Football club ‘braced for administration’

Portsmouth Football Club are on the brink of administration, the club’s manager has said.

Speaking to BBC Radio Solent, Michael Appleton said: “I am prepared for administration,” indicating a clear understanding of what is happening to the club off the pitch.

Normally, of course, Mr Appleton would be focused entirely on the job of picking a team and trying to get results, but today (February 10th) is a day when the club is meeting with Her Majesty’s Revenue and Customs (HMRC) over its unpaid tax bill, meaning insolvency services could be needed very shortly.

The club, which nearly went out of business in 2010, was issued with a winding-up petition by HMRC on February 3rd and is set to face a hearing at the Royal Courts of Justice on February 20th.

Portsmouth’s situation is dire. Administrator Andrew Andronikou has already revealed £800,000 of tax has not been paid, but a figure of £1.9 million has now emerged, while between £4 million and £7 million is still owed to the previous owners. And this is a company where the players were not paid in January.

If the problems at Portsmouth are deep, they are certainly not unique. Many football clubs have been in administration in recent years but recovered, even if some have suffered on the field. (An example of this is Stockport County, who dropped out of the Football League last year after successive relegations).

Like Stockport, Darlington are a club who recently lost league status and are currently in administration, coming very close to going out of the league and being in a situation where the administrator sacked the whole playing staff before re-engaging them.

This created uncertainty over the rights of those individuals to ply their professional trade and the Football Conference, the league in which the club plays, was even forced to issue a statement recently denying claims that an opposing club had attempted to get a fixture called off.

But uncertainty over employment is one reason why sporting institutions run as businesses – and often not very successfully – are companies that may need skilful administration work when they get into trouble. The same applies to their other paid staff.