The effect of expensive signings and big time wages can be clearly seen in the financial results published by Liverpool Football Club recently.
In the 10 months up to May, 2012, the club posted losses of £40 million.
During that period the club signed the likes of Jose Enrique from Newcastle but the real big expenditure is clearly in wages.
During the reporting period the wage bill was £110 million which means that for a full year Liverpool’s wage bill was £130 million.
In fairness some of these wages were for the likes of Andy Carroll (on loan now at West Ham) and Charlie Adams (transferred to Stoke City) but it’s still a very substantial bill.
The report also shows termination payments of £10 million which were paid to Kenny Dalglish and his backroom staff.
The club’s overall debt has also risen by about £20 m, and now stands at close to £90 m.
Interestingly, the club which is very much in favour of the proposed financial fair play rules, would fail with their last two year returns.
The club’s owners, Fenway Sports Group, in the meantime have been helping out by loaning substantial money to the football club.
These accounts clearly show the need for a much bigger capacity ground and a bigger income to compete with the ‘big four.’
The important thing for football is that this expenditure results in a Liverpool side capable of challenging on all major fronts.
I believe this is something the Premiership and football in general needs.