I’m going to start by defending Mike Ashley…Now I don’t like this any more than you do but stick with me and I’ll get around to bashing him soon enough.
I’ve been put in the awkward position of standing up for the awful man following a number of people getting angry about the notion of selling Lascelles because they view it as madness to imagine that Ashley would then allow the club to reinvest the funds generated.
I have to disagree with these people, it’s not madness to imagine that the funds generated would be reinvested. It might have been 8 years ago, but not any more. Back then the club was making losses that Ashley did not want to subsidise entirely and wouldn’t allow the club to borrow to subsidise. Instead, the losses were offset by the sales of players like Milner, Nzogbia, Given, Martins, Duff, Beye, Bassong, Carroll and Enrique. After Enrique was sold the net profit from player sales in Ashley’s tenure was approaching £50m.
First impressions last and it’s this initial 4 year phase of ownership that has entrenched perception of how Ashley operates in the transfer market.
In 2011 it changed though, since then (save for an £11m loan repayment) if any player has been sold not only has that money been reinvested in it’s entirity, but any operating profits generated by the club otherwise (TV, matchday, commercial) have also been spent on top of that.
The biggest player sold after Enrique was Cabaye. £20m in January 2014. The income wasn’t spent immediately in the same window, but the following summer the club spent twice as much on new signings.
After that Debuchy and Mbiwa were sold for a combined £15m, the spend the following summer was over three times as much at £48m.
Only in one transfer window since has the club made a profit on player trading, following relegation in 2016 there was a temporary reversion to satisfying losses by selling players and not spending all of the money, a £28m profit that summer wasn’t the new norm though, last summer the club spent £45m, £25m more than was received in return for sales.
In all this time, since 2007, whether the spend on signings exceeded the return from sales or not, the approach that generated those outcomes has been entirely consistent throughout – the club spends all it can afford on transfers without borrowing money from banks or Mike Ashley. The club doesn’t spend as little as possible and it doesn’t seek to profit on player trading as many suggest, when the club isn’t in profit player sales subsidise losses. When the club is making money greater investment is made in players.
The club’s spending power and how Ashley impacts it can be debated, we can’t know to what extent that the total earnings of Newcastle are inhibited by handing free advertising to Sports Direct or by handing them our retail operation to manage. It’s difficult to say how much profits are enhanced by all loans being made on interest free terms or from the cost cutting exercise that was initiated by Ashley soon after his arrival. Leaving all that aside though, what the club generates does get spent.
We know the club will be profitable in 17/18 and 18/19 due to the massive increase in media income. That being true, from what we have seen before, it’s only logical to suppose that any fee for Lascelles would be reinvested, along with fees for any other player sold.
Ashley’s transfer policy is a complete disaster though, even having spent £100m over and above fees received since 2011. No matter how much he tries to disassociate himself from it by employing a range of head scouts, managers, directors and unofficial fixers that he claims act autonomously, Ashley is the only constant and it’s his criteria on transfers that have held the club back.
On the whole, the money the club invests should be sufficient, Ashley’s miserly approach to every individual transfer is the problem. He has a ceiling on the price he will pay for an individual, on the wages he’ll pay those individuals, he enforces rules on the age of signings that only get circumvented for the cheapest of stop-gaps. He is the man that walks away from negotiations where the selling club don’t give him the discount he wants or the players representatives value their client more than he does.
Back to the Cabaye example, I gave credit above that we added £25m to the pot Cabaye created for a total £45m to be spent. That should have seen us do some excellent business, but where did it get squandered? Perez, De Jong, Cabella, Riviere, Janmaat, Darlow and Lascelles. The club diluted proven talent to take a punt on 7 predominantly unknown quantities on cheaper wages. Ultimately Lascelles alone could recoup the entire amount for us if stories of Chelsea’s upcoming bid are right, but it’s taken 4 years and the appointment of Rafa Benitez to inspire him and to reap that reward. Few would argue that it was a very disappointing way to spend so much. Re-investment that saw us stagnate at best.
Similarly the £48m spent on Wijnaldum, Mitrovic, Mbemba and Thauvin. Benitez never got a chance to do anything with the two of those that have gone on to prove themselves elsewhere after partaking in our relegation (Wijnaldum and Thauvin) and he wants nothing to do with the other two he was left with (Mitrovic and Mbemba), they’ve just been expensive hindrances on making signings of his own. In this instance, re-investment of huge sums of club money saw the quality of the team regress and our capacity to sell players and clear wages for new signings hindered.
