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Manchester United’s finance chief Cliff Baty has warned against a major overhaul of how money from the Champions League and other European competitions is carved up.

Jacco Swart, managing director of the European Leagues group which represents 37 professional leagues across the continent, including the English Premier League, said on Thursday that “drastic changes” are needed to the revenue split when the newly-agreed European club competition formats kick in from 2024.

Revenue for the 2024-27 cycle is understood to have been projected at five billion US dollars a year (around £4.1bn) and Swart has called for an increased percentage of that to be given in solidarity to non-participating clubs, a greater share to the Europa League and Europa Conference League and a change to how money is divided up within the two premier competitions.

Cliff Baty
Cliff Baty (top left) is Manchester United’s chief financial officer (Mike Egerton/PA)

Swart called for a reduction in the percentages awarded in the Champions League and the Europa League based on historical coefficient and the television market pool.

United’s chief financial officer Baty said football’s leaders should not “kid themselves” about where value in the European game was created – by the continent’s top clubs – and that major changes to financial distribution would impact on club sustainability.

“One thing I would say from our perspective is that (the split) gives us a degree of certainty that helps in terms of sustainability, and all the discussions that are happening around financial sustainability and financial fair play in football,” he said.

“If you take that away, it’s going to increase the volatility and it’s going to be more difficult for us to manage.

“And whilst I appreciate the sentiment of wanting to give more money (to smaller clubs and those outside European competition) the pie is getting bigger – (and) the reason the broadcasters are paying that much money is for the product, frankly at the Champions League level.

“If you’re changing the distribution and wanting more money, I think you’ve got to be careful what you’re doing there. We all know where the value is created, let’s not kid ourselves.

“I think we should put more money down, I totally agree with the sentiment, but the value is created at the top. So if you start changing that, and making it more difficult for the bigger clubs to perform, it’s hard.”

European Leagues presented data showing that out of 3.6 billion euro (£2.95bn) in annual income in the current 2021-24 cycle, 2.8bn euro (£2.3bn) ends up at 96 participating clubs with just 175m euro (£143.7m) then split among 750 non-participating clubs.

Porto earned less from their run to the Champions League quarter-finals in 2021 than clubs who were eliminated in the previous round (Isabel Infantes/PA)

Swart said the way money is divided in the Conference League – 40 per cent as a starting fee, 40 per cent based on performance, 10 per cent on historical coefficient and 10 per cent on the television market pool – was a “very good example” of a more equitable split and added: “We should move in the same direction for other competitions.”

Currently the split for the Champions League is 25 per cent starting fee, 30 per cent performance, 30 per cent historical coefficient and 15 per cent TV market pool.

The current financial model clearly favours Europe’s established clubs from the bigger TV markets. In 2020-21, Porto made 74.05 million euro (£60.8m) from their run to the Champions League last eight, according to UEFA figures, but that was only the 11th-highest club figure for revenue derived purely from the Champions League.

Barcelona (84.8m euro), Juventus (82.9million euro) – who Porto beat in the last 16 – and Atletico Madrid (75.06m euro) all earned more, despite dropping out in the round before.

Fellow quarter-finalists Bayern earned 97.22 