Bluebirds blow-out leaves FA with escape route for QPR case

Cardiff City's collapse to Middlesbrough in the final home game of the season not only ruined the club's automatic promotion hopes but may have given a perfect opportunity for the FA to escape its QPR dilemma.

The case involving Queens Park Rangers' purchase of Alejandro Faurlin is likely to be settled today with any punishment, if the club is found guilty, also handed out.

Speculation has been rife that QPR has already be found guilty of breaching and that a substantial penalty, possibly up to 15 points, will be applied.

And this is where the effects of Bank Holiday Monday's first-half nightmare could play a very significant part.

The Bluebirds' 3-0 horror show defeat ensured that Norwich City's subsequent 1-0 away win at Portsmouth guaranteed a place in the Premier League next season for the East Anglia club.

As a result with just one game left to play QPR are champions (subsequent to the FA inquiry) with a five point lead over Norwich who are a further four points ahead of Cardiff.

And this gap is crucial.

Had Cardiff beaten the visitors and Norwich repeated the result that would have left the Bluebirds trailing the Canaries by just one point and QPR by only six.

Effectively this would have cut off an easy route to punish the London team had they been found guilty.

Now however, should the FA decide QPR need to be penalised severely, it can dock seven or eight points and be comfortable in the knowledge that if all QPR win the season's final game promotion will be secured, albeit minus the glory of a champions trophy.

Doing this would also prevent major disruption to the league standings and playoff picture and hence likely avoid the potential myriad legal challenges such a move would prompt.

Of course, the FA could decide to just enact a massive fine but no points deduction, effectively ok-ing QPR's actions and ensuring promotion.

Or it could take an incredibly severe option and simply invalidate the club's promotion (effectively demoting it back to the Championship) and enforce one less relegation from the Premier League this season to maintain continuity of that structure.

Either of those methods would also involve a minimum of interference in league standings, and a reduced relegation count is unlikely to be objected from the Premier League clubs, but they lack the often desired 'Goldilocks factor'.

This new opening provides an outcome that could be 'just right'.

Is the FA Cup the root of all evil?

Has this world famous trophy been responsible for bringing a pair of finalists to their financial knees in just two years?

David James seems to think so.

The ex-England and current Portsmouth goalkeeper believes the club's FA Cup win in 2008 resulted in their spectacular financial meltdown, suggesting that win resulted in bonuses being paid that could not be afforded, and a European campaign being fought that the paper-thin squad could not sustain.

Maybe that explains the near identical scenario facing Cardiff City, the team they beat two years ago.

As I wrote about earlier this year, both clubs have faced several dates in court with the tax man in an effort to reclaim unpaid debts.

Although the methods in its near downfall appear different, the economic fallout looks remarkably similar in south Wales.

For many clubs outside the Premier League, an FA Cup final appearance would be seen as a one-off event to be celebrated for what it was, to certain extents, a fluke.

However, at Cardiff, it appears the Chairman Peter Ridsdale and the board's ambitions were already out growing the club and its purse, but the day-out at Wembley may have given them all the encouragement needed to believe this was a significant glimpse of the future.

The merest hint that they could replicate the big four of Chelsea, Manchester United, Arsenal and Liverpool in their near annual trips to the home of football for one of the big finals was too much to resist.

Paying the price

Instead of continuing the general path being taken of low-budget player signings using manager Dave Jones' transfer market experience, (putting aside the huge contracts given to high profile but aging strikers Robbie Fowler and Jimmy Floyd Hasselbaink), the purse strings were loosened, including a £4m return to the club for now record transfer Michael Chopra.

Granted, a much needed new stadium was also a vast expense to be paid, but knowing that this project was in the motions, and that these things never come cheaper than advertised, a policy of financial prudence elsewhere within the club would have seemed preferable.

Sadly, this was not followed, and now Cardiff and its fans are paying the price, wondering if they will still have a team to support come next season, let alone which division they will be in.

In the end Pompey could not avoid the ignominy of becoming the first Premier League club to enter administration.

Their relegation to the Championship has since been confirmed, but Cardiff's fate still lies in their own hands.

So far, the Bluebirds have only avoided following the south coast side into administration by the skin of their teeth, but the potential of replacing Portsmouth in the top division is still too tempting to ignore.

On this occasion though, there is no possibility of reinforcements.

Barring a collapse greater than the one witnessed this time last year, Cardiff will finally make the Championship playoffs, to battle with three other sides for one last promotion spot.

Victory in a different Wembley final would take them to the Premier League “promised land”, and a certain degree of financial breathing room, if not security.

Losing out would mean another term in England's second division, and probably result in a significant sell-off of players, but maybe the avoidance of administration, although the potential of Malaysian investment still, apparently, remains a possibility.

