye firmly on the future. Our core metrics are positive, with three years of growth, which will position the league for revenue growth in the future.

“We thank you for your ongoing support, and we look forward to announcing details on the 2024-25 season shortly.”

This story was first published on July 7, 2024.

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