The IFR State of the Game report and what it means for club leadership
English football generated more than £9 billion in revenue in the IFR’s 2025/26 dataset. Yet 94% of clubs across the top five divisions were loss-making before tax, and two-thirds of clubs responding to its funding exercise said they could not survive beyond 90 days without new owner funding. The report explains how those conditions developed. For owners, boards, CEOs and CFOs, it also sets out the work required to build a club that can withstand a financial shock.
The IFR State of the Game report at a high level
English football’s commercial success has not translated into financial resilience. The Independent Football Regulator’s first State of the Game report describes a system in which rising revenues sit alongside persistent losses, growing financial commitments and heavy dependence on owner funding. In its 2025/26 dataset, which combines actual and forecast information, 94% of clubs across the top five divisions were loss-making before tax. In a separate funding exercise, 66% of responding clubs said they could not survive beyond 90 days without new owner funding.
The report connects that vulnerability to the pressures shaping club decisions: promotion incentives, uneven revenue distribution, rising operating costs, debt and increasingly complex transfer financing. It also identifies weaknesses in contingency planning, board effectiveness and the way supporter views influence decisions. Its proposed response combines financial reform with stronger governance, better risk management and meaningful fan engagement.
Our view at Lagom Sports Compliance is that these findings make financial resilience a board responsibility. Owner investment can support ambition, but directors need to understand how reliable that funding is, what commitments depend on it and what happens if it stops. A credible plan must account for the time required to reduce costs, sell players or secure replacement investment. Governance should give directors the information and challenge needed to make those judgements, while supporter consultation should visibly inform decisions affecting the club’s identity and community.
Implementation must also be proportionate. Clubs need processes that reflect their resources, ownership structures and actual exposure, with clear responsibilities and evidence that controls work. For owners, boards, CEOs and CFOs, the practical priority is to test funding assumptions, prepare realistic responses to financial shocks and strengthen decision-making now. The report gives football a detailed diagnosis. Club leadership must turn that evidence into action.
Continue reading for our full summary and analysis of the IFR State of the Game report.
The Independent Football Regulator’s first State of the Game report brings together club financial information obtained through its statutory powers, ownership research, supporter evidence and governance surveys. It covers the 116 clubs in the top five tiers of English men’s football, including the Welsh clubs competing in that system.
The document is a consultation draft, with comments due by 8 December 2026. Its 2025/26 financial information combines actual and forecast data. Those qualifications matter when interpreting the figures, particularly when comparing them with completed accounts. [1]
Our view is that the report’s most useful contribution is the connection it makes between financial exposure and the way clubs are governed. It asks whether funding is reliable, whether directors understand the consequences of their commitments, and whether the club has a credible response when assumptions fail. Those are questions leadership teams should already be able to answer.
Commercial growth has left substantial financial exposure
The report recognises English football’s extraordinary success. Its clubs attract global audiences, investment and committed local support. The average age of Premier League and EFL clubs is 139 years. These are institutions with relationships that extend well beyond an ordinary customer contract.
Commercial growth has been substantial. Average Premier League club revenue increased from £10.5 million in 1992/93 to £341 million in 2024/25. Championship revenue also grew, but the gap between the divisions widened: average Premier League revenues moved from 2.7 times Championship revenues to 8.7 times over that period. [2]
That uneven growth helps explain the distribution of resources today. In the report’s 2025/26 dataset, Premier League clubs account for £7.5 billion, or 83%, of revenues across the top five leagues. Championship clubs account for approximately £1 billion. League One and League Two together account for around £460 million, with approximately £70 million in the National League. [3]
The financial consequences become clearer when costs are considered. Between 2021/22 and 2025/26, average player wage costs increased by 33% in the Premier League, 32% in the Championship, 71% in League One and 63% in League Two. Amortisation costs doubled from £1.3 billion to £2.6 billion. Agent fees increased from £317 million to £484 million. [3]
Amortisation spreads the accounting cost of acquiring a player registration over time. For a board approving a transfer, that means the commitment continues to affect future financial results. The cash instalments may follow a different schedule. Both need to be understood before the deal is approved.
