A Note From The Chairman Hallett Outlines Club Position

Hi everyone,

I thought I would write a note to update you on what is going on at Argyle, and more broadly in the English Football League, to answer some of the questions posed by this virus-induced crisis.

Football clubs are obviously suffering financially from inability to play matches – they have no revenue, yet have continuing costs, including wages, for both players and non-football staff.

At Argyle we have reduced the impact of that problem by furloughing most staff, thus taking advantage of the government support scheme, but promising to top up all wages until June 30. We chose that date because it is the end of our financial year, and the date at which most player and loan contracts end. The club will, of course, lose money over that period, and I, as the major shareholder, will finance that loss.

We have been helped in managing cash flows by action taken by the EFL and the Premier League to accelerate payments due to us, and by HMRC in allowing us to delay payments of PAYE taxes that we owe (we do not owe any VAT). We have renegotiated some payment terms with our larger suppliers, but have committed to making our own payments to the smaller, often local, businesses that rely on us.

In the longer run, we need to manage the club so that our financial future is secure. That means that we need to be able to plan for a resumption of football, and income to cover our costs. The nature of the virus, however, means that that is impossible. We simply do not know when we will be able to resume playing football at all, let alone in front of the Green Army.

We do not want to play behind closed doors and believe that a resumption of football should not take place until it is safe for crowds to come and watch. That is partly for financial reasons; we need the revenues generated on match-day to pay the players - and no crowds means no revenues, unless some other body is prepared to fund our expenses.

More importantly, if it is not safe for a crowd to watch a contact sport, how can it be safe for a participant? We would respect any individual player who said he did not want to play until assured it was completely safe.

We suspect, therefore, that this season will not be completed in the normal way - by playing the remaining matches.

Alternatives include completely voiding the season, or halting it now, with those in the promotion positions being promoted (after adjusting for games in hand, based on average points per game already earned). This would mean promotion to League One for Argyle, but, believe it or not, that is not our priority. We think this is the fairest solution to an impossible situation. Note that we do not suggest relegation based on current league positions.

In thinking about the long-term future of football and the solvency of clubs, we support increased enforcement of existing EFL rules that govern how much clubs can spend on player wages - their largest expense, and the one that most often leads to financial calamity.

We think the current system needs some tweaks, but that increased monitoring of clubs’ finances and stronger enforcement against clubs breaking the rules and spending beyond their means would go a long way to making football more financially sustainable.

We would oppose any attempt to impose a “one size fits all” limit on player wages for each club in any division. We believe that clubs with greater resources should be able to pay higher aggregate levels of wages, and/or have larger squads.

The important criterion for us is that clubs’ revenues and expenses should match, or, if expenses exceed revenues, the shortfall should be made up with shareholders’ equity (not debt).

We believe that players’ wages are contracted and that clubs have an obligation to fulfill those contracts. We would not support a collective agreement to cut players’ wages. We recognize, however, that budgets for future seasons will be drastically reduced and new contracts are highly unlikely to be offered on terms similar to those given in previous years.

In the short-term, we also think that, once football is safe to restart, the transfer window should remain open for a continuous period, enabling clubs in financial stress to realise the value of player contracts where they are no longer in a position to pay contracted wages.

We think this crisis provides an opportunity to reset English football and the financial structures that support it. So, we also believe we should:

Restructure Academy compensation schemes, allowing clubs with successful academies to preserve the value of their players, and receive proper compensation for players who switch to other clubs in pursuit of professional contracts. Such restructuring would not only provide fair compensation, but help with the redistribution of wealth from upper echelons of the football pyramid.
Unify all the lower leagues in the football pyramid, enabling more extensive promotion and relegation between them. The result would be more fluidity throughout the pyramid, enabling clubs to find a level appropriate to their resources, without needing to face administration and without the apparent stigma of leaving the EFL.
We do not support restructuring the league into geographically-based divisions.

We have let the EFL know our position on these issues, but recognise that we will not always have our own way! There is a wide range of opinion within the League, reflecting the wide range of individual club circumstances.

The elected Board and the executives are working hard to find solutions that are best for the League as a whole. The Argyle board accepts that the wider interest – the survival of an effective football pyramid — is the goal we should all be trying to reach.

We own our stadium, are almost entirely debt free and I am prepared, in the short-term, to provide the financial support to see us through this difficult time.

Make no mistake though, this crisis has presented an existential threat to all football clubs. We are stronger than most, but not invincible.

