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Pat Nevin: Gretna will not be the last club to go through this nightmare



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AS THE good ship Gretna lurches from crisis to crisis each week, any last vestiges of sympathy are being wrung from anyone who ever believed in the dream. There are of course feelings for Brooks Mileson the man because of his serious ill health and his likeable character, but for Brooks the businessman there will be precious little compassion around.
Each time a club crashes into administration I find myself tossed back into the period when I was at Motherwell and they went on a similar journey to save money. There were however differences in the two situations, for a start there was no point in
the entire saga when I felt that Motherwell FC was in serious danger of going under for good.

It was well documented at the time that I disagreed with the interim administration route and resigned on principle after working through the previous year slashing costs. Even then I had a buyer in place and ready to move before Bryan Jackson was appointed. Agreement couldn't be reached with the owners there and then, but I am convinced a deal would have been done if the club was actually on the brink of going out of existence.

All that hassle was painful enough to deal with but it was nothing compared with the pain and suffering of others. This is where the similarities between Gretna, Motherwell and any club that goes into administration are crystal clear.

We have read in the papers about the hardship suffered by the players whose contracts have not been honoured. Even though some were well remunerated over the years by a very generous owner, they have a right to feel aggrieved at being kicked out of their jobs at the start of what could be the deepest worldwide recession in generations.

Thoughts then turn towards other staff at the club who are in an even weaker position than the players. Everyone from the secretaries to the cleaners have not earned anything like the money the players have and many now find themselves suddenly out of work.

When I had to gather the staff at Motherwell and tell them the situation it was these people I felt most sympathy for. It was upsetting enough to see the girls crying; worse still was seeing the fear through the tears. Fear for an uncertain future when they had children, mortgages and bills to worry about as well as the torment of losing their respected place in the community.

Another group often ignored are those small businessmen owed money by the club who will never be paid back. They get a mention in passing but it might have taken decades for them to have honestly and diligently built up their small companies only to have them ruined overnight by 'a multimillionaire's romantic dream'.

If Brooks and his businesses have actually gone bust and all the money has gone, then there is less of a moral problem with letting people down and letting Gretna FC die, but if there is five or 10 million pounds squirrelled away somewhere then it is unacceptable. You often hear it said on these occasions that 'It isn't personal, it's just business.' Trying telling that to the folk who have lost everything they have worked for all their lives.

It was the same with the spivs in suits who tried to collapse HBoS a few weeks back, and in turn almost destroyed confidence in the entire banking system while they tried to make a quick couple of billion bucks. They would doubtless also have claimed it was "only business", while caring nothing for the millions of us who would have suffered in the fallout.

This may seem a long way from the SPL but the link is, who do we want running our football clubs?

I am convinced Gretna will not be the last club to go through this nightmare; there is absolutely nothing in place to stop it happening again and there are plenty of City boys and flush businessmen who crave the fame or simply want to 'enjoy the toy' without understanding their longer term obligations to the game.

The SPL has had its fingers burnt by the situation, having been forced to bail out Gretna once already. The clubs will be furious with this turn of events as they aren't exactly rolling in the green stuff themselves, but even they will be asking themselves 'what can we do to stop it happening again?'

Other sporting leagues have gone down the route of only allowing their members to spend a set amount on wages. A figure of 60% of turnover appears to be the agreed, sensible level that should be released to the manager to use in building a team. That is, of course, unfair on the likes of Celtic and Rangers who are also battling on European fronts most seasons, a totally different market that needs higher levels of finance.

The answer to this is that any monies that can be generated from wealthy benefactors, over and above the 60% of turnover, should also be made available to use on buying players, but only on condition that the money be lodged in a ring-fenced account before it can be spent and specifically it should not be loaned to the club. This would ensure clubs could not spend beyond their means however tempted they are.

Businessmen would claim this is naive, over-simplistic, not tax-efficient and even anti-competitive. I would argue that it would save football from overexposure to dangers it has managed to live without for over a century and it would secure these institutions from those who would callously or thoughtlessly use them for their own means.

