The FFA has announced some changes to the salary cap. The club’s spending budget will increase from $2.25m to $2.525 million for next season, a health increase of 12%. That includes the Additional Services Agreement which is 25 per cent of the salary cap and amounts to roughly half a million dollars.
Each club will also now be able to name a Marquee Under-23’s who can have a maximum salary of $150,000 excluded from the cap. The player has to be Australian, or a New Zealander for Wellington. The purpose of this particular change is to try and help the clubs maintain their best young talent. In addition, the club can also have a main Marquee player whose salary is completely excluded.
Even though there is a salary cap, the disparity between the spending of the clubs could be quite substantial. It is a well known fact that Newcastle owner Con Constantine refuses to allow ASA payments to his players so there could be a disparity of over half a million dollars there already. If a club fails to use the extra salary cap available for the Marquee and/or Under-23 Marquee player, the disparity could be significant. If Aloisi is really a million dollar player, Sydney could be spending well over one and a half million dollars more than Newcastle, and probably are. It will be interesting to see if the disparity in spending will begin to reflect in terms of results and performance on the pitch.
Marquee Under-23
In relation to the Marquee Under-23’s, it seems that the PFA’s proposal of 50 per cent of the wages of three Olyroos players to be outside the cap is much more functional in terms of achieving the goal of helping clubs to retain their young talent. Firstly, the extra $150,000 for one player will only operate as an effective defence against other A-League clubs. While the extra cap will be sufficient to provide a youngster with a good living in Australia, it is still pittance compared to the wages available overseas. This reality is really evidenced by the fact that ex-Sydney FC duo of Ruden and Talay are earning a much better living playing in Japan’s second division. For foreign clubs, the Marquee Under-23 feature will not present a great barrier to signing the young talent they desire. In any case, the A-League is meant to be a stepping-stone for those talented enough to play abroad.
Arguable, the PFA model better encourages the development and utilisation of young players. If you can develop quality youngsters who become first-team regulars, you are effectively getting a first-team player for half the price, assuming that the club has the finances in the cover such wages. This will free up money for the club to sign other players. This could provide real incentives for clubs to engage in scouting, developing grass-root links and seriously try and bring through the kids in their squad.
Under the FFA model, there is not the same level of incentive to develop youngsters. If you have more than one high-quality youngster, the Marquee Under-23 could well work against you as one could get poached by another club as their Marquee Under-23. There is only really an incentive to develop one quality youngster so that you can utilise the additional cap. It could even be beneficial to have your other youngsters being mediocre players which will reduce their wages and free up the cap to sign other players.
Additionally, excluding half the wage of three players under the PFA model provides for more flexibility than excluding the complete or the majority of the wage of one player. However the total sum is distributed amount the three players, half of that total will be excluded and the club can vary the distribution at their discretion. If you take the same three players and completely exclude one of their salaries, the club may have to moderate the salary of the other two to fit it within the salary cap. You will probably end up with a situation where the excluded player is earning much more than the other two simply because he is Marquee Under-23. This could put the club in a difficult situation if their youngsters are fairly equally talented as they will have to decide who they will protect with the salary cap option. Will Queensland protest Zullo and hope that Kruse isn’t poached? The PFA model avoids this problem as it gives the club the discretion to evenly distribute wages among the youngsters if this reflects their talent.
It is ironic feature of the FFA model that the exact opposite to the intended effect could result as a club has an abundance of quality youngsters could face a poaching barrage from A-League rivals who could utilise the Marquee Under-23 option to sign their talent. To avoid this, I would add one additional feature to the PFA model. Once a player moves from his first A-League club, he is no long eligible to have half his wage excluded. This ensures that it will become very difficult for rivals clubs to compete with the wages that the player’s current club will be able to offer. Under this system, Newcastle would probably still have the services of Bridge, Musialik and Hearfield even if the owner refuses ASA payments. This feature will help clubs reap the benefits of a successfully policy up until the point a foreign club comes knocking.
One foreseeable problem with this feature is that it could provide detrimental to a youngster who is released by a club and is trying to find another A-League club. Because that players salary will now count fully to the salary cap, teams may not be too keen to use up their limited cap in such a manner, particularly if they are signing a player for potential rather than intending him to be a regular immediately. A possible solution would be the introduction of a tribunal to hear applications of exemption. Of course, exemptions should only be granted in strict circumstances and there should be required evidence that the youngster has failed to establish himself at his former club, and hence he is not being poached as an established talent.
It will be interesting to see the practical consequences of the reforms next season and whether the clubs will be able to better hold onto their best young talent.
2 Comments
April 15, 2008 at 12:04 pm
The increase in salary cap just means more brazilians.
It won’t change much, young footballers don’t want salary – they wa
nt to play at the best clubs in Europe. Nick Ward for instance shooted off the moment he got an offer. Salary won’t keep young blood in.
April 19, 2008 at 12:28 pm
Good piece Peng. Thoroughly agree with you that the PFA model is much more sensible.
I think one unintended spin-off from this is that there will be more internal rumbles within the clubs that possess a number of good young players. If there’s only one of them who can be given marquee status and if the club is keen to make use of the new option (or is subtly encouraged to), then the ground is pretty fertile for a dressing-room schism.