The report also challenges the assumption that player spending explains every loss. Non-player operating costs increased materially in every division. At 17 EFL and National League clubs, those costs alone exceeded total revenue. Those clubs would therefore have made operating losses even without player wages. [3]
Average losses before tax for the 2025 to 2026 season
The scale relative to revenue is especially concerning below the Premier League. For every £1 of revenue, the average non-parachute Championship club lost 64p before tax. The equivalent figures were 67p in League One, 43p in League Two and 57p in the National League. [3]
A board responding to those findings needs to examine the whole operating model. Cutting recruitment expenditure may help, but it will not resolve a club whose underlying facilities, staffing and other operating costs already exceed income. The right response depends on where the deficit arises and which commitments can realistically change.
The report also questions whether league spending rules will adequately constrain that exposure. Its Championship analysis suggests that using all available headroom under the new framework could increase total squad expenditure by £460 million. That is a hypothetical use of permitted capacity, rather than a forecast of actual spending. [3] For directors, the implication is direct: the club needs its own assessment of affordable commitments and financial resilience, even where a proposed budget falls within its competition’s rules.
Owner funding needs a credible contingency
Owner investment has supported clubs, infrastructure and sporting ambition throughout the pyramid. The report’s concern is the vulnerability that develops when a club needs repeated injections simply to meet its obligations.
The IFR requested funding information from 112 clubs. It asked how long they could continue operating if new owner funding stopped after the March 2026 payroll. Among respondents, 66% said they could not survive beyond 90 days and 29% beyond 30 days. These are conditional survival estimates, rather than predictions that those clubs will fail. [4]
The frequency of support is revealing. Between March 2025 and March 2026, 67 clubs received at least six funding injections and 28 received at least 12. A monthly funding dependency leaves little time to respond if an owner’s circumstances change.
The preparedness figures are more troubling. Seventy-six clubs reported having no funding contingency plan, while 71 did not forecast a downside risk scenario. The report’s separate analysis of cash operating days also suggests that many clubs have less liquidity than their own survival estimates imply. [4]
Our view is that this is one of the clearest governance findings in the document. Directors who approve expenditure dependent on future funding should understand the commitment behind that funding. They need to know its timing, conditions and availability, and what happens if the next payment does not arrive.
An owner’s wealth can be relevant to that assessment. The board still needs evidence about the resources available to the club and the reliability of the proposed support. A history of payments is useful evidence, but it cannot answer every question about future capacity or willingness.
Contingency planning must also be realistic about time. A proposed player sale is only useful if it can complete before the cash shortfall. Cost reductions depend on contractual flexibility. Replacement investment depends on a suitable investor, negotiations and any necessary approvals. The board needs to test those constraints before relying on the mitigation.
As we explained in the IFR-ready board pack, directors need information that allows them to challenge assumptions and make decisions. This report gives that discipline a clear financial purpose. Funding concentration, forecast cash shortages and the progress of mitigations belong in regular board reporting.
Financial distress requires continuous assessment
The report records 71 formal insolvency events since 1992, but only six between 2014 and 2026. That improvement should be recognised. A wider definition that includes significant overdue payments nevertheless identifies at least 20 clubs experiencing financial distress between 2018/19 and 2025/26. [5]
Its case studies of Bury, Derby County and Wigan Athletic illustrate how funding shocks interact with financial overreach and governance weaknesses. The consequences depend on the exposure already built into the club and the mitigations available when support or revenue changes.
The IFR’s exploratory modelling identifies liquidity measures as particularly informative about short-term distress. The sample contains only seven distress events, so the results should not be treated as a definitive prediction model. [5]
For leadership, the useful lesson is to assess the direction of risk continuously. A deteriorating cash forecast, increasing indebtedness or weakening funding availability deserves investigation in the context of the club’s wider circumstances. The absence of a formal insolvency procedure does not establish that those risks are under control.
Debt and transfer financing create future financial pressure
The report shows increasing exposure to debt and financing costs. Gross interest-bearing debt rose from approximately £2.8 billion in 2020/21 to £4.1 billion in 2024/25, with a forecast increase to £5.1 billion in 2026/27. This measure excludes non-interest-bearing shareholder loans. [6]
Interest costs increased from approximately £97 million to £455 million between 2020/21 and 2024/25. Debt therefore consumes more of the resources available to fund operations, while refinancing and repayment obligations remain live risks.
