Tuesday, 8 March 2011

How not to communicate with Parliament and supporters

I had the pleasure of attending the Department of Culture, Media and Sport Select Committee hearing into "Football Governance" at the House of Commons this morning. The first witnesses were David Gill (CEO of Manchester United), Peter Coates and Tony Scholes (Chairman and CEO of Stoke City), and Niall Quinn (Chairman of Sunderland).

During questioning from Labour MP David Cairns about the impact debt had had on United, David Gill made an extraordinary statement (you can watch for yourself at 11.02:58 on this video):
"our net spend on players since the owners taken over [sic] was greater than in the five or six years before that"
Now that statement is not correct.

In the five years prior to the Glazer takeover (2001-2005), United spent a net £89.4m on players. From 2006-2010, the club spent a net £56.0m on players. You can see the full figures in this table:


I didn't make these figures up, they come from ten separate cash flow tables from the Manchester United plc and Manchester United Limited accounts filed at Companies House. I have chopped out the individual sections and you can see the originals below:

Pre-takeover cash flows


Post takeover cash flows


David Gill went on to explain at some length why he felt no need to engage with MUST or IMUSA and dismissed those fans concerned about the club's finances as "domestic" (outrageous!). He said the club was very good at communicating with its supporters and cited social media in Saudi Arabia as an example (let's hope they don't mention democracy).....

I think he needs to work on his communication strategy and he could start by giving Parliament the correct information.

LUHG

31 comments:

Darren said...

David Gill in fibbing shocker. He can't open his mouth without lying, or without insulting those who have made him wealthy. A pathetic excuse of a man. A man of no moral groundings and no self respect.

John Beech said...

Excellent to see him 'outed'.

pharrap said...

Perhaps he included wages as part of "net spend on players", not just transfer fees.

andersred said...

Hi pharrap,

I don't know whether you watched the video but it's pretty clear to me from the context that he is talking about transfer spending.

Whatever his motivation it is patronising nonsense to claim that paying out £200m+ in interest, £40m+ in derivative losses and £70m+ in banking fees has "no impact" on the club. It impacts everything from ticket prices onwards.

anders

Norman. said...

He makes me feel sick.

Anders, can I ask you to explain what the "tangible fixed assets" are? And what the figures next to them mean?

Keep exposing them for the lying, money grabbing toss pots that they are, you're doing a great job!

James Alger said...

Anders if only you worked for the Times/BBC or some such we could see Gill outed in the mainstream media for being the liar he is.

Only today the Beeb headline it with him bigging up the Glazers when surely the angle is. Gill tells lies to government.

He's appalling and quite why he was asked to comment is beyond me. Surely executives from a non-debt ridden outfit like Arsenal would have been preferable

Anonymous said...

What happens to the net transfer spending figures if you include the sixth year prior to the Glazers takeover (financial year 1999/2000) and the half year to Dec 2010?

Anonymous said...

Questions for the boys - higher net spent on players or decrease season ticket prices. What would the supporters like to see?

Tucker said...

Anon,

well at the moment we have neither so not sure what your point is?

LUHG

Darren said...

How's about getting rid of the Glazers and their debt and then we could spend more in the transfer market AND reduce ticket prices?

Luke said...

Hi Anders,

Do you have any plans to point this error to the committee? Surely you could just write to them, they need to be made aware that Gill lied to them.

Great blog by the way. Keep up the good work!

LUHG

Dicko said...

Haha - nice to see you shaking your head and smiling wryly in disbelief at Gill's worst bullshitting in that vid...

ja said...

I love the way Gill threw in the red herring of the nationality of owners. Reminded me of various american voices who claimed that the anti Glazer demos were anti semitic!

Anonymous said...

Hi Anders,
What is the actual net spend on players sold and purchased in the Glazers era? We owed quite a bit more money to trade creditors at the time of the takeover- about 20m. Most of the Rooney transfer fee was outstanding at the time. I guess you would need to allow for the credit\debit position at 2010 year end as well.
Do you have data for transfer fee inflation over the last 10 year period in the PL? It would be interesting to get a real money analysis as well.
Thanks

Anonymous said...

Also bare in mind some of the cash spent after 2006 were installments from transfers from before that date. Most of United's transfers pay based on appearances, and trophies won. Hence the £46m spend in 08, when correct me if I'm wrong we only bought Berbatov.

ted said...

hey anders keep in touch with those mp.who making reports about english football.let them know what's the truth of english football....

i m sure they will do something. b'coz process allready started .

ja said...

Anonymous 23.15,
as I understand it, the plc paid transfer fees up front in full. This was clear from the fight to get the full fee from Lazio for Jaap Stam not long after the club had signed Veron for much more. The question of offsetting what Lazio owned and were late paying against the Veron fee was a non starter as the Veron fee was already paid.
As for Rooney, who was a 'promising youth', the fee was split into various bonus add ons depending on how United did. I think this was also the case with Carrick. So if the Rooney add ons were payable that was because United were successful and therefore earned more money. So effectively a red herring in this particular debate

andersred said...

