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Revealed: How does the new PL rule of spending cap affect Liverpool?

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By Sarthak Joshi

Insights on Liverpool’s situation ahead of the new Premier League rule of spending cap as compared to their rivals

One of the clubs in favor of the new Premier League financial rule, decided upon in principle during a conference in London, is Liverpool. An ‘anchoring’ plan approved by Premier League clubs in their most recent vote. It will now be presented to the Premier League’s AGM.

The plan is to ‘anchor’ the maximum spending amount on wages, transfers, and agency fees to a certain multiple of the broadcast income of the club that makes the least amount of money. The current proposal is to set the cap at five times that base amount.

Manchester United, Manchester City, and Aston Villa gave their votes against the new rule. Chelsea abstained from voting. This whole concept of ‘anchoring’ is turning out to be very controversial.

Liverpool’s situation amid the new rules

Liverpool would have been well under the $649 million (£518 million/€607 million) hard spending cap. Undoubtedly, this is a very high amount, even if it’s not nearly as absurdly high as it initially appears, considering that it accounts for both transfer expenses and salary and agency fees.

Liverpool had the fourth-highest squad expenses in the Premier League in 2022–2023, with an estimated $516 million (£412 million/€482 million). High earners like Virgil van Dijk and Mohamed Salah had a major contribution in that amount, although the Reds could have spent an additional $133 million and still been under the cap.

Manchester United would have come in third, while Manchester City would have come in second, closest to going over the cap, behind Chelsea. Most of the league would have been within the limit by hundreds of millions. No wonder they cast their vote against the new rule.

Liverpool would not have much of a problem with the rule

The league’s new financial rules are the subject of intense debate. This season, Everton and Nottingham Forest have both had points deducted, and Manchester City continues to face 115 accusations.

This is a sensible idea that Liverpool should support. The 2022–2023 season’s numbers show that this rule won’t be revolutionary, but at least it keeps all the teams in line by acting as a check on completely outrageous expenditure.

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This is how Liverpool’s owners, FSG, have traditionally managed the team. They would appreciate anything that even slightly balances the playing field. Although it would be even more enticing to anchor with a lower multiple, the idea has gotten the required 14 out of 20 votes to be approved.