Independent regulator warns majority of English clubs are 'on the edge of financial disaster'
The independent football regulator (IFR) said in its 'State of the Game' report on 13 October 2026 that English football's finances are "dangerously exposed", with the majority of clubs living on the edge of financial disaster.
The report, published by the IFR, cites historical examples including Bury's expulsion from the EFL amid financial difficulties in 2019 and Maidstone's liquidation in 1992, and warns of "a dangerous cocktail of rising debt and an over-reliance on owner funding, leaving clubs and their fans at risk". The regulator states that 94% of clubs are loss-making and that more than 60% of EFL and National League clubs are technically insolvent.
The IFR provides several headline metrics: 94% of clubs in the top five English leagues made losses in 2025-26; 17 clubs across the EFL and National League would be loss-making even if their players played for free; 66% of clubs could not survive for more than 90 days without new owner funding; 29% reported they could not survive more than 30 days; and 68% have no contingency plan if their owner walks away. "Seventeen clubs are now trading in such a way that if their players played for free, their non-playing costs would mean they would go bust," IFR chair David Kogan told BBC Sport. "Thirty-two clubs are operating on only 30 days' cash. If the owner chooses not to pay cash at the end of the month, those clubs go bust."
Tasked with improving financial sustainability, the IFR outlined six areas of concern and urged clubs to adopt robust contingency plans in case owner funding is withdrawn. The regulator noted that, despite talks, the Premier League and EFL have not yet agreed a new funding settlement to share more money through the pyramid and warned that "if football can't find a solution we will consider our next steps and will not hesitate to use all the powers at our disposal to bring about lasting change". The report also presses clubs to explain how they incorporate fans' views and to take steps to improve boardroom diversity and governance.
The watchdog highlights a rapid growth in transfer financing as a source of liquidity: transfer financing rose from £55m in 2020-21 to £779m in 2024-25, and about £1.2bn of future transfer income has now been monetised through financing arrangements. Across English football, payments for transfer outgoings are about 3.3 times transfer incomings; in 2025-26 clubs reported approximately £4.8bn in transfer payables and £1.5bn in transfer receivables, creating a net transfer debt of about £3.3bn. The report warns that deferred transfer payments and transfer financing create links between clubs, owners and lenders that increase the potential for financial stress to spread.
Liquidity and wage pressures are prominent in the IFR analysis: most Championship, League One and League Two clubs hold less than 30 days of cash, more than 60% of EFL and National League clubs have liabilities exceeding the book value of their assets, and 20 clubs—primarily in the Championship, League One and National League—spent more than 80% of revenue on player wages. The majority of League One clubs spend more than 40% of revenue on player wages, including two spending more than 100%, and wage costs rose across all leagues between 2021-22 and 2025-26, including a 33% increase in the Premier League. Seventeen of 18 EFL club owners surveyed supported more robust cost controls, with one investor commenting: "the single biggest issue is player wages".
The IFR documents widening revenue gaps within and between leagues: in 1992-93 the average Premier League club earned £10.5m—2.7 times the average Championship club's £3.9m—whereas in 2024-25 the average Premier League club earned £341m, or 8.7 times the Championship average of £38.9m. From 2007-08 to 2025-26, a non-parachute Championship club's solidarity payments rose from £0.9m to £5.3m while a year-one parachute club's payments rose from £12m to £48.7m; the six highest-earning Premier League clubs now account for 56% of Premier League revenues and the average revenue gap between the big six and the rest widened from £9.4m to £421m.
The report states many clubs would not currently meet the Football Governance Act requirement to hold "appropriate financial resources" ahead of the May 2030 deadline, and Kogan said additional funding is close: "League One and the League Two clubs will receive significantly more funding [through a new deal with the Premier League]," Kogan said, adding that the funding would be used along with a development fund and a liquidity fund potentially to help clubs through current pressures. Kogan also said the new financial distribution deal between the Premier League and the EFL is close.