The accounts don't disclose outstanding debts for players purchased or money owed for players sold until 2001. In May 2001 the club owed £3m to other clubs on prior transfers and was owed £3.75m, so net virtually zero.

By June 2005, just after the takeover, United was owed £2.15m and owed £20.3m, a net liability of £18.2m.

The most recent full year accounts (June 10) show the club was owed £14.2m and owed other clubs £13.4m, a net asset of £0.8m.

What all that means is that within the £56m net cash spend since the takeover, is a net £19m of cash payments on transfers agreed prior to the Glazers taking over. Only £36m of the net spending relates to players bought and sold since June 2005.

anders

David said...

We have lies from top to bottom at our club, Gill/Glazers are excellent at alienating supporters but you never know what is round the corner. Arsenal knocked out last night, Man Utd must win on Saturday, Marseille next week Man Utd must win at home, but.....Anders keep up this tremendous work, you are a CREDIT to the fans and also the wider football community

Diem said...

I don't object too much about the rejection of MUST.

Their stated position is the removal of the Glazers, his bosses, so why bother? He can't do anything about the ownership, they don't want to talk about anything else - at least not in a substantive manner, it seems from their PR.

Anonymous said...

Diem,

Gill also opposed the takeover. Should he be banned from speaking to himself? I was in many a meeting where he came to SU (as it was then) for help in stopping the takeover. He said he would stand behind the barricades with us to use his exact expression. A £2m bonus changed that view.

Football fans are crucial to each and every club, without us they are shafted. Many clubs have fans that oppose the owners or chairmen etc, but I have never seen an official supporter trust shut out in the way MUST is in the history of the game. The fact it is the largest supporter trust in the history of UK football makes it even worse.

If Gill wished to show MUST are irrelevent - by stating that it is 170k people out of 330m fans worldwide as he did in that session - then why was the whole of Old Trafford covered in green and gold protest colours last season? Presumably under Gill's terms only 0.01% should have been protesting.

Clubs have a moral and social responsibility to talk to their fans. Even the Premier League accept it is madness for United to ignore fans groups.

Also interesting to hear Niall Quinn in that session talking about how Sunderland work with fans, on a daily basis. Gill could only point out the fans forum at United that meets 3 times a year (it met 4 times one year) and discusses key issues like the flavour of pies. The other examples Gill gave re communication were all one way - website, email updates, text alerts for tickets, MUTV etc.

Anonymous said...

Hi Anders,

"By June 2005, just after the takeover, United was owed £2.15m and owed £20.3m, a net liability of £18.2m.

The most recent full year accounts (June 10) show the club was owed £14.2m and owed other clubs £13.4m, a net asset of £0.8m."


Thanks for this. Would you not also need to include the contingent payment positions at the start and end of the period?
For instance, there was a contingency attaching to the Rooney transfer and you could assume that the conditions for payment were met in the Glazer period.
I notice that the accounts for 2010(and indeed earlier Glazer accounts) do not provide details for contingency payments due to the club but do note contingent payments due to others- has the club altered its policy wrt selling\buying players?
Thanks

Anonymous said...

thanks very much i am looking for something like this ask you to transfer this to my website.

http://www.herealmukalla.com/vb

Anonymous said...

http://www.forbes.com/wealth/billionaires/list?state=Florida&industry=-1&country=225

andersred said...

For those asking about net and gross spending as a proportion of the club's profits, see this new post:

http://t.co/yjyX0wT

anders

Rood said...

it is pretty clear that Gill is including wages - he wouldn't be so stupid as to go to the House of Commons with incorrect info.

andersred said...

Hi Rood,

God knows why he gave them incorrect info, lack of concentration?

He wasn't talking about wages (see the club's comment to Kelso in my second post). If you watch the video, David goes on to differentiate between "investing in players" and "investing in player contracts" (around 11:03:25). "Net spend" has no meaning when wages are included.....

anders

Anonymous said...

On Rooney: the PLC paid £11m of the eventual £29m (total) transfer fee. The Glazers paid the other £18m.

I think it's good that this and a couple of prior posts have helped to debunk some of the Glazer myths. For example, rather than the £13m quoted on various blogs, we actually spent a net £56.0m on players in the Glazer's first five years.

Rather than starving SAF of transfer funds we actually spent £144m on player registrations in the last three financial years (that's about £53m more than any three year period in United's history). The five year expenditure is £54m more than the PLC's last five.

If Real hadn't gone crazy for Ronaldo the net figure would have looked a lot more like the previous years. As andersred noted in a prior post, the Ronaldo money was a windfall ("These windfalls remain unspent"). It's hardly surprising that the bulk of that money is still in the bank.

Rood said...

Hi Anders,

I have watched the video now, without asking Gill for clarification it is difficult to be sure what exactly he is refering to - but it is fair to say that usually 'net spend' means transfers so he should have been clearer if he meant something different.

Are the Kelso comments from an article or is that from private communication between him and the club?

Anonymous said...

Hey Anders, what's the net spend over the same period at teams like Chelsea, Arsenal, Real and Barca? Many many thanks for your time.

la tienda erotica said...

Thanks so much for the article, pretty useful data.