Liquid Gold
Well-Known Member
The 3 year window still becomes relevant when you get promoted into the championship. The idea that there is a grace period is an urban myth.They were under different rules then. The £39m loss over 3 years is for FFP in the Championship which is known as profit and sustainability (P&S)
League One and League Two Clubs follow the Salary Cost Management Protocol (“SCMP”) These state that Clubs can only spend a fixed percentage of its revenue on player wages etc. This limit can also be added to or impacted by equity injections or net transfer spend. This is now lower than it was before the start of this season because of what Wrexham and Birmingham did. It is now 60% of income for players expenditure in League One and 50% for League Two. But owners can donate as much as they like and the % of this can go on players expenditure. That's how they got to spend so much. They have a clean slate on entry to the Championship.
That's how Birmingham got to spend lots like £15m on Stansfield.
Clubs have to submit figures to the EFL to say they will come under the losses needed for any 3 year period.