Some in-depth reading for you this Thursday with an article from Blackpool fan Chris Walker. Chris trades on Twitter under the moniker @onedavebamber and runs the excellent Up the ‘Pool blog. Here he summarizes a debate that has divided fans of the Lancashire seasiders.
‘F5…nothing. F5…nothing. F5…a-ha!’.
This was the routine I went through waiting for Blackpool FC’s annual accounts for the 2010-11 season to go live on the Companies House website in late February, refreshing the window at every opportunity. Covering the period of the Seasiders’ first foray into the top flight since 1970-71, I had been eagerly anticipating the annual report which would detail just how well Blackpool had done financially out of their adventure. Days before this, the club had taken the unprecedented decision to publish some headline figures from the accounts early – this was the first sign that something might be slightly awry.
The numbers published on the club website weren’t massively out of line with what I had expected based on some crude calculations, but costs did seem a little high, and in turn profits were lower than I had perhaps anticipated. As I opened up the PDFs – two of them given that Blackpool FC is split into a football company and a properties company – I began to glance down each page looking for anything out of the ordinary.
‘That looks fine…Yes, that’s OK…Yes, fine…Er…WHAT?!…ELEVEN MILLION POUNDS?!’ Only a few pages of scrolling had revealed the nasty truth, laid bare in black and white. Under the header of director remuneration, it was there – the highest paid director at the club had been paid £11 million straight out of the club’s coffers. A few angry missives into the social networking ether later, and the story began to unfold, and would be revealed in that weekend’s Mail on Sunday that the beneficiary of the huge sum was long-term owner and major shareholder Owen Oyston.
Needless to say, the fallout was intense. The angle that The Mail on Sunday went for was that by taking £11 million in director remuneration, Owen Oyston effectively earned more per week than the basic wage of any player in the Premier League – a damning statistic, especially when son Karl had espoused the dangers of paying over the odds and had placed a strict cap on Ian Holloway’s playing budget. The paper’s Nick Harris followed up the news on his sportingintelligence.com site, while the story also received coverage from David Conn in The Guardian.
As someone with an interest of my own in the story, and as one of the first to uncover the ugly truth, I too wrote at length about the publication of the accounts, outlining 10 key questions that the Oyston family should be made to answer. Along with the £11 million payment, there were a number of other issues that were of concern, including the use of external Oyston-owned companies to project manage construction of the stadium and a controversial land deal – Blackpool FC sold a plot of land opposite its South Stand to Owen Oyston in 2008 for £650,000 before buying it back from their majority shareholder during 2010/11 for £6.5m – a 1,000% price increase.
Faced with a media backlash, chairman Karl Oyston did attempt to quell the storm by agreeing to interviews with some sections of the press, but his answers were deeply unconvincing, as explained in-depth here. The main justification given for this £11 million being paid was as a means of avoiding a significant tax bill for the club due to the profits made. This is a rather flimsy excuse however, and the net result is a loss to the club of £11 million, rather than a loss of a portion of that figure in the form of a tax bill.
It’s fair to say though, that while this whole situation did cause a lot of negative feeling, the Oyston family do still have their advocates. ‘What’s the problem?’ some will say. ‘It’s their money, they can do what they want’ say others. Yet by far the most widely heard defence of their actions was to suggest that the club could have folded without the Oystons’ support and that in getting us to the Premier League, what is there to complain about?
The argument does hold some weight, with fans of other clubs often perplexed as to how Blackpool fans could have any issues with the way the club is run given the great strides it has made in the course of the last ten years, and particularly the last three. Recently fans have been fortunate enough to witness the best ‘Pool side in a generation as supporters from around the country looked on with envy at the team, somewhat patronisingly, referred to as a ‘breath of fresh air’.
So just where have the Oyston family gone right in their approach, and could it be argued that £11 million is a fair price to pay for their leadership down the years…?
Whenever the Oystons draw fire from critics regarding their frugal approach to spending, their advocates are always quick to cite examples of clubs who have spent big, gambled on a dream, and ultimately failed. There are numerous examples with the Football League littered with clubs who have experienced financial hardship after rolling the dice – the phrase ‘doing a Pompey’ being the most topical.
In one sense, this is a solid argument. Many clubs have gambled the farm on Premier League existence, only to suffer horrendous consequences when things don’t quite work out. Portsmouth are the latest example, with Bradford perhaps the most effective scare story having spent numerous seasons in the lower reaches of League Two only a decade after their top flight adventure came to an end. Under the ownership of the Oyston family, the long-term future at least guarantees stability, with the threat of administration about as remote as possible.