We are regularly told that football clubs are only 'business', but they are in fact much more than that. They are part of our history and our culture. The clubs are often at the centre of our communities and engender a sense of belonging and shared desire. They can be beacons of national pride, as well as acute embarrassment on occasion if truth were told.

The SPL itself has been embarrassed this season and made to look foolish and amateurish more than once, though their biggest fault has usually been nothing more than failing to see what is crashing towards them from over the horizon.

Let me warn them now that, in the future, Gretna may be looked upon as a storm that had to be sailed through, but there is a tsunami waiting to strike unless action is taken now regarding those who are allowed to run some of our clubs.





The full article contains 1121 words and appears in Scotland On Sunday newspaper.
Page 1 of 1

 
1

Rolland,

06/04/2008 00:13:02
Oh queue the Hobo Finiance Experts telling us all Hearts will be next.

Interesting point about the 60% of turnover being allowed to be spent on wages. Would back this approach although I can't see the old firm ever agreeing. Is it not upto the custodians of the clubs, be it owner, board, chairman to ensure these things as good buisness pratcise ? In other walks of life a business spending like Grenta would have had the plugged pulled long ago
2

kiwidoug,

22 In A Row 06/04/2008 00:25:28
Who says Hearts won't be next? Do you (Rolland) have total faith in Mr Romanov.

We needn't worry about becoming a laughing stock. That has already been achieved. The next question is will we continue to exist.

In our current form and structure, I for one, very much doubt it.
3

GeorgeCowieOrWalterKidd?,

06/04/2008 01:01:10
Nevin is just another bandwagon jumper. Gretna are so obviously a complete anomaly in Scottish football. Their situation simply can't be compared to any others. They had no support, no ground and absolutely no hope from the moment they entered the SPL. How, with virtually no fanbase, Mileson or anyone else thought a village team could compete in the SPL is beyond me. And all the journos were far too busy ripping into Hearts to even notice.

Contrary to Nevin's message of doom, apart from Hearts (who have stated they have a plan to address their situation and at least have a fanbase and significant assets), Scottish clubs on the whole are much better and more conservatively run now - certainly compared to the period Nevin mentions a few years ago when Motherwell, Dundee and Livingston were all in deep doo-doo, Hearts were on the point of selling the ground, and only Celtic and Partick (out of all the SPL teams - even Hibs!) were said by analysts (proper ones, not Hibs fans) to be living within their means.

Just as Celtic and Rangers are an anomaly in Scotland (or even when compared to any league in the world) due to their fanbase being artificially boosted by, shall we say, non-football related issues, so Gretna are a completely unique case. Yet we continually hear how they serve as a warning to other clubs. Total nonsense.
4

Ajax MacKindling,

06/04/2008 01:25:58
1
you are spot on. Hearts could easy be next.
The rest of Scottish football will fall away behind them. There's no point being solvent if there is no one else to play.
5

uncle bulgaria,

06/04/2008 05:56:26
Oh Rolland relax.

Hertz will be alright even if they do go under.

A season or two in div one with a rented ground and they'll be back.

Hibs will have you under our green thumbs for a good decade though.

Bring it big team.
6

Puling Prince Roman,

Tynie insider 06/04/2008 07:09:20
#3 "How, with virtually no fanbase, Mileson or anyone else thought a village team could compete in the SPL is beyond me..."

Do you have 'ARROGANT DELUDED FOOL' tatooed on your forehead?

IIRC a village team did a perfectly good job of competing with Europe's Megaclub in their matches in the first half of the season, and IIRC back in January, when Mileson's illness and the financial problems started to bite, Europe's megaclub were about the same number of points ahead of a village team as, say, for example, Hibs are ahead of Europe's Megaclub now. I also recall a few nervous glances being cast over the shoulders on 'Sickbag'...

