The 2021-2022 season.

The first season since 2018-2019 not impacted by the Covid-19 pandemic.

There were full crowds.

And no (questionably) distributed grant funding by the National League to massage the Profit & Loss accounts of member clubs.

Most financial set of accounts for 21/22 were released at the end of February/March 2023, as most accounting periods for clubs ended on 31 May or 30 June 2022.

However, a number of clubs applied to extend the usual 9 month period they have to file their accounts within, such as York City, Yeovil Town & Solihull Moors.

These accounts should paint a fairer reflection of the state of National League clubs’ finances compared to recent seasons (19/20 & 20/21) given those seasons were impacted by the Covid-19 pandemic that comprised of reduced crowds, grant funding, the furlough scheme, Sport England/Bounce Back loans and partially completed seasons.

And paint a fairer reflection they do indeed:

• Total losses across the 3 leagues have accumulated £20.2 million.
• These losses of £20.2m are spread across just 39 clubs, compared to profits of just £1m spread across 12 clubs.
• 62% of clubs are trading insolvent with liabilities (debt) greater than assets.
• 7% of clubs haven’t filed their accounts on time with Companies House.
• NLS clubs are fairing – financially – better than NLN clubs, with 44% of NLS clubs making a profit in 21/22, compared to 19% of NLN clubs.

It is important to note that the above figures are based on 51 out the 68 National League clubs’ set of accounts, equivalent to 75% of all clubs. There are a further 5 sets of accounts over-due with Companies House (Southend United, AFC Fylde, Farsley Celtic, Ebbsfleet United & Oxford City) with another 12 set of accounts due to be filed, 10 of which should be by the end of June 2023.

During the 21/22 season, 4 out of the National League’s top 7 that year (Stockport County, Wrexham, Notts County & Grimsby) made total losses of £10.4m, demonstrating the sheer amount of finance required to be competitive at the top-end of the National League.

It also shows the complete desperation of some clubs to achieve the promised land of the Football League, where the disparity of levels of funding is estimated to be anywhere between £750k – £1.5 million per season through increased broadcasting funding, league distribution, increased Academy funding & increased attendances.

Halifax Town were the only club in the top 7 during 21/22 to make a profit, (a modest £52k), whilst the accounts of Solihull Moors & Chesterfield are still to be released.

Given the Moors & the Spireites made losses of £1.1m & £2.3m respectively in 20/21, then it is difficult to envisage a scenario where both clubs reduce the levels of losses made by the top 7.

In is indeed telling, that 90% of National League clubs (17/19) made a financial loss in 21/22.

Rather interestingly, there is quite a disparity between the financial health of National League North & National League South clubs. 81% of NLN clubs made a loss in 21/22, compared to 56% in the NLS.

These losses were also – on average – 18% less than those sustained in the NLN.

One hypothesis for this could be the increased amount of travelling expenses clubs in the National League North are having to incur, with the boundaries ever-increasingly shifting south.

After all, Bath to Eastbourne is a lot different than Blyth to Bishop Stortford:

Map of all National League North sides (21/22):

Map of all National League South sides (21/22):

So, what are the National League Board doing about the significant amount of cash being haemorrhaged from steps 5 & 6 of the fabled English footballing pyramid?

The answer – not very much.

The Premier League & EFL have introduced spending caps relative to turnover in the form of Financial Fair Play (FFP) & Salary Cost Management Protocol (SCMP) to limit frivolous spending & club owner’s financing clubs with interest-bearing loans, secured against the assets of the football club.

Indeed, ‘finance’ is only referenced 3 times in the National League handbook, which is a 39-page document outlining the rules of the competition.

FFP and SCMP are not perfect, but they at least offer a clear and consistent financial framework that football clubs must operate under.

Until this is addressed at National League level, there will be more unsustainable spending, winding-up petitions issued by HMRC, deadlines missed with Companies House & clubs predominately dependent on the success of their owner’s core business, rather than its own performance as a single entity.

The National League Board has – once again – found itself waning.