How inequality works - £5b football deal will not see clubs pay living wage

Thu, 12/02/2015 - 13:49 -- nick

England's Premier League is one of the world's most exciting - and the most watched football league in the world.

Its most recent TV rights auction still took many people aback though, with more than £5.1 billion set to roll into clubs from 2016 to 2019, a 70% increase.

The team that finishes bottom of the league will receive more than £100 million from TV channels alone under this deal, a huge increase on their current arrangements.

This may be a good time to ask where all that money will go.

Richard Scudamore, the Premier League's head, was asked whether he felt uncomfortable that only one of the 20 clubs in it actually pays all staff the living wage - Chelsea, since you ask.

Scudamore replied: “No, it doesn’t make me uncomfortable. The reality is, just like in the film industry, in the pop industry, the talent, the absolute talent, gets paid a disproportionately high amount. That is the reality in any talent industry."

This argument can be employed in any sector of the economy, and it has for example been used to justify the huge salaries now commanded at the top of all companies, including banks.

The same banks where 'talent' was rewarded hugely both before and after it ruined the world economy and put millions more on the dole.

If people in the poorest fifth of the country - including most unemployed people - got the same share of income as they did in 1977, they would be nearly £2,000 per year richer.

The richest fifth by contrast would be over £8,000 poorer, showing how there has been a huge transfer of money from the poorest to the richest as earnings and benefits at the bottom have not kept pace with inflation.

Some firms appear to have exploited fear of the newly-insecure benefits system, which can see claimants lose income for any tiny rule infraction, even invented ones, to reduce entry level wages in real terms.

It has been predicted that the huge influx of new money into football will follow this exploitation route, resulting not in more clubs paying the living wage, but in the first ever player earning £500,000 every week.

Inequality is becoming more and more evident, and extreme wealth more widely celebrated.

This additional income will no doubt go towards footballers putting huge pink wheels on a Range Rover, or painting a Cadillac gold, all while those who clean their changing rooms cannot afford to live, and may be forced into using food banks.

Only governments can affect the distribution of income, through fair taxes and benefits, but the coalition has delivered a huge 5% tax cut for the richest while cutting and capping welfare payments.

The new football deal fits perfectly into the culture of modern Britain: those in need are punished while those with the most are rewarded over and over again.