Championship losses pile up along with problems for QPR, Birmingham and co

Ian King
Championship club Queens Park Rangers recently posted losses of almost £25m

Championship clubs are releasing their accounts for last season and the numbers don’t look good, but this is only one of the issues in the second tier.


To say that this season has been one of ups and downs for Queens Park Rangers would be putting things mildly. In the middle of October they were set fair, top of the EFL Championship under the management of Steven Gerrard’s former assistant Michael Beale; they’re now two places above the Championship’s relegation places and recently appointed Gareth Ainsworth as their third manager of the season.

Ainsworth might well already be forgiven wondering what he’s let himself in for at Loftus Road. On the pitch, his time as the club’s manager has started with little discernible improvement on what had preceded his arrival, with a 3-1 home defeat against Blackburn Rovers in his first game and a 3-1 defeat at relegation rivals Rotherham United in his second. It was Rangers’ fifth league defeat in a row and they’ve won just one of their last 18 games, a rotten spell that has seen them drop from third to 20th place in the table.

And then the accounts dropped. Published for the 2021/22 season, they made for grim reading. The club lost £24m, not that far short of half a million pounds a week, with almost £90m still owed in various loans and player transfer instalments, as well as an outstanding settlement over Financial Fair Play breaches. An increased playing staff accounted for a 10% increase in wage costs. And all these losses came despite the club increasing their turnover by 7% on the previous year. 

Of course, Queens Park Rangers are far from the only club in the Championship in this sort of position. Indeed, although their position is without doubt precarious, they’re not in the worst shape, and by some distance. One such club in a worse predicament than QPR is Reading, who are reportedly sailing close to a second six-point deduction.

The club were deducted six points for breaching financial rules in 2021, with a further six-point deduction suspended until the end of the 2022/23 season, providing they hit targets outlined in a business plan agreed with the EFL. Such a punishment right now would drop Reading a point below QPR and into the middle of a relegation fight. 

While Reading are at the extreme end of the scale, this type of financial oddness is all over the place. Clubs are losing money hand over fist, and we know where all this money is going. According to the Deloitte Annual Review of Football Finance 2022, the combined 24 clubs of the Championship spend £1.25 on wages alone for every £1 that comes into them.

There are two angles here, one of which is considerably less sympathetic than the other. Some might argue that the inequality of parachute payments made to clubs relegated from the Premier League forces Championship clubs who do not receive those payments to overspend on wages to stay in some sense competitive. Another, more cynical take might be that owners desperate for a shot at the pot of gold at the end of the rainbow are endangering valued community institutions for their own ultimately selfish ends.

It’s easy to see why parachute payments are considered to be especially smothering. While they amount to a substantial cut in the TV revenue of the relegated club, they also amount to several times the average of around £9m that Championship clubs make from their current deal with the EFL. It has been reported that this could be about to rise, with greater interest in the next EFL television deal, but this in turn raises questions.

Does it always have to be about scrabbling around for even more money? Might it not be a better idea to try and rein in this runaway wage inflation, rather than simply depending on being able to wring ever-increasing amounts of money out from somewhere as wages continue to spiral? Because somebody is going to end up having to pay for all of this and TV companies don’t pay a lot of money for television contracts out of the goodness of their hearts. Both the somewhere and the somebody in this equation will likely end up being the fans themselves, as per usual.

But the issues with the financial outlook in the Championship stretches beyond the amount of money coming in and going out of clubs. There are also fundamental issues regarding the way in which clubs are run.

West Bromwich Albion fans are protesting against the owners of their club, after a mortgage was taken out through MSD Holdings UK while controlling shareholder Guochuan Lai took out a £4.95 million loan with interest against the club on behalf of his related party, Wisdom Smart Corporation, which was due to be repaid at the end of 2022, but which hasn’t been. 

The picture has been similarly bleak elsewhere in the Midlands. At Birmingham City, St Andrews has been half-closed on safety grounds for two years now, and it is now understood that it is unlikely to be fully reopened ahead of the start of next season. Meanwhile, with the team loitering just above the relegation places themselves – they’re on the same number of points as QPR – a takeover by a consortium led by Birmingham-businessman Jeremy Dale continues to rumble along in the background, with Birmingham supporters having long ago hit a point of cynicism at which nothing will be believed until it actually happens.

Even Sheffield United, with a place in the FA Cup quarter-finals and a fairly firm grip one of the division’s promotion places, have faced questions over an attempted takeover by the businessman Dozy Mmobuosi.

Stoke City this week became the eighth club to post their financial figures for the 2021/22 season, and were the first to report a a profit, though it took the owners of the club writing off £120m in debt for them to do so. Take out that debt write-off, and they lost £18.2m. And even QPR’s £24.7m losses aren’t the worst yet to have been reported; Bristol City have posted losses of £28.8m.

Watford, meanwhile, have now become the fourth Championship club to move onto their third manager of this season, after sacking Slaven Bilic and replacing him with Chris Wilder until the end of the season.

This feeling of mania has hung over the division for years, but it only seems to be intensifying with each passing season. And perhaps we’d be able to treat it all as little more than a soap opera were it not for the fact that mismanagement can have such disastrous effects upon a football club, especially without £100m a year to cushion you from the costs of your mistakes.

Clubs being on their third manager of the season while spending more than they bring in on player wages is not effective management, and allowing this to go on unchecked is not effective governance. It’s why football needs an independent regulator in the first place.