Barcelona's salary cap crisis and why wage bill has to be less than Watford's

Barcelona are in a full-blown crisis. Just when it seems they have hit rock bottom, the situation at the Camp Nou somehow gets even worse.

The Blaugrana's problems on the pitch are in full view; Wednesday night's three-goal loss at Benfica means they have no goals and no points from their opening two Champions League matches for the first time in their history.

Domestically, the situation is not much better - last week they were held to underwhelming draws against struggling Granada and Cadiz.

All that has mounted pressure on Barca's under-fire boss Ronald Koeman with president Joan Laporta and his board making plans to replace the Dutchman in the dugout.

Ronald Koeman is reportedly on the brink of losing his job at Barcelona ( Image:

AFP via Getty Images)

The primary reason why Koeman remains in the Camp Nou hotseat is that the club cannot afford to sack him as it would cost in the region of £10million to terminate his deal, which expires at the end of the current campaign.

That is complicated because of the Catalan club's precarious financial situation and their lack of funds.

Earlier this week, the club's economic problems were laid bare and shown to be even more alarming than initially feared.

La Liga confirmed that Barcelona 's salary cap for the season was a relatively paltry £84million - a staggering fall of £212million from the previous campaign.

Barcelona's financial problems accelerated with the absence of fans due to the pandemic ( Image:

REUTERS)

It meant that Barca now have the seventh biggest salary budget in Spanish football and less than a seventh of Real Madrid 's £635million budget.

The Catalan club are now operating on a budget smaller than Sevilla, Atletico Madrid, Villarreal, Real Sociedad and Athletic Bilbao, while they have just £18million more to spend than Espanyol, their city neighbours who spent last season in the second tier.

By comparison to Premier League clubs, the nearest club to whom Barcelona are comparable is newly-promoted Watford.

The Hornets' accounts show that they actually spent around £97million on their wage bill last season, £13m more than Barca are now allowed to spend.

The most recent comparison across the Premier League - who, unlike La Liga, do not enforce salary caps - is from the 2019/20 campaign, detailed by football finance blogger Swiss Ramble.

Watford's most recent published wage bill at that point had been £84million, which was actually from the 2018/19 campaign - and has risen by £13million in the years since.

Watford are back in the Premier League after a year away ( Image:

Newcastle United via Getty Image)

From the 2019/20 numbers, only Sheffield United - who were then in their first season back in the Premier League - had a lower annual wage budget than Barca, with the Blades accounts showing £78million in outgoings.

Other similar numbers from two seasons ago show that Norwich City had £89million outgoings on wages with Wolves posting £95million and Burnley £100million.

Without published accounts for the current campaign, it is tricky to gauge what clubs are currently spending on wages - such as those at newly-promoted Brentford - but it is possible that Barca's restrictions would place them lower than any side in England's top flight on wages.

Barca were unable to register a new contract for Lionel Messi this summer

The Catalan giants posted losses of £413.2million for last season while their club president Joan Laporta also revealed that their club debt now stands at an alarming £1.16billion - a rise of £172million from January.

Barca had the highest wage bill in football until the summer of 2020, but the drastic unravelling of their finances has ensured that it is likely to be just a quarter of that figure for the upcoming campaign.

The club's salary cost limit for the 2019/20 campaign was a whopping £579 million (€671m); by comparison this was £247million more than Manchester United, who had the Premier League 's highest wage bill for that season (the Red Devils no longer have the highest outgoings).

Luis Suarez helped fire Atletico Madrid to La Liga glory after leaving Barca ( Image:

NurPhoto/PA Images)

Barcelona's current budget is now approximately seven times lower than it was two seasons ago.

Last summer, the club cashed-in on sellable assets who were high earners: Arturo Vidal, Ivan Rakitic and Luis Suarez while this year saw the club unable to register a new contract for their highest earner Lionel Messi, while the next highest salary of Antoine Griezmann was also moved on (the French forward joined Atletico Madrid on loan with a mandatory option to buy).

Earlier this year, Catalan media outlet La Vanguardia claimed Barca's economic situation was "out of control" and the debt was described as "runaway" and they attested that austerity was now the "inescapable destiny" of the club.

These salary restrictions are imposed by La Liga upon all 42 clubs across the top two divisions of Spanish football - with the budget for each club based on their earnings, revenue streams, profits and losses, overhead costs, investments and debt repayments.

The league places the restriction upon each club based on their audit of the club's health and finances, in a move to each the growth of clubs sustainable and to ensure outgoings are justified by their income.