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Tuesday, May 28, 2024

Premier League: Why were Everton deducted more points than Nottingham Forest?

Nottingham Forest discovered their punishment for breaching the Premier League’s Profit and Sustainability Rules on Monday as they were handed an immediate four-point deduction.

That penalty plunged Forest into the Premier League’s relegation zone, putting them one point behind Luton Town with nine games remaining in 2023-24.

While Forest have yet to confirm whether they intend to appeal, they hit out at the Premier League in a furious statement, saying the ruling harmed the club’s trust in the league.

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Forest are the second club to receive a points deduction for breaking the Premier League’s financial rules this season, with Everton losing 10 points – reduced to six on appeal – for breaching the rules in the four-year assessment period ending in 2021-22.

Everton are still awaiting the outcome of a second charge covering the next assessment period, as they bid to stave off the threat of relegation.

The Toffees may well be wondering why Forest received a smaller points deduction than they did – particularly given Forest exceeded their loss limit by £34.5million, compared to Everton’s £19.5m.

Here, we run through the findings of the independent commission which heard Forest’s case to shed some light on the differences between the punishments.

What are the Premier League’s PSRs?

Premier League clubs are assessed against the competition’s Profit and Sustainability Rules, with a maximum loss of £105m permitted across a rolling assessment period, usually comprising three years but taking in four seasons in all recent cases due to changes to combat the impact of COVID-19.

Clubs can claim ‘add backs’ towards their losses, which are costs the Premier League deems to be in the general interest of the club and football. For example, investment in club infrastructure, community projects, women’s football or youth development can be claimed as ‘add backs’.

How does Forest’s overspend compare to Everton’s?

In Forest’s case, they were held to a stricter upper loss limit due to the fact they spent much of the assessment period under the Football League’s jurisdiction, before winning promotion in 2022.

They were permitted to lose £61m, so their overspend was 57% of the threshold, as opposed to Everton being 19% over their £105m limit.

Everton’s total losses for the period ending in 2021-22 were around £124.5m, while Forest lost circa £95.5million in the period ending in 2022-23.

What was Forest’s case?

The extent of the club’s overspend was not the only thing considered by the commission, however. Forest put forward six points of mitigation.

The commission rejected all but one of those argued points of mitigation, including that pertaining to the £45m sale of Brennan Johnson to Tottenham, which went through after the end of the accounting period in September 2023.

Forest argued they could have avoided a breach by selling Johnson earlier in the transfer window and claimed holding out for a larger fee was within the spirit of sustainability.

The commission, however, said that argument “flies in the face of mitigation” and rejected the club’s other claims surrounding the cost of promotion, a lack of sporting advantage gained and having a good financial record in the past.

The one point of mitigation accepted by the commission was that Forest supplied a guilty plea at the earliest opportunity and cooperated fully with the Premier League’s investigation. In fact, the commission ruled that Forest “displayed a level of cooperation which is above the level reasonably expected”.

Everton, meanwhile, were said to have provided “incorrect information” to the Premier League around their first charge, which seems to be the root cause of the difference between the punishments.

In Forest’s case, the commission considered a three-point deduction to be the “entry point for a significant breach”. They then deemed the circumstances and scale of the breach to be worthy of a further three points, but reduced that six-point penalty by two points after considering mitigation.

Will Forest appeal?

Both Forest and the Premier League have seven days to lodge an appeal against the penalty. Forest, unlike Everton, did not immediately signal their intention to appeal in their first response to the ruling.

The Premier League have marked May 24 as a ‘backstop’ date for any appeals – from Forest or regarding Everton’s second charge – to be finalised, raising the prospect of the relegation battle being decided after the season ends on May 19.

The Premier League is reportedly confident in its ability to expedite any appeal hearings so they are concluded earlier, however.

When is Everton’s second hearing?

Everton’s hearing regarding their second alleged breach will take place later this month. A verdict is expected to be delivered in early April.

Harry Carr
Harry Carr
Harry is a freelance sports journalist with experience of working for the Racing Post, Stats Perform, Opta Analyst and more, covering major events across all sports but holding a particular love for the beautiful game.
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