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Dundee FC – A Cautionary Tale

October 18, 2010

The current plight of Dundee FC is no real surprise to those of us in the trust movement who have been warning about the perils of the ownership structure that afflicts Scottish football.

An over-reliance on so-called benefactors allied to company structures that belong in the 19th century,  are a recipe for ultimate disaster in the (modern) football world.

In Dundee’s specific case, it is reported that they owe HMRC nearly £400k and have now been, unsurprisingly placed in administration – for the second time in 7 years – which is a shocking situation.

We feel for the Dee fans, who were magnificent in saving the club last time they faced going out of business, but surely, this time around, enough is enough?

No-one, repeat no-one wants to see a football club go to the wall. The demise of Airdrieonians, Clydebank and Gretna stabbed the hearts of all true football fans, but the day of reckoning is coming, and not just for Dundee.

The Dee4Life Trust has been keeping a watching brief at the goings on at Dens Park, and in May this year (Trust)  Chairmain Scott Glenday voiced concerns at the financial goings on. And rightly so.

Football’s problems are far more widespread – today –  than during the last recession (of the 80s) because of the changes the game has undergone.

It’s different this time for two reasons. First, it’s about scale – there were no teams in the top division that went under during the last recession. This time around we’ve had Gretna.

Secondly, a lot more investors have come in for the money, for a speculative gain. When the going gets tough, they disappear. Like sna’ aff a dyke.

From a business point of view, football’s great problem is that it doesn’t generate profits. Alan Sugar, now a Lord and until recently known as ‘Siralan’, a former chairman of Tottenham Hotspur, called it the “prune juice effect” (it comes in and goes out straight away).

The time for change is upon us. Involving fans in the ownership of even the largest football clubs should make both social and commercial sense. And there is a model. The German Bundesliga, which is considered Europe’s best-run league, is dominated by fan-owned clubs and can be judged fairly, by any criteria, to be a success.

The beautiful game needs your help. After all, no one ever changed the world by sitting on their bahookies, eating a pie and shouting abuse at the TV, did they?

Dundee’s directors gambled with the club’s future by plunging into to debt to chase a dream they could never, ever make reality. And, please, no crocodile tears for those men who will stoutly defend their position with up turned hands and a shrug of the shoulders.

The administrator, Bryan Jackson, who has seen it all before – faces a tough job in trying to find a buyer, but there is a glimmer of hope in that respect. The first thing any solvency mandarin looks for is the ability of the company (in difficulty) to pay for their services, otherwise they don’t take it on and said business goes phut.

According to some press reports, Jackson may be able to find a white-knight, but in doing so, the problem of the benefactor route is  still a spectre looming large and so the problems potentially will continue.

The state of football’s finances are frightening. But we can’t give up hope that things won’t ever change.  Supporters Trusts are not the panacea to the game’s ills with the truth being that there is no magic bullet that when fired can solve all the ailments.

However, democracy, good governance and transparency are all vital tools to any modern business that wants to survive. If Barcelona FC can elect a new board every four years, then why not Dumbarton and other Scottish clubs?

The overriding problem is investor greed.  Club’s stadiums are seen as bargaining tools or collateral for pie in the sky borrowing plans. Perhaps a solution to this challenge would be for supporters trusts to own stadiums thus preventing asset stripping?

There is much food for thought and over the next few years, there will inevitably be change in the game’s structure.

Fingers crossed that the lifeblood of the sport, the fans, will have a say – a big say, in what happens.

Meantime, we wish Dundee FC  and our colleagues at the Dee4Life Trust all the very best and a good outcome for all.

One Comment leave one →
  1. October 18, 2010 8:38 pm

    Sound points, very well put.

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