Tomorrow, Manchester United dispatch representatives to a meeting of Premier League club owners, where they will cast their vote on the future of the defining financial issue of the day: PSR.
In their current form, Profit and Sustainability Rules have been in place since the 2015-16 season. Before that, the domestic system of spending rules was known as ‘Financial Fair Play’.
There are different financial rules at Premier League and UEFA level, and Manchester United have been under one form or another of limit since the European introduction of FFP in 2011.
Prior to 2011, United were, for all intents and purposes, operating in the Wild West. If a club wanted to spend £1bn, there was nothing stopping them other than their own cash reserves.
In many ways, PSR has its roots in Manchester. When Man City were bought out by Abu Dhabi royalty in September 2008, the wheels were set in motion.
The takeover was seen as a threat to the established order. And rightly so. City became a global football superpower almost by brute force. Initially, at least. Paris Saint-Germain also went down the sovereign wealth route in 2011, and – suddenly – football had two newcomers to its top table who, if unconstrained, could outspend their rivals hundreds of times over.
Domestically, the version of PSR introduced in 2015-16 has remained virtually unchanged. Then as now, United are still allowed to lose no more than £105m over a rolling three-year period, with adjustments for things like women’s team, academy and infrastructure investment.
- READ MORE: What Man Utd’s 2025 spending means for PSR, the ‘£300m buffer’, UEFA factor and Project 90
Ostensibly, the idea was to make clubs more sustainable. A cursory look at the aggregate losses of Premier League clubs – which stand at close to £2bn over the last three seasons – suggest that hasn’t been entirely successful. Man United have lost £392m since they last turned a profit in 2018-19.
That said, clubs aren’t going to the wall, the Premier League remains the most attractive league in the world for investors, and only a handful of clubs – Leicester City being the latest – have actually been charged with breaching PSR.
At the same time, however, there is a class of clubs who believe that PSR insulates ultra-wealthy clubs like Man United from failure while simultaneously freezing them out.
Those resentments, as well as a delicate dance between realpolitik and the libertarianism which characterises most billionaire club owners, will take centre stage at tomorrow’s vote on PSR’s future.
Manchester United’s budgets under proposed new PSR system
Sir Jim Ratcliffe has surprised a fair few football finance experts with his stance on PSR.
While the Ineos billionaire has had no problems asking the British government for help in the European chemicals industry’s trade war with China, he is – ideologically – a free-markets man.
That’s the philosophy he appears to be taking at Premier League shareholders’ meetings. He wants less regulation, not more. Reportedly, that means he is set to vote against two fresh proposals on Friday:
- Top-to-bottom Anchoring
- Squad Cost Ratio
Under Top-to-bottom Anchoring (TBA), United would be limited to spending a 5x multiple of what the Premier League’s bottom-placed club earned in prize money.
Based on the most recent figures available, that would limit spending to £546m
United, and indeed every Premier League club, should have plenty of grace here. In 2024-25, their spending on wages (assuming 75 per cent of their total was for the first team) was £235m, while amortisation (which is how clubs account for transfer and agent fees over a player’s contract length) stood at £193m, giving them a relevant spend of just under £428m.
When it comes to the proposed Squad Cost Ratio, United have a handy barometer in UEFA’s system, which limits club in European competition to spending 70 per cent of revenue plus a three-year average on player sale profit on first-team wages and transfers.
At UEFA level, the Red Devils’ limit here – again, based on the 2024-25 figures – sits at around £538m.
The Premier League proposes to set the cap at 85 per cent, so the domestic cap would be just short of £653m. So there is a variance of over £100m in terms of what United would be allowed to spend under the different systems.
Ratcliffe, of course, will hope that United will qualify for Europe more often than not, so it is the 70 per cent that they are looking at, but the implementation or otherwise of the Squad Cost Ratio at domestic level will have profound impacts on the club’s competitors. It has the potential to be a seismic moment.
Will Anchoring and Squad Cost rules be passed by the Premier League?
Manchester United are expected to join Manchester City in voting ‘no’ on the proposals to introduce Top-to-bottom Anchoring and a UEFA-style Squad Cost Ratio rule.
In order for a motion to be passed, the Premier League needs to have a two-thirds majority. Effectively, that means that if five more clubs join United and City, they will veto the proposal.
If one or more club abstains, the number of clubs needed to force an issue shrinks. However many clubs vote, a two-thirds majority is required.
Arsenal, in what appears to be a change of heart, are said to be sceptical of the rules in their current form. Newcastle United, Chelsea, Aston Villa and a handful of others have their own doubts about PSR, so the United-City axis will hope that they have the numbers to block the proposal.
Premier League shareholders’ meetings have been somewhat anticlimactic in recent months, with votes on the future of PSR consistently knocked back.
However, the conventional wisdom is that, once Manchester City’s ‘115’ charges case is dealt with, there is likely to be more movement in terms of reforming the spending rules.
But in another potential bulwark against change, the Premier League could face legal challenges from player unions and agencies, who argue that Top-to-bottom Anchoring would act as a de-facto hard salary cap, which could potentially violate anti-competition or employment laws.
United in Focus will bring you more reaction after Friday’s vote.
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