English football could be on the verge of one of the most significant financial changes in recent decades. The Premier League is working on an agreement with the English Football League (EFL), the organization that oversees the Championship, League One, and League Two, to redefine how the revenues generated by the top flight are distributed. The goal is to reduce the financial gap between divisions and strengthen the stability of a system in which hundreds of clubs represent the sporting and social heart of their communities.
The proposal, known as the “New Deal,” includes an estimated €1.7 billion investment over the next ten years and aims to establish a fairer model for professional football in England. Beyond the numbers, the initiative seeks to address a challenge that has gained momentum in recent years: ensuring a fairer distribution of financial resources so that the Premier League’s economic growth also benefits the divisions where players are developed, coaches are trained, and thousands of supporters keep football traditions alive every weekend.
A new redistribution model to balance English football
For the agreement to come into effect, at least 14 of the 20 Premier League clubs must vote in favor of the proposal. One of the key changes would increase the transfer levy from 4% to 6%. As a result, the clubs that are most active in the transfer market would bear a larger share of the financial contribution, generating additional revenue for the lower divisions.
The plan also introduces a contribution system inspired by the distribution of television rights revenue. Under this mechanism, clubs with greater financial capacity would contribute proportionally more, placing Arsenal FC, Chelsea FC, and Manchester City FC among the largest contributors to the project. The aim is to create a more sustainable system, in which the commercial success of the top division directly supports the development of the rest of English football’s pyramid.
Another key element of the agreement is the gradual reduction of the so-called “parachute payments,” the financial support provided to clubs relegated from the Premier League for three seasons. Although this mechanism was designed to soften the financial impact of relegation, it has also been criticized for creating significant competitive imbalances within the Championship, where recipient clubs often enjoy substantially larger budgets than their rivals.
Infrastructure, financial stability, and long-term sustainability
The “New Deal” is not only intended to increase the financial resources available to the lower leagues but also to establish clear rules on how those funds can be used. At least 20% of the money received by EFL clubs would have to be invested in infrastructure, including stadiums, training facilities, and operational venues. The objective is to ensure that a significant portion of the funding creates a lasting impact rather than being spent entirely on player transfers and wages.
The proposal also includes the creation of an emergency fund worth £20 million (€23 million) for clubs facing severe financial difficulties or entering administration. This mechanism would serve as a safety net for historic institutions that, despite their sporting and social importance, encounter critical financial challenges.
If the agreement receives the necessary support, the measures would take effect starting with the 2026-2027 season. The first annual payment would be less than £100 million, rising above £130 million in the second financial year and reaching £160 million from the third year onward, with that amount remaining in place for the rest of the agreement. The timeline reflects a gradual transition that will allow clubs to adapt their financial planning while the new system begins reshaping the economics of English football.
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