Budget Problems and Government Ownership in Russian Football

Budget Problems and Government Ownership in Russian Football

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Manuel Veth –

Budget problems for some Russian clubs has meant that once again the oddity of the Russian Football Premier League schedule has been a major topic in our weekly Futbolgrad Podcast. Russia made the switch from the spring to fall season to the more commonly used European fall to spring of the following year calendar during the 2011-12 season.

Since then, one of the major topics of Russian football has become the divide between the first part of the season and the second part of the season. The long winter in Russia means that clubs have to take off three months from late November to early March.

This has meant that clubs very much kept with the tradition of the old match calendar by making most of their squad moves during the winter break. Some of this was due to the fact that Russian clubs simply had more time to prepare their squad in the long winter break rather than in the short season summer break.

There is, however, a strong political component to why many Russian clubs undergo a big overhaul of their squads during the winter break, and that reason is club ownership. As pointed out in a previous Futbolgrad Network article, many Russian clubs are either directly or indirectly owned by the Russian government.

Russian government actors own 50% of all Russian Football Premier League clubs

Currently, the Russian government directly or indirectly owns 50% of all Russian Football Premier League clubs. The number is even more significant in the Russian Football National League (FNL) where 15 out of 20 clubs receive direct financial support from city governments and/or regional governments. Furthermore, Fakel Voronezh are owned by KB Khimaavtomatika, which is a state-owned aeronautical company. Finally, Zenit-2 are the farm team of Zenit Saint Petersburg, which is owned by the state-owned company, Gazprom.

Ownership structure of Russian Football Premier League clubs.

Ownership structure of Russian Football Premier League clubs.

This means that, in fact, 17 clubs in the second division are directly dependent on government budgets. This has been the main reason why clubs often experience big turnovers during the winter.

Governments usually allocate their budgets in the beginning of each year. This means that clubs in Russia only have their budgets secured from January to December of each year. A change of government or a poor fiscal year can, therefore, mean that a previously well financed club can see significant cuts during the winter break.

The most recent example of this is Tom Tomsk, who are now on the verge of bankruptcy because the regional government is no longer willing to provide the funding necessary for them to compete in the Russian Football Premier League. Going further back in history, other examples include Mordovia Saransk—located in one of the World Cup host cities—that saw its budget reduced, and as a result was relegated.

Ownership structure of Football National League clubs. Budget

Ownership structure of Football National League clubs.

In Tom Tomsk’s case, government cuts happened after a poor first half of the season. The regional government felt that the club’s lacklustre performances no longer merited heavy government funding and, therefore, cut the budget. As a result, the club went through a fire sale in the winter and started the second half with a severely reduced squad.

Budget Problems in government regularly have an impact on football

The problems of government dependency are obvious, but the calendar could also be blamed. In the past, clubs like Tom Tomsk would have been relegated at the end of the year, and then the government could have reassessed the budget in-between seasons. Now, this assessment often happens at the halfway point of the season, which means that clubs that see their budgets cut have to finish the season.

There are several problems with this. First of all, players live with uncertainty until the end of the season, which has often led to players seeking other income opportunities—which has opened the door to match fixing. This, in turn, leads to the question of sportsmanship.

The setup of the Russian Football Premier League schedule means that some games of the first half of the season are played before the winter break. This means that a club that has gone through budget cuts will not play everyone twice. Therefore, clubs that faced Tom Tomsk before the winter break, for example, are now at a disadvantage.

With this in mind, the urgent need for ownership reform in Russian football becomes clear. Russia took a big step forward when the match calendar was moved to conform with the rest of Europe. The fact that many clubs remain tied to old Soviet ownership principles and, therefore, are subject to the whim of government funding, however, means that, in Russia, professional football will continue to have difficulties.

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Manuel Veth is a freelance journalist, and podcaster for WorldFootballIndex.com. He is also a holder of a Doctorate of Philosophy in History from King’s College London, and his thesis is titled: “Selling the People’s Game: Football’s transition from Communism to Capitalism in the Soviet Union and its Successor States”, which will be available in print soon. Originally from Munich, Manuel has lived in Amsterdam, Kyiv, Moscow, Tbilisi, London, and currently is located in Victoria BC, Canada.  Follow Manuel on Twitter @homosovieticus.

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