The balance-sheet position is also weak for many clubs. In the report’s 2025/26 analysis, 63% of EFL and National League clubs had liabilities exceeding the book value of their assets. Recognising estimated squad market values improves the picture, but 46% of EFL clubs would still have negative equity. [6]
Negative equity, an accounting loss and an inability to meet debts as they fall due are different conditions. The IFR identifies clubs whose liabilities exceed the book value of their assets as technically insolvent on an accounting basis. This does not, in itself, establish that a club is legally insolvent or unable to pay its debts as they fall due. Boards should assess balance-sheet solvency alongside liquidity, cash-flow forecasts, debt maturity and the availability of funding. A valuable squad may improve an estimate of the club’s assets, while offering limited help with an obligation due outside a transfer window.
Transfer debt adds another layer. English clubs reported approximately £4.8 billion of transfer payables and £1.5 billion of receivables, producing approximately £3.4 billion of net transfer debt using the report’s rounded figures. Annual transfer factoring activity increased from £55 million in 2020/21 to £779 million in 2024/25. Around £1.2 billion of future transfer receipts had already been monetised. [7]
Factoring allows a selling club to receive cash earlier from a finance provider. It can solve an immediate funding requirement, but it brings forward money that would otherwise arrive later. The board must assess the resulting future cash position, including outstanding transfer instalments and any recourse terms.
There is a wider dependency as well. Five lenders accounted for 93.6% of transfer financing activity identified since 2020/21. A change in their appetite could affect several clubs at once. Deferred payments also connect clubs to one another, allowing a missed instalment to create pressure further along a chain of transactions. [7]
Our practical conclusion is that transfer approvals need to include the full payment schedule, financing terms and effect on future liquidity. The sporting decision and the financial commitment are made together. The board should have a clear view of both.
Promotion incentives and distribution arrangements intensify the risk
The report identifies substantial financial differences between divisions and between clubs receiving different distributions. A Premier League club received between 10 and 17 times the domestic competition distributions of a non-parachute Championship club in 2025/26. A club in its first year of parachute payments received approximately five times as much. [8]
Parachute payments help clubs manage the loss of revenue following relegation. The IFR also finds that the current arrangements contribute to incentives for other Championship clubs to overspend in pursuit of promotion. These effects need to be considered together.
The sporting evidence requires care. Parachute clubs took 17 of the 30 Championship promotion places over the last ten years, but the report describes the evidence on their sporting advantage as mixed. It does not establish that parachute payments alone explain promotion outcomes. [8]
The IFR recommends distribution reform that supports financial stability, cushions relegation and allows clubs to rebuild their balance sheets. It also warns that additional funding could be absorbed into further cost increases unless spending behaviour changes.
That is a useful discipline for club boards. A budget should distinguish the income already available from the income dependent on promotion. Directors should see how the club would operate if promotion did not arrive, including the funding required to honour commitments already made.
The report discusses a Premier League proposal involving increased solidarity payments, an infrastructure fund, tighter financial controls and changes to parachute payments. These are proposals within the report’s discussion, rather than a completed settlement. The IFR continues to prefer agreement between competition organisers. Its statutory backstop involves an application, relevant conditions and mediation before any distribution order. [8]
Our view is that clubs should plan around their current resources while engaging constructively with reform. A prospective distribution agreement cannot safely fill a funding gap before its terms and availability are established.
Investor interest does not remove the need for scrutiny
The ownership market has grown substantially. The report identifies 78 transactions worth £7.2 billion between 2021 and 2025, compared with 30 transactions worth £2.4 billion in the preceding five years. Minority investment, institutional participation and more complex corporate structures have become increasingly important. [9]
Those developments can bring capital and expertise. They also require clubs to understand where control, assets and funding commitments sit across the wider structure. A stadium, training ground and club operating company may have different owners or financing arrangements.
