is Wayne Rooney worth £85m?

is Wayne Rooney worth £85m?

Didn't find your answer?

£85 new contract reported in todays news.

My questions in comnection to this, whether you are a football fan or not:

1) how much of this is he likely to receive net of tax and costs?
2) what costs are likely to be incurred against this fee. My view is security costs are one acceptable cost associated to a professional football player.
3) what overall tax rate is he likely to pay on this amount? Taking avoidance schemes into place.
4) what is the tax take in monetry terms likely to be, so is the exchequer likely to be happy with this deal.
5) what utility or telemedia company is likely to put their prices up to customers as a result.
6) my ultimate question is whether he or anybody is worth £85 million? And whether these sort of deals should be stopped.

My view is that no one is worth that amount of money, however I dont believe he will receive much of that fee after taking away necessary tax and costs. I would put a figure of 10% as being net receipts.

Replies (84)

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By ShirleyM
22nd Feb 2014 12:25

Excluding costs

He should come out with around 80% net if he uses an avoidance scheme.

1% tax, 15-20% scheme fees, so I guess the government will be happy if he makes a generous donation to the Tory party, but not otherwise!

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By User deleted
22nd Feb 2014 15:29

Beware ...

... the Ides of March

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By somanyquestions
22nd Feb 2014 23:35

Why not

If an entertainer like Leonardo DiCaprio can pull in £50m a year for memorising the odd line & snogging a few hot girls, why shouldn't Rooney pull in £15-16m for entertaining god knows how many avid footy fans week in week out?

 

He's an absolute master of his trade and is part of one of the biggest industries in the world.

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Replying to Tornado:
Sarah Douglas - HouseTree Business Ltd
By sarah douglas
23rd Feb 2014 18:37

er I don,t think so

Leonardo Di Caprio is worth every penny and more,   I loved is performance in Romeo and Juliet which is more then snogging a few hot girls.  There is no comparsion between the two.  I know which one I would have in for a cup of tea Ah Leonardo.  Rooney is a toe rag I sure to many he is well respected.  I certainly don,t the way he has treated women and his family,  but than morals is no base for whether you deserve the money or not.    

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By mrme89
22nd Feb 2014 23:47

Lionel Messi (best player in the world) earns £275k per week.

United fans have been had again.

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By andy.partridge
23rd Feb 2014 12:46

It won't happen

If Rooney sees out the contract in full then I am Robin van Persie (ie. a Dutchman).

It just gives both parties some security for the next couple of transfer windows. Rooney has famously questioned his club's lack of quality and ambition in the past. I don't believe he would be prepared to forego Champions League football for very long and the club's commitment to his bank balance only leaves fewer resources to strengthen an inadequate squad.

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By User deleted
23rd Feb 2014 12:50

I agree, Andy

As soon as Wenger quits, watch Arsenal snap him up

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Replying to lionofludesch:
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By andy.partridge
23rd Feb 2014 16:05

Genuinely didn't understand this

BKD wrote:

As soon as Wenger quits, watch Arsenal snap him up

You might have had a valid point. If you have I'd be interested in hearing it.
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By andy.partridge
23rd Feb 2014 13:24

Misprint

Don't you mean Moyes?

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By User deleted
23rd Feb 2014 13:52

No, I meant Wenger - sorry, I meant ...

... Whinger, who would never sign Rooney, but I wouldn't be surprised if his successor does.

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By andy.partridge
23rd Feb 2014 14:00

Sincere belief

By the time Wenger leaves Arsenal, the only sport for Rooney will be Sumo.

If Wenger is/was interested in Suarez and, apparently, Balotelli why do you think he would not be interested in Rooney?

More to the point, who do you think in Arsenal does want Rooney but is being blocked by Wenger?

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Replying to chicken farmer:
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By User deleted
23rd Feb 2014 15:32

Stats speak for themselves

Julius Caesar wrote:

Arsenal don't need to sign a fat joke, they already have Bentner.

