Premier League clubs have rejected the implementation of a salary cap despite significant changes to the league’s financial regulations. The proposed new system was set to replace the division’s existing financial rules.
In a recent meeting, all 20 Premier League clubs convened to vote on the matter. Ultimately, anchoring, which essentially involves a salary cap, was not included in the new framework, with 12 clubs voting against the proposal, seven in favor, and one abstention.
However, the voting did result in some notable adjustments. A squad-to-cost ratio measure will now be enforced, replacing the previous Profitability and Sustainability Rules (PSR). This shift was approved by a 14-6 margin, with Manchester United and Manchester City reversing their initial positions to support the proposal.
Under the updated guidelines, clubs are now restricted to spending a maximum of 85% of their annual revenue on “football costs,” covering expenses like transfer fees and coaching staff wages. This model closely mirrors the one applied in UEFA competitions, where clubs can allocate 70% of their revenue towards player expenses.
Additionally, clubs endorsed the introduction of Sustainability and Systemic Resilience rules (SSR) to subject teams to financial health assessments through a series of tests. All 20 clubs voted in favor of this rule.
An alternative proposal that did not gain enough traction was Top to Bottom Anchoring, which would have imposed spending limits on clubs based on a formula tied to the division’s lowest-earning team. This proposal was not advanced, meaning the previous system under PSR, allowing clubs to incur losses of up to £105 million over three years, will remain in place for the current season.
Nottingham Forest and Everton had previously faced penalties under the old system, while ongoing legal disputes involve Manchester City and Leicester City. The Premier League confirmed that the new financial regulations will take effect at the beginning of the 2026/27 season, focusing on Squad Cost Ratio (SCR) and Sustainability and Systematic Resilience (SSR) guidelines.
SCR aims to cap clubs’ on-pitch spending at 85% of their football revenue and net profit/loss from player sales, with a 30% multi-year allowance available for additional spending. The new system aims to level the playing field, encourage financial responsibility, and streamline financial operations within the league.