Everton Football Club faces an unprecedented challenge after the Premier League imposed a 10-point deduction following their breach of profitability and sustainability rules (PSR) for the 2020–21 season. This decision makes Everton the first Premier League club to incur such a penalty.
An independent commission swiftly enforced the deduction, forcing Everton to plummet from their 14th position in the standings to the relegation zone, sitting at four points, narrowly ahead of bottom-side Burnley on goal difference. The club expressed its discontent, labelling the decision as unjust and immediately announcing its intent to appeal.
The Premier League’s statement revealed the club’s admission of breaching PSRs for the 2021/22 period while disputing the extent of the breach. The commission concluded that Everton’s breach amounted to a staggering loss of £124.5 million, surpassing the £105 million threshold allowed under the PSRs.
Everton’s financial woes persisted, with their recent financial report reflecting a fifth consecutive year of losses, totaling over £430 million in losses over this period. Despite reporting a £44.7 million loss for the 2021–22 season, the club highlighted a reduction in losses by £76 million from the previous year.
The club’s unprecedented deduction underscores the severity of their situation, although point deductions are not unprecedented in the Premier League. Past incidents involved Middlesbrough and Portsmouth facing point deductions for reasons varying from fixture obligations to financial turmoil.
The independent commission pinned Everton’s situation on their actions, stressing the club’s responsibility to comply with PSRs and highlighting their excessive spending on players despite warnings. Everton’s hefty investment of nearly €750 million in player transfers since 2016-17, following Farhad Moshiri’s acquisition, came under scrutiny.
Everton vehemently disagreed with the commission’s decision, deeming the sanction “wholly disproportionate and unjust.” The club asserted its transparency throughout the process and declared its intention to appeal.
The recent sale of Everton to 777 Partners for over £550 million remains underway, unaffected by the ongoing change in ownership process. Meanwhile, Manchester City faces similar scrutiny over alleged financial breaches, with Everton closely monitoring the outcome.
Calls for an independent regulator in football gained momentum in light of Everton’s sanction. Caroline Dinenage, Chair of the Culture, Media, and Sport Committee, reiterated the urgent need for the Football Governance Bill to introduce a statutory independent regulator to oversee such matters.
Everton’s quest to overturn the 10-point deduction remains a focal point, highlighting broader concerns about financial regulations within football and the need for greater oversight.