Bendtner - 1 goal every 4 games

Rooney - 1 goal every 2 games

Having said that, Bendtner's record may well have been better had he had more capable players around him.

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Replying to Pipperoo:
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By andy.partridge
23rd Feb 2014 16:30

Confused

BKD wrote:

Julius Caesar wrote:

Arsenal don't need to sign a fat joke, they already have Bentner.

Bendtner - 1 goal every 4 games

Rooney - 1 goal every 2 games

Having said that, Bendtner's record may well have been better had he had more capable players around him.


Are you saying that Rooney is not fat and/or not a joke as alleged, or are you saying that despite being allegedly fat and/or a joke his scoring record is better than another allegedly fat/joke footballer over the course of a comparable, but unilaterally chosen, timescale?

You are definitely more forensic when it comes to tax and accountancy matters!

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By User deleted
23rd Feb 2014 15:50

Based on current league standings ..

... I'd say Chelsea.

But since I was talking about their goal records during their time with their respective clubs, this season's standings are of no relevance.

Since 2004, Man U have won about 16 trophies, Arsenal no more than 2. So I think that answers the question ("who has had the more capable players?")

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By andy.partridge
23rd Feb 2014 15:55

Oh no, it's (selective) stats time

Lies, damn lies and statistics.

Serious debate has left the building.

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By ShirleyM
23rd Feb 2014 15:58

Deja vu!

Deleted threads may well be on the agenda again.

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By User deleted
23rd Feb 2014 16:04

Serious debate left the building ...

... as soon as someone mentioned football on an accounting forum.

But in my defence I thought it quite reasonable to compare the records of the two clubs during the time that the two players have been with their clubs, which time is quite similar.

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Replying to Justin Bryant:
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By User deleted
23rd Feb 2014 20:30

So what?

Julius Caesar wrote:

 I could point out that since the formation of the football league United have been relegated more than once, whereas Arsenal are the only club in the league never to have been relegated.

You can point that out if you want to - but it would be an utter irrelevance to the discussion in hand. The specific point that I made was that had Bendtner had better players around him his goal tally might have been higher. So in comparing the qualities of the players around those two it makes sense to restrict the comparison to the period when they were both playing for their respective clubs - relegation stats (and stats re other periods) have nothing to with this particular point. If you want to point out other stats to try and "prove" that one club is better than the other, or just ignore the specific topic and wander off on a tangent, be my guest - because I'm not interested.

BTW - even if you were to point out that Arsenal have never been relegated you'd be wrong. It's bad enough citing statistics that have no relevance to the discussion - it's even worse to get them wrong.

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By mrme89
23rd Feb 2014 18:45

@ Sarah. His performance in The Wolf of Wall Street was exceptional too (De Caprio that is).

Rooney has no morals but at least he tops up the income of pensioners.

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By ShirleyM
24th Feb 2014 07:25

Back to the topic

Does anyone think that Rooney will pay the expected amount of tax?

With regard to whether he is worth that amount of money .... someone must think they can make money from him (unless they are just giving the money away) and they will have to recoup the money from somewhere  ... so who will pay in the end? It will be the ordinary guy in the street, won't it? I am no footie expert but I would think the money must come from tickets, or TV & advertising rights, which in turn are paid for by the subscribers and/or purchasers of advertised goods.

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Replying to djbrown:
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By andy.partridge
24th Feb 2014 09:53

A statement of intent

ShirleyM wrote:

With regard to whether he is worth that amount of money .... someone must think they can make money from him (unless they are just giving the money away) and they will have to recoup the money from somewhere  ...

I think it's a bit of (expensive) PR. Man U are in the doldrums compared to their incredible success in recent years. They don't want to 'do a 'Liverpool' who when they fell from their perch stayed dead. The Rooney factor is saying, 'things are OK here really, it's a blip, Wayne thinks so too, we are ready to build something better' and so hopefully attract world class players to the club. Remember, last summer David Moyes (and Ed Woodward) spectacularly and rather embarrassingly failed to convince players to join them.
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By User deleted
24th Feb 2014 08:18

You were right, Andy

"Lies, damn lies and statistics"

Particularly the lies.

