Parachute payments are designed to help clubs that get relegated from the Premier League and into the Championship. However, there is an argument that certain clubs are more in need of these payments than others and that any time who receive parachute payments has an unfair advantage over the other teams in the Championship.

The gulf in finance between the Championship and the Premier League is extremely evident but in a lot of ways it is the own clubs stupidity that got them into trouble into the first place – so why should they be bailed out? Take the example of West Ham that has been paying out some huge wages on some very average players – which was proved by their relegation. However, despite all this it is clear to see why there is a need for parachute payments in this case – especially if West Ham fails to make an immediate return to the Premier League.

However, not all teams who fall out of the Premier League need any significant adjustment to life in the Championship; mainly because they haven’t taken a significant gamble in staying in the Premier League. Usually these are teams that have spent a solitary season in the top flight and have spent comparable little on transfer fees and wages.

Perhaps the best recent example is Blackpool and under the guidance of Ian Holloway they stubbornly refused to spend big. Holloway constantly suggested that no player would be paid over £10,000 per week; Blackpool spent just over £3.5m on new players – despite receiving over £40m on Premier League TV revenue alone. The squad hasn’t had many changes made since the last time they were in the Championship – so adjustment to Championship football should not be hard. This would be especially the case if the club receives a large transfer fee for Charlie Adam – with the star linked with a move to Liverpool again; other Blackpool players may also be in demand.

Blackpool is now in a much improved financial state than they were prior to their season in the Premier League. Effectively they have pocketed the cash that they received through promotion to the Premier League – which will give them more to play with in the summer transfer market. But it should also be kept in mind that Blackpool already has a decent squad to play with that should be competitive in the Championship. However, even so in the Premier League eyes they need additional help and will receive £48m over the next four seasons.

Blackpool could perhaps take the view that this is their reward for taking a cautious approach to Premier League survival. Certainly they look fairly stable at the moment and should not encounter further relegations or financial hardship in the seasons ahead. There will be a number of teams receiving the revised higher parachute payments next seasons comprising of the teams relegated last season and the season before. Previously parachute payments were a package of £32m paid over two seasons.

However, surely this will give an unfair advantage to teams that do receive parachute payments over other teams in the Championship next season. The Championship tends to be a very competitive division and it would be shame if it became somewhat anti-competitive; due to certain teams having more money than others. That was the fantastic thing about Blackpool winning promotion – the fact that no one expected it and it was just a fantastic story.

The same goes for Swansea gaining promotion into the Premier League last season and it certainly would be a shame if we lost this sort of magic in football. There is also the view that there should be a level of incentive for teams to go for it in the Premier League. With the amount of money that is around in the Premier League and the level of debt in the football league – it may be tempting to take the money without spending much of it. However, is there scope to modify the current parachute payment system to only reward teams that have been in the Premier League for a certain period of time or teams that have gambled somewhat to stay there?

Therefore, the parachute payment could be changed so it only teams that have been in the Premier League for a significant period of time would receive the pay-out. The logic to this seems sound considering the longer a team has been in the Premier League – the more likely they will have adapted to Premier League wages. A period of three or more seasons seems fair.

Another possible change would be to allow a team that has spent a lot in their first season to receive parachute payments. However, critics would argue that just rewards teams that have perhaps been reckless in their spending. However, statistically speaks I suspect the teams that spend money in their first season would typically survive the drop. Therefore, such a change probably would not be necessary.

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