Barcelona financial crisis deepens as LaLiga cut €300m from spending cap

Julien Laurens speaks following Ansu Fati's Barcelona victory against Levante in LaLiga. (1:21).
After LaLiga reduced their spending limit by 300 million, Barcelona's financial crisis is now worse. Six clubs in the Spanish top flight are now allowed to spend more than them.

Barca's operating costs for the 2021-22 season have been reduced to 97m. This is nearly 650m less than Real Madrid, which has a limit of 739m.

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Last season, Barca's maximum was 382m. The season before (prior the pandemic), it was 600m.

Jose Guerra, LaLiga's corporate director, explained that the Catalan club has a limit of 500m, which is lower than Real Sociedad and Villarreal.

Guerra stated in a video conference on Wednesday that they have acknowledged much greater losses than initially thought, which has a greater impact on their spending limit.

"If you add the 97m limit to the losses (around 480m), then we get 570m which would be more usual. It's therefore more or less stable.

Barca has confirmed that it suffered losses of 481m for the 2020-21 season. That was around 200m higher than had originally been estimated following an external audit by PricewaterhouseCoopers.

ESPN sources said that this was because Joan Laporta, the president, wrote off assets last year, including amortisation payments due to certain players, in order to make the club a profit again this season.

Joan Laporta was unable to resolve Barcelona's financial crisis. Photo by LLUIS GENE/AFP via Getty Images

The club anticipates that their spending limit will be significantly raised next season. Guerra however warned that losses from the past would still be taken into consideration as they move forward.

Guerra said that Barca were not at risk of being punished for the immediate consequences of the pandemic. However, the league will need justification of the COVID-19 damage.

Barca's wage bill for this season will be much higher than 97m, despite the best efforts of the company to lower it by letting Lionel Messi & Antoine Griezmann go.

Laporta recently revealed that salaries and amortization payments still account for approximately 80% of the 765m season's predicted revenue.

Barca's financial controls require that this figure be around 70%. However, Barca's will be even lower as they have to make up for losses. The league's gross debt stands at approximately 1.4 billion.

Barca will have to save 25% on wages or transfer fees to register new players and sign players. This is a change they had to follow this summer.

Guerra maintains that the club could have retained Messi, who left to Paris Saint-Germain in August despite all this.

Barca turned down the league's offer to sell 10% to CVC Capital Partners. This would have increased their limit. Only 17 of the 20 LaLiga clubs signed the agreement. Madrid and Athletic Bilbao were also disqualified.

Guerra stated that while there could have been solutions to keep Messi at the club and that the management made a different decision, he believed that they had the right ones. "It wasn't just a matter of their finances," Guerra said.

Guerra stated that Madrid's limit of 500m is now higher than any other Spanish team. This was due to the club's decision in 2012 to save over 200m.

This means that the club has enough capital to sign Kylian Mbappe from PSG, for whom they paid around 200m.

Guerra stated that "they would have no problem whatsoever." "They were ready to play Mbappe and any other player."

LaLiga's spending limit is the maximum amount that clubs can spend on wages and bonuses, as well as amortisation payments for transfers. It does not reflect how much they are spending.

Atletico (171m), Villarreal (163m), Real Sociedad (127m) and Athletic (111m) have the league's second-highest ceilings.

Valencia, the Spanish champions of 2004, has the lowest limit in the league. Los Che, who, like Barca, have seen their debt spiral at alarming rates during the pandemic and can only spend 31m, compared to 103m 12 month ago.