Brexit blog: A spectacular own goal?

Catherine Stihler MEPjpgCatherine Stihler MEP, in the first of a series of Brexit blogs, looks at the impact leaving the EU is likely to have on our national sport: football.

 

Since the vote by the UK electorate to leave the EU there have been a series of questions asked about what Brexit will mean for various sections of society and our economy.

In order to try and shine a light on what is going on and help my constituents keep up to date with the latest developments I have decided to do two things. Firstly, I have established a Brexit Bulletin (published every Friday) to provide updates on the political process and commentary concerning Brexit. Secondly, I am going to produce a weekly Brexit Blog (every Wednesday) to explore different aspects of the impact Brexit may have.

To kick-off (pun very much intended) the Brexit Blog series I have opted to dive into the potential consequences for our national sport: football.  Just last week I came across an article in the Telegraph that revealed the game developers of the popular Football Manager franchise had introduced changes ahead of the release of the latest instalment (FM2017) to reflect the vote in the June referendum and some of the possible outcomes i.e. ‘soft’ and ‘hard’ Brexit.

This got me thinking about the sort of future our football clubs face as a result of the vote and what varying degrees of soft/hard Brexit mean for players and fans alike.  I decided to begin by looking at player signings: the changing costs associated with signing as a result of the economic impact of Brexit as well as the effect on EU migrant footballers if the UK ends its participation in the Freedom of Movement of people across the EU (and EEA/EFTA).

The plummeting value of Sterling since the vote made the last transfer window more expensive for transfers between currencies.  The Pound Sterling (£) is the worst performing currency against the US Dollar in 2016 and if the current level is maintained, or falls further, we are likely to see transfers between UK clubs and those of other nations cost our clubs a lot more relative to pre-June 23rd prices.

An example of this would be the signing of Paul Pogba by Manchester United from Juventus for a record fee of €105 million. The transfer took place on August 8th of this year and cost approximately £89.1m (using an average price of 1.1781 EUR to 1 GBP that day). If the transfer had taken place two months earlier, on June 22nd, this transfer would have cost £80.7m (1.3011:1). The transfer of Paul Pogba, while already a startling sum of money, was made 10.4% more expensive as a result of the Brexit vote.

The story is even worse if you look at that transfer with the price of the Pound from yesterday.  That £89.1m would instead be a whopping £95.2m, a 6.8% increase on the actual transfer fee simply because of the sliding power of Sterling. Comparing yesterday’s price to the day before the referendum, as above, we see a massive 17% rise in price.

Not many clubs can compete with the Manchester United’s of the footballing world when it comes to purchasing power but that makes these weakening exchange rate performances more worrying.  Small to medium-sized clubs will be squeezed out of the market for the best players altogether or will have to decide between making one large buy to get in the best player possible and buying more players with smaller price-tags.

The Football Association’s (FA) former Chairman, Greg Dyke, said in his parting letter to the FA Board in July that Brexit would see greater opportunities for home-grown talent to succeed as foreign players could reduce in number.  This will be because of the rise in the cost of transfer fees between currencies and because of the end of the UK’s involvement in Freedom of Movement regulations.

Clubs have always been able to develop their own players at home and bring them through but had the ability to pick up the best players around Europe at good prices because of the strength of the UK currency.  Brexit isn’t creating a new opportunity for clubs; it is closing down other options. This looks more like using the UK’s EU membership as an excuse for clubs failing to develop home-grown players.

What does this mean for Scotland and the game here? Scottish football has had a long running problem in attracting the same kind of money to the game on this side of the border when compared to our larger neighbour.  The lower level of investment via TV deals and other advertising contracts means Scottish clubs give some kind of example to their English counterparts as to what lower purchasing power can mean.

Obviously the English Premier League is still one of the biggest leagues in the world and will continue to make billion Pound deals for coverage rights and so the comparison is not direct but Scottish football already exists within a tight fiscal environment. That economic reality is reflected in the proportion of non-UK footballers that ply their trade in the SPFL Premiership (Table 1). A weakening Pound means the gap between Scotland and England is only likely to grow still further in footballing terms.