(The League wasn't suspended until MCMXV and Arsenal spent two seasons in Division II. And Bendtner has played more than CLXX games - including subs - for Arsenal).

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By justsotax
24th Feb 2014 09:11

On the serious

question - I think Rooney was already part of one of these offshore EBT's...where the only tax paid was on the loan that was written off.  I am guessing at least part of his 'salary' will attract then normal PAYE so I guess we should be grateful for that.  Are any of these players worth that money....I guess you need to ask Sky as they are bank rolling the premier league...As for Bendtner vs Rooney....the only question you need to ask is which would you want in your team - I don't need stats to tell me that Rooney wins that one everyday (he may be a questionable individual off field...but on it he is a good player).

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By mrme89
24th Feb 2014 09:33

He might be a decent player, but how can they justify paying him more than Ronaldo or Messi?

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By andy.partridge
24th Feb 2014 09:39

@ BKD

Interestingly, Bendtner's goal scoring record for Denmark is roughly the equal of Rooney's for England. That doesn't provide any answers but it can provoke more questions.

I read a fabulous book over Christmas. 'The Numbers Game. Why everything you know about Football is Wrong' It's a serious study of football statistics. If you haven't read it do check it out.

 

 

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Sarah Douglas - HouseTree Business Ltd
By sarah douglas
24th Feb 2014 10:14

Leornardo

Yes I am going to see the film next week .  Definitely  worth more than Rooney.  Sorry off topic .    I am sure management gets a lot of Rooneys money. 

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By Roland195
24th Feb 2014 10:27

£85m

When the media report an £85m contract, this is not a job offer with a salary of £85 PA as we would generally understand it but a complex package of various payments from which the fees for agents, managers and assorted hangers on are deducted. The part that make it to Wayne's grubby paws is likely a fraction of this and doubtless this is structured in a way to leave as little possible subject to PAYE or ERNI.

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Replying to bernard michael:
By petersaxton
24th Feb 2014 16:00

Exactly

Roland195 wrote:

When the media report an £85m contract, this is not a job offer with a salary of £85 PA as we would generally understand it but a complex package of various payments from which the fees for agents, managers and assorted hangers on are deducted. The part that make it to Wayne's grubby paws is likely a fraction of this and doubtless this is structured in a way to leave as little possible subject to PAYE or ERNI.

I wouldn't be surprised if it included Manchester United buying all his image rights and shirt sales. I think Real Madrid have very complex deals in similar ways for 50% of income from other sources.

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By justsotax
24th Feb 2014 10:38

he may not be

worth 300k....but there are plenty of lower league players paid £50k plus per year who would struggle to trap a bag of cement and pass the ball with the accuracy of a 1 year old who has just eaten a bowl of ice cream stacked with e numbers...(that looks like a 'headless chicken' for those fortunate enough not to own a one year old who has been fed some high octane food by 'Nanny').

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Replying to richardterhorst:
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By observer
24th Feb 2014 12:45

I agree with justsotax

Just look at the number of world class Premier League players who are British. There are very few people in this Country who could make it into a top Premier League team, hence Rooney's salary reflects that.

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By B Roberts
24th Feb 2014 10:55

I guess that ....
... the "free marketeers" would argue that if that is what he is paid, then he must be worth it.

What I find interesting - in general and specifically on this thread - is the general opinion of "good luck to him", both in terms of his salary and in terms of minimising his tax liability.

On the other hand there are company executives who earn in a year what Rooney will earn in a week and they are vilified and castigated by the press and most people for their level of earnings.

Also, the sole trader who seeks to reduce his tax liability is treated similarly on this site (without getting in to the old argument as to the legality or morality of belonging to a scheme purporting to be selling cars !).

