Why does half the A-League have a debt problem?

Why does half the A-League have a debt problem?

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If recent reports are to be believed, then up to half of the A-League clubs could be docked competition points and have player contracts severed if payments are not made by the end of this month.

There is a big question worth asking in regards to this entire situation and it is rather simple: why are there so many clubs in this situation? In two separate articles published by the Roar and the Sydney Morning Herald, the clubs identified as being at risk of FFA sanctions are the Brisbane Roar, Adelaide United, Newcastle Jets and the Central Coast Mariners with the Roar article adding Perth Glory into the mix as well.

Some of these clubs have been more well known for their off-field issues in recent memory than others. Most notably, Brisbane have made the headlines with their failure to pay players and former staff while under the ownership of the Bakrie Group and Newcastle have been struggling to make payments since the days of Nathan Tinkler and this creates another issue as the club is now owned by the FFA.

But the most well known issues plaguing an A-League side recently have come at the helm of the Central Coast Mariners, who have reportedly been failing to uphold players’ superannuation payments since the first quarter of 2013. While Mariners owner Mike Charlesworth has stated to the media that the club has “possibly never been in better financial shape” there still is the issue of just how the club aims to pay the debts owed while maintaining their talent under the new Collective Bargaining Agreement which came into effect last month.

One of the more interesting clauses in the agreement is the term that allows players to terminate their contract at any point should certain statutory obligations not be met, one of these being the payment of superannuation. This clause could mean that players such as Storm Roux, Liam Rose and Mitch Austin could be forced to leave the club should payments fail to be made and this would not be the first time something like this has happened to an A-League club, which makes the situation all the more worrying. Previously in August of this year, Brisbane lost Luke Brattan as a result of unpaid superannuation and this could be seen as the start of a worrying trend should clubs continue down this path of failing to pay players.

However there must be a discussion as to what can be done about the situation at hand. Charlesworth, in an interview with The World Game, pointed towards management solutions such as the creating and grooming of young players to create a profit through transfers as being a way of managing the issue regarding superannuation payments, but this is a risky strategy to attempt. The more players the club produces, the more payments will need to be made and this could quickly result in a rather slippery slope for clubs should none of their youth intakes pay off. One or two bad years of youth talent and a club could quickly be in too deep.

However, the manner with which the PFA have pushed forward as the main option is also not ideal. While players should be free to leave clubs in order to find paid football, it should not come as a direct consequence to the league at hand. For every Luke Brattan the league loses, along with it goes a little more quality and respect the league has.

This is not a problem with an easy answer, as clubs needs to tread the fine line between keeping afloat and remaining competitive all while making sure they can provide the basics for any future growth. At this time, it appears the Mariners are pushing a little too far towards remaining competitive and providing for growth, with the construction of a Centre of Excellence being ranked as a higher priority by the club than the payment of players.

This all brings us back to the main question brought up earlier: why are there so many clubs in this situation? One could surmise that this is merely growing pains the league needs to go through. In the 10 years since the formation of the A-League, the competition has grown at a reasonably impressive rate both in terms of commercialism and competitiveness and the issues that face the clubs now are just the adjustments that need to be made in order to prepare the league for the next chapter of its history.

However, one could also argue that this is down to nothing more than severe mismanagement by the clubs in question, as they appear to have incorrectly prioritised and the issues surrounding these clubs are merely the just desserts owed.

With less than two weeks left in the year for these clubs to sort out their debts, this issue is going to become one more prevalent in the coming weeks as we could be hearing much more about the very issues at hand. But for now, it appears there is nothing more we can do but look on and wonder why and not so much how we can fix it, but how can we minimise the fallout.

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