In Scotland’s top-flight fifty-four per cent of players come from Scotland. Of the total players in the top twelve First Teams, seventy-seven per cent are from the UK. Expanding the net a little further to include players from the Common Travel Area (UK-Republic of Ireland) the numbers increase to eighty-two per cent of all players.

Scotland already draws on home-grown talent for the overwhelming majority of top-flight players but the non-UK market may be about to become even trickier for Scottish clubs to tap into. I mentioned briefly changes to Freedom of Movement could have a material impact on club signing policies and in Scotland the case is clear: ‘hard’ Brexit would be awful for our clubs.

Thanks to Freedom of Movement, Scottish clubs are able to sign players from across the EU (and EEA/EFTA nations that also sign up to this fundamental freedom such as Norway and Switzerland) with minimal fuss in terms of visas.

With the Conservative government moving to prioritise ending Freedom of Movement privileges over maintaining access to the Single Market we may be about to see some big changes to the way players are signed from the EU and a reduction in transfers driven by rejected visa applications.

In 2015 the Scottish FA published guidance on changes to visa application procedures.  If a ‘hard’ Brexit takes place footballers from the EU will be subject to the same visa restrictions that currently apply to players from the ‘Rest of the World’ as numbered in Table 1.

The rules require players to meet the following criteria:

1. The player must be sponsored by a club in full membership of the Scottish Professional Football League (SPFL) and can only play for clubs in those leagues during the period of endorsement.

2. The player must have participated in at least seventy-five per cent of their nation’s ‘A’ team competitive fixtures in the previous two years.

3. The player’s National Association must be placed at 70 or above in the official FIFA World Rankingswhen averaged over the previous two years.

If a player fails to meet one of these requirements the visa is rejected and the applicant club has an opportunity to appeal the decision based on mitigating circumstances i.e. the player in question is an exceptional talent or a young talent who has clearly demonstrable ability to make it to their National Association’s ‘A’ team in the future.

This visa appeals process has been used for emerging talent previously. A recent example in Scotland concerns the Celtic signing Victor Wanyama. Wanyama hails from Kenya and they do not meet the ‘top 70’ FIFA World Rankings requirement and so an appeal took place to make the case for his visa application to be granted.

A good way to assess the consequences of restrictions to Freedom of Movement in football on these shores is to look at the EU (and EEA/EFTA) players currently in Scotland and look at whether they would have met the visa requirements at the time of signing.  You can see the results in Table 2.

There are approximately fifty players from non-UK EU nations playing in Scotland (If you notice any omissions from this list please let me know so that I can update/correct), of that only one player, yes one player, would have automatically qualified for a visa at the time of signing.  Mikael Lustig from Sweden is the only player who would be playing football in Scotland if the visa rules that apply to non-EU players existed at the time of his transfer to Celtic.

There is also the situation with regards to current non-UK EU nationals working in the UK.  The UK Government has yet to confirm whether or not new visa restrictions will only apply to EU migrants post-Brexit or if it will also apply to those already living and working in the UK. While the UK Government use this situation as a bargaining chip in their Brexit negotiations, people live with great uncertainty about their future rights within the UK, footballers included.

A big question mark hangs over the continuation of the UK-Republic of Ireland Common Travel Area (CTA). Both national governments have stated clearly they wish to maintain the CTA as it existed prior to both nations joining the European Union and was protected during the time of EU membership.

The CTA is mentioned in the Lisbon Treaty and at no point has the CTA existed when one of the two members of the area were in the EU while the other was outside.  As the border between the Republic of Ireland and the UK is set become a land border between the EU and the UK – and the area is catered for within the EU Treaties – the EU will want to have a say on the CTA going forward post-Brexit.