Not to worry. Once the Porcine Airfied is built you guys can take back your rightful place among Europe's elite. In the meantime, good luck with finishing in a respectable place in the bottom six.
7

Anglo Jambo,

Chorley 06/04/2008 08:21:18
Here we go again, someone always has to write in and compare Hearts to Gretna. They don't compare.

The problem is with Scottish football is that there are too many clubs for too many fans. We have 42 so called league clubs for a population of 5 million as England as 92 for around 50 million. figures don't tally. Gretna should not be replaced. I can understand about tradition and people will be against it but if clubs have to amalgamate to survive then so be it. It would reduce wage builds, grounds if owned could be sold to generate cash, if rented less rent to pay. Inverness clubs have proved you can achieved a lot more by amalgamation.
I know it will never happen with some clubs, too much pride. However a lot of clubs should look at it. How much stronger would Dundee be. Take a look at small clubs in close proximity of each other.

Hearts problems are not solely of Romanov's making, he didn't buy some of the over paid under achieving players. We know he has an ego and overestimated how good he thought some of his Liths were. Players look good if playing in a lesser standard of football each week.

A few more players will be going soon to balance the books, of that I am sure. If we have to give certain players away to get them off the wage bills then do it.

As for those who shout about Frail being permanent manager, it is a no no. He has carried a bit of luck and some of the games he has been in charge of has produced poor performances. When he continually thinks he can delude the fans by saying certain players are good and picking them.
8

Starchief,

06/04/2008 09:16:00
#7 Don't think there's really too much of a problem having the two Dundee teams. Both seem to get decent support. Likewise, QoS, Stranraer, ICT, Aberdeen, Dumbarton etc are there as much for the community as for success. But teams like Stenhousemuir, Albion Rovers, Cowdenbeath etc etc who have bigger clubs on their doorstep but no real community support should really be in the amateur/junior leagues. I know people can point to the occasional decent result but by concentrating the better players across a smaller range of clubs, there could be two, maybe three reasonably strong leagues.

BTW, I don't have much faith in Romanov but don't think Hearts will disappear even if he did pull the plug. Sure, they might be Hearts Utd and play at Murrayfield but, unlike Gretna, they have a support that would turn up, even if they were relegated and about to go bankrupt. Gretna are completely unique. Their hanger-on fans had a blast but everyone knew that, really, they were just fairweather supporters.
9

Stoobing,

London 06/04/2008 09:20:48
#7 - you're in cuckoo land. Hearts wages are Romanov's doing. £12k a week for players who wouldn't look out of place in teams with a top wage of half that? If you think that Hearts will be fine if Vlad pulls out, then you're a wonderfully optimistic fellow. Oh, and good luck wit the post split games. Gretna, ICT and St Mirren will provide stout backing to your theory.

As for Gretna, no this will never happen again. Illness aside, Mileson has shown a disgraceful shirking of responsibility at Gretna, happily leaving tens of people with mortgages and families high and dry because he, the Gretna management and the SPL couldn't be bothered to breach the "what if" question. Nobody will ever be stupid enough again to try what Mileson has, or back it.
10

Stoobing,

London 06/04/2008 09:23:31
Also, #7 Dundee United are on course to turn a profit of plus £2m this season. Amalgamation not needed from a Tannadice point of view, thanks.

Also, you should beware that anyone pertaining to be a football fan suggesting that clubs amalgamate demonstrates a full lack of understanding of what supporting a football club is all about. But then again, you support Hearts so that makes sense.
11

Dood,

06/04/2008 09:42:12
#9 - You make the valid point that everyone seems to have missed. Why exactly has Mileson been absolved of blame in this matter? Whilst I appreciate his illness is unfortunate (and I wish him a full and speedy recovery), this mess did not just surface overnight. Massive debts and unpaid bills were accruing for months/years.

And to the Jambos - No I don't think anyone is comparing you to Gretna. But for god's sake, how can any of you put positive spin on the current situation at Tynecastle. YOU ARE IN A MESS. Everyone else can see it, even some of your own punters are recognising it, why do you insist on keeping your heads in the sand and beLIEving that Uncle Vlad will come good?

