John Oxley: My football team is on the brink – but a football regulator won’t save it

John Oxley is a consultant, writer, and broadcaster. His SubStack is Joxley Writes.

It may not be an optimistic time to be a Conservative Party member, but it is perhaps an even worse one to be a Sheffield Wednesday supporter as well.

With the new football season starting on Saturday, it should be a time of hope and excitement. For Wednesdayites, however, there is little to be had. Rather than dreaming of victories and promotions, fans are worried the club might not even survive. Indeed, it was only confirmed a couple of days ago that they would even field a team for the first match of the season.

For the club’s fans and the city of Sheffield, it is a moment of real peril. For football and its governance, the question of regulation comes into sharp relief. As Wednesday circled the drain this summer, the Football Governance Act became law, paving the way for the football regulator to begin work.

It remains unclear, however, what increased regulation will do for Sheffield Wednesday, or how it will stop clubs succumbing to the same forces that have brought it so low.

The predicament the Owls find themselves in is typical of other clubs that have faltered. One of the game’s oldest clubs, their history is marked with peaks and troughs of success and failure.

In the 90s, they were a founder member of the Premier League, enjoyed good cup runs and healthy league performances. As money began to pour into the game, they spent chasing greater success – and fell short. This led to a vicious cycle of debt and relegation. For a quarter of a century now, the club has hovered between the second and third tiers of English football. High-spending runs towards the premiership ended in disappointment, drops, reconsolidation and tentative recovery.

Yet now a bigger crisis is engulfing the club and threatening to put it out of business. The current owner, Dejphon Chansiri, looks either unwilling or unable to keep putting money into the club – but is equally unwilling to sell it for whatever offers have recently materialised.

This has turned questions of long-term financial stability into ones of an acute cash flow crisis. With Chansiri not topping up the money each month, Wednesday have been unable to meet many of their obligations. Wages have not been paid on time (or at all) for several months.

As a result, a host of players and managerial staff have left; the squad has just 16 players left and will be topped up by juniors and reserves. Until a few days ago, the opening match of the season was threatened by strike action.

Off the pitch, things are just as dire. Support staff, including low-paid workers like cleaners, have gone unpaid, leaving many in financial difficulty. A lack of maintenance has led to the North Stand being closed by the council, reducing ticketing revenue. The club’s large debts remain in place, including to HRMC, with some not serviced due to the cash flow crunch. Without a new owner coming in and plugging the cash gaps, it is hard to see how the club survives.

It is exactly the sort of story the Football Regulator is intended to stop: a storied, historic club being run into the ground by risky and capricious management. When in place, it will exercise control over who is allowed to buy clubs and check plans on how they are managed. It will have a suite of sanctions against owners and clubs to steer them into better practices.

It is hard, however, to see how it would have prevented this crisis. When Chansiri purchased the club, there was nothing to suggest he was unfit or improper, or that he lacked the funds to support the team, i.e. the two things that the regulator will check. They would have paid no heed to his apparent lack of understanding or ability in actually running a club, or whether he would run out of enthusiasm for it years later.

It is questionable, too, whether his financial plans would have failed: the club was sustainable so long as the owner was prepared to eat the losses; now he isn’t.

Even if the regulator did mind what the owner was doing, it seems unclear how they could correct him. Chansiri and the club have already suffered a host of sanctions from the league. His dealings around selling the ground resulted in a points deduction. Failure to pay wages has allowed star players to leave for free, and seen the club put under a transfer embargo until 2027.

The only thing more severe that the regulator could threaten would be a loss of licence, ending the club’s ability to play in the professional leagues – but it is hard to see how that would correct an owner seemingly happy to let it slide into insolvency.

There are only two things that could save Sheffield Wednesday. The first is Chansiri changing his mind and putting his hand in his pocket to meet the expenses. The regulator would have no ability to do this.

The second is a new owner. This again highlights the impotence of the regulator. They cannot conjure one up, only approve one. Even powers to force a sale rely on a willing buyer. It’s hard to see how a regulator will be willing to reject a new proposed owner if the alternative is a club going bust.

You cannot regulate away financial reality. Football clubs remain expensive to run, with the average Championship side losing £400,000 per week. Ambition is closely tied to an owner’s ability to absorb losses, and financial stability is in constant tension with the desire for success. Indeed, one of the perpetual complaints against owners from fans is that they are not spending enough to secure trophies and promotions.

The new governance systems will not change this dynamic, but will impose new burdens and costs on clubs, all without being clear about how they will save those who struggle.

The Football Regulator has been a cross-party proposal, introduced by Boris Johnson and steered through to completion by Sir Keir Starmer. It gained momentum as a knee-jerk reaction to top clubs threatening to break away from the Premier League. As so often with government projects, its remit has now spread and spread, but with little sense of how it will achieve its stated aims. Even this week, as Sheffield Wednesday has struggled, the Government has been vague about how a regulator might have changed this state of affairs.

It serves as the perfect example of how government creeps ever bigger. Football has become one of our most prominent exports without any regulatory intervention, but when the government spotted a chance to make changes that were superficially popular, it leapt on it. Now, a regulatory body will see its remit grow, find ways to intervene in successful businesses, and will be powerless against the fundamental dynamics that drive clubs to crisis.

If Wednesday does fold, it will be a tragedy for the fans, the game, and the city. That’s not enough of a reason, however, for government to be concerned with the running of football clubs. Nor is it evidence that the regulator will be able to stop such issues in future.

Indeed, it is precisely the sort of bad thing that people who believe in small government have to let happen – a tragedy, but no significant threat to national security or prosperity.

The story of Sheffield Wednesday is one of poor management and eventually running out of money. In other industries, some buyer might sweep in and save it. For the club, that still might happen. Yet it remains unclear in all of this how a regulator would have stopped this trajectory, what they would do now, or, indeed, why it should be the concern of government at all