The kind of Brexit we experience will be key to the nature of the CTA going forward.  Closing down our involvement in Freedom of Movement and the Single Market will potentially put great stress on the CTA and this creates uncertainty for RoI footballers that wish to play in the UK.  RoI players who would not meet visa requirements but who may continue to play in the UK depending on the existence of the CTA are highlighted in Table 2.

The ability of clubs to augment their squads with talent from across the EU would be severely diminished and this would have consequences for the ‘product’ on the pitch, potentially reducing the appeal of the SPFL in the short to medium term and further depressing earning potential from TV deals, ticket sales etc.

A lot of these players are older and not regular internationals, they wouldn’t make the visa requirements or justify an appeal. Perhaps a player like Moussa Dembele would meet the young talent criteria and win on appeal. The fact is, by going down this path we raise a lot of uncertainty within Scottish football.

In England there are some high profile players who come from the EU and could be considered ‘late bloomers’. Dimitri Payet, from West Ham United, or N’Golo Kante, who won the Premier League with Leicester City, weren’t regular internationals or considered exceptional talents prior to signing their contracts but look what they have gone on to produce on the pitch? They almost certainly would not have been granted visas and football on these shores would have missed out on their skills.

EU membership also allows UK football clubs sign EU nationals between the ages of 16 and 18.  Going back to Manchester United for an example we see Paul Pogba was signed initially on a youth contract at 16 years of age before leaving and returning for that monumental record fee. Arsenal also signed a young Cesc Fabregas – who is to say the next Fabregas will opt for a top Spanish, German or Italian club at 16 or 17 instead of waiting to turn 18 to sign for a top British club? Would Arsenal’s Hector Bellerin have hung around waiting for his 18th birthday or would he have gone elsewhere? The list goes on.

What does Brexit mean for football fans? In short it means higher costs. If clubs lose out on top players and the product diminishes in any way the revenues from advertisers and sponsors will not be as lucrative.  Clubs will have to either reduce their transfer kitty or put up prices to fill the gap.  If transfers for EU players cost more, thanks to the weaker performance of the Pound, then either clubs will ask for more cash from their fans to continue buying the best players around or they will have to recalibrate their signing policies.

None of this touches on the rising inflation that is coming nor the potential for higher costs as a result of tariffs being applied to imports.  A trip to the football is about to cost even more on petrol, more for a drink in the pub (for those not driving obviously), more for food before or during the match and more for season tickets next season and beyond. Many working class football fans have already been priced out of the game in recent years, this is the last thing they needed when looking to get away from it all at the weekend by watching their favourite team.

In the end we have to ask ourselves: have British voters just scored a spectacular own goal?

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28 thoughts on “Brexit blog: A spectacular own goal?

  1. Catherine, you’re clutching at straws.

    There are people all over Britain who can’t afford to eat properly, have no/insecure/low paid employment and Dickensian living conditions.

    Man Utd not being able to afford a 105 Million Pound transfer fee? Who really cares?

    Next you will be complaining that the “top stars” wages are being cut by £20,000 a week!

    Talk about being out of touch with reality

    You…Labour Party? No wonder we are deep in the Turkish Delight, with elected representatives coming out with nonsense like this.

    1. “Talk about being out of touch with reality”? You do realise many people like watching football as an escape from the troubles in their lives, don’t you? It is our national sport too but hey, we can only talk about the issues you deem worthy.

      As Catherine makes clear in this article, this is just the first of a series of blogposts looking into a variety of areas where Brexit may have an impact. Get a grip of yourself, this doesn’t deny there are issues facing people with regards to poverty and employment but it does look at an area where people may be unaware of the potential consequences.

    2. Spot on Andy. What patronising woman Catherine Stihler is. She thinks she has to ” ….shine a light on what is going on and help my constituents keep up to date with the latest developments”. And the example she uses to explain what is going on is, football teams and how much more they will have to pay in transfer fews.
      In Catherine’s world EU citizens that have settled in Scotland and are now uncertain of their and their childrens future don’t enter.
      What next will Catherine help her constituents with in her Brexit Bulletin 2? the impact on the price of Bordeaux Claret?

