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Do we pay ‘huge fees’ to agents?

Posted on July 12th, 2011 | 28 Comments |

Does Newcastle United pay huge fees to football agents?
What's a 'huge fee'?
Newcastle United manager Alan Pardew has indicated that a huge amount of fees go to agents for transfers and such, but just how much classes as ‘huge’?

One of the things I picked up on in Workyticket’s transcription of Alan Pardew’s interview is that he (meaning Alan Pardew rather than Worky) claimed we pay huge sums of money to agents as part of any transfer agreement.

What Pardew said was:

I was listening earlier when you was talking about the money being spent and I just want to sort of make something clear. When you sign someone like Demba Ba and someone like Marveaux there’s huge fees involved in that, it isn’t just transfer fees. This is unfortunately how the Premier League works and a lot of money in those deals doesn’t come back through the system. Ideally, in the old days we would sign someone from the Championship and it would go back into the English game but this money’s going out through agents and stuff like that.

So I thought I’d do some investigation to try and find out just how much money is spent on things like agents’ fees.

Fortunately, Premier League clubs have now started publishing these details, the latest of which I could find was from October 2008 to September 2009 and, club-by-club, it looked like this:

Man City £12,874,283
Chelsea £9,562,223
Liverpool £6,657,305
Spurs £6,066,935
Wigan £5,527,548
Arsenal £4,760,241
West Ham £3,576,972
Portsmouth £3,184,725
Bolton £3,166,611
Everton £2,008,407
Sunderland £2,007,040
Aston Villa £1,708,374
Hull £1,599,188
Man United £1,517,393
Blackburn £1,610,885
Fulham £1,469,258
Wolves £1,235,703
Birmingham £974,982
Stoke £716,042
Burnley £468,398

These figures include:

  • fees paid to agents by clubs for player registrations,
  • fees paid to agents by clubs on behalf of players for their own player registrations,
  • fees paid to agents during the defined period relating to previous transaction costs that have been amortised over the length of a player contract,
  • fees paid to agents by clubs to facilitate the outward transfer of player registrations.

And those fees are paid for:

  • domestic permanent transfers,
  • international permanent transfers,
  • domestic temporary transfers (loans),
  • international temporary transfers (loans),
  • extension of existing player contracts,
  • first professional registration,
  • free transfers.

The total for all Premier League clubs for October 2008 – September 2009 comes out at £70,692,513 for 803 separate transactions, so the average amount paid in agents’ fees per transaction is £88,035.

It’s probably fair to assume that since that £88,035 ‘average’ fee includes all the above items, including things like contract extensions, the ‘average’ for pukka transfers is likely to be higher, although your guess is as good as mine as to how much higher.

Newcastle aren’t included in that list because it was created for 2009/2010 Premier League clubs and we were in the Championship at the time, but let’s do a bit of finger in the air extrapolation. Let’s assume that we’d be in the upper-middle part of that table – that would make for about £5m spent by the club on agents’ fees in a season. Let’s be even more generous and call it a range of £5-£8m on middleman costs, which I think is probably overestimating.

But is even my (probably overestimated) guess of £5-£8m per season on agents’ fees a ‘huge cost’ in terms of a Premier League club’s finances? I’ll leave it up to you decide that one!

NUFCBlog Author: Hugh de Payen I'm a baby-boomer of the punk rock persuasion, currently exiled in Somerset for crimes committed in a previous life where locals keep trying to poison me with something called 'scrumpy'. Hates sprouts, coat-hangers, Cilla Black, ornaments, Steven Seagull movies and 50 Cent (he's not worth 10). Hugh de Payen has written 634 articles on this blog.

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28 Responses

  1. These fees Pardew was talking about are huge to the man in the street, but, in football terms, or to be more exact, in premier league terms we will have spent very little in agents fees etc.
    Look at the value of the players we have brought in in relation to the signing on fees of Man Citeh.
    If the agents fees are relative to the transfer fee, we have spent next to nothing, probably around 3 mil to agents, add in sign on fees of around 1-2 mil.
    If Pards is on around 5g pw (as previously guessed at ) then these fees are huge,but in relation to our available funds we have barely touched it.
    The figures are relative to each other and only become huge when taken out of the football context, more spin from the puppet im afraid.
    I do think the players we have brought in are better than the ones who have so far left the club so we are as promised making progress, and improving the squad with the money from Judas, but why give the impression we have spent more than we have, and treat us punters like mugs?
    I also still think we will bring in another striker who is totally off everyones radar (another Carr gem) who will help us up the league this season.
    HWTL

  2. The signing on fees for Demba Ba and Marveaux were 4m
    each,plus 1 years wages about 2m each,and agents fees ?,so a total of at least 12m,cabaye cost 4.2m
    plus signing on fee,2 years wages and agents fees,the
    total will be nearer 8m than 4m,add all that up and it
    comes to around 20m,and thats not counting the money for
    tiotes contract and the money which was put aside for
    Enriques contract,thats another 5m,that comes to about 25m.

  3. You have also got to take into account the Training Ground Heating Installations. I suppose all these transfer wages are only for one year of their contracts or else we’re already skinned.

