AliousPremier League Confirms Overhaul of Financial Rules — What the New System Means for Sunderland
The Premier League has officially voted through a major shake-up to its financial framework, replacing the long-debated Profitability & Sustainability Rules (PSR) with a new mechanism known as the **Squad Cost Ratio (SCR)**. Beginning next season, clubs will no longer be judged on three-year cumulative losses. Instead, their spending will be assessed annually, with strict limits imposed on how much of their football income can be used on first-team costs.
Under PSR, clubs were allowed to post up to **£105 million in losses over three seasons**, a rule that triggered multiple investigations and sanctions in recent years. The new SCR system takes a very different approach: teams may now spend **up to 85% of their revenue** on player wages, amortisation, and agent fees related to their senior squad. The Premier League says this will streamline the financial landscape and create a more level playing field, allowing “all clubs to aspire to greater success.”
UEFA clubs have already been operating under a similar structure, though Europe’s limit sits slightly lower at **70%**. The Premier League has opted for more leniency, but with additional flexibility built in. Each club will receive a **30% multi-year spending allowance**, enabling them to exceed the 85% threshold when necessary. However, using this buffer triggers a levy, and continuing to exceed limits after the allowance is used will result in **sporting sanctions**.
The league’s statement emphasised that SCR will focus squarely on regulating “on-pitch spending” while also maintaining broader financial oversight through three long-term health checks: the **Working Capital Test**, the **Liquidity Test**, and the **Positive Equity Test**. The broader aim is to simplify the system, protect competitive balance, and allow clubs to invest responsibly off the pitch while still supporting growth.
This overhaul follows more than a year of consultations, including input from club executives, finance and legal departments, agents, the PFA, and independent analysts. Trial versions of the SCR and associated rules were already run in shadow form this season to assess how they function in real time.
One proposal that didn’t survive the vote was **“anchoring”** — a rule that would have capped spending at five times the broadcast revenue of the league’s bottom club. Strongly opposed by the PFA and seen as potentially restrictive, it failed to gain enough support among Premier League shareholders.
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### **What Does This Mean for Sunderland?**
For Sunderland, the immediate impact is minimal. The club entered the summer in an excellent PSR position and would have enjoyed comfortable wiggle room next season regardless of how much they invested in their squad. Internally, Sunderland were believed to support both the new SCR model and the anchoring system that ultimately failed to pass.
The real challenge lies in what the rule change means for Sunderland’s rivals. Clubs that were previously forced to tighten their belts under PSR can now operate with more freedom, which may intensify competition when it comes to transfers and squad building. As Sunderland look to establish themselves and grow at Premier League level, the change highlights how vital it will be to **expand their revenue streams** — both through commercial growth and profitable player trading — in order to keep pace with clubs who now have renewed spending power.
In short, the new system won’t cause Sunderland any compliance problems, but it raises the stakes across the league. Sustainable growth, bigger revenues, and smart recruitment will be more important than ever.
Alious