Benitez himself has lamented that the problem is not the totals being spent, but the price the club will pay for individuals that make his job most difficult. Prior to the Chelsea game at the end of the season he wasn’t as insistent that Lascelles had to stay as some fans are right now, but he was clear on how any funds he generated would have to be spent if he were to go.
“If you want to continue growing, normally you have to try to keep your best players. Jamaal has a great potential, but if you cannot compete, or you cannot keep the level of your team, then maybe you have to sell one player to be sure that you can bring in other players.
“When people say ‘wheel and deal’ – sometimes you have to do it, because if not, you don’t have the money. If you don’t have the money, the main thing is to be sure that if you sell this one for £40million, you have two at £20million who can do well. Then you can be better.”
Mike Ashley would like the public to believe this is an unreasonable demand, whenever he’s been asked about spending power he’s misled people into thinking the ask is for Newcastle to compete with Manchester City. In truth, clubs much further down the league reinvest their income on much more proven talent than Newcastle. But to what extent? There are several ways to gauge that but comparing what clubs spend in one window or over several, doesn’t necessarily tell us about the market value they’re operating at. Clubs buy and sell a different number of players over different periods. To get around this I’ve looked at the last 10 signings at each club and totalled the fees paid for those ten, I think this gives the best idea of the standing in the game the players that clubs target currently have.
Using data from Transfermarkt.com shows that the total cost of the last 10 signings at Newcastle was £72.3m. We’re paying an average £7m on signings. Just 3 players were signed over £10m. Compare this with other mid to lower table Premier League clubs.
Everton spent £208.9m, averaging £21m per player with 7 players costing more than £20m.
Leicester spent £137.7m, averaging £14m per player with 7 players costing more than £10m.
Southampton spent £131.4m, averaging £13m per player with 8 players costing more than £10m.
Crystal Palace spent 131m, averaging £13m per player with 6 players costing more than £10m.
West Ham spent £111.7m, averaging £11m per player with 5 players costing more than £10m.
Even clubs below Newcastle in terms of what they’ve spent have invested elsewhere, all have developed or bought their stadiums and training facilities in recent years, something Newcastle have steadfastly left on the back-burner since announcing development works with great fanfare.
Having been in the championship 2 years ago the season of consolidation last year was excusable for Newcastle. Going into 18/19 though, there cannot be any excuses for failing to compete at least on the same playing field as other mid-table clubs going forward.
Newcastle are in dire need of better quality attacking options and whether or not Rafa chooses to sacrifice Lascelles to better fund that advancement there has to be a reversal of the old transfer criteria that saw us dilute our buying power. We have to go out and pay what is needed to entice the best players Rafa identifies away from their current clubs.
I am very confident that money Newcastle generates will be spent on the squad, sooner or later. Whether Mike Ashley has the appetite to do what Rafa wants with that money is my greatest concern. I don’t believe Rafa will sanction another batch of £7m punts, like Ashley wants, it’s throwing more good money after bad. The £4m capture of Dubravka exemplifies his excellent eye and his willingness to jump on a bargain, but he needs to be allowed to bring in those £20m players he spoke of too.
There is a valid argument Ashley could make here in that the club currently has 10 senior pros that can’t get a squad number. Many on high wages such as Colback, Sels, Mitrovic and Saivet. The club is restricted in how much they’re allowed to increase the wage bill so the limit placed on the manager to sell before he buys is one that cannot be spent around. Ashley bought these players on the cheap and it’s ultimately his fault we’re in the position that few other clubs have been willing to take on their wages, but rather than stumbling around focused on trying to force the manager into a new contract, the primary objective right now should be on clearing those wages as soon as possible to allow better players to start arriving. Everyone knows that only this is what will secure a new contract from the gaffer.
If Ashley refuses to sanction some big additions and Benitez refuses to waste money on players no better than those we have, then no matter what credit I’ve given him through gritted teeth, no matter what excuses I see as valid, I would not put it past Ashley simply to save that money for a new manager that will do it his way, rather than cave in and make some signings at the current market rates. Without any intention of selling the club at it’s value and with no one keen to pay him over the odds, he surely understands the risk to his investment if he proceeds with that course of action and allows Benitez to leave the club.
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