Pompey Plunge Into Administration
By Jim Bonner
Updated Friday, 26th February 2010
And things will get worse before they get better. (Updated Friday)Pompey have become the first Premier League club in history to go into administration.
With this comes the nine point deduction which would simply rubber stamp the club's return to the Championship and it will now be down Andrew Andronikou of finance firm UHY Hacker Young to find the club a new owner.
But whilst the club is saved for the time being, things will still continue to get worse. If you haven't read this very frank and honest Q & A piece with BBC's Matt Slater yet then I strongly suggest you do so. It paints a very bleak, but unfortunately real picture of the huge problems we face.
But before we can think about what happens in the summer, we have 12 more matches of this utterly miserable campaign to endure. Of course, we can still mathematically survive if we somehow managed to win 10 of those last dozen games. I'd suggest that task is impossible for a team who have managed just 4 wins in 26.
It'll be difficult to watch an unmotivated team canter towards the season's inevitable conclusion, but at least we can still take some joy from the fact that we still have an FA Cup to play for.
The other good news is that (to my knowledge) the 9 point deduction won't carry over into next season if Pompey were to be relegated without being penalised.
I understand that because administration is being entered now, and not after some time in late March, the Premier League nor Football League can postpone that points deduction until next season because it would be breaking the rules.
However, the real pain will come in the summer.
All players of any value will be gone, leaving us with a very mediocre squad indeed and then there is a prospect of a 15-20 point penalty in the Championship next season if Pompey cannot agree a company voluntary arrangement (CVA).
To keep things simple, the CVA is an agreement between Pompey and its creditors to basically accept less money then they were originally owed, paid back within an agreed schedule. Pompey has many creditors but this CVA will be the same for every single one, which includes HMRC.
HMRC are the huge problem here. This is just my opinion, but it seems like that HMRC are hell bent on trying to make an example out of us. They seem to have a chip on their shoulder because they are not top priority when it comes to paying money back.
Therefore, they will certainly vote against a CVA which basically means we will be hit with a heavy points deduction next season unless the money owed to HMRC is 25% or less than Pompey's total debt, and every other creditor can be convinced to accept the CVA.
It's reported that Pompey owe £11.8 million to HMRC, which would mean that the rest of the debt would have to stand at at least £35.6 million for our club to stand a chance of not being penalised next season. Given that the media reports our debt to be in the region of £60 - 70 millon then that might be a blessing in disguise in terms of the on-the-pitch situation.
But we really don't know the true extent of our money problems and there will still be bills to pay throughout the summer, even when the season has ended.
So we could be looking at a the worst case scenario where Pompey are in the Championship with at least a 15 point deduction and a mediocre, wafer-thin squad of players. League One wouls surely beckon then.
Of course, the positive way to look at it is that we end this season as remarkable FA Cup winners, the triumph inspires a wealthy man to buy the club, pay the creditors what they are owed and fund a squad to challenge for promotion.
But I'm dreaming there, if there is one lesson I have learnt from this season is that it's to expect the worst.
It's the staff I feel for the most, as Andrew has already hinted that there will be job cuts so the normal, everyday people who work for Portsmouth Football Club could be without a job next week.
Spokesman Gary Double has already left the club whilst Peter Storrie is finally going to do the right thing and resign when a new owner is found.
Avram Grant will stay until the end of the season which is some good news, but all Pompey fans, players and staff can prepare for things to get worse before they get better.
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