We have crossed the midway point of the January transfer window but there is sense that clubs are reluctant to splash the cash this time around.
This is a stark contrast to 2023 January, in which Premier League sides had a record-breaking transfer window that saw clubs spend £815m.
There is a clear difference between both windows, and something has changed, with clubs potentially more wary of FFP (Financial Fair Play) and PSR (Profit and Sustainability Rules).
So, what has changed in a year and are clubs holding back on signing players this winter in fear of potential future sanctions?
Record-breaking spending in 2023
Embed from Getty ImagesAs mentioned, Premier League teams had a record-breaking transfer window last year with some big name players making moves.
Chelsea were a large reason for the inflated spending, bringing in Enzo Fernandez, Mykhaylo Mudryk, Benoit Badiashile, Noni Madueke, Malo Gusto and Andrey Santos for a combined £276 million.
Other notable signings included Cody Gakpo from PSV to Liverpool for £37.2 million and Anthony Gordon’s £40 million move to Newcastle.
Until the 2019 January window, the record for highest spending in the Premier League was £100m, set during the 2016 January window. However, the 2020 window saw a surge in January activity as Premier League clubs spent £165m. Last year, of course, was a massive outlier.
What has changed?
Embed from Getty ImagesLooking at the numbers, the contrast between now and last year suggests something has changed.
Everton and Nottingham Forest have both been charged by the Premier League for breaking their financial rules so it’s understandable that other teams may have taken note and adopted a more cautious approach to spending. Everton’s point deduction has sent a warning to clubs that there are serious ramifications for breaching the rules.
Under the Premier League’s rules, clubs can essentially lose £105m over a three-year period, though there are some exceptions to what counts towards that loss.
With transfer fees consistently rising in recent seasons, it is becoming easier and easier for clubs to breach that £105m figure. Arsenal, for example, spent that on just one player through signing Declan Rice from West Ham, and both Moises Caicedo and Enzo Fernandez cost Chelsea around that amount each.
The general consensus has always been that clubs prefer to complete their business in the summer as opposed to the winter but the lack of activity this month compared to last January is certainly surprising. Clubs spending huge amounts on players in the summer is certainly impacting their January plans.
2020 was a record-breaking year for transfers, but so was 2022, when the record was broken again with clubs spending £295 million in January. In 2021, clubs were reeling from the financial ramifications of the pandemic so spent less.
The market has been subdued this year, with Tottenham’s £22m acquisition of Radu Drăgușin the only prominent signing so far. It’s become clear that the levels of spending in recent windows won’t be replicated this time around and it is no doubt because of FFP and PSR looming over clubs.
What can clubs spend?
The Premier League’s financial rules have certainly hit club’s potential plans for January hard.
Under UEFA’s own FFP rules, clubs are permitted to make three-year losses of €60m (£51.8m), with €55m (£21.5m) of that through ‘secure funding’ from owners. The Premier League’s rules, PSR, are practically the same but clubs can’t generate losses of more than £105 million.
So, can any Premier League club afford to do any deals? Well, Manchester United are seemingly restricted, as the Athletic reported a few weeks back that they can only look at loan deals.
Chelsea, having been the big spenders last year, are perhaps the most cautious and reluctant to spend. The Evening Standard’s Nizaar Kinsella recently told Hayters TV that the Blues have had to slow down with their spending, like many clubs, because of these rules.
Having said that, they have generated over £300 million in player sales since Todd Boehly’s arrival so there is some wiggle room to work with, particularly if they manage to sell more players with Armando Broja and Conor Gallagher being linked with moves away.
Much of the talk around Arsenal has concerned their need for a striker, and Ivan Toney is reportedly their main target, but the deal would cost around £100m. Keeping in mind Mikel Arteta spent around £200m in the summer, signing Toney or another big money forward this month looks very unlikely.
The club do not expect a busy window and unless there are sales, spending a big amount towards the end of the month is not a possibility. David Raya’s initial loan deal with a view to a permanent move is evidence of Arsenal’s current situation with FFP and PSR. They have had to be smart.
Manchester City, having already been charged with 115 breaches of financial rules, are having to tread carefully and also spent big in the summer on the likes of Josko Gvardiol, Matheus Nunes and Jeremy Doku.
Fellow title chasers Liverpool also dedicated the bulk of their spending to the summer window, adding Dominik Szoboszlai for £60m as well as Alexis Mac Allister, Ryan Gravenberch and Wataru Endo too which totaled around £150m in spending.
Newcastle United are a club who have been open about their challenges with the financial rules, with boss Eddie Howe stating: “Financial Fair Play is a problem for us, and we’re having to navigate round that.”
As for the others, their lack of spending can be somewhat attributed to the fear of being punished by the Premier League. Everton’s historic punishment shows the Premier League are prepared to enforce the rules with a heavy hand and the combination of huge transfer fees and spending limits has put big restrictions on clubs.
Nottingham Forest spent big following their promotion in order to boost their chances of staying up and while they did that last season, it looks as though it will have a knock-on effect.
Ultimately, it appears unlikely that this January will get anywhere near the spending figures of last year.