      1. Maybe you struggle to read and understand simple English too Mr MacKinnon…

        This isn’t “the” example, it is “an” example of the impact and as Mrs Stihler says, it is the first in a series.

        Secondly, you may have difficulty understanding but she is producing a Brexit Blog *and* and Brexit Bulletin. This is a blogpost not a bulletin – confusing, I know.

        You do realise it is incumbent on our MEPs, all six of them, to make sure their constituents know what is going and and see the reality of Brexit in a number of areas. If she wasn’t doing any of this no doubt you would the first to complain.

        1. A Brexit Blog and Brexit Bulletin; I didnt know that Gerard, thanks for pointing it out. What a busy wee MEP Catherine Stihler must be.
          It makes me wonder, what the point of all this shining of lights is about. Ms Stihler will be redundant in two years time. She would be better spending her time looking for a new lob.

  2. A very well written, researched and interesting article indeed but perhaps it should have been published pre-brexit. the thing about an own goal is you can explain it, but it has still happened!

    Some might even run with your point to suggest that a weak pound means bigger fees for selling clubs – Scottish clubs selling to the Eurozone would see a bigger return if €1m is worth more than it was 12 months ago, and outside of the big two very few clubs in Scotland spend money on players. Most deals are free transfers. Also if avoiding Brexit is the answer to saving Scottish football, is that not an argument for Scottish Independence?

    After all, in the computer game you mention Scotland is not included as the simulation suggests that Scotland have left the UK.

    This was a brilliant article though and I am certain that the top UK sides are worried about the ramifications of Brexit.

    1. The article looks more at the visa issues in Scotland rather than fees and in England you would then have to conclude, following that line of selling for a greater return in £, that the weaker pound is likely to make English club players easier to purchase from the view of their big European competitors. If their players are easier to take and those clubs find it harder to replace them because of costs and visa restrictions then the game in England will suffer.

      I think that is some leap from avoiding Brexit to Scottish independence. An independent Scotland would not be inside the EU until it completed the accession process and ticked all the boxes which it would take some time to do. As you say, it is a computer game and it I would suggest it has oversimplified the situation for the purposes of the game.

      1. Well done Gerard, with your “interventions”.
        As a knee creepin’ suck up sycophant you are almost there.
        Just a little more lickin’……………..

        1. Gerard has been practising his little “interventions” for the past 40 years, but still wasn’t good enough to be ever included on a ballot paper.

          Psycho analise that, ya plooky wee wank.

  3. Scottish football is at the lowest level possible. So Brexit might force clubs to bring on young players rather than bring in duds and rejects from around Europe.
    English football is different. Awash with money, it faces two problems —–foriegn players will be more expensive to buy and will want paid in Euros.
    The other is that English clubs will appear a bargain to those from abroad. It should be realised that much of the money swilling around London is dodgy, and the spenders won’t care if a thing costs a hundred million or two hundred million, because football assets (clubs/players ) are a prime way to “wash” money.
    So well done, Catherine. You will need gainful employment as Brexit bites. Duncan better watch out!

  4. Brexit is important, but it is not as important as who wins the presidential elections in the US? We will soon overcome Brexit, the next US president is with us for four years!

    The gravity of events in the US is brought into focus as Scotland’ first minister in waiting flies out to the US to campaign for Hilliary against Trump.

    I for one am deeply proud Kezia has gone out to the US, Hillary will make Kezia very welcome and Kezia will have the opportunity to raise Scotland’s profile and network. Ee in Scotland have much to learn from the US.

    I also look forward to Kezia returning to Scotland and raising pertinent questions in parliament related to her visit. The Scottish public will be impressed by Kezia’s bold and brave initiative and she will make a complete fool out of Ms Sturgeon at FMQ, yes that woman who won’t let the irrelevance of independence drop.

