Real Madrid and Barcelona Debts: A Growing Problem

Barcelona Debts

In the midst of a global pandemic, football clubs are struggling to keep afloat. Gargantuan wage bills, monumental agent fees, and astronomical transfer deals are but a few of the reasons why. Real Madrid and Barcelona are two clubs that are facing rising debts. They are also at the forefront of the European Super League. The offer of a €3.5 billion grant, provided by Investment bank JP Morgan, to join the ESL likely tempted the financially worried clubs. Either way, the Real Madrid and Barcelona debts are a growing problem.

Real Madrid and Barcelona Debts Will Only Grow

First Team Wages Are One of the Biggest Outgoings for Both Clubs

The Spanish giants are both struggling financially as their wage bills spiral out of control. As reported by El Mundo, Barcelona are verging on bankruptcy, and that more than 74% of the club’s expenditure is used on first-team player wages. The club’s former interim president Carles Tusquets said recently they had been forced to delay payments to players. Despite earning €715.1 million in the 2019/20 season, according to data compiled by Deloitte, the club is still struggling.

Barcelona’s past financial decisions are straining the club as the impact of the Coronavirus is ongoing. The club reportedly pays Messi €138,000,000 per season, including variables. However, Messi’s contract is running down, and releasing the superstar will free up some of the wage budget.

Although, keeping hold of their prized asset and footballing phenom will bring an obvious benefit. Keeping Messi, with a more sustainable contract, may be a possibility with the new president Joan Laporta.

Laporta will need to rethink the way the club works. Focusing on their youth intake from La Masia, a reliable source of talent, is more sustainable than marquee signings. Rising stars, Oscar Mingueza, Ansu Fati, and Ilaix Moriba could all supplement the first team and be given reasonable contracts.

Real Madrid, Like Barcelona, Also Struggling With Rising Debts Amidst the Pandemic

Real Madrid earned €691.8 million during the 2019/2020 season according to data compiled by Deloitte. However, in a report by SPORT, Real Madrid’s debts are now standing at €901 million. The club is now attempting to claw back lost revenue.

In absurd claims, reported by BBC Sport, Real Madrid’s president Florentino Perez claims: “Young people are no longer interested in football. They have other platforms on which to distract themselves.

“When you don’t have any income other than from television, you have to find a solution to make more attractive matches that fans all over the world can watch with all of the big clubs”.

The scheme is currently in tatters with as many of eight of the original twelve teams pulling out. But Perez, the potential chairman of the new league, believes the European Super League is not dead. As reported by Sky Sports, Perez, appearing on the Spanish radio show El Larguero, said: “The Super League is not dead, it is on stand-by.”

‘The Project is on Standby’ Says Florentino Perez

Barcelona and Real Madrid seem intent on creating the league to amplify revenue streams. However, fierce opposition from fans and other clubs will halt the current plans. In the near future, UEFA and FIFA will need to adapt and develop their current formats to ensure that fairness is key amongst them.

And there are plans to introduce an expanded 36-team competition from 2024. As reported by the Guardian, The new competition would mean every club plays ten league stage games against ten opponents. These plans were approved by Uefa’s executive committee on Monday, shortly after plans emerged for the European Super League.

In any case, the fans have spoken and they want diverse competition. Clubs should be able to rise – and fall – within football.

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