A recent report from the Independent Football Regulator (IFR) exposes widespread financial instability across English football clubs, revealing that the vast majority are operating at a loss, with a significant number effectively insolvent. According to the regulator’s State of the Game analysis, 94 percent of clubs reported losses, and approximately two-thirds of those competing in the English Football League (EFL) and National League are trading while insolvent, raising concerns over the sector’s sustainability.
The report highlights a growing financial divide between the Premier League and the lower leagues, describing it as a "financial cliff edge." Premier League clubs earn on average nearly nine times the revenue of Championship clubs, an increase from 2.7 times in 1992 when the Premier League was founded. This gap has contributed to escalating costs and an unsustainable arms race in player wages, which rose by 33 percent in the Premier League and more steeply in the lower tiers, reaching 71 percent growth in League One since 2021-22.
The IFR’s findings point to a "dangerous cocktail" of rising debt and heavy dependence on owner funding, which endangers club viability and leaves fans vulnerable. More than 60 percent of clubs in the EFL and National League are “technically insolvent,” and over a quarter would be unable to continue operating for more than a month without owner support. The report also criticizes the system of parachute payments distributed to clubs relegated from the Premier League, suggesting it encourages excessive spending in the Championship to secure promotion, thereby heightening financial risk.
Operating expenses have surged across all levels. Seventeen clubs at EFL and National League levels reported non-player costs exceeding total revenue, indicating losses even before player wages are factored in. Debt within English football has increased from £2.8 billion in 2020-21 to £4.1 billion in 2024-25, with expectations it could rise to £5.1 billion by 2026-27. Premier League teams account for roughly 75 percent of this debt.
The IFR report also reveals that while English football generated over £9 billion in 2025-26, the bulk of this—about £7.5 billion—was concentrated in the Premier League. The Championship accounted for £1 billion, League One and Two combined for roughly £460 million, and the National League contributed £70 million. Agent fees surged to £584 million, representing 17 percent of transfer costs.
In response to these challenges, the IFR calls for urgent reform and has proposed a six-point plan aimed at improving financial risk management and governance. Measures include requiring clubs to have contingency plans in case owners withdraw support, shifting revenue distribution to reduce disparities between leagues, and promoting greater fan engagement, diversity, and governance improvements at the board level. The regulator also intends to conduct annual risk assessments and has indicated it will intervene if the EFL and Premier League fail to reach a new revenue-sharing agreement, currently under negotiation for an additional £1.8 billion over 10 years.
David Kogan, chairman of the IFR, emphasized the contradiction at the heart of English football, with some clubs among the wealthiest globally while many others face severe financial distress. Both the EFL and Football Association have welcomed the report’s findings, whereas the Premier League maintains that its July financial offer to the EFL addresses numerous concerns raised.