Cold hard cash facts – the Gazprom method

Having vast reserves of cash with ways needed to dispose of it is always a difficulty, especially if said cash is not completely clean. You can stick it in the bank but for what? You can buy shares or land, but that’s old school.

Most of the time you’ll end up paying a heap of taxes on income so there needs to be a way to get around it, losing money! Sports are perfect for just such a thing, especially for money that should not be yours in the first place.

 

It’s not just dodgy Eastern European set-ups or Southern European clearing houses, it’s in our own backyards.

Whether unusual agent interactions (e.g. West Ham, Manchester United) or bulking up sponsorship deals to get around FFP (e.g. Manchester City, Liverpool), the bigger the deal, the bigger the red flag that should be raised, however the media remains largely compliant and many “investigative” journalists know what side their bread is buttered.

It can’t be stopped in England by the FA or Government though as the business of football is just too big. And the clubs will always run to that much maligned lender of last resort, FIFA, for help if there is any interference in their messing around, so here in Russia there is a chance to breathe life back into the game and be a World leader. Why? Because the Central Government is in complete control of everything and every club is a political plaything, even if they appear to be owned by a private business. Clubs will not dare to step out of line as to do so means immediate collapse.

As part of our investigation here we conducted a survey of players, clubs, agents and football officials. This I topped up with conversations with club supporters and respected foreign football agents.

The single question was: What Russian players from the Premier, FNL and Second Divisions would be good enough to play for a club in the top tier of: England, Germany, France, Italy, Spain? From a combined 84 respondents we got a total list of…six!

Even being generous and doubling the list, it still represents a tiny amount of players from nearly 100 professional clubs (discounting those who went bust and reserve teams). It is appalling, yet the wages continue to rise each year with negligible taxes due.

So this is where we need to start. There isn’t enough talent or resources in Russia to support the current number of professional clubs. So under the 2009/10 proposal, there should be 50 professional clubs with strictly enforced salary caps, licencing rules and standards of marketing, match day events, supporter comfort and community development.

In addition, each club is to operate youth structures from Academy to Schools (different beasts in Russia). Clubs need to work along the German model – 51% community owned.

The limit on foreign players was proposed to be ten (with five on the field) for Premier and six (with three on the field) for First Division. Which makes sense as there is a lot of dross in the top two tiers that could well be removed, local and foreign.

There was a set proposed salary cap of $5 million for the Premier and $1.5 million for the First Division, which would allow for almost all clubs to survive and thrive. Foreign players would demand more money while local players would be incentivised to get game time and get out of the country, or becoming leading stars in their own right.

Yet it will boil down to cash, or lack of it. The Continental Hockey league (or KHL) is the Kremlin/Gazprom attempt to flex muscle and spend money quickly. Gazprom and its companies sponsor the competition, organise promotion/marketing and fund the clubs (in varying amounts).

In only seven years they have managed to grow outside of Russia and into Kazakhstan, Slovakia, Finland, Belarus, Latvia and Croatia. The Ukranian team (Donbass) didn’t play this year, while Prague and Spartak Moscow pulled out for various reasons, though the benefit to hockey in general has been immediate.

Croatia have risen up the world rankings and next year will be one level below the elite World Championships, yet only four years ago were in the same tier as Ireland.

Gazprom has thrown money into clubs and infrastructure to give them a boost, something similar with pro football in Russia would work wonders, not just loading cash into Zenit and a couple of lower clubs. But with consistent, accountable support.

As well as money they could put their expertise and know how into marketing and building the game, from personal experience they have a strong central Corporate University with packs of good PR and Communications professionals.

There will be teething problems but at least not the disasters in waiting, political baubles, rich man playthings or criminal enterprises that we have at present.

They will be purely business run for the benefit of the community and those already in a good situation with decent facilities and youth development will be the greatest beneficiaries, ironically many of the leading current pro clubs will initially lose out. Medium-Long term football will blossom in Russia and the country will finally have clubs to be proud and a competitive National Team.

It will take time to make sure it works, though unless something radical happens now, Russian football is going nowhere but down.

Author Details

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Alan Moore

Russian based sports journalist and consultant, working with major clubs including Hajduk Split, Eintracht Frankfurt, Lokomotiv and Spartak Moscow. Current host of Capital Sports FM in Moscow, former international boxer and semi-professional footballer and commentated at the FIFA World Cup 2018.

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