Anyway, enjoy the bottom six.
12

brettgallacher,

edinburgh 06/04/2008 10:29:24
if vlad owns the club how come he takes over 3million in interest alone out of hearts if he owns and loves the club simple sell off all their assets players stadium etc then bolt with the cash, hearts fans better face the facts hearts are in dire straits and a baw hair away from going out of business
13

walkie,

Top 6 06/04/2008 11:30:28
The games a bogey, the yams are flucked and no amount of beLIEving will change it. Harsh but fair.
14

rorie,

alloa 06/04/2008 11:36:13
what is all this nonsense about clubs amalgamating?if clubs like my own home team alloa can survive without puting out the begging bowl what is wrong with that?do you honestly think that if alloa joined up with stirling albion or other clubs joined forces that they would attract super crowds,i think not.these clubs are doing more than just playing a game every saturday they are community based with other interests for the fans and local people, and their supporters are not stupid enough to think they are going to win the champions league, unlike the deluded glory hunters with some of the "bigger teams".anyway if queens park never signed sir fergie as a player and east stirlingshire did not employ sir fergie as a manager maybe manchester united would not have enjoyed the success that they have had in the past 20 years.maybe rangers and celtic should join together and try to get into the last eight in europe.
15

Bleeding Heart...,

06/04/2008 13:07:18
Nevin's article is a thinly-veiled reference to Romanov's conduct and the potential danger HMFC now faces.

But he has a point. What has Romanov achieved by increasing Hearts' debt from £20+M to almost £37M?

It's not like we're watching a team running away with the title (again) and reaching the advanced stages of the Champions League (again).

It's not like you can point to a highly-paid clutch of prize footballers coached by a respected, high-calibre manager on top-dollar, and equate the outlay with something tangible like on-field success.

So, why has this extra debt been incurred? And what has it been spent on?
16

Aitchie,

Craig Gordon Stand 06/04/2008 13:14:01
Big Rob the Hibbie - we love a bit of Hobonomics.
17

Aitchie,

Craig Gordon Stand 06/04/2008 13:15:39
#16 - what has it been spent on indeed? How the f**k can we have spent 1 million pounds on working out whether we can have a new stadium or not.
18

Puling Prince Roman,

Inside a tiny wee place 06/04/2008 13:59:58
#12 Big Rob
"Match day revenue DOWN over 7% (£4.9m / £5.3m)"

You raise some good points. One of the wee sweeties awaiting the bammers in the 07-08 accounts (assuming they get that far) is that matchday receipts will be:

1. The walkups for this season (now I wonder if they'll be HIGHER or LOWER than last season...), plus

2. The cash that's coming in now for the 08-09 season ticket sales (now I wonder if that's going to be MORE or LESS than this season's sales...)

Expect a substantial drop in revenues in the 07-08 Accounts... ;)
19

Puling Prince Roman,

06/04/2008 14:04:59
#18:
"How the f**k can we have spent 1 million pounds on working out whether we can have a new stadium or not..."

The good news that awaits you is that, as matters progress and as is the way with such projects, expenditure on development of the porcine airfield can be expected to grow year-on-year.

07-08 accounts will probably show an even bigger sum spent on the albino tachyoderm
20

Puling Prince Roman,

06/04/2008 14:08:21
*pachyderm*
21

GeorgeCowieOrWalterKidd?,

06/04/2008 16:06:06
#6 Gretna have a population of about 2,700. That's a village or at least a very small town. My point was they had no fanbase and no prospect of ever building a decent fanbase (which is what clubs need to survive and compete LONG-TERM need) even if every Gretna resident went to every game. But you ignore reasonable points and go off on a rambling rant instead...
22

GeorgeCowieOrWalterKidd?,

06/04/2008 16:10:43
#12 We can all cherry-pick quotes. The difference is that the auditors are required to point out dangers. The guy below who says "there is no real cause for concern" (as long as Romanov and UBIG are funding which they say they will and until they don't we have to believe them or call them outright liers) doesn't have to say anything:

From The Herald:

According to David Glen, a senior partner in PriceWaterhouseCoopers and a Scottish football financial analyst, the Gretna crisis highlights the inherent risks of single ownership of a club's entire financial infrastructure.

