CHRIS Hughton will be asked to keep Newcastle United in the Premier League without spending any money on new players as Mike Ashley takes a massive gamble in order to balance the club’s books.
Having pumped in more than £25m of his own money to finance the club after relegation to the Coca Cola Championship, Ashley appears to have decided he wants that money back immediately rather than spend any of the extra revenue generated by promotion on strengthening the squad. Despite insisting he still possesses long-term ambition to bring sustainable success to St James’ Park, it is short-term financial considerations which have apparently dominated Ashley’s thinking.
The Journal understands the news came as a shock to Hughton who has previously spoken publicly about the need to add three or four new players before the start of next season.
He will still try to do that, but he will not have any money to spend and he will be forced to rely on free signings and loan players. Indeed, even these signings could be called into question as free agents want signing on fees and money is normally paid to bring in players on a temporary basis. Some money, however, can be raised through the sale of existing members of the squad.
In an official club statement Ashley revealed last night he wants the club to “break even” by the start of the 2015/2016 season while simultaneously insisting the first priority was to “maintain Premier League status” despite the fact there will be “no capital outlay on new players.”
When The Journal attempted to clarify what “no capital outlay” means the curt response was that it meant “no capital outlay.” When The Journal asked again, through the club’s media spokesman, whether this meant there was no money to spend at all, the answer was “there will be no capital outlay on new players.” Newcastle are currently losing almost £40m a year and also have a £20m overdraft with the bank. Ashley has made the remedying of these financial problems his first priority now that promotion has been secured.
The statement said: “The Board of Newcastle United Football Club, whilst celebrating winning the Football League Championship 2009-2010, are aware that the next season in the Barclays Premier League presents a challenge to all at the club. “The board recognises that one of the greater elements of this challenge is to promote stability throughout the organisation. This great club has not won a major trophy since the 1969 victory in the European Fairs Cup. The first challenge is to maintain Premier League status.
“The club presented its financial report to Companies House this April for the year 2008/2009. The financial report shows that there was an operating loss of £37.7 million for that year and an estimated loss for 2009/2010 of £32.5 million.
“Newcastle United also has an overdraft of £20 million that is fully committed. It is clear to the Board that no organisation can be successful, until the financial position is stabilised.
“The board have therefore structured a five-year plan in which the ultimate goal will be to ensure that the club is run at a ‘break even’ manner by the year 2015/2016.”
Despite also talking about transparency, the statement went on to declare there will no further comment from any member of the board on any matter relating to Newcastle United, other than through prepared statements.
It will be left to Hughton to try and explain the sense in the club’s transfer policy as he is the only senior member of staff allowed to discuss football and financial issues with the media. It appears to be just one of the unenviable tasks ahead of him.