All this shows that maybe those presently among the smaller members of the football community should learn from Icarus, and not fly too close to the sun, or their wings may fall apart.

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To add an ironic twist to this tale, Portsmouth have once again reached the FA Cup final, with reports escaping the club that some players may not be able to play in that game unless they waive contractual bonuses that would be due to them.

In this circumstance it is the administrator ensuring only that which can be afforded is spent, and the players are left with the decision – loose a bonus they probably won't get anyway, or take the opportunity to play in the final of the greatest knock-out cup competition in the world.

For once, most of the players seem to have the right idea.

HMRC v Football Clubs - postponed

A brief update from those court cases earlier today.

Portsmouth now appear to be treading on very thin ice, although there is still a glimmer of hope that they may survive.

Pompey were granted just seven days to prove they will be able to make a payment schedule for the HMRC to prove the ability to pay their debts.

According to the BBC: Court registrar Christine Derrett said she feared the company would continue to trade and build up more debts that would not be paid.

"I am very concerned about the financial status of this company," she said. "It seems to me there's a very real risk that this company is undoubtedly trading while it is insolvent.

"I'm obviously conscious that, by making a winding-up order, it would have very severe consequences not only for the company as a business but for the supporters themselves, but that's not a consideration that I strictly take into account."

It also seems the situation is even worse than many feared, with the club not only owing the estimated £7m in VAT, but a further £4.7m in PAYE and National Insurance, which was not included in this process.

However, both Cardiff City and Southend United are able to breath a bit easier, having earned a 28-day reprieve to get their financial affairs in order, or at least get in a place to pay their tax bills.

It seems the payments these clubs have either made or are set ot make in the near future has at least kept the wolf from the door for the time being.

I guess we'll have to wait another seven or 28 days to get the final decisions in this long running saga.

Cup finalists face fight for their lives

Just 21 months ago Portsmouth and Cardiff City faced each other in front of a packed Wembley Stadium and worldwide television audience in the FA Cup Final.

Today, in a cruel twist of fate they will both appear before the same court just minutes apart in a battle far more important to their thousands of fans than victory on that Saturday in May 2008.
Defeat on this occasion could lead to one or even both clubs to fall into administration, and in a worst case scenario, to be wound up altogether.

The opponent this time is none other than Her Majesty, or rather Her Majesty’s Revenue and Customs, who are trying to recoup millions of pounds in unpaid taxes from the two clubs.

It’s estimated that more than 100 million people around the world watched Portsmouth lift the famous trophy after a 1-0 win, but since that highlight, fortunes have turned for the worse.

The south coast club faces estimated debts of £60m, is already on their fourth owner of a season that has barely passed its mid-point, and lies bottom of the Premier League staring at the near certainty of relegation to the Championship.

Meanwhile Cardiff, who currently lie a very respectable fourth place in that Championship, are thought to owe around £30m, with HMRC targeting £2.7m of that total debt today.

While both clubs can put much of their ills down to poor ownership decisions that some may call downright financial mismanagement at boardroom level, this is a trend that is fast becoming alarming in its frequency.

Already this season, Crystal Palace, one of the Welsh club’s Championship rivals, have been placed into administration, while League One Southend United will also face a winding-up petition.

There have been 53 professional club administrations since 1992, and that date is more than a coincidence.

It marks the year football entered its new era with the breakaway of the country’s top division and subsequent formation of the Premier League.

With this new league came new money from massive television and sponsorship contracts that brought more matches into more homes, and even to a global audience.

However, this new found wealth has meant that many clubs are living off vast amounts of borrowed cash, paying vastly inflated transfer fees and wages for players in a bid to reach the Premier League promised land where the sport is paved with gold.

Unfortunately, as Dick Whittington discovered on his arrival in London, this is often not the case.

Few teams manage to reach the giddy heights, and even one season of failure can lead to the club’s financial ruin.

So common has this occurrence now become, the sports’ powers have had to introduce football related penalties in an attempt to ensure clubs live within their means.

Crystal Palace have already suffered a ten-point penalty alongside the uncertainty of finding new owners, while previous Premier League regulars Southampton began this campaign in League One with a similar deduction following their troubles last term.

HMRC has begun taking a harder line with football clubs that fall into debt after losing vast sums in overdue tax revenue thanks to this rapid increase in administrations.

A clause of the administration process determines that players must be paid first and in full from any monies available, often meaning that other creditors are left high and dry, receiving only a few pennies from each pound owed.

This has resulted in a big hole often being left in the tax purse, and so the agency has decided to start taking preemptive action in an attempt to recoup all it is owed, rather than wait for the remaining crumbs.

It seems Southend and Cardiff may have some chance of meeting Her Majesty’s demands as eleventh hour bids for cash are pulled together, but for Portsmouth the signs are bleaker, and the club’s survival may come down to the court granting a stay of execution.