English Football Faces Financial Meltdown, Report Warns
A new report reveals 94% of clubs are operating at a loss, with many technically insolvent, highlighting a widening financial gap and unsustainable spending.
English football is teetering on the edge of financial disaster, with a new report indicating that 94% of clubs are making losses and nearly two-thirds of those in the English Football League (EFL) and National League are trading while insolvent.
The Independent Football Regulator's (IFR) State of the Game report calls for urgent reform, exposing a system of spiraling player wages, increasing debt, and an over-reliance on owner funding that leaves clubs vulnerable.
The financial chasm between the Premier League and lower leagues has grown significantly. In 1992, top-flight clubs earned 2.7 times the revenue of Championship sides; that figure has now ballooned to 8.7 times. In the 2025/26 season, Premier League clubs generated over £7.5 billion, while the Championship brought in £1 billion, and Leagues One, Two, and the National League combined accounted for £530 million.
This disparity is exacerbated by parachute payments to relegated Premier League clubs, which critics argue incentivize riskier spending in the second tier in pursuit of promotion. Meanwhile, rising operational costs have contributed to losses even before player wages are considered for many clubs.
Average losses have surged across the leagues. In the Premier League, losses more than doubled from £20 million in 2021/22 to £44 million in 2025/26. The Championship saw losses rise to £22 million in 2025/26, while League One and League Two losses more than trebled and quadrupled, respectively, over the same period.
Overall debt within the game has climbed from £2.8 billion in 2020/21 to £4.1 billion by 2024/25, with projections estimating it will reach £5.1 billion by 2026/27. Premier League clubs represent approximately 75% of this total debt.
The IFR has outlined a six-point plan to improve financial sustainability, including measures for managing financial risk, ensuring robust contingency plans, and promoting diversity and governance in club boardrooms. The regulator also advocates for a fairer distribution of revenue to reduce the "financial cliff edges" between leagues.
IFR chair David Kogan described the situation as a "massive contradiction," where highly competitive clubs exist alongside those facing potential ruin. He stressed the need for intervention, noting that a significant number of clubs would not survive if their owners withdrew funding.
The EFL welcomed the report, echoing concerns about disproportionate revenue distribution and its impact on competition and financial stability. The Premier League stated it shares the IFR's preference for a football-led solution to revenue distribution and believes its own proposals address the report's objectives.
The Football Association (FA) acknowledged the report's findings, promising to review them and collaborate with stakeholders to support the game's long-term financial health.