The Premier League’s current Profitability and Sustainability Rules (PSR) will remain in place for the upcoming season (2025-2026) after discussions among member clubs at a recent shareholders’ meeting.

While there were expectations that a new financial model would be introduced for the 2025-26 season, its implementation has now been postponed.

Instead of holding a formal vote on replacing PSR with the proposed Squad Cost Ratio (SCR) system, which is currently being trialed alongside the Top to Bottom Anchoring (TBA) rules, clubs were asked to share their views.

Nearly all clubs supported the SCR model, except for one unnamed club that preferred to stick with PSR. However, there was no consensus on when the transition should take place. Despite differing opinions, the discussions were described as constructive and amicable.

Controversy Surrounding PSR

The PSR framework has been a contentious issue, with Everton and Nottingham Forest both receiving points deductions last season due to breaches. Introduced in 2015-16, the current rules permit clubs to incur losses of up to £105 million over a three-year period.

The decision to extend PSR for another season has raised concerns among several clubs and their supporters. Just last month, Manchester United informed fans that the club was at risk of breaching PSR regulations, which could lead to increased ticket prices.

There has been criticism of PSR by some clubs in the Premier League, arguing that it benefits the wealthiest clubs. There’s even been a suggestion of possible legal action against the regulations. Further, a Premier League manager has expressed concerns over how PSR seemingly forces clubs to sell academy players to stay compliant.

Reason[s] behind retention of PSR?

One major reason for delaying the introduction of new financial controls is the ongoing legal battle between Manchester City (Man City) and the Premier League. Man City is challenging new rules on sponsorship deals, arguing that they are unlawful.

Last year, an independent arbitration panel ruled against certain aspects of the Premier League’s Associated Party Transaction (APT) regulations, which aim to prevent clubs from securing inflated sponsorship deals with companies linked to their owners.

Additional factors influencing the delay include potential legal action from the Professional Footballers’ Association (PFA) regarding any changes to spending limits, as well as the uncertainty surrounding a proposed independent football regulator. The Football Governance Bill, which could impact financial regulations, is still under parliamentary review.

In addition, the Squad Cost Ratio (SCR) and Top to Bottom Anchoring (TBA) rules are currently being tested alongside PSR on a non-binding basis. SCR is similar to UEFA’s financial sustainability model, capping squad-related spending at 85% of a club’s total revenue.

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