Reading FC are one of the clubs who have led the way in a proposal for the EFL to introduce a salary cap for League One clubs.
Led by both Reading and Peterborough, 18 League One clubs in total have written to EFL chair Rick Parry in support of a £4.7m salary cap and a luxury tax for clubs that overspend. However, the EFL are set to reject the proposal.
The clubs also proposed a 100% tax on every penny of overspending above the cap, creating a fund that would be redistributed to clubs who complied.
The matter is understood to have been discussed on Thursday by the EFL board, which concluded it would not support the clubs’ proposals.
The EFL sought to introduce salary caps in Leagues One and Two four years ago after the Covid pandemic left many clubs facing acute financial problems, but it was thwarted by a legal challenge from the Professional Footballers’ Association.
The EFL Board is understood to have concluded that it would be irresponsible to endorse a salary cap that could also be subject to a PFA legal challenge. There are also misgivings about one division seeking to pursue fundamentally different financial regulations.
League One could go it alone, with a two-thirds majority vote of its clubs required to alter the financial regulations, but it is unclear whether they are willing to go against the board’s wishes.
The EFL is expected to tell the League One clubs there are other ways in which they could get spending under control. League One clubs can spend 60% of turnover on player expenditure. The limit is 50% in League Two, where spending on managers is also included.