Thank you for your support.

Argyle are in a good position to come out of this crisis at a big advantage to a lot of other clubs.

From that statement they’ve clearly adopted a preferred stance of not wanting games behind closed doors, which obviously benefits us as the longer this goes on, the less chance of this season being finished on the pitch, and conversely we do the same as the National League have today and get promoted by virtue of currently being 3rd.

Brent ~~~~ Hallett
Chalk ~~~~ Cheese

I like cheese.

Feck knows where we would be if brent was still in charge!

mouldyoldgoat wrote:

I like cheese.

Feck knows where we would be if brent was still in charge!

furloughs everything and have the GT's and bucket rattlers pay for it all.

Including his board member daughter.

Note from the Chairman Hallett wrote:

Alternatives include completely voiding the season, or halting it now, with those in the promotion positions being promoted (after adjusting for games in hand, based on average points per game already earned). This would mean promotion to League One for Argyle, but, believe it or not, that is not our priority. We think this is the fairest solution to an impossible situation. Note that we do not suggest relegation based on current league positions.

How does the club get over the dilemma of advocating promotion based on current position, but not relegation?  How do you do one without the other?

Hallett making the point many have made here....

[You must be registered and logged in to see this image.]

Notably that Hallett also makes two further point in that he's happy for now to fund Argyle in the short term and also that we're not invincible

Rickler wrote:

Note from the Chairman Hallett wrote:

Alternatives include completely voiding the season, or halting it now, with those in the promotion positions being promoted (after adjusting for games in hand, based on average points per game already earned). This would mean promotion to League One for Argyle, but, believe it or not, that is not our priority. We think this is the fairest solution to an impossible situation. Note that we do not suggest relegation based on current league positions.

How does the club get over the dilemma of advocating promotion based on current position, but not relegation?  How do you do one without the other?

The bottom line in this proposal is basically, no team starts next season in a worse position than they started this one ( no one is relegated.) A team either gains, or it is ‘even’.

This idea has been doing the rounds for a while now. Obviously, if things came to a vote, it would appeal to a lot of clubs closer to the relegation zone, than the promotion places.

We’ve set our stall out. When it comes down to it, every club will vote for a proposition that best suits them. But the longer this all goes on, the more chance of it happening in league 2, because teams will want to slash their wage bill by releasing out of contract players on June 30th.

For me I would relegate just 2 from L1, 4 up from L2, no relegation from L2 and 1 promoted from the National league and no play offs from that league
Let’s face it Southend and Bolton we’re coming down anyway

Got to be all or nothing Graiser. Knowing our luck all the other clubs will vote to just dismiss this season with no promotion or relegation at all.

I can't get my head around any of these proposed outcomes or see the benefit of any of them tbh. Why o why can't this season be put on hold and completed when it's safe to do so, whether that be in 1 month or 6 months. Apart from the out of contract issue with some players, which could surely be extended on a short term basis if both parties agree, why is football so different from any other industry/employee situation? If clubs can't afford to top up the furlough money to 100% then players and staff will have to cut their cloth and survive on the 80% like millions of others are having to do. I know both ends of the stick are covered in shit but mothballing everything and resuming from where we left off would be the best and fairest option imo.

Les Miserable wrote:

I can't get my head around any of these proposed outcomes or see the benefit of any of them tbh. Why o why can't this season be put on hold and completed when it's safe to do so, whether that be in 1 month or 6 months. Apart from the out of contract issue with some players, which could surely be extended on a short term basis if both parties agree, why is football so different from any other industry/employee situation? If clubs can't afford to top up the furlough money to  100% then players and staff will have to cut their cloth and survive on the 80% like millions of others are having to do. I know both ends of the stick are covered in shit but mothballing everything and resuming from where we left off would be the best and fairest option imo.

Contracts ending in June is the problem. If the players all agree to play on for fook all the clubs will go for it but the players won't offer that. The sensible thing would be for players to get paid pro rata per game at the same rate they are on now but a lot of clubs are saying they don't have the money.
The sensible thing IMO is to end it now so at least when we are ready we can start a new season.

Earwegoagain wrote:

Les Miserable wrote:

I can't get my head around any of these proposed outcomes or see the benefit of any of them tbh. Why o why can't this season be put on hold and completed when it's safe to do so, whether that be in 1 month or 6 months. Apart from the out of contract issue with some players, which could surely be extended on a short term basis if both parties agree, why is football so different from any other industry/employee situation? If clubs can't afford to top up the furlough money to  100% then players and staff will have to cut their cloth and survive on the 80% like millions of others are having to do. I know both ends of the stick are covered in shit but mothballing everything and resuming from where we left off would be the best and fairest option imo.