Furthermore, the Oystons have laid these solid foundations while at the same time modernising Bloomfield Road into a respectable, if a little small and unspectacular, football venue. Fifteen years ago, Blackpool’s home was on the verge of collapse. Little had been done to the ground in generations and bit by bit, certain areas began to be condemned – most notably the iconic Spion Kop. Yet during the tenure of chairman Karl Oyston, Bloomfield Road has been transformed.
The new North and West Stands were the first to be redeveloped, with a helping hand from the Football Foundation who provided a grant for £2.5 million to aid with the building costs. However, after the first phase of construction was completed in 2002, it was a long wait for further work to take place. For years it was deemed there was no business case to justify the next phase of development – the South Stand. Karl Oyston suggested that the demand on the football side just was not there – ‘only 50-100 people are being locked out’ was the line often trotted out – and that pre-letting office space was the only way the new stand could be self-funding.
Nonetheless, by March 2010, the South Stand did eventually open and with promotion to the Premier League months later, a hastily constructed semi-permanent stand was constructed on the East side of Bloomfield Road, replacing the uncovered stand down that side more typically witnessed on the 18th hole at St. Andrews – or the ‘Gene Kelly Stand’ as it was affectionately known by supporters, with opposing fans often left singing in the rain.
The redevelopment may not have occurred at a pace to please Blackpool’s fanbase, but over the course of a decade Bloomfield Road changed from a ground with surely a catalogue of health and safety breaches to a home that can almost be termed as a stadium. It may be compact, and a little quirky with the stanchions that line the front of the East Stand, but it no longer holds the same embarrassment for Seasiders that it once did. A definite improvement, one has to concede.
Karl Oyston also has some positive attributes on the football side of things. Perhaps most significantly, he gives his managers free rein to approach the game as they see fit. This is of course within a given budget, but at the same time it is refreshing for a chairman not to stick his oar into footballing matters – it is rare to hear from Karl Oyston more than a few times during the course of any given season, and when you do he very infrequently voices any kind of opinion on the football itself. Managers at Blackpool then are not placed under anywhere near the same level of pressure exerted on some of their peers.
In terms of how he manages the football budget, it could be argued that Blackpool’s current chairman is also something of a revolutionary. In an era where money is perceived to rule football, under the leadership of Karl Oyston the Seasiders have firmly bucked the trend. ‘Pool achieved promotion to the Premier League on one of the lowest wage bills in the Championship, and then nearly retained top flight status despite players’ salaries being only around a third of the next lowest earners. In fact, there is strong evidence to support the theory that the best example of a ‘moneyball’ approach is taking place on the Fylde coast.
Moneyball is a term that has been bandied around an awful lot since John W. Henry’s Fenway Sports Group took over at Liverpool, but if you bear with me, I believe there is a genuine case to be heard that Karl Oyston has gone down this very route in a more bona-fide manner. Certainly, when compared with the origins of the term from Michael Lewis’ excellent book on Billy Beane and the Oakland A’s, Blackpool represent a much stronger parallel than any other football club out there.
The Oakland Athletics, with a level of revenue dwarfed by their Major League Baseball rivals, needed to look for undervalued players in order to try and be competitive with one of the lowest wage bills in the sport. Statistics are certainly an element of a moneyball strategy, but the crux of Beane’s approach was in drafting players not regarding highly by other teams, but with the potential to out-perform their market value.
Are Liverpool adopting a moneyball approach with a net transfer spend well in excess of £100 million? Their results seem to show that they have in fact overpaid for players of average ability at Premier League level. With that in mind, Newcastle are now being hailed as the great exponents of the moneyball ethos, but how valid is that? Papiss Demba Cisse is certainly value for money, but Newcastle have still spent good money on the former SC Freiburg man and the other recent Graham Carr-inspired imports. It’s hardly a tale of overcoming great odds to rival that of the Oakland A’s, is it?
Meanwhile, Karl Oyston has eschewed the big money signings and sought to squeeze maximum value from players brought into the club. Blackpool’s players have developed a siege mentality when faced with criticism as being a rag-tag bunch of ‘cast-offs, rejects and journeymen’ but in all truth it is the market the club have mainly been shopping in with a decent success rate. Take Charlie Adam for instance – out in the cold at Rangers he was signed by Blackpool for just £500,000, rediscovered his potential and helped guide the club to the top flight while also being recognised with a PFA Player of the Year nomination. Or perhaps even more strikingly one can consider Alex Baptiste who cost Blackpool an undisclosed fee (believed to be less than £50,000) from Mansfield Town and has gone on to become a regular in the side.
