The AFL will implement measures to end footy’s arms race with a football department spending cap Daryl Timms
From: Herald Sun
February 26, 2014 THE AFL will move to end footy’s arms race with a luxury tax aimed at restricting football department spending to be announced next week when club officials gather in Adelaide for the season launch.
A footy spending threshold is expected to be set in the $20-21m range.
Clubs will forfeit 50 per cent of each dollar they spend over the “cap”, with the tax to be used as part of an equalisation fund formula to bolster the football department spending of poorer clubs.
The aim of the equalisation fund is to bring the football department spend of poorer clubs up to that of the league’s financial leaders.
Last season footy spending, which includes player payments, ranged from $16.9 million to $22.5 million.
While it’s understood the cap will be introduced for 2015, some clubs believe it should be phased in over at least two seasons in a bid to protect the jobs of some staff, who could be made redundant if their club is forced to comply with reduced spending.
Several clubs are committed to long-term projects, including overseas training camps.
And some clubs also expect to be told next week that Sydney’s extra 9.8 per cost of living allowance in their salary cap will be wound back.
Rival clubs have been angered that the Swans have been able to poach Kurt Tippett from Adelaide and Lance Franklin from Hawthorn on multi-million-dollar deals in the past two years.
Capping football department expenditure has the support of most of the 18 clubs.
They admit something has to be done to stop what some describe as excessive, and in some cases silly, spending.
Clubs bosses are also bracing for the taxing of their revenues by the AFL as part of the equalisation fund.
“It’s one of the most controversial issues we’ve been faced with,” one club boss said last night.
“The AFL has a formula and they know how much they want from some of the clubs and it’s a tax on revenue and no one knows how it is going to work.”
An AFL spokesman said last night clubs would be provided with an update of the discussion on equalisation at next week’s meeting in Adelaide.
He said there were ongoing talks with the 18 clubs, but nothing had been “set in stone’’ at this stage.
There was a $5.6 million gap in what the poorest and richest clubs spent on football department matters last year.
Collingwood generated $75 million in revenue in 2013 and spent $22.5 million on its football department.
The Western Bulldogs and North Melbourne spent $16.9 million.
http://www.news.com.au/sport/afl/the-afl-will-implement-measures-to-end-footys-arms-race-with-a-football-department-spending-cap/story-fnelctok-1226837623961