  4. 4m signing on fee wold most certainly stop many clubs looking for free transfers. No wonder we were invincible.

  5. Pugface says: “The signing on fees for Demba Ba and Marveaux were 4m each.”

    That seems incredibly high in the context of the above table. During the period quoted, Man City signed Gareth Barry, Roque Santa Cruz, Kolo Touré, Emmanuel Adebayor, Carlos Tévez and Joleon Lescott and paid £12.8m in ‘costs’ other than the actual transfer fees.

  6. Pugface says:
    July 12, 2011 at 6:00 pm

    “The signing on fees for Demba Ba and Marveaux were 4m
    each”

    Aye, it has been speculated that there were £2 million signing on fees for each player and £2 million agent fees for each player, amounting to £4 million each player as you write. It is just speculation though, or possibly some kind of ‘leak’ by the club’s new PR department.

  7. Pugface,

    1) If your figures are right, and we are actually the biggest spenders to agents in the premier league for 3 unproven players with patchy injury records, then it makes a mockery of suggestions that Ashley is taking a more business like approach to expenditure.

    2) Don’t forget to subtract from your figures the reduced wages from Carroll (who was on a post-England contract), Campbell, and Nolan.

    3) If that is all we can afford from the Carroll money, why didn’t we just stick with players like him and Nolan who we know could produce the goods rather than line the pockets of agents for players who may or may not (remember everyone getting excited by the likes of Maric?).

  8. No transfer fee involved in Demba Ba signing , so player and agent get substantial payment.
    Chelsea example quoted a record signing on fee for a 16 year old. You didn’t mention age related record ,and you didn’t mention the small matter of the £6m transfer fee.
    So to summarise; Chelsea sign a 16 year old for £7.1m of
    which £1.1m is a signing on fee.
    NUFC sign Demba Ba for a total of £4m – all of which relates to signing on fees.

  9. I think that the point was that Gbp.1.1m is their record signing on fee. In this case it comes as part of a paid transfer, but they have had plenty of signings without transfer fees, but haven’t gone over Gbp.1.1m signing on.

  10. sidekick says:
    July 12, 2011 at 7:27 pm

    “NUFC sign Demba Ba for a total of £4m – all of which relates to signing on fees.”

    As I mentioned above though sdekick, there isn’t any real proof of that. It’s just speculation at the moment.

  11. See, I’m assuming that ‘fees paid to agents by clubs to facilitate the outward transfer of player registrations’ – which goes through agents – includes the player’s signing-on fee and would therefore be included in the above table.

    I could be wrong but I was also bringing into it that Pardew specifically mentioned “this money’s going out through agents” in reference to the ‘huge fees’.

    It could just be that he made a spur of the moment comment and therefore the ‘agents’ reference is accidentally misleading.

    I’m trying to figure out what we’ve spent and how it relates the agents’ fees above. Estimates in these comments suggest that the signing-on fee for Ba and Marveaux is somewhere between £2-£4m each.

    Does that go through agents or not?

    If it does then we’re already way up on that table. Alternatively signing-on fees don’t go through agents.

  12. Those fees suggested do seem on the high side…I think we’re seeing the start of a trend that sees players & agents running down contracts to ensure they receive all the cash involved whilst being cheaper for the club…a bit like America

  13. Don’t see where it says the figures mentioned in the article involves signing on-fees. Just says it’s what goes to the agents.

  14. Hugh, what happened to Steven Harper in the goalkeeper’s table on the squad page? I know how much you like to keep all your tables ship shape and Bristol fashion, so do you know something that we don’t?

  15. Hugh de Payen says:
    July 12, 2011 at 8:13 pm

    “Aye, special table. You can’t have too many tables.”

    Aye but it no longer has the date he signed at the club!

    I agree with you about tables, though admitting to using them in web design nowadays is a bit like admitting that you have crabs seemingly. I still use ’em though!

  16. Yeah – I plucked the figure of £4m from comment 2.
    Totally speculative.
    However , if it was £4m – bargain!!

  17. Hugh de Payen says:
    July 12, 2011 at 8:32 pm

    “Worky, I’ve updated the ‘injured’ table to included date signed.”

    Wahey! I love those date signed stats!

    sidekick says:
    July 12, 2011 at 8:27 pm

    “However , if it was £4m – bargain!!”

    Possibly sidekick, so long as his knee doesn’t end up like my neck anytime soon.

  18. Hugh de Payen says:
    July 12, 2011 at 8:48 pm

    “This suggests we paid a £500,000 signing on fee for Demba Ba:”

    Aye Hugh, I think that one may be gannin’ on what he was allegedly offered by West Ham, which was, allegedly, £500,000 signing on fee and £50,000 per week. There was yet another figure somewhere inbetween the two suggested by the Grauniad, but it wasn’t Louise Taylor.

  19. The end of ‘buying & selling’ people as commodities is nigh!
    About time too.
    It’ll be all about contracts soon, particularly if fifa gets it’s way with the ‘new rules’ coming up. Therefore clubs will have to ‘buy out’ players contracts to get them.

    Can’t believe it’s took this long & counting.

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