    Well done Kezia, we are all so proud of you, a credit to labour and Scotland,

    1. Shona,, Brexit is a deeply serious issue, not least for the many whose jobs and life chances will be BADLY affected by it.
      Because of the impact of the USA on the world (not least by its military ), then obviously who leads that country is of great significance. But if it weren’t so significant to the world, it would be a hilarious event starring two badly flawed candidates.
      Neither Clinton or Trump is worthy of the post of Leader of the free world, and I doubt if either will serve a full term, given their character and background.
      Good luck to Kezia and to you, but your hero will not play any serious role in this, won’t appear by Clinton’s side, and if you can think of ANY pertinent question she can raise in Parliament due to her American jaunt, please feel free to share it with us.

      1. Brian

        I think you make light of Kezia without any justification or foundation what so ever, Kezia is:

        – Single minded and determined, she sticks to her guns when others change their minds

        – Provides a clear and consistent message that resonates with the Scottish people of all classes

        – Is a confident and brave leader, she has whipped the party into great shape since Jim left

        – Puts others before herself, she did not need to go to the US, she did it out of duty yo Hilary, a completely selfless act

        – Lastly, Kezia will not play fast and loose with our precious union with England, if not for monies from England how else would would Scotland survive and feed our poor? The union is cornerstone to Kezia’s moral compass!

        1. Shona, are you getting paid for writing this guff?

          “Single minded and determined, she sticks to her guns when others change their minds”

          She has flip flopped all over the shop on the issue of Scottish independence.

          “Provides a clear and consistent message that resonates with the Scottish people of all classes”

          We came THIRD in the last Scottish Elections.

          “Is a confident and brave leader, she has whipped the party into great shape since Jim left”

          Beam me up, Scotty!

          1. Andy:

            Kezia has turned the corner for labour in Scotland and we are now back. Kezia will be the next first minister in Scotland!

            Only this week Kezia defeated the hated SNP on their sectarian act, criminalising people for singing harmless songs is plain stupid.

            Kezia is leading the way on the US elections, brexit and much more.

            Regards brexit, Kezia believes the British people have spoken and we must make it work.

            Sturgeon on the other hand keps harping on about Scotland,this is getting us nowhere and only making Scotland look like parochial fools. We could never manage Scotland ourselves, this is plain to the whole world, only the foolish SNP believes this and sections of the population they have brainwashed with their control of the media.

            It’s time for Scots to grow up, the SNP and fixation with Scotland above Britain is running everything, Kezia will put that right by opposing another referendum, modernising the party in Scotland, taking advantage of brexit and the policies she and our top team are developing.

            Move over Sturgeon, labour are back.

          2. Awa an bile yer heid Shona!

            Yon lassie kezia is useless and gleachid, wits more, fur the chop pretty soon,

            Her performance wi Brewer three weeks ago was the final nail!

  5. Take it the 2019 EU elections are off side as far as the UK is concerned.
    Hate to say it but those on the left wing were outplayed at this European game.

  6. Shona,

    I admire both your positive outlook and loyalty to Kezia Dugdale and I hope that over time, you are proved to be right in what you say.

    On a positive note, I understand that Kezia is now pushing the UK wide wealth redistribution policy. The Tories are unwilling to do this and the SNP are unable to. Redistribution is a far better policy than a penny on tax. If Kezia continues to hit the Tories and the SNP with this policy it will cause them severe long term damage.

    Additionally, if she were to put the boot into the SNP over the Named Person Scheme and call for the abolition of Police State Scotland, it would certainly help restore democracy and civil rights to the Scottish people.

    However, Kezia would be wise to stay clear of the internal factional infighting within the Labour Party.

    Nevertheless, if we’re going to pick internal fights it should be with the 5th columnist SNP appeasers, who are itching to hang us out to dry, by forming a “progressive alliance” with our enemies.

    The enemy within is far more dangerous than the enemy out with.

