Premier League clubs have agreed on principle for the new rule with five clubs known to have abstained

Premier League clubs have voted in principle to support a proposal for a cap on spending. The decision was made at a Premier League shareholders’ meeting in London today, Monday 29 April, and further discussions are to be had ahead of the AGM in June where the ultimate decision will be made.

Fourteen out of twenty votes would result in the proposal being passed and it was reported by the Times sport writer Martyn Ziegler that Manchester City, Manchester United, Aston Villa and Chelsea abstained from voting.

The PFA have responded to the ‘vote in principle’ with Ziegler reporting them to have said: “We will wait to see details of proposals but we could oppose any measure that would place a ‘hard’ cap on player wages. There is an established process in place to ensure proposals like this, which would directly impact our members, have to be properly consulted on.”

If approved in June, the new model would replace the current Profit and Sustainability Regulations which are presently used from the 2025-26 season onwards. The current financial rules have already seen Everton and Nottingham Forest penalised six and four points respectively this season and have been heavily criticised for favouring clubs with the highest revenue.

How would the cap work?

The cap would be introduced amid concerns that the Premier League is becoming less and less competitive with only the very wealthy and well-resourced sides being able to win. Manchester City, for example. have won three consecutive titles having spent large sums on players while Chelsea dished out over £1 billion on new signings since being bought by Todd Boehly.

If all is approved in the June AGM, the spending cap would be based on ‘anchoring’ and would limit the amount of money any club can invest in their squad. It would also be tired to a multiple of what the lowest earners received from the league’s centralised broadcast and commercial deals. When first suggested last year, the proposed multiple was a factor of 4.5 from that broadcast and commercial figure.

If the figures were based off last season, the key figure would be the £103.6m that Southampton - the then bottom club - earned from TV and commercial revenues. This figure would then be multiplied by the agreed upon amount with everyone else keeping their wages, transfer fees and payments to agents below said figure.

Working on a factor of five, the cap would then be £518m meaning Chelsea - who had an estimated squad cost of £539 in 2022/23 - would then come above this figure while Man City would sneak just below as their squad is estimated to be worth £501m.

The final decision on the spending cap will then be made at the Annual General Meeting for the Premier League in June.