It is a strange world !

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Replying to David Heaton:
By ShirleyM
24th Feb 2014 11:19

Not me!

B Roberts wrote:
...  is the general opinion of "good luck to him", both in terms of his salary and in terms of minimising his tax liability.

I am against aggressive and artificial tax avoidance, where they pay 1% tax, or thereabouts. As mentioned in the news, they are bigger parasites than the benefit cheats that are villified in the press, and by governments (not that benefit cheats shouldn't be taken to task). These tax avoiders (who should maybe be reclassified as tax evaders?) live & work in the UK, so they should contribute to the UK, too.

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By daveforbes
24th Feb 2014 11:23

Free market economy

I suppose whoever is paying that much feels it is worth it. There is even more money in football since BT came in. As a plus point for the UK economy, footballers have a very low marginal propensity to save.

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Replying to JDBENJAMIN:
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By User deleted
24th Feb 2014 11:34

Economy - where?

daveforbes wrote:

As a plus point for the UK economy, footballers have a very low marginal propensity to save.

Perhaps so, but buying villas in the Caribbean doesn't exactly help the UK economy, does it :)

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Big Daddy's Diner
By mookgirluk
24th Feb 2014 11:53

Continuing the Wolf of Wall Street comparison....

Jonah Hill did the film for £36k just for the priviledge of working with Scorsese.  Wouldn't it be nice to see some footballers just being proud to play for their club.

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Replying to Accountant A:
By mrme89
24th Feb 2014 12:16

.

mookgirluk wrote:

Jonah Hill did the film for £36k just for the priviledge of working with Scorsese.  Wouldn't it be nice to see some footballers just being proud to play for their club.

 

A big difference when compared to De Caprios £6.2m fee for the film.

 

However, it will do wonders for Jonah Hill's career. He's been nominated for an Oscar for best supporting actor.

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By daveforbes
24th Feb 2014 12:02

@bkd

Yes but he buys his hair from Harley Street.

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By cfield
24th Feb 2014 13:52

Is it anyone else's business?

How much you get paid is between you and your employer (or clients). It's got nothing to do with anyone else.

This trend you see these days to complain about other people earning too much is a worrying development, as it's based on nothing but a) pure envy, and b) antagonism towards a particular individual or group. 

Imagine how you would feel if some busybody stuck his oar in whilst you were negotiating a fee with a client and said it's too much. You'd tell them to sod off and mind their own business, wouldn't you?

Where I do worry about high wages which seem out of line with what someone does or deserves is when they seem to have rigged the market. Examples would be bankers whose ultimate bosses (us the shareholders or pension fund members) would never agree to such high bonuses if they had any proper say in the matter. It just seems to me that these people have somehow hijacked the banking industry and created a "going rate" for their services which is not sustainable in a properly free market.

Same goes for all the chief executives who are awarded huge pay rises even if their company doesn't do that well or who scratch each others backs on remuneration committees that are not exactly representative. More shareholder power would put an end to that nonsense. The shareholder revolts we saw recently were sadly ineffective in the long run. There has to be a change in the law and international co-operation on shareholder approval of executive pay, which would be very difficult to bring about. Maybe pension funds should consult their members before giving approval, I don't know.

Just to show I am not just picking on people at the top, striking tube drivers are another example of people rigging the market. They earn way in excess of the "real" market rate for their services by regularly striking or threatening to strike in a transport system we simply can't do without, and are aided and abetted by weak management and weak labour laws.

Next to that lot, at least people in the entertainment industry earn what the market says they're worth. Until people stop watching Sky Sports, players will earn whatever clubs think they're worth and whatever media organisations are prepared to pay. Once people lose interest in football, films or whatever, the money will dry up and wages will fall. So at the end of the day, it's up to us. We have the power, we just need to learn how to use it.

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Replying to Mr_awol:
By cfield
24th Feb 2014 23:11

It's your choice

mrme89 wrote:

cfield wrote:

How much you get paid is between you and your employer (or clients). It's got nothing to do with anyone else.

