Coronavirus: EFL clubs must not abuse government loans, says Mark Palios
Last Updated: 20/03/20 9:59pm
The English Football League (EFL) must ensure clubs do not abuse the loans they are eligible to receive from the government because of the coronavirus pandemic, says Tranmere owner Mark Palios.
The Chancellor, Rishi Sunak, announced on Friday the UK government would step in to pay people's wages, with grants that will cover 80 per cent of the salaries of retained workers
Companies will be able to claim up to £2,500 per month for each worker as the government bids to stop firms laying off staff due to falling revenue. It comes just days after Sunak announced a £330bn package to help small businesses.
However, Palios - who was formerly chief executive of the Football Association (the FA) - told Sky Sports News clubs may seek to use the money from the government to increase the wages they offer to players.
He said: "One of the things that the EFL has to do is look at the whole package from the government and decide how to ensure that all the clubs do make the most of the opportunity. I'll certainly push them to look at it, but the clubs themselves will be looking at how they access that.
"There are issues in the package, such as the loans - we're uncertain how that pans out. We'll be interested to understand exactly what the interest rates are, how we repay these loans, etc.
"I think that's a major amount of work for the EFL to get on with immediately, to make sure all the clubs access the support the government has given.
"If these loans are taken, I think there has to be some sort of conditionality around them, to stop clubs using that money to prop up what I think is already a very hot wages market, in terms of players' wages."
Several EFL sides have suffered well-publicised financial difficulties this season, with Bury even being kicked out of the EFL after failing to fulfil their fixtures.
Palios says the situation has become so perilous that the EFL should use the break enforced by the coronavirus pandemic to redress the the way clubs build their squads.
"I think the wages market, and the way it's constructed in the English game, is very dangerous," he said. "This is an opportunity for the EFL to move forward and look at a wage cap, to look at a squad-numbers cap.
"If they don't do that, we go straight back into the old scenario, which clearly isn't working. Clubs are not paying wages, administration is being mooted, there were winding-up orders in the courts.
"We lost Bury this season, which nobody wants to lose. What you don't want to see are these grants handed out and then propping up the wages in the market going forwards.
"So I think that has to be considered. The industry has a responsibility to self-help."