Hellas Verona, Parachutes, and the Divisional Gap

Date: 22nd March 2016 at 7:38pm
Written by:

Hellas Verona might look set for relegation, but depending on which of the teams who are struggling along with them also fall down to Serie B, they could yet secure a fairly substantial windfall as a result.

hellas verona

The new Serie A TV deal has been subject to all manner of issues and disputes on its way through, but one aspect that has come to prominence as the battle at the bottom heats up is that of parachute payments, which have risen to a pot of €60 million for those teams who suffer relegation this season.

These ‘rewards for failure’ are something that have been issued in England for some time and Italy, with Europe’s second highest TV deal, have stepped into line with the Premier League – at least in certain ways.

For the Mastini, their hopes of a windfall can be two-fold.

As a club that have been in the top flight for more than two years, they would be entitled to the maximum share available of that €60m. If they are joined by two other such clubs – Atalanta and Palermo have been flirting with the drop zone – then each would be allocated €20m, and the whole pot used up by that.

atalanta verona

If Carpi and Frosinone were to tumble, their share, as first season clubs, would be just €10m – making the initial payout €45m. This would allow the Gialloblu, should they not bounce straight back, a further delve into the pot to the tune of the remaining €15m the following summer. For Verona then, a potential €40m, just for being relegated in the right company – reward for failure indeed.

Yet there are lessons to be learned from the English model – illustrating that even though it might seem that receiving such a hefty payout would unduly bias clubs who received it, there are just as many examples of teams falling down the league as there are those who bounce back.

In the last five seasons, as many clubs have returned to the Premier League after dropping to the Championship as returned to Serie A from Serie B. The extra money may ensure that the examples of those such as Siena and Parma do not enter such difficult situations so quickly, yet financial mismanagement and misjudgement can still have a massive effect on clubs who rely so heavily on TV money for their income.

No supporter of Wolverhampton Wanderers, who ended up in the English third tier, nor Portsmouth, currently in the fourth, could argue that parachute payments did anything other than act as a slowing factor in their club’s decline.

Stadio Bentegodi

There are counter-examples; West Ham United and Sunderland have returned to the top table relatively quickly multiple times. Bologna and Palermo did the same. For these sides, parachute payments allowed them forward planning with a safety net; the knowledge that while funds may be tight should they be relegated, it would not bring about the end.

These are clubs with long recent histories in the top division. Their fanbase alone would likely ensure they would remain a force in the lower division for a little while to come – one does not become a Leeds United or a Bari overnight.

It seems that these are the intended beneficiaries of parachute payments, and it is not their failure being rewarded but their earlier success. In being regular members of the Serie A crowd, Verona have come to carry a certain prestige that they will be aided in regaining should they be relegated.

For the likes of Carpi and Frosinone, their visit to Serie A has been brief and the lower remuneration they would receive should they be demoted rather suggests that their presence was not entirely welcomed in the first place.

Verona - Inter

The increase in parachute payments could, in that way, be seen to encourage Serie A to become a closed shop. In that scenario, the same small cohort of teams that are relegated would be remunerated enough to ensure their return the following season and the ‘smaller’ clubs such as Carpi, Sassuolo and Frosinone would find their prospects cut off by parachuted Serie A big beasts.

There have been parachute payments in Italy for some time now, though the new TV deal has doubled the total amount on offer. While that is reflective of the increased revenue that can be expected in Serie A, the gulf between the two leagues is almost certain to grow larger as a result.

It remains to be seen if the increased payments will result in a less competitive Serie B – though it is worth noting the even nature of that league. Behind Crotone and recently relegated Cagliari, 13 teams are separated by just 11 points.

It is a league of fine margins, and high competition and to inject money into it from above may well be enough to tip that balance.

 

Comments are closed.