New reality dawns over Gorgie

By Moira Gordon
Published on Sunday 6 November 2011 02:00

IF THE reality of life as a Hearts player took another bite out of staff morale this month, the club as a whole is finally waking up to the harsh realities of Scottish football.

The long-running saga of the late payment of wages came to a conclusion on Friday, with owner Vladimir Romanov still unwilling to offer playing staff or fans any explanation for the 19-day delay.

While the team goes back to focusing on the football, with the worries about whether there will be a repeat when the November salary is due in ten days’ time pushed to the back of their minds, the wage delay has prompted questions. Was it simply an unwillingness to pay up in a timely manner and if so, why? Or was there an inability to do so?

The club has tried to steer things on an off-the-record basis, claiming that as far as the powers that be are concerned it was merely a timing issue, not a funding one, but that did not prevent scare stories emerging. In the midst of it all the man once considered the Tynecastle side’s saviour referred to Scottish football as “showbusiness”. Ranking us alongside Armenia, Panama and Burkina Faso, Romanov said that entrepreneurs and large businesses turned their backs on that sort of football. He also laid into the SFA, SPL, media, referees, tax authorities and opposition teams. “No one is interested in what is going on,” he concluded. “This why I think there is no point in spending millions to watch someone else’s show.”

It was seen by some as a veiled threat and a suggestion that he may be ready to walk away. But while the fears about the club’s finances were given oxygen by the extended period of non-payment, allied to little or no communication with fans or players, the reports of the club’s demise are premature.

The suggestion of a fire sale is also wide of the mark. The claim that David Templeton had been touted to Rangers for the knockdown price of £500,000 was not only denied by Ibrox manager Ally McCoist but also rubbished by agents and Hearts. Players’ representatives say that while they have all been made aware that there is scope for their clients to seek pastures new, the club have not tried to accelerate departures in the wake of recent events. But what cannot be denied is the desire to cut the wage bill drastically and offload high earners.

“Like any club, every player is for sale if the price is right,” said one club source. “Scottish football is struggling just now and like every other club we have to keep the wage bill manageable. I don’t think that has anything to do with paying the players; historically that hasn’t been the problem, and there is nothing to suggest that this time is any different.”

But realising the kind of hard cash Romanov is demanding in terms of sales could prove tricky. Andy Driver was undoubtedly a player with a decent sell-on value a few years ago but a sustained period of injuries and now a descent down manager Paulo Sergio’s pecking order means that valuation will have decreased accordingly. Yet the club are reportedly still seeking around £3m for him. With such an unrealistic price tag, it’s more likely that the winger will see out his contract at the club, which is not due to expire until the end of next season. He won’t be the only one.

But against such a backdrop it’s almost inconceivable that the club would offer Templeton, one of their most valuable assets, to an SPL rival at such a low price. Others will not survive. With or without willing buyers, the club could cut more than a dozen from their wage bill by the end of the season.

Goalkeeper Janos Balogh and midfielder Rudi Skacel’s contracts expire in January, while the deals of others, including keepers Marian Kello and Jamie MacDonald, midfielders Eggert Jonsson, Ian Black, Ryan Stevenson, Suso Santana and David Obua and strikers Kevin Kyle, Stephen Elliott, Gary Glen and Calum Elliot, run out in June.

A mass exodus would rip the guts out of the first team but replacing them with free signings and lower paid versions or swamping the squad with graduates from the Riccarton academy may prolong the lifespan of the club. It will, though, require a reassessment of expectations. At the moment Hearts are able to lure the better quality players to the club despite the constant uncertainty and histrionics because they offer by far the best salaries of any SPL club bar the Old Firm and therefore the most obvious chance of silverware outwith the Glasgow duo. But, as that wage gap narrows, as it will have to, will the off-field nonsense and constant dramas be considered worth it?

The annual wage bill was in excess of £12m in 2007 and over the ensuing three years the club successfully shaved around a £1m per annum from that figure. That trend is expected to continue when this year’s accounts are released. But the bill is still worryingly high.

Further surgery is required. And it will be severe. The running wage bill for this year is around £8m but insiders say they need to slice another massive chunk off that. With Hibs and Aberdeen operating wage bills of less than £6m (Aberdeen’s is estimated at just over £5m, while Hibs’ 2010 payroll totalled £4.8m), Hearts need to reduce theirs to a more manageable level, with some sources suggesting that a stripped down figure of just over £4m is the final objective if income does not pick up.

At the moment, though, the ratio of wages to turnover is around 120 per cent, despite the recommended target being 60 per cent to ensure a sound fiscal footing. Simply put, it is not sustainable. Attendance levels are down, commercial backing is not what it once was, and television money plays a minimal role in the day-to-day financing of SPL clubs. In such embattled times Hearts will not be the only ones tightening their belts. When David Glen of accountants PricewaterhouseCoopers wrote the 2011 annual report into Scottish football finances, in August, he said: “It is all about clubs continuing to cut their cloth accordingly and they are probably going to have to be selling clubs just to balance the books.

“My message to the fans would be – if you want your club to survive, you are going to have to accept that they have to reduce the wage bill and sell their best players when they become of worth.”

The reality seems to have dawned on all but a blinkered few this week. They are looking at the future and seeing one where they and their rivals for third place will compete on a slightly more level playing field in financial terms. But it is a future in which Heart of Midlothian still exist and players and creditors are paid – perhaps even on time.

Fans will always want the best but following the jolt offered by headlines this week they are tempering their expectations. The only hope for Sergio and his successors is that Romanov does likewise as he pulls his belt in, notch by notch.

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New reality dawns over Gorgie