The report’s illustrative investor-return analysis reinforces the uncertainty. Using enterprise-value changes and accumulated losses as proxies, it estimates an average return of minus 41% across 76 clubs over five seasons. Outcomes varied substantially with sporting performance. This is an indicative model, not a record of realised investor returns. [9]
For a board considering a sale or new investment, our view is that the questions should extend beyond the acquisition price. What continuing funding does the business model require? Who provides it? What happens if performance disappoints or an investor’s priorities change? These are central themes in our football M&A regulatory due diligence analysis.
Financial pressure also creates a financial crime vulnerability. The report specifically discusses the risk that distressed clubs accept apparently easy funding from unsuitable sources, and extends the concern to sponsorship and commercial arrangements. [9] Urgency should therefore trigger clear escalation and scrutiny of ownership and funding. It should not weaken the standard of enquiry.
Broadcast assumptions need to be tested
Broadcast income remains fundamental to clubs’ financial models, but the IFR identifies uncertainty about future rights values. It points to a maturing domestic market, broadcaster concentration, uncertain streaming demand, piracy and competition for audiences and fixture slots. Existing multi-year contracts provide visibility within their terms; they do not establish the value of the next cycle. [10]
The report models revenue reductions to illustrate exposure. Those exercises are stress scenarios, not forecasts that a particular reduction will occur. Their practical value is to show how quickly losses can increase where costs remain committed.
Boards should test a lower-growth case alongside their central forecast. That assessment should also consider the timing of adjustments. A reduction in broadcast receipts can arrive faster than a club can renegotiate player contracts, refinance debt or complete asset sales.
Governance needs evidence of challenge and capability
The corporate governance findings require an important qualification. The IFR’s voluntary survey received responses from 43 of the 116 clubs. Responses were self-reported, and the regulator acknowledges that the sample is not representative and may favour clubs with more developed arrangements. [11]
Within that sample, 95% had formally constituted boards, but only 30% provided training for new board members and 23% periodically evaluated board performance. The distinction between establishing a board and developing its effectiveness is therefore material.
Independence is another area requiring scrutiny. The IFR reviewed directors described by clubs as independent and found that at least 11 of 33 did not meet the Club Code’s definition. A label in a governance document needs to be supported by the individual’s relationships and circumstances. [11]
Our view is that boards should use these findings to examine how decisions are made. Who challenges a funding assumption? How are conflicts handled? Do directors receive papers early enough to assess them? Are concerns recorded, actions assigned and unresolved risks brought back to the board?
This follows the approach in our Football Club Corporate Governance Code guide. A credible statement should explain how governance works in practice and why the arrangements suit that club. Its preparation should expose gaps that need to be addressed.
The report also identifies underrepresentation of women, people from ethnic minority backgrounds and people reporting a disability, while acknowledging limitations in the available data. Its concern includes board and senior leadership diversity. [11] For clubs, the practical work involves examining recruitment, succession and access to leadership, then setting objectives that can be assessed over time.
These are decisions for the board. Delegating the drafting of a statement does not remove directors’ responsibility for understanding the arrangements it describes.
Fans need to see how consultation affects decisions
The report recognises positive engagement across football. Among responding clubs, 84% said engagement had strengthened supporter trust and the same proportion said it improved decision-making. The supporter evidence also identifies a substantial gap between opportunities to engage and confidence that input matters. [12]
In the wider fan survey, 62% were satisfied with clubs’ overall approach to engagement, but only 42% felt clubs valued and listened to fans. Among supporter groups, 39% were satisfied with how fan views were considered in decisions and 37% with communication and transparency around decision-making. [12]
Our view is that the process needs to make the treatment of supporter input visible. Consultation should happen early enough for a proposal to change. Representatives need sufficient information to contribute. The club should then explain what it considered, what changed and why it reached its decision.
Fans will not agree with every outcome. The report recognises that consultation does not necessarily give supporters a veto. Meaningful engagement can accommodate disagreement when the club explains its reasoning and shows that views were considered.
That is consistent with our article on why fan engagement is football’s real licence to operate. Supporters contribute to the identity, trust and commercial relationships on which a club depends. Leadership needs to understand concerns about affordability, access, heritage and the experience of attending matches before making decisions that affect those relationships.