Contracts ending in June is the problem. If the players all agree to play on for fook all the clubs will go for it but the players won't offer that. The sensible thing would be for players to get paid pro rata per game at the same rate they are on now but a lot of clubs are saying they don't have the money.
The sensible thing IMO is to end it now so at least when we are ready we can start a new season.

Ending it now with no promotion/relegation is the next best option for me but it would feel like 9 months of effort from everyone involved in football including fans just thrown out the window. With the mothballing option out of contact players could be retained on short term rolling contracts if they are happy to do so, it's that or universal credit because transfers to other clubs should be a no no until things are back to almost normal imo.

Les Miserable wrote:

Earwegoagain wrote:

Les Miserable wrote:

I can't get my head around any of these proposed outcomes or see the benefit of any of them tbh. Why o why can't this season be put on hold and completed when it's safe to do so, whether that be in 1 month or 6 months. Apart from the out of contract issue with some players, which could surely be extended on a short term basis if both parties agree, why is football so different from any other industry/employee situation? If clubs can't afford to top up the furlough money to  100% then players and staff will have to cut their cloth and survive on the 80% like millions of others are having to do. I know both ends of the stick are covered in shit but mothballing everything and resuming from where we left off would be the best and fairest option imo.

Contracts ending in June is the problem. If the players all agree to play on for fook all the clubs will go for it but the players won't offer that. The sensible thing would be for players to get paid pro rata per game at the same rate they are on now but a lot of clubs are saying they don't have the money.
The sensible thing IMO is to end it now so at least when we are ready we can start a new season.

Ending it now with no promotion/relegation is the next best option for me but it would feel like 9 months of effort from everyone involved in football including fans just thrown out the window. With the mothballing option out of contact players could be retained on short term rolling contracts if they are happy to do so, it's that or universal credit because transfers to other clubs should be a no no until things are back to almost normal imo.

The EFL should just call it now and whatever the current positions are, leave it at that. Promotion and relegation awarded appropriately by the EFL, then tell clubs to prepare for a new season - whenever that may be ?.

Some clubs won't be happy about that but, it is not the fault of the EFL. The organisation has monies in place to help clubs who will find themselves in trouble.

mouldyoldgoat wrote:

I like cheese.

Feck knows where we would be if brent was still in charge!

Whilst everyone else is struggling, you just know Brent would be finding ways to make money out of other people's hardship.

thank feck he is away from the nhs now too.

seadog wrote:

thank feck he is away from the nhs now too.

Don’t think so somehow.

“In recognition of the extraordinary circumstances caused by the COVID-19 pandemic, following agreement with NHS England (NHSE) and NHS Improvement (NHSI), James Brent has agreed to continue as Chairman of both the Royal Devon & Exeter NHS Foundation Trust (RD&E) and Northern Devon Healthcare NHS Trust (NDHT) until June 2021.”

Suggesting promotion without relegation is frankly, idiotic. I can't see the Premier League taking in three extra teams  so we would end up with a 27 team Championship and a 22 team League 2. Less income for Leahue 2 and no time to play all the games in the Championship

Hallett's remarks about  restructuring the EFL seem to be "fair to all, but more so for PAFC" I can't see anything fairer than a playing squad wage limit on every team in a Division, with clubs with a bigger sustainable income able to spend more on transfers-which is the best way of distributing wealth between clubs. . It's quite interesting that SH seems to be hinting that Argyle should be allowed to spend more as they get better attendances, but even under the ownership of a financial expert like SH, they are losing money in normal circumstances!

I'm also struggling to understand  SH's comments re extending the transfer window so clubs can "realise the value of player contracts when Clubs are no longer in a position to pay Contracted wages." If Clubs (or any employer) fails to pay contracted wages, the employee is released from that contract, so no transfer fee would be payable. And does he think any lower league clubs will be in a position to pay transfer fees in the foreseeable future?

Reading between the lines, it's clear that SH is not prepared to keep signing the cheques, I suspect that the even worse Covid situation in the States is making him (or his backers) a bit twitchy.

I just hope Peter Ridsdale isn't planning a walking holiday once lockdown is lifted

Increasing relegation and promotion between the Leagues will lead to more uncertainty-bigger financial gambles to get promotion or retain status, and lots  of clubs that change leagues at season end tend to revert back within a season or two.

