State of the Game report warns 94% of English clubs are running at a loss

English football’s new State of the Game report has warned that 94 per cent of clubs across the top five divisions are operating at a loss, with the Independent Football Regulator pushing for urgent financial safeguards across the pyramid.

The findings follow an 18-month investigation into the game’s finances. They show that, despite the Premier League’s position as the world’s richest domestic competition, its income is not being distributed in a way that guarantees stability further down the system.

Clubs facing the biggest financial pressure

• Championship and lower-division teams are spending heavily in pursuit of promotion or survival, often relying on owners to cover mounting losses.
• Seventeen clubs across the EFL and National League have operating expenses higher than their revenue before player wages are included.
• Thirty-two clubs have cash cover for fewer than 30 days, leaving them exposed if an owner withdraws backing.
• A typical Premier League club earns more than eight times the revenue of a Championship side, creating major financial drops between divisions.

The regulator described the current model as a dangerous mix of increasing debt and dependence on owner money. Its concern is that clubs and supporters can be left facing collapse when external funding disappears.

Chair David Kogan said the game’s £9bn annual income sits uneasily beside the widespread losses being recorded across the pyramid. He warned that clubs with less than a month’s cash available could become insolvent if their owner leaves or is unable to continue funding them.

Parachute payments and promotion pressure

The report identifies the gap between the Premier League and Championship as one of football’s key “cliff edges”. It also raises concerns that parachute payments can fuel riskier spending among clubs trying to reach the top flight.

That pressure has helped create repeated boom-and-bust cycles, with teams committing money on short-term targets while putting their longer-term security at risk.

What happens next

The regulator has set out a six-point plan aimed at making clubs more resilient. Teams would be expected to manage financial exposure more carefully, retain stronger cash reserves and prepare credible contingency arrangements.

The IFR also has legal powers to judge whether club owners and senior executives are suitable to run their sides. Kogan said football must use the present period of strong media-rights income and wealthy ownership to tackle its structural problems before the financial climate turns.

The stated target is to protect the Premier League’s leading status while maintaining the Championship as the strongest second tier in world football, without allowing promotion and relegation to push clubs towards financial ruin.