Wages spiral in wealthy English Premier League

Wages and profits are up again in the English Premier League, but it lags behind Germany's Bundesliga in terms of profitability, a study by accountants Deloitte showed Thursday.

Manchester United, fresh from winning another domestic title and the European Champions League, is the richest club in Britain with record operating profits of 66 million pounds (84 million euros, 130 million dollars).

But the Premier League's hefty wage bill of 942 million pounds — which rose 13 percent in the 2006-2007 season — limited its collective profit to 94 million pounds.

That compares to 168 million pounds (212 million euros) profit for the Bundesliga, the annual study showed, despite the German league's failure to produce a Champions League finalist since 2002.

The surge in wages at English clubs has been fuelled partly by the spending power of Chelsea, owned by Russian billionaire oligarch Roman Abramovich, which paid its star-studded squad 132.8 million pounds in the 2006-2007 season.

But the London-based club has amassed debts of 620 million pounds, even though Abramovich has used 575 million pounds of his personal fortune to snap up players.

These include Germany captain Michael Ballack, who has been a success at the club, but also Ukrainian striker Andriy Shevchenko, widely considered to be an expensive flop.

Deloitte said however the wealth was being felt by all Premier League clubs.

“In 2007-2008, England's Premier League clubs will have had around one billion euros (or 50 million euros per club) at their disposal.

“We believe all 20 Premier League clubs are now in the world's top 50 by revenue,” said Dan Jones, partner of the company's Sport Business Group.

English clubs are also set to get richer when they feel the effects of a new, 2.7-billion-pound television deal from August 2008, giving the big guns spending power matched by only a handful of clubs in Europe.

Not surprisingly, given the wages on offer, Deloitte said the Premier League was increasingly the destination of choice for the world's biggest stars.

“There is increasing evidence that it is also becoming the most popular league for players to ply their trade,” Jones said.

Deloitte also said it was confident that the Premier League's new foreign owners, such as former Thai prime minister Thaksin Shinawatra who bought Manchester City, will have a positive effect on the game.

The study pointed to the fact that the 2008 Champions League finalists Chelsea and Manchester United both have foreign owners.