Matt Phillips and Tom Ince are two more recent examples of players brought in at minimal cost but are now touted for big money moves elsewhere. However, it is a strategy that has its failures too. Lomana Lua Lua was brought in on a free transfer during the season just gone after plying his trade around Europe, but a few magic moments aside, never really produced on a regular basis. An unusual move for Robbie Fowler also backfired when the former England international refused to accept a £90 per week basic wage with performance-related add-ons, sparking some negative publicity in the process. Nonetheless, these mistakes are relatively low risk, with the potential for high reward when they do come off – an indisputable hallmark of Beane’s approach with the A’s.
With all this in mind – a modernised Bloomfield Road, the best team in a generation, stable financial footing and an antidote to the prevailing big money approach – one might wonder what the problem is for a significant section of Blackpool fans, and when written down like that it does look a compelling argument. What’s £11m between friends? Yet as with everything, there are two sides to the story, with the counter-argument being that much of this success story has been in spite of the Oyston family, not because of them.
It would certainly be wrong to suggest that the Oystons can claim no credit for Blackpool’s current situation, but there are a number of other key figures whose influence should not be underestimated. Observing the graph below, it is possible to pick out a couple of key landmarks in the recent history of the club which may help to explain some of latest success.
Prior to Owen Oyston taking control of the club in 1988 (1), Blackpool had endured a turbulent decade, including having to apply for re-election to the Football League in 1983. Relegated from the second tier in 1978, the Tangerines spent time languishing in the lower leagues and mired in financial problems. Owen Oyston came in seeking to turn around fortunes, but as the graph shows, it took until 2006-07 for any significant upward trend to emerge. One anomaly that needs pointing out is the 1995/96 season when Blackpool, under the management of Sam Allardyce and backed by heavy investment in the playing side, capitulated from a commanding position in the top two of League One, before missing out in the play-offs against Bradford City – despite winning the first leg away 2-0, ‘Pool went down 3-0 at home to seal Allardyce’s fate.
In the early 2000s, Blackpool established themselves again as a third tier club after dropping into the basement division for one season, but under Colin Hendry’s reign as manager, the club looked to be moving in the wrong direction. The team Hendry had assembled was weak, while off the pitch work had stalled on the redevelopment of Bloomfield Road. In November 2005, with the team facing relegation to League 2 and unrest amongst supporters growing, the Oyston family were forced to act.
Hendry was, somewhat messily, dismissed and replaced with Simon Grayson and outside investment was sought with Owen Oyston bringing Latvian businessman Valeri Belokon on-board (2), who acquired a 20% stake in the club. Belokon’s ambition brought a refreshing change at the top with an outlandish claim he wanted to take Blackpool to the Premier League within five years – a goal that was realised with promotion in 2009/10. Belokon pumped in the money to support Grayson and ensure the club avoided relegation in 2005/06, but that was only the start.
Given Belokon’s lofty ambitions, merely stopping the rot was not enough. Further investment in the playing side followed – Ian Evatt, Shaun Barker, Wes Hoolahan, Ben Burgess and Andy Morrell all came in – as Blackpool set their sights on promotion. Despite a shaky start to the season, ‘Pool won their last 10 games of the season to win the League One play-offs and take their place in the second tier of English football for the first time in 29 years. It’s hard to imagine promotion could have been achieved without the influx of Latvian finance.
After maintaining Championship status for two seasons, the next major turning point of the Oystons’ tenure was the arrival of Ian Holloway as manager at the start of the 2009/10 season (3). Simon Grayson departed for boyhood club Leeds in late 2008, while Tony Parkes was unable to convince Karl Oyston he was deserving of a long term deal despite a successful six months as caretaker boss. If Belokon was the catalyst to kick the Seasiders on from being a lower league side, then Holloway – in cooperation with Belokon – was the spark that made the next leap possible.
After being appointed, Holloway embraced Belokon’s vision of reaching the Premier League at a time when most associated with the club, including the majority of supporters, would have been happy to maintain the status quo as a bottom half Championship side. Holloway demonstrated his determination and met with Belokon in Riga before the start of his first season asking for funds to be released to sign Charlie Adam and Neal Eardley – Belokon loaned the club the £800,000 necessary and the rest is history.
