It is pretty tricky analysing our financials.
First of all, not every state federation releases a budget publicly – at least, that I can find. Second, the line by line items in the budget are grouped in vague categories which makes it difficult to compare what we do with other countries.
Finally, there has been so much change in Australian football that it is hard to talk about a “typical year”. It was only a few years ago Football Australia unbundled from the APL and immediately after came COVID. However, from what Is available I can tell a tentative story that we don’t spend nearly enough on the grassroots and growing the participation rate.
What is football’s financial state?
Football Australia collected $113 million in 2023, which is around 12 per cent of what the English FA collects with one-seventh of the participants. Unlike England, we have state FAs, which I estimate to collect a total of $67 million.
Cumulatively this puts our revenue per participant around 50 per cent higher than what England rake in. So a comparison with what the English spend their money on actually seems fair despite the massive financial might of English club football.
The English use around a third of their revenue in grassroots grants. By contrast, grants from FA is around one per cent of revenue. Things look better when you include state federations, but you still only get to a shave under four per cent at all levels spent on grassroots.
In Australia, the extra money was partly spent on $25 million in travel expenses. Without further information it is difficult to tell if this is reasonable, but this presumably covers the costs of both male and female teams at all age levels.
More importantly, we have a much bigger staff budget. England spend around a sixth of their budget on staff whereas in Australia we spend around 40 per cent both federally and at the state level. England also give information on what their staff do, 70 per cent spend their time promoting football and trying to get everyone in England kicking a ball with their local club.
England, like most football powerhouses, absolutely smoke us with their participation rate and it looks like most of their energy is given to growing the participation base. We don’t give information on what our staff do, unfortunately.
However, the picture that seems to be emerging is that, despite revenue per participant being similar to England, we spend very little on grassroots and growing our base. The strength of the EPL seems almost irrelevant to these financial decisions.
Health of the A-League
For most of Football Australia’s history they have also run the A-League and a lot of effort has been spent on trying to turn it into the Aussie EPL, or at least the football version of the NRL/AFL.
Constantly we hear the argument that we have a massive participation base and if we could just turn a fraction of such fans into A-League fans we could make football explode in this country.
After looking at the data, I’ve become pretty sceptical of this argument. Football crowds are very closely correlated with average wages in the league. For the mathematically inclined, I analysed 33 first, second and third divisions across the world and find a very strong correlation between the logarithm of the wages and the crowd sizes that does not seem to vary much by division or confederation.
Remarkably, the A-League actually punches above its weight in crowds, even in the post-COVID era. For the crowds we had last season, we can expect wages to be more than double what they are now. We already have fantastic, passionate crowds, we need to be better at making a competition this size financially viable.
If we can’t find a way to make crowds this big viable, those problems may not be solved even if we grow. In a previous blog I gave some ideas on how to get there.
Crowds also seem to be correlated with participation rate, but even here the A-League isn’t massively underperforming. Even if I add the weekly attendance of all leagues together, we do roughly as well at converting participants to bums on seats as Italy and about half as well as England and Scotland.
Football just isn’t a sport that converts a large portion of participants into spectators like NRL, NFL or AFL. It is a sport that doesn’t need to because usually its participation numbers are huge.
Conclusion – is the money being well spent?
Football in Australia is often said to be top heavy with too much spent on bloated administration and I have to admit, the publicly available information does little to reassure. We have revenues that are similar for our size compared to England, but too little seems to be spent on growing the grassroots.
Our participation rate could easily triple if we match the participation rates of football powerhouses and there seems to be much more room to grow the base than there is converting the base. Things could be better than they look, as many items in the budget are vague, however what we can see does not look good.
Football in Australia has for as long as I can remember called itself the sleeping giant about to take over. However, I worry we’ve been misled as to what makes football a giant. Rather than converting a large number of a decent participation base, football works by converting a small fraction of an astronomically huge base.
Football giants have a one-two punch for growing this base which affects all levels. First promotion and relegation benefits the country through the fact that local clubs near a promoted team have a surge in participants but relegated teams result in no decline.
If we cannot afford a proper pyramid, we should at least aim for some sort of hybrid that protects some clubs from dropping too low and gives them an easier path to getting promoted.
Second, the central governing bodies spend big on growing the base. If you want to know why we aren’t a football nation, to quote Bill Clinton, it’s the participation rate, stupid – and every effort at every level should be spent on growing it. And if not, what little media we have should apply the blowtorch in discovering why.