The report also acknowledges resource constraints. Staff capacity is a particular challenge outside the Premier League, while supporter representatives often work voluntarily. A workable process should recognise both. Proportionality can change its scale and administration while preserving timely consultation and a clear response.
Proportionality must reflect actual club exposure
The financial and governance findings vary substantially across the pyramid. A club with a straightforward ownership structure and limited transactions will require different systems from a complex group with extensive international activity. League position alone cannot describe every risk.
The National League illustrates the issue. The report says 23 of its 24 clubs are professional, with significant investment, losses and vulnerability to owner withdrawal. Its central administrative resources are limited, and clubs generally have fewer opportunities to respond through player sales or commercial borrowing. The IFR identifies stronger governance and oversight there as a specific priority. [13]
For Lagom, proportionate implementation means identifying the decisions and dependencies that create the greatest exposure, then giving the club a process it can operate consistently. That may involve a concise risk register, a cash forecast leadership understands, named responsibilities and focused external support.
As our league-by-league analysis of IFR proportionality explains, the evidence should fit the club’s circumstances. A small team needs clarity about what it owns, what it must escalate and where specialist judgement is required.
The IFR also has an implementation challenge. Requirements need to be clear enough to apply, and the cost of compliance needs to be considered alongside the financial pressure already identified. Supervision should focus on whether the club understands and manages its material risks. Clubs should be able to explain the controls they chose and demonstrate that those controls work.
The six actions proposed by the IFR
The report’s action plan connects its evidence to six priorities. These include matters for clubs, competition organisers and the wider football system. The regulator’s proposals should be read with that allocation of responsibility in mind. [13]
Reform distributions to support financial stability. The IFR wants arrangements that address relegation shocks and distorted incentives while helping clubs rebuild their balance sheets. It warns against additional funding driving further spending increases.
Reduce financial losses. The report calls for action on operating losses, agent costs and the viability of financial models lower down the pyramid. The IFR says it may use licensing conditions where necessary and consider whether additional powers are required if trends persist.
Improve National League governance and oversight. The response needs to recognise the professionalism and financial exposure of clubs, alongside the limited resources supporting oversight.
Improve financial risk management. The IFR intends to agree action plans with clubs before the 2027/28 season on meeting Appropriate Financial Resources requirements by 2030. It identifies the possibility of greater cash holdings, limits on borrowing or debt reductions for particular clubs. Stress tests with mitigating actions for relegation, revenue reductions and loss of owner funding are due by May 2028.
Demonstrate that fan views are considered. The report identifies May 2030 for meeting the Fan Engagement Threshold Requirement, alongside annual consultation reporting and earlier work to improve practice. This timetable should inform implementation planning now.
Improve corporate governance. Corporate governance statements are to be published every two years from October 2027. The IFR’s first review follows in 2028, with an EDI Advisory Group proposed to support its work on boardroom diversity.
The report also proposes annual risk assessments starting in spring 2028. It will monitor financial trends, competition, league governance and the possibility of lower revenue growth or reduced investment. Women’s football remains outside its remit, but the report recognises its growth, investment needs and links with men’s clubs. [13]
What club boards should do with the findings now
The immediate task is to turn the report’s findings into questions about the club’s own position. Directors should ask management to identify where the business depends on assumptions that could fail and what evidence supports confidence in them.
Begin with cash and funding. Reconcile the central forecast with committed expenditure, transfer instalments, debt service and the timing of owner support. Identify the earliest shortfall under realistic adverse scenarios and the actions available before it occurs.
Review governance alongside that work. Confirm who owns each material risk, how the board receives information and what happens when circumstances change. The record should show decisions, challenge and follow-through, rather than merely the existence of meetings.
Run the same exercise for supporter consultation. Examine a recent decision affecting fans and trace when they were consulted, what was considered and how the outcome was explained. That provides a practical test of the process.
Finally, build the licensing evidence around these working arrangements. Our analysis of ongoing IFR licence compliance sets out how reporting connects to financial planning, governance and fan consultation. A coherent approach reduces duplication and gives directors a clearer view of their responsibilities.
