Tottenham: Levy’s greed could cause future problems
The announcement this week of the significant sums paid to Tottenham’s chairman could have ramifications in what is set to be a crucial period for the club.
A Spurs press release on Tuesday, detailing the headline figures for the club’s most recent financial year, was full of positives.
Club revenues in the 2016/17 season had tipped over the £300 million mark for the first time in Tottenham’s long history, an increase of nearly a third on the previous season, whilst profits before tax of £58 million represented the second highest such figure in the entire Premier League.
The club confirmed that investments in their long-term future continued apace. The Northumberland Development Project (i.e. Spurs’ new home) and the new state-of-the-art academy, ‘The Lodge’, were said by chairman Daniel Levy to have benefited from “extraordinary levels of financial and human resource”.
Yet a notably absent figure was one relating to Levy himself. The remuneration of football club executives does not quite attract the intrigue and opprobrium afforded to, say, that of university vice-chancellors but the release of Spurs’ full Annual Report later that day still raised a few eyebrows both within and outside North London.
Levy, in his sixteenth year as club chairman, received over £6 million for his efforts across the year.
The chairman’s defence
That figure meant Levy was comfortably the best-paid director in England’s top division last season. Ed Woodward, executive vice-chairman at Manchester United, the world’s richest club, was paid less than half as much as the Spurs chairman over the same period.
Furthermore, Levy’s considerable compensation is jarring when set against the backdrop of the strict wage structure he himself has imposed at the club. That £6 million translates to roughly £115,000, a week, a sum which no current Spurs player commands as their basic salary.
In mitigation, nor is it Levy’s basic salary. Last season’s pay represented a 112% increase on the year prior, an uplift which is in large part due to one-off bonus payments. Levy was rewarded for not only delivering the move away from White Hart Lane to a new, 62,000-capacity stadium, but also for driving the club towards those record revenue levels.
Such income was achieved by the Spurs’ first foray into the Champions League for half a decade, not to mention their highest league finish for 53 years.
Levy has transformed Spurs in many ways and the current season continues to bear that out.
Only a three-minute whirlwind from Juventus ensured that Champions League progress was halted in the first knockout round and, while they are unlikely to finish as runners-up again this time around, Sunday’s 3-1 victory at Chelsea not only lifted their Stamford Bridge hoodoo but also essentially confirmed that the club is now a mainstay in the Premier League’s top four.
When Levy took over as chairman from Alan Sugar in 2001, he inherited a side that was the epitome of mid-table mediocrity.
Slowly but surely, he has overseen years of steady progression to a point where they now boast one of the most exciting teams in Europe. This has been achieved through long-term planning, a careful usage of funds, and no end of hard bargaining in the transfer market.
And yet, for all such a pay packet may be understandable, its unveiling could well plunge Levy and Spurs into difficult waters in the near future.
The chairman has implemented a salary structure whereby no one in the squad has been afforded in excess of £100,000 a week. Harry Kane and Hugo Lloris are believed to be the only two of the current squad who hit that limit and, although Kane, in particular, enjoys various bonuses on top, it is not surprising that several within the squad are said to have been surprised by Tuesday’s news.
Frictions were present even before the chairman’s earnings were widespread knowledge. Fullback Danny Rose openly hit out about his own wage back at the beginning of this season, whilst Toby Alderweireld has scarcely played since entering into his own contract dispute with the club.
With Kane perennially linked to moves abroad and the likes of Dele Alli and Christian Eriksen also attracting admirers from afar, Spurs will know new deals may be required to keep hold of such key players, particularly if no trophies are forthcoming.
For all their improvement under Levy, the club has won just a solitary League Cup during his premiership. That was a decade ago; their only hope of adding to it this season requires them to defeat Manchester United and, more than likely, Chelsea in the FA Cup.
Those mentioned above are not the only players seeking improved deals. Mousa Dembele joins Alderweireld in entering the final year of his contract this summer, whilst Eriksen and Son Heung-min – both outstanding this season – see their own deals run down in 2020.
Jan Vertonghen is another who is expected to engage in negotiations with the club this summer and it is difficult to see how the club will be able to deny any other first-teamers an increase should they come calling.
A level paying field
At £127 million, Spurs had the sixth highest wage bill in the division last year. In finishing second, they far outstripped expectations set by the widely held theory that a club’s salary expenditure keeps track with its league position.
Spurs players will be aware of this; if they aren’t, their agents certainly will be. The chairman was rewarded for increasing the club’s revenue, yet a significant proportion of that increase arose via the actions of those on the pitch.
Many observers had already felt Levy would have to break with his wage policy if he wished to retain the several stars that have been melded into a strong side by Mauricio Pochettino.
Following this week, he will find sticking to it an even more difficult task.
What do you think the long-term implications of Levy’s salary raise will be? Let us know by commenting below.