The difference is nobody pays me £50 for a ticket to see me work. When fans are expected to pay an extortionate price for a ticket, they should see where that money goes.

Nobody forces you to pay £50 for a ticket. If you think it's too much, or you're getting poor value for it, then stop paying it. If millions of people voted with their wallets and stopped going to matches, or paying TV companies for over-priced sports channels, ticket prices would fall, TV companies would stop bidding so much for media rights, players wages would fall and some sort of sanity would return to the game.

As an added bonus, fewer foreigners would come here to play for the top clubs, the best English players might get a chance to come through and develop their talents and we might have a team with a chance of winning the World Cup again.

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Replying to Samantha20:
By mrme89
25th Feb 2014 09:25

Value

cfield wrote:

mrme89 wrote:

cfield wrote:

How much you get paid is between you and your employer (or clients). It's got nothing to do with anyone else.

The difference is nobody pays me £50 for a ticket to see me work. When fans are expected to pay an extortionate price for a ticket, they should see where that money goes.

Nobody forces you to pay £50 for a ticket. If you think it's too much, or you're getting poor value for it, then stop paying it. If millions of people voted with their wallets and stopped going to matches, or paying TV companies for over-priced sports channels, ticket prices would fall, TV companies would stop bidding so much for media rights, players wages would fall and some sort of sanity would return to the game.

As an added bonus, fewer foreigners would come here to play for the top clubs, the best English players might get a chance to come through and develop their talents and we might have a team with a chance of winning the World Cup again.

 

But how do you know a ticket is too much if you don't know what that money is spent on?

 

A true footballer supporter doesn't just buy the shirt, pay for the ticket etc for the fun of it, they buy it because they know the money supports the club. If they knew the money was thrown away, they could make an informed decision.

 

 

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By 25677652
24th Feb 2014 15:43

Recognising expenditure
A flat management company has a trade creditor at the year end of £19,000. This is material.
The creditor is for materials and work to commence on a lift repair. The work starts and takes place after the year end. Should this also be shown as deferred expenditure in the financial statements?

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Replying to newaccountantsf:
By mrme89
24th Feb 2014 15:51

?

25677652 wrote:
A flat management company has a trade creditor at the year end of £19,000. This is material. The creditor is for materials and work to commence on a lift repair. The work starts and takes place after the year end. Should this also be shown as deferred expenditure in the financial statements?

 

 

Own goal?

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By User deleted
24th Feb 2014 19:09

Wrong place

Time Out (or Highbury) is the place for football jokes.

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By ShirleyM
24th Feb 2014 19:58

New member 'The Investigator'

It was highlighted lately that not everyone knows about the T & C's, so here are the forum rules, to help you stay within the guidelines.

https://www.accountingweb.co.uk/community-rules-and-moderation-policy

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By User deleted
25th Feb 2014 08:14

cfield

I was agreeing with everything you said - right up to your last few words :)

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By mbdx7ja2
25th Feb 2014 13:17

@mrme89

What does what the money is spent on have to do with anything?  How you decide whether your £50 ticket is good value is whether the entertainment you have paid for (match day) is fair value for the £50 ticket.

Do you ask how much Odeon's costs are when buying a cinema ticket?

Or how much the overheads of a bowling alley are?

No, you consider whether the value of the entertainment you are purchasing is fair value with respect to how much entertainment you perceive you receive and how it compares with other forms of entertainment.

There seems to be some tribal element to football which is given as a good reason for supporters to override the normal society and market conventions and demand a say in how the business they are patronising is run (the "true football supporter" syndrome).  It is pretty much the only example of it I can think of and I don't agree with it.  So I'm with cfield on this.

A real "true football supporter" would want to support good football, irrespective of who is playing it.  The real football supporters are prepared to support teams which play diabolically boring football simply to get "a good result" (it's not the performance that matters, it's the result - or winning ugly.)  It's just an excuse for a boring spectacle which is not worth the entrance fee.

