Barcelona’s wage bill crisis as Spanish giants forced to make £441m cuts

Barcelona are facing up to a staggering wage bill crisis that could see the La Liga giants forced to make as much as £441million worth of cuts.

The Catalan side have found themselves in a horrendous financial position after paying out massive transfer fees and wages in recent seasons, which has been exacerbated by the Covid-19 pandemic.

Though they have been granted permission to register Lionel Messi having agreed a new contract with the Argentine superstar, they face a battle to register any new signings.

They have already been forced to sell a number of fringe players, with the likes of Antoine Griezmann, Philippe Coutinho and Samuel Umtiti all up for sale.

They are struggling to cut those players from their squad though, which is causing them to head for a showdown with La Liga.

The Spanish top-flight uses a salary cap which is devised by studying revenue, profit and loss, overhead costs, savings, non-player contracts, investments and debt repayments.

Following that a salary cap limit is then produced, which combines transfer spending and wage bills.

Clubs are at risk of penalties if they fail to follow the rules, with Barcelona at serious risk of falling foul of the league.

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According to The Athletic, Barcelona earned £627 million in 2020, but they admitted to having a staggering £1.1bn worth of debt.

They are also struggling with the amortisation (the writing off of an asset’s value over time) from the expensive signings of Griezmann, Ousmane Dembele and Coutinho.

Those financial missteps means that La Liga are set to severely slash Barca’s wage cap, from £579m in the 2019/2020 season to £138m for the upcoming campaign.

In order to avoid penalties, it means they will have to cut £441m from their wage bill, with the need to move on high-earners increasing by the day.

It will see Barca’s wage bill going to a level they have not fallen to since 2012, dropping below Atletico Madrid’s and one which is little more than a quarter of what they were spending on wages alone in 2018-19.

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