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The coming storm in Australian football

December 6, 2011

Recently, the right-wing media made much of the increase in working days lost due to strike action. The Australian reported “employers declared that new figures showing there were 101,300 working days lost to strikes in the September quarter – the highest since June 2004 – represented a “huge wake-up call” for the government.”

The wake-up call being, of course, that the government must implement tougher anti-union and anti-worker laws than already exist. Well, the reactionaries may be horrified to hear that more  working days will be lost, if Australian football players are forced to go on strike

Adelaide Now reported that “THE Australian players’ union has not discounted taking strike action if the Football Federation Australia tries to enforce a wage freeze or reduction. ”

The Federal Government commissioned a report into the game into Australia, the Smith review, which made eleven recommendations . As it tends to be with government commissioned reports, it found that the workers (players) were earning too much and needed to have their conditions driven down. So, they advised that ‘at a minimum, the salary cap must be frozen, but it would be appropriate to explore options to reduce the cap’,’ as well as completely eliminate the minimum salary.

The problem with this, is that the players association signed a collective bargaining agreement that agreed to a minimum salary of $47,094 for players 21 or older and $38,020 for those below in August, nor would the players association agree to a freeze, let alone a reduction in the salary cap, with the head of the Players association Brendan Schwab, saying “‘It’s not happening.”

The basis for the call is that the review says that the players share of the income is unsustainable at the level that it is. They claimed that the players took in 46 per cent of the income generated, where compared unfavourably in their minds to Cricket (28 per cent), Rugby League (22 per cent) and AFL ( 20 per cent). The players association, have already pointed out how misleading this is  when they said “As the Socceroos take home between 6.8 percent and 10.12 percent of the revenue they generate, the overall share of Socceroos and A-League player payments of combined FFA and A-League revenue ranges between 21.36 percent and 29.34 percent,”

You can compare this figure to the American NBA players, who have just been involved in a bitter industrial dispute, their last collective agreement allowed players to receive 57% of all Basketball related income, almost three times the percentage that players receive in the major codes here.

The memory of  A-league clubs being in extreme financial trouble in recent years remains fresh for many people and may make it seem more reasonable that players should cut their wages “for the good of the game”.  But the clubs that have been put in financial trouble haven’t been put in that position by the players but rather by capitalists, who have withdrawn their capital when things don’t look so bright.

The problem, simply, has been with the ownership model that has been promoted by the FFA. This model, of encouraging big capital to come in and spend up big has proven disastrous for so many clubs around the world. Blackburn is one, as is Portsmouth. It can certainly can seem like a wonderful idea, when owners are spending up big but it can come with the cost of knowing it can be withdrawn, which leaves clubs bankrupt and some have ceased to exist. It is far from stable, let alone in any sense accountable to fans.

This, though,  is precisely the model that the FFA is promoting, as you would expect when the game is run by a multi-billionaire.  Indeed, one of the recommendations in the report is to call on the owners of the clubs to invest more in the game, make it abundantly clear that the game is already over-reliant on a small group of super rich individuals.

That a competition can pay its players well and be financially sustainable has been shown by the German Bundesliga. CNN reported last year that “The German Bundesliga has overtaken the English Premier League as the most profitable in the world, according to financial analysts Deloitte.”

The reason why was that “their clubs exercise more restraint over the wage bill,” than English Premier League clubs.

Dan Jones from Deliotte stated  “In the Premier League, the wages to revenue ratio is 67 percent, but it is just 51 percent in the Bundesliga. There are two reasons for this. Firstly, the licensing of clubs is stricter in Germany in terms of the financial regulations they have to adhere to.

“Secondly, rather than being private enterprises under the control of an individual, like Roman Abramovich at Chelsea, clubs are under control of the fans.

“The clubs’ fans are required to own 50 percent plus one of the shares — with the exception of Wolfsburg and Bayer Leverkusen, who are owned by corporations.”

So, the fan ownership model has proven more financially viable than the private capitalist model and it should be no wonder. When private individuals or corporations take over clubs, they are often motivated by short-term glory, either they see it as a vanity project or a good way to improve or enhance their brand image. This inevitably leads to big short-term spending projects, often on players transfers fees and wages, in the long-term these are unsustainable leading to financial difficulties, particularly when those same individuals or corporations are no longer willing to continue investing in the club.

Fans, though, see the club as an extension of themselves and are motivated first and foremost by its long-term survival. Ask any fan what they fear the most when it comes to their club and it ceasing to exist would inevitably be the highest. They are also interested in success, of course, which is why they are happy to pay players well but not at the expense of the clubs long-term survival. A club being on firm financial footing is also in the long-term interests of players. When clubs are in financial trouble, players, inevitably,  stop being paid.

That a government commissioned report would seek to put the blame on Labour costs should be no surprise. It firs neatly with this governments neo-liberal ideology but it is something that no football fan should accept.

It is a smokescreen for the fact that the current ownership model creates chaos. Nor should we accept that the answers to the problem to the game will be found in a government commissioned report. We can only look to the fact that the report found something wrong in players wage levels and nothing wrong with how the FFA managed Australia’s world cup bid to tell us that

The only way to begin to address the problems is if fans and players assert their right to have a say in how the game is run. It is their knowledge, their passion, their money and their skills in which the future of the game lies. This is often recognised enough in words. It seems time to recognise it in deeds.

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