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By cfield
25th Feb 2014 13:49

True football fans

Despite my comments, I'm a football fan myself, both playing and watching, although the latter is very infrequent these days due to the cost and difficulty of getting tickets, and my performance in the former is getting even more comical than it was "in my prime".

One of my dreams is for players and fans to "rise up" and take back the game that has long been taken away from them by the bureaucrats and money men. Form clubs that must by their constitutions be owned by the fans, with nobody allowed to control more than 1% of the shares.

Drum up the money by harnessing the power of the internet - much the same way as peer-to-peer lending is cutting out the banks and producing huge sums of money for the people and businesses who deserve it most with fair interest rates on both sides. I'm sure the same sort of thing could be done by loyal fans to create new clubs.

Tweak the rules to eliminate the worst features of the moden game, such as diving for penalties and trying to get players sent off. Maybe have season-long bans to deter cheats and point deductions to rectify games won by cheating. Use technology to stop wrong decisions being made in the first place.

Call it a new code of football so the FA and FIFA don't take it over and we can ensure the game is run by those who love it most.

Once the crowds build up and interest grows, TV coverage will follow, more money will come in and the best players will be affordable, but have  financial fair play rules to stop money ruining the game again.

Maybe it's all just a dream, but wouldn't it be great if the beautiful game could come back to us again.

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Replying to andy.partridge:
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By Ken Howard
25th Feb 2014 16:25

Support a lower league club instead

cfield wrote:
One of my dreams is for players and fans to "rise up" and take back the game that has long been taken away from them by the bureaucrats and money men. ................Maybe it's all just a dream, but wouldn't it be great if the beautiful game could come back to us again.

That's easy.  Just support your local lower league club instead.  Plenty of league 2 or lower clubs that would welcome your ticket fee, programme and pie money.  My local club (League 2) struggles to get more than 2000 supporters at home games and needs to rely on signing up youngsters as they have no money for transfer fees or high wages.  At the same time, lots of locals travel 90 minutes to Liverpool or Manchester, paying higher ticket costs, parking, couple of gallons of fuel, etc. If people want a return to the "beautiful" game, then they have to vote with their feet and support their local lower league and non league teams.  

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By mrme89
25th Feb 2014 14:03

@mbdx7ja2

What does what the money is spent on have to do with anything?  How you decide whether your £50 ticket is good value is whether the entertainment you have paid for (match day) is fair value for the £50 ticket.

 

Because if I knew the money was wasted on over rated players or not reinvested into the club, I would not buy a ticket (I would go to the pub any watch it for nothing). This is the same reason I am no longer a season ticket holder at Leeds United.

 

“Do you ask how much Odeon's costs are when buying a cinema ticket?”

I don’t do to the cinema so cannot comment.

 

Or how much the overheads of a bowling alley are?

I am sure the staff at my bowling alley don’t earn £300k a week. Also, the bowling alley doesn’t have to pay the pins an appearance fee.

 

You are comparing very different industries.

 

No, you consider whether the value of the entertainment you are purchasing is fair value with respect to how much entertainment you perceive you receive and how it compares with other forms of entertainment.

 

As a football fan, I consider that my money paid for a ticket is not just for entertainment value but also enable the club to invest in new players, renewal of contracts etc. If I thought that they were paying someone that has had their pants down before £300k per week with my hard earned money, I would choose not to buy a ticket.

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By User deleted
25th Feb 2014 19:45

Tom Finney ...

... was worth a dozen Wayne Rooney's and had more talent than him in his little finger - all for £12 a week, and if the showers weren't working after the match he could fix them to boot!

Fotball has never been the same since the end of terraces.

No one is worth £85m, but I would rather it go to someone like Rooney, who will waste great piles of it on cars, parties etc, so at least he is stimulating the UK economy, unlike a banker type where it goes off shore to be of no benefit to the UK whatsoever,

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