Aitor Elizegi Reportedly Requests Forgiveness For Financial Deficit Following Pandemic
Budgets have been thrown out the window. As a result of the pandemic and football stoppage, clubs are facing unprecedented financial loss and things will be far from normal for quite some time. Fortunately, Athletic are in a much better position than most but will still suffer a negative impact.
Back in October the club and Socios approved a €132 million budget for the 2019/2020 season which included a surplus of roughly €226,000. However, because of the pandemic the club stands to end the year with a deficit of at least €25 million and that number could be even higher depending on several factors. For president Aitor Elizegi the financial loss could be disastrous.
As laid out in the Sports Law of 1990 Athletic, Barcelona, Real Madrid, and Osasuna were not required to become public limited companies as a reward for having no debt. As a result, elected presidents must submit “guarantees” equal to 15% of the club’s budget when taking office. This measure is in place to ensure that governing Boards are held accountable for any financial issues when leaving office.
Simply put, when a president is elected the new board is responsible for leaving the club in the same financial standing, or better, when their term in office is over. For example if a Board were to end their term with a deficit of €30 million from when they originally took office, they will be held personally responsible for the losses and will be required to pay it back to the club.
In light of the Sports Law, the financial impact will be a massive issue to overcome. As a club Athletic can always turn to the Extraordinary Fund to cover the losses, but doing so would still require the current Board to be held responsible when leaving office. Because of the unforeseen circumstances there is hope that the specific deficit caused by the pandemic could be forgiven.
According to a report from El Confidencial, Athletic have appealed to the Higher Sports Council (CSD) in a formal letter along with Barcelona, Real Madrid, and Osasuna. Elizegi is said to have led the initiative, in which the clubs have requested not to be held responsible for the deficits this season. They argue that losses are a result of “an unforeseen and unsolvable crisis that has nothing to do with the management of the leaders.”
Whether or not the appeal will be accepted remains to be seen, but some sources are optimistic that the CSD will grant the request. Athletic could end the season with a deficit of over €40 million while Barcelona expect to lose at least €50 million and a modest €1 million for Osasuna. Real Madrid are said to be €300 million in the red as a result of the pandemic, but have the least to worry about with Florentino Pérez having built up a hefty surplus of guarantees over his 11 years as president.