Parachute payments are vital mechanism for relegated clubs to survive, claim Premier League
After EFL Chairman Rick Parry’s comments over parachute payments for relegated clubs, the Premier League has admitted, via a spokesperson, that it’s a key ‘mechanism’ for clubs to survive. The COVID-19 pandemic has forced a financial situation on football that has seen many struggled to cope.
The lack of matchday and broadcasting income has forced a few clubs on the verge of bankruptcy with many of them plying their trade in the Championship and below. Premier League sides have also been affected but not as bad as bankruptcy reports have indicated. But while that might change over the next few months without football, the EFL sides are in serious danger.
That saw EFL Chairman Rick Parry claim that the parachute payments that the Premier League hands relegated clubs are “an evil that needs to be eradicated”. But that has been refuted by a Premier League spokesperson as they admitted that the payments are a vital part of helping a relegated club survive the drop back to the Championship.
"Parachute payments give newly promoted clubs the confidence to invest in their squads to be competitive in the Premier League. They are also a vital mechanism to give relegated clubs financial support while adjusting to significantly lower revenues and having a higher cost base related to their playing squads. The Championship is a highly competitive league with attendances, viewing figures and revenues the envy of second-tier leagues around the world," said the spokesperson to Sky Sports.
"We see no evidence that parachute payments distort performance at that level and are an essential part of this highly competitive environment. We also provide solidarity payments to every other EFL club - payments without parallel elsewhere in leagues around the world."
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