Shifting Tides in Football Finance: The Impact of the “Football New Deal” on EFL Dynamics

Times are rapidly changing in the Football League. The league has a nice new contract to show games over the next five seasons, pocketing $1.2 billion over the length of the deal with Sky Sports. That pales in comparison to what the Premier League gets, but it’s not bad. There could be more good news coming: the Premier League could be set to send another $125 million down the pyramid as part of the so-called Football New Deal.

With an extra $325 million to split up, better times could be ahead for long-suffering EFL clubs. Then again, there’s also one key reason that nothing might change. Here’s a look.

1. A Rising Tide Lifts All Boats

The EFL is at its best when all of its levels are competitive. Nobody wants to see a top-heavy situation where two or three clubs are clear favorites, three or four have no hope of doing anything but trying to avoid the drop and the rest are just kind of there. The best leagues have a handful of good teams that could win the league, keeping everyone engaged until the last day.

Adding money to the pot means more teams will have a chance to compete for talent and earn their way up the table. As smart teams get additional funding, they can set themselves up to find the pieces they need to win. Teams will need to invest in the right pieces at all levels, or they’ll get left behind.

2. Parachute Payments Still Exist

This is the biggest thing that could sink the EFL’s efforts to strengthen the pyramid. Over the past three years, the champion of the EFL Championship has always been a newly relegated side. In a team’s first season down from the Premier League, they still get 55% of Premier League money. AFC Richmond going straight back up in “Ted Lasso” was seen as a huge achievement, but in reality, one in five teams relegated does exactly that because it has a big financial edge.

Fulham, as shown in the image, made a swift return to the Premier League after the 2019-2020 season. Yet, their stay in the top flight was short-lived, facing relegation after just one season. Bouncing back, they secured their spot in the top tier four matches early and clinched the Championship title in 2021–22.

Relegation, right now, is a calamity. It should be a penalty, but it shouldn’t be disastrous. Nor should it be easy to bounce back. The best way to fix this would be to use this newfound money and create fairer payments for all to maximize competition. Anything that makes the EFL more even and more enjoyable to watch is a win.