Lucy Frazer, the culture secretary, has urged English football’s 92 professional clubs to resolve their differences over an £800m-plus financial settlement as the government prepares to launch plans to establish the sport’s first independent regulator.
Sky News has learnt that Ms Frazer held separate talks with Premier League and English Football League (EFL) club executives this week, during which she told them not to wait until the new watchdog is established to put the finishing touches to their “New Deal”.
Sources close to the discussions, which took place on Thursday, said the culture secretary had indicated that legislation to set up the new regulator would be introduced to parliament before the end of the month.
A Whitehall source said on Friday that that timetable could slip but was only likely to do so by, at most, a few days.
Talks over the New Deal, which will involve hundreds of millions of pounds being paid by top-flight clubs to their lower-league counterparts over a six-year period, have been dragging on for many months.
At one point last autumn, a £925m agreement looked to be inching closer, but the two sides failed to bridge their remaining differences.
In December, Richard Masters, the Premier League chief executive, notified clubs that it was calling a halt to further talks with the EFL because of divisions about the scale and structure of the proposed deal.
At a meeting with shareholders last week, however, he suggested that negotiations had again become more constructive.
Image: Culture Secretary Lucy Frazer
Some EFL clubs appear to be resigned to the lack of a voluntary agreement, and believe the new regulator will be charged with imposing a deal as one of its first priorities.
With the time required to establish the watchdog and get it fully operational, though, government officials believe it could be 2026 before it is in a position to do so.
There has been significant unrest among Premier League clubs over the cost of the subsidy to the EFL, as well as the lack of certainty about the regulator’s powers and other financial reforms being driven forward by the Premier League.
Under the most recent plan put to clubs, roughly £850m would be handed over by Premier League clubs to their 72 EFL counterparts over a six-year period.
Ms Frazer has been heavily engaged in talks with football’s powerbrokers over the government’s proposals, and attended a dinner last week with Premier League executives and clubs including Everton, Manchester City and Tottenham Hotspur.
One club executive said on Friday that they did not envisage the New Deal being signed before the introduction of the football reform bill in the coming weeks.
At least one club in the bottom half of the Premier League is understood to have raised the prospect of having to borrow money this year to fund its prospective share of the handout to the EFL.
The executive at that club said the New Deal “remains unsignable”.
Last week, Sky News revealed that the Premier League also faced a fresh legal fight over the associated party transaction rules which most affect clubs with state, private equity or multi-club ownership structures.
Manchester City is understood to be the club seeking arbitration in a bid to overturn the rules.
In a white paper published last year, the government said: “The current distribution of revenue is not sufficient, contributing to problems of financial unsustainability and having a destabilising effect on the football pyramid.”
The document highlighted a £4bn chasm between the combined revenues of Premier League clubs and those of Championship clubs in the 2020-21 season.
A spokesman for the Department for Culture, Media and Sport declined to comment.
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