With those few signings, and a new expansive playing style, Holloway was able to achieve a tremendous improvement in both performances and results, despite having one of the lowest budgets in the league commensurate with the low attendances. Tipped as the bookmakers’ favourites for relegation in 2009/10, Holloway led the side to promotion through the play-offs with Nottingham Forest swept aside in a thrilling semi-final second leg before ‘Pool enjoyed a Wembley win over Cardiff.
Again, it is hard to recognise just how significant the Oystons’ influence was on this success. They must be given credit for the Holloway appointment, but what their manager did with the resources, and the financial support from Belokon was arguably a bigger factor. It was Belokon too who provided the necessary funding for the South Stand to at long last be constructed, as he loaned the club a further £7.5 million for the work to be carried out. Belokon is yet to see this loan repaid according to the most recent accounts, despite the £11 million payment taken by Owen Oyston. Belokon now appears a peripheral figure, with rumours abounding about a possible fallout between the two parties.
What happened after promotion has also provided plenty of ammunition for critics of the Oyston methods. An awful lot was asked of Ian Holloway in trying to keep Blackpool in the top flight on a budget so out of sync with the rest of the league, regardless of whether some teams do overpay their players – the failure to back Holloway during the January transfer window when the team were comfortably mid-table perhaps being the most frustrating. Deals could not be agreed for any of Holloway’s top targets, which left a scramble on deadline day at the bottom of the barrel – James Beattie, Andy Reid, Sala Sbai and Sergei Kornilenko are all names that will send a shiver down the spine of Blackpool supporters. That transfer window ultimately cost the club its Premier League status.
Furthermore there are additional non-footballing issues that continue to cause consternation. A promised new training ground to replace the existing ramshackle facilities is not even off the drawing board, while the new South East corner is currently around a year behind schedule – for comparison Wolves had fans in their new stand just months after knocking down the previous one. Meanwhile construction on the small corner, project managed by an external Oyston company, has dragged and dragged.
Perhaps the biggest sin of them all though, is the poor state of relations between club and fans. At a time when the club is doing better on the pitch than it has for 40 years, it should be easy for the club to build bridges with the supporters, but communication is at its worst in years – the handling of the £11 million revelation a prime example of the disdain with which the owners treat the fans at times. There has been no reasonable explanation, nor any proactive dialogue about the vision the Oyston family have for the club. With Valeri Belokon seemingly silenced, Ian Holloway has an uphill battle on his hands to maintain a positive atmosphere around the club – a task that at times appears to have taken its toll.
Ultimately, you can almost break down the arguments into two separate issues. 1. Have the Oyston family been good for the football club? 2. Was it right to take £11 milliondirector pay, plus other monies in different ways, out of the club?
On the first question, given the club’s current situation it’s hard to deny they have put the club on a good footing, both financially and in football terms. Whatever credit one wants to attribute to them, the fact is that under their ownership the club has come a long way, and much further than most Blackpool fans could ever have hoped. Perhaps more open-ended is a discussion as to whether they have maximised the current scenario to its full, and in this regard they really come short.
Secondly, one has to question whether any director at any company can really justify taking a salary of £11 million. Even heads of large multinational banks have not taken such extravagant bonuses, and have been widely castigated in the process. The removal of such a sum is also at odds with the financial prudence preached by Karl Oyston – the hypocrisy can surely not be lost on him and his family.
The reality of the situation is that for the time being, on-field success will continue to cloud the issue. After all, had Blackpool taken their chances in the Championship play-off final against West Ham, they would be set for an instant return to the Premier League, which could have been argued as another gauge of successful ownership. There is an underlying feeling around the club though, that a sizeable portion of the fanbase is ready to turn on the owners at the first sign of failure – the Oyston family will be all too aware of this fact and may have to bend their principles this summer to give Ian Holloway the backing he has requested.
The true extent of Oyston involvement at Blackpool Football Club may not be seen for another 15-20 years however. Once promotion to the Premier League was won back in May 2010, the buzzword, like it is for the London Olympics, was legacy. The money should be there to secure the long-term future of the club, but with £11 million extracted, and slow progress in infrastructure projects, that legacy is far from certain. Only time will tell how damaging (or otherwise) Owen Oyston’s £11 million salary will prove to be.