VillageGreen wrote:

Les Miserable wrote:

Earwegoagain wrote:

Les Miserable wrote:

I can't get my head around any of these proposed outcomes or see the benefit of any of them tbh. Why o why can't this season be put on hold and completed when it's safe to do so, whether that be in 1 month or 6 months. Apart from the out of contract issue with some players, which could surely be extended on a short term basis if both parties agree, why is football so different from any other industry/employee situation? If clubs can't afford to top up the furlough money to  100% then players and staff will have to cut their cloth and survive on the 80% like millions of others are having to do. I know both ends of the stick are covered in shit but mothballing everything and resuming from where we left off would be the best and fairest option imo.

Contracts ending in June is the problem. If the players all agree to play on for fook all the clubs will go for it but the players won't offer that. The sensible thing would be for players to get paid pro rata per game at the same rate they are on now but a lot of clubs are saying they don't have the money.
The sensible thing IMO is to end it now so at least when we are ready we can start a new season.

Ending it now with no promotion/relegation is the next best option for me but it would feel like 9 months of effort from everyone involved in football including fans just thrown out the window. With the mothballing option out of contact players could be retained on short term rolling contracts if they are happy to do so, it's that or universal credit because transfers to other clubs should be a no no until things are back to almost normal imo.

The EFL should just call it now and whatever the current positions are, leave it at that. Promotion and relegation awarded appropriately by the EFL, then tell clubs to prepare for a new season - whenever that may be ?.

Some clubs won't  be happy about that but, it is not the fault of the EFL. The organisation has monies in place to help clubs who will find themselves in trouble.

The thing is if you award promotion and relegation places it would more or less mean the best go up and the worst go down. There obviously be the odd bit of good and bad luck involved but for once we'd be on the right side of that line and others would have to suck it up.

mouldyoldgoat wrote:

I like cheese.

Feck knows where we would be if brent was still in charge!

Argo are safe under Simon Hallet, im sure, however the club would go out of business if Jimmy was running it, though Uriah Nool, would still be tugging the forelock and be fully supportive towards the master long after the baliffs had cleared Homepark out.

Graiser wrote:

seadog wrote:

thank feck he is away from the nhs now too.

Don’t think so somehow.

“In recognition of the extraordinary circumstances caused by the COVID-19 pandemic, following agreement with NHS England (NHSE) and NHS Improvement (NHSI), James Brent has agreed to continue as Chairman of both the Royal Devon & Exeter NHS Foundation Trust (RD&E) and Northern Devon Healthcare NHS Trust (NDHT) until June 2021.”

WTF!

Listened to SH on radio Devon this morning from the States, I think his interview was sensible and balanced, he is rightly sceptical about the logistics and practicalities of playing behind doors. As he said it is not consistent to bar crowds because of not being able to socially distance and yet players are expected to play a contact sport.
Null and void all leagues - the fairest way.

"More importantly, if it is not safe for a crowd to watch a contact sport, how can it be safe for a participant? We would respect any individual player who said he did not want to play until assured it was completely safe."

This is unavoidable. Add to that the thousands of non-playing staff interacting every round of fixtures, the travel and journalists attending. I miss football but life is just more important.

akagreengull wrote:

Graiser wrote:

seadog wrote:

thank feck he is away from the nhs now too.

Don’t think so somehow.

“In recognition of the extraordinary circumstances caused by the COVID-19 pandemic, following agreement with NHS England (NHSE) and NHS Improvement (NHSI), James Brent has agreed to continue as Chairman of both the Royal Devon & Exeter NHS Foundation Trust (RD&E) and Northern Devon Healthcare NHS Trust (NDHT) until June 2021.”

WTF!

he must have been given a big payrise then.

Angry wrote:

akagreengull wrote:

Graiser wrote:

seadog wrote:

thank feck he is away from the nhs now too.

Don’t think so somehow.

“In recognition of the extraordinary circumstances caused by the COVID-19 pandemic, following agreement with NHS England (NHSE) and NHS Improvement (NHSI), James Brent has agreed to continue as Chairman of both the Royal Devon & Exeter NHS Foundation Trust (RD&E) and Northern Devon Healthcare NHS Trust (NDHT) until June 2021.”

WTF!

he must have been given a big payrise then.

Something to add to his illustrious CV, alongside his insolvencies, non development plans and 'saving' a football club.