    1. Andy

      I agree with you, Kezia should ditch all the Scottish this and Scottish that and place emphasis on our British roots and culture. Being Scottish never got anyone elected. It’s time others in labour release this!

      Those in labour who would work with the SNP are enemies of labour and Britain. These enemies within as you so aptly put it Andy, want to work with the SNP to scrap Trident. Kezia has it oh so right with Trident, we need it for jobs and those in Argyll should thank their lucky stars they have Kezia and Jackie looking after them. If it was not for Trident we would loose our seat on the UN Secuity Council and we would be less feared in the world and the others would take advantage of us.

      I see Kezia being leader in Scotland for the next ten years. Kezia will lead us to power and glory at the next Scottish elections, consolidate that victory and then move on to Westminster to become an mp after that, I see no limits to the objectives for Britain that she can achieve, nor the heights within the Labour Party she can rise to.

      Move over Mrs May, Kezia is coming!

    2. I agree with you I think kezia is hitting the nats hard a lot of nats are staying quiet trying not to rock the boat we are responding to the first in a series of articles on brexit I th ink brexit is a disaster on football the wages and fees are a disgrace I wold like some sort of system where some of the money can be diverted to local causes this is the first in a seirious on brexit I was on there remain side it was a uk vote and I want the snp to govern stop being so confrontational to the uk government see if they respond

      1. I agree with you absolutely David, the SNP should take the lead from Kezia, stop complaining about brexit and become fully in favour of brexit and partner with the tories.

        We as labour should insist the SNP work with the tories as labour are working with the tories in the Scottish Parliament. Labour and the tories made a good partnership to defeat the SNP last week on the sectarian bill,excellent job, filled me with pride. We should seek cooperation with the tories to stop the SNP across the board and remove them from office or damage them so severely they will never recover. This will protect the union.

        I for one would be in favour of labour working with the tories to ruin any education reforms Swinney comes up with. We will be able to point to the resulting failure of our children and place the blame on the SNP and labour can take the credit

        It’s time for labour to take the gloves off and use any and every weapon, be it the NHS, education or the elderly to attack the SNP and expose them for the shallow and inward looking bunch they are, in that respect labour has much we could learn fron Trump.

        labour are back!

        1. Hey Hothersal if you want justification for being called the RED TORIES, just read this comment by your new friend Shona.

          She wants labour to work with the tories to ruin the education systems in Scotland so our kids can fail.

          She’s a keeper this one, you are so lucky.

          1. Really disappointed with the US result, we will just have to work with Trump.

            As for working with the tories, labour must work with the tories as we did during the refrendum to defeat the SNP. We are unionist parties fighting a common enemy.

            I would look to form a pack with the tories so that we vote jointly against anything and everything the SNP tout before parliament. The more votes the SNP loose, the more the country will move to us.

            The biggest problem and enemy Scotland faces is the SNP, it is our patriotic duty to use every weapon we can to defeat them and seize power.

            Labour can learn from the tories, they wrap themselves in the union flag and win elections, we must use the union flag and win elections tool

            Lastly, we have no reason to attack the tories, they are our natural allies, fellow Brits and working with them is the quickest way to consign the SNP to the politcal dustbin. What a team Kezia and Ruth would form. I have no doubt if they work together they can engineer a vote of no confidence, opening the door for labour!

          2. If an SNP supporter wants to pretend to be a Labour supporter and post silly comments on here that’s entirely up to them. There is no vetting of identity here. Anyone could be pretending to be anyone else. Mike, for example, often pretends to be a rational human being.

  7. Duncan

    If you do not want labour people on labour hame, please say so.

    If you do not want labour people on labour hame promoting and supporting Kezia, please say so.

    If you do not want labour people on labour hame attacking the SNP please say so.

    If you do not want labour people on labour hame supporting our great union please say so.

    Getting behind our leader, attacking the SNP, supporting our union and creating alliances with other unionist parties is the way we will regain power!

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