Professional Footballers Australia has rejected an A-League Men plan to introduce a hard salary cap and work towards introducing spending limits based on club revenues, saying the league was "negotiating with themselves" and that the unilateral announcement, seeking to address with its executive chairman Stephen Conroy called unsustainable trends in club finances, was reflective of a "flawed governance model".
Currently operating with a soft cap of $AU 2.55m that features several exemptions for categories such as scholarship, designated, and loyalty players, A-League administrators the Australian Professional Leagues (APL) revealed on Wednesday their intentions to introduce a 'trial' $AU 3.5m cap for its clubs during the 2025-26 season before shifting to a hard cap of AU$ 3m for the 2026-27 campaign, which will be the first season to be staged under an as-yet to be agreed upon collective bargaining agreement (CBA).
The new system would do away with the previous system for outside-the-cap payments - which are believed to totally or partially cover over 30% of current player remuneration - and instead allow just a singular marquee to be exempted. In the long term, APL executive chairman Stephen Conroy said the league envisioned the introduction of a model, designed with the circumstances of the A-League Men in mind, that would see the clubs' spending limits tied to their revenue.
COVID and a series of strategic blunders after it gained independence from Football Australia have seen the A-League hit by successive waves of austerity in recent years and it slashed its central distributions to clubs to a record low of $AU 530k this season. Conroy said the league was on target to break even this year, which would likely see distributions remain static, and declared that no clubs were in imminent danger of folding. Nonetheless, the envisioned cap changes would require further belt-tightening from cash-strapped clubs, whose "unsustainable" spending on their men's sides, per the executive, averaged "well in excess" of the $AU 3m limit envisioned. Melbourne Victory, the only club that publicly releases its finances, reported losses of AU$ 9.87m for the 2023-24 financial year.
"What we're seeing is what we frankly think is an unsustainable trend in terms of their performance, their profitability, their losses," Conroy said, "Behind the scenes ... the level of the financial stress the clubs are under is significant, and it's getting worse.
"Financial stability of [A-League clubs] rebounds onto us at the APL. So if someone like Perth, for example, falls under the bus and has to pull out of the competition, there are significant financial impacts on that flow through to the APL.
"[The APL has] reached a point where we're rebuilding our finances. Our ambition was to break even this year. We are on target to meet that at the moment, we still have three months to go, so I'm not getting ahead of myself, but we're on target at the moment to do that, so we have stabilised."
The APL's reforms, however, would need to be agreed upon as part of the competition's new CBA. And in the hours following the APL's announcement, PFA executive Beau Busch said that players themselves only became aware of the proposals on Wednesday.
"Simply put, the APL is unable to unilaterally impose these conditions on the players without their agreement, which has certainly not been provided," Busch said. "There is a CBA in place for next season. Any changes would have to be agreed with the players, and until today, they haven't even been discussed.
"The framework beyond next season will be negotiated as part of a future CBA. Today's announcement is simply the APL negotiating with themselves. As always, the employment conditions of players will be the product of proper, good-faith bargaining; not unilateral decision-making."
Under the APL's plan, there would be no penalties for clubs going over the $AU3.5m trial cap during the 2025-26 season - clubs will still be required to work within the bounds of the existing regulations under the current CBA- but "financial and sporting sanctions" would be imposed on any club that ran afoul of the $AU 3m figure upon its mooted introduction. The A-League Women's salary cap would remain unchanged for 2025-26.
"What we've got to do is ensure that everybody is working within a framework that doesn't see [major clubs losses]," said Conroy.
"Behind the scenes, because of the data that we get, we are concerned [with ensuring] that everybody remains viable."
While Conroy told journalists on Wednesday that he was confident the ALM's quality wouldn't suffer with the changes and that it would further empower clubs to provide young players with opportunities, Busch said the changes were misguided. The PFA boss said the changes would hamper clubs' ability to attract and retain talent, weaken their ability to compete in Asian competition, and lower the league's standard of play at a time when broadcast deal negotiations were underway and the league was striving to attract new fans.
"The announcement speaks again to the APL's flawed governance model," said Busch. "Club directors are always likely to find themselves conflicted between their club's short-term interests and the game's long-term, strategic needs.
"Because of previous decisions taken by APL, the league has a revenue problem. The players have always been reasonable negotiating partners, however, they will not accept half-baked cost-cutting solutions while the same governance structure which got us here remains in place."
Conroy addressed reporters on Wednesday afternoon following an extraordinary general meeting of the APL that saw Melbourne Victory chairman John Dovaston and Brisbane Roar chairman Kaz Patafta elected onto the board. It was the first time the former federal senator had spoken publicly in his capacity as APL boss since he took over following the sudden ouster of commissioner Nick Garcia.
Garcia, it was confirmed, remains with the APL, now working as its "chief expansion and investment officer."