UEFA Says Soccer Must Work to Prevent ‘Financial Insanity’

European soccer’s ruling body said its plans to curb overspending by clubs are already having a positive impact, although more needs to be done to protect the sport from “financial insanity.”

UEFA has said it will probably announce sanctions at the beginning of May against clubs found to have breached its Financial Fair Play spending guidelines. The rules prohibit clubs in the Champions League and Europa League racking up an accumulated loss of more than 45 million euros ($62 million) over the previous two seasons. Penalties could range from fines to exclusion from competitions.

Figures from almost 700 teams show more owners are fully committing their money to clubs, rather than lending it, while losses in 2012 were almost 600 million euros lower than in each of the two previous years, UEFA said yesterday in its sixth Club Licensing Benchmarking Report.

“While such figures are encouraging there is still considerable work to be done in reducing these losses further,” UEFA General Secretary Gianni Infantino said in the report.

He added that in the past three years of club soccer there had been almost 2,000 head-coach changes and combined club losses of more than 4 billion euros, showing the need for “more stability, less short-term thinking and better financial sustainability.”

“UEFA is providing leadership to protect European football from greed, reckless spending and outright financial insanity,” he said. “It is only through good governance that we will be in a position to protect European football for the long term by ensuring that clubs live within their own revenue in a sustainable manner.”

UEFA also reported yesterday that top-division club income rose by 800 million euros in 2012 to 14.1 billion euros.

European clubs’ revenue increased by 42 percent between 2007 and 2012, although wages climbed by 59 percent. In 2012, wage growth was restricted to the same 7 percent level as revenue “for the first time in recent years.”

To contact the reporter on this story: Peter-Joseph Hegarty in London at phegarty@bloomberg.net

To contact the editors responsible for this story: Christopher Elser at celser@bloomberg.net Dex McLuskey, Michael Sillup

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