In the worst-case scenario - Romanov loses interest or is unable to maintain his investment - Glen believes Tynecastle Stadium is the key to Hearts' survival, but that reducing the debt in the meantime is in the hands, and bank, of their elusive owner.

"The level of debt is simply not sustainable with the business model Hearts have," he said. "Last year, they had a turnover of £10m, a wage bill of £10m and a £5m loss too. It is not an ideal model but the ownership structure is routed through Ukio Bankas and supported by the major shareholder. As long as he is prepared to do that, there is no real cause for concern but this season, with Gretna, we have already seen what happens when that support network falls away. Then you have real problems.

"In the context of Hearts and Gretna, Gretna have no real infrastructure, no SPL-compliant stadium and no fanbase. Hearts at least have the asset of the stadium, and the land on which it is built, therefore something can be done to restructure in the worst-case scenario."

I think I'll choose to believe Scotland's leading football analyst rather than a bunch of foaming-at-the-mouth Hibee opportunists who see a chance to profit from Hearts going under.
23

GeorgeCowieOrWalterKidd?,

06/04/2008 16:24:50
#19 Unless your Financial Director pal has a crystal ball and knows that Romanov and UBIG are going to sell any time soon (and, incidentally lose a lot of money at the same time as assets are less than the debt) his opinion is pure conjecture.
24

Another Albert,

06/04/2008 18:12:50
#24 - "I think I'll choose to believe Scotland's leading football analyst rather than a bunch of foaming-at-the-mouth Hibee opportunists who see a chance to profit from Hearts going under".

Excuse me, but that's a bit rich, isn't it?

It's not that long ago that therere were plenty of Hearts fans on here WANTING Gretna to go bust so that their results would be declared null and void. That desperation was fuelled by Hearts desire to profit from the likes of Hibs and Dundee United losing the points they won fair and square against the very same Gretna.

Pot? Kettle? Black?
25

GeorgeCowieOrWalterKidd?,

06/04/2008 19:52:59
#26 "the facts as I see them" - ie from a Hibs fan's POV. Are you sure you are well-placed to provide an impartial view?

In any case, the facts are that Hearts are still funded by Romanov and he is not, as you cheerfully say, "dead". What an optimistic fellow you are. Let's hope no-one in your circle gets a potentially terminal illness as you don't sound like someone who give them much hope - Rob the Hibee: "Well, Bill, the facts as I see them point towards your likely demise." Bill: "But I might live" Rob: "Sorry Bill, I know a doctor and he says the chances are you will not. Of course I don't want this to happen, but..." and on and on and on...
26

GeorgeCowieOrWalterKidd?,

06/04/2008 20:20:45
#26 PS. He didn't have his facts wrong. He was referring to the previous year's accounts, when wages were 10m. Still a ridiculous amount but totally explained by Romanov's attempt to speculate to accumulate.

Feel free to state another way that team's can split the Old Firm if not by taking a chance through increasing wages... because no other method has worked to date.
27

Cathcart Boy,

London 06/04/2008 21:53:29
Pat Nevin,
I very seldom agree with your "existentialism my way" pseudo intellectual writing, but in this article on the damage done by administration to employees and small businessmen you are spot on. (I do not see exact parallels with Hearts.) The Gretna administrators are even less football people than Bryan Jackson, and the SPL should simply tell them to clear off now the split is past.
28

WJR,

Leith 06/04/2008 22:24:55
#24 Walter, I'm no Hoboeconomist or DoomsdayHobo but the numbers are not that difficult for us simple folk are they? When the Pieman sold up there was a deal with Cala(?) which may or may not have covered most of the debt. Look at where the debt is now and land values for residential development have hardly rocketed since then.

We don't want Hearts to go out of business but the lack of a post split derby may start to get us used to the possibility.

 

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