The new season failed to kick off on time after the poor state of club finances forced the government to step in with a new TV deal
By Eric Weil in Buenos Aires
Back in 2001, Argentina’s top-flight players held up the championship when they went on strike in protest at not being paid their wages. Not for the first time, they were complaining about the country’s poorly-run clubs, who raked in money with big transfers to Europe and from other sources, but then spent it badly – with some of it ending up in the wrong pockets.
On that occasion the Argentinian FA (AFA) lent the clubs money to pay their players and fulfill other financial obligations, such as tax. A condition of the loans was that the AFA would appoint independent auditors to check the clubs’ books. It never happened. Two years ago, the tax authorities, suspecting possible money laundering in the transfer of players abroad, asked the AFA for assistance in their investigations. The AFA, in turn, asked the clubs for details of who owned what percentage of player’s contracts. Hardly any clubs complied.
Eight years later, the start of the 2009-10 season was held up, again by the players. This time, the players union claimed its members were owed salary payments totalling £6.6million. The real amount owing was probably much higher but many players had not submitted formal claims. It has been calculated that the total debt of Argentinian clubs is around £33m.
Julio Grondona, AFA chief for the last 30 years and nearing 80 years of age, sprang into action – something he has not done very often in recent times – but he may have put his foot in it.
Grondona asked the league’s TV rights holders, Torneos y Competencias (TyC), which was due to pay £44m to screen games this season, to cough up more than twice as much. Not unexpectedly, it refused.
TyC’s head, Marcelo Bombau, pointed out that the local TV market does not earn nearly the amount asked for and said: “The clubs have been irresponsible with their finances and the AFA never controlled anything. So whatever money you give them, they’ll still not make ends meet.”
Grondona’s next step was to knock on government doors. Officials initially told him that state funds could not be used to pay the debts of badly-managed clubs and passed the ball back to television. However, it appears that the country’s president, Cristina Kirchner – who wants everybody to be able to watch football free on TV – then suggested Grondona should break the contract with TyC.
Grondona, who is also a FIFA vice-president and handles the world governing body’s finances, had been heavily criticised when he signed a lengthy contract with TyC in the 1990s, which was due to run until 2014. Grondona thus broke the deal with TyC (which is now seeking hefty compensation) and announced that the new championship would start one week late, with or without TV.
A meeting was arranged at which Grondona and club directors were due to meet president Kirchner, and an announcement was set to be made that the official state TV channel would televise soccer matches for free – the only such situation in South America – with the clubs receiving £100m for the season.
However, in a country where government guarantees are notoriously unreliable, some cabinet ministers are now denying such a financial transaction will take place.
Amid all of this, the clubs are claiming that their problems are all down to the global financial downturn and say they cannot sell players to Europe, as they have done in the past. Yet that is only a partial explanation for their financial mess.
Despite their claims, clubs are continuing to buy and sell players; the real problem lies with the investors who now own more and more of those footballers. These are not people interested in keeping players at clubs; instead, they want to profit by selling them on quickly, with very little of the transfer fee going to the clubs.
As an example of how unprofessional clubs have been, San Lorenzo – who have debts of £12m – have had to give several players free transfers in exchange for their salary claims, and the players union has said the club’s entire squad could claim free transfers. However, most clubs, despite their debts, continue to give their hooligan gangs free tickets and pay for their transport to games.
Players union secretary Sergio Marchi says that if clubs not complying with their obligations were relegated, or had deducted points, as is the case in several other countries, the problems would be eradicated.
Perhaps he forgets this is Argentina, where football reigns supreme.