How Lagom Sports Compliance can support your club
Lagom Sports Compliance works with club leadership on IFR readiness, governance, financial risk and compliance. We help clubs assess gaps, establish proportionate processes and prepare evidence that reflects how the business operates.
Our IFR licensing support includes Review Only, Part Support and Full Support, according to the capability already available inside the club.
The State of the Game report gives directors a detailed account of the risks facing football. Its value for an individual club will depend on the decisions its board makes in response.
Report references
Independent Football Regulator, State of the Game, 2026 consultation draft. Page numbers refer to the PDF version.
[1] Scope, evidence and consultation status: pages 5-6.
[2] Historical growth, revenue differences and cultural importance: pages 43-61.
[3] Revenue, costs, losses and spending-rule headroom: pages 64-77.
[4] Owner funding, cash operating days and contingency planning: pages 24 and 96-99.
[5] Insolvencies, distress pathways and exploratory modelling: pages 110-128.
[6] Debt, interest, solvency and squad valuations: pages 78-85 and 101-109.
[7] Transfer debt, factoring and financial interdependence: pages 179-185.
[8] Distribution arrangements, incentives and reform: pages 35 and 132-158.
[9] Ownership trends, investment and financial crime risks: pages 50 and 159-174.
[10] Broadcast uncertainty and stress scenarios: pages 175-178.
[11] Corporate governance survey, independence and EDI: pages 222-231.
[12] Fan engagement outcomes and supporter views: pages 206-218.
[13] Six-point action plan and outlook: pages 33-40.
Frequently asked questions about the IFR State of the Game report
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The State of the Game report is the Independent Football Regulator’s assessment of financial sustainability, ownership, governance and supporter engagement. The 2026 document is a consultation draft, with comments due by 8 December 2026. Its 2025/26 financial dataset combines actual and forecast information. [1]
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No. The finding that 66% of responding clubs could not survive beyond 90 days describes their estimates if new owner funding stopped after the March 2026 payroll. It identifies exposure under a conditional scenario. It does not predict that those clubs will enter insolvency within 90 days. [4]
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Owner investment can support a credible plan. Risk increases when a club depends on repeated injections and has no workable contingency. Directors should assess funding timing, conditions and reliability, then test their response against the earliest cash shortfall. An owner’s wealth alone does not establish the resources available to the club. [4]
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Recognising estimated squad values for accounting or analytical purposes does not, by itself, establish that a club can realise those values or meet its liabilities as they fall due.
Player valuations do not provide cash to pay an obligation when it falls due. Boards relying on sales must consider transfer-window timing, achievable prices and when proceeds become available. The report finds that 46% of EFL clubs would still have negative equity after recognising estimated squad market values. [6]
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Among 43 clubs responding to the IFR’s voluntary governance survey, 30% trained new board members and 23% periodically evaluated board performance. The self-reported sample was not representative of all clubs. Lagom’s view is that directors should examine challenge, independence, conflicts, information quality and follow-through alongside their formal governance arrangements. [11]
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The report finds a gap between opportunities for engagement and confidence that supporter views influence decisions. In the wider fan survey, 62% were satisfied with engagement overall, but 42% felt clubs valued and listened to fans. Clubs should consult early, consider concerns about heritage and the supporter experience, and explain their decisions. Consultation does not necessarily give supporters a veto. [12]
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Lagom’s view is that processes should reflect a club’s activities, resources and actual exposure. Smaller clubs should prioritise cash forecasts, funding dependencies, board responsibilities and meaningful supporter consultation. Concise records and named responsibilities help, with specialist support where needed. League position alone does not capture complex ownership or funding risks.
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The consultation draft identifies financial action plans before the 2027/28 season, governance statements every two years from October 2027, and stress tests with mitigating actions by May 2028. It sets out financial resources and fan engagement milestones for 2030. Boards should plan earlier implementation work and review those plans as the consultation and regulatory process develops. [13]
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Reconcile cash forecasts with committed expenditure, transfer instalments, debt service and owner support. Test relegation, lower revenue and withdrawal of owner funding, then identify actions available before a shortfall. Review board challenge and supporter consultation alongside that work. Lagom recommends building licensing evidence around the club’s working decision and monitoring processes.