PSR (profit and sustainability rules) has become a despised acronym for many football fans in the UK, particularly those whose clubs have been negatively impacted by the regulations.
Put simply, it relates to financial rules set out by the Premier League which state that clubs cannot post a loss of more than £105m over three seasons, and failure to comply could result in points deductions, a punishment inflicted on Everton and Nottingham Forest during the 2023/24 season.
While the intention may be benign (i.e. to prevent clubs from running up massive losses which could cripple them over time), its application has met with widespread confusion and criticism from football supporters across the country.
Will Liverpool have any concerns with PSR this summer?
Liverpool are on course for a summer of vast spending, having already secured Jeremie Frimpong’s signature for just under £30m and pushing hard for a club-record deal for Florian Wirtz which could top £125m, in addition to pursuing Milos Kerkez. Those three signings (if completed) are expected to see a combined outlay in excess of £180m.
However, James Pearce has outlined in the latest DealSheet for The Athletic that, despite posting a pre-tax loss of £57m for the 2023/24 season, the Reds ‘have no concerns in terms of PSR’ due to their sensible fiscal management in previous years (£9m loss for 2022/23, £7.5m profit for 2021/22).
LFC’s finances are also set to be helped by prize money from returning to the Champions League and winning the Premier League over the past 12 months, along with a new £60m-per-year kit deal with Adidas and a lucrative summer tour to the Far East in a few weeks’ time.
Chris Weatherspoon added that Liverpool had a net transfer spend of just £100,000 last summer and ‘have little to worry about in PSR terms’, a byproduct of FSG’s commitment to ‘run the club largely within its means’.
Liverpool unlikely to run into trouble with PSR any time soon
The Boston-based firm might have come in for plenty of criticism from Reds supporters who’ve bemoaned a lack of ambition in the transfer market in previous years, but that accusation certainly can’t be labelled at them this summer if they clinch the signings of Wirtz and Kerkez to accompany Frimpong.
Also, FSG’s ongoing desire to run Liverpool sustainably means that the club can avoid the messy PSR situations which have impacted Everton and Nottingham Forest, along with curtailing the marketplace activity of clubs like Newcastle in recent months.
While it’s set to be a spendthrift summer by LFC’s standards, much of that outlay will be offset by players leaving. The Merseysiders have banked £8.4m from allowing Trent Alexander-Arnold to leave early and have agreed an £18m deal to sell Caoimhin Kelleher to Brentford.
As mentioned by Pearce for The Athletic, any further signings over the next three months would be very much contingent on further exits, with several members of Slot’s current squad potentially moving on before the end of August.
We can expect the Liverpool hierarchy to keep transfer dealings within reason so that the club stays well away from PSR trouble and strikes the ideal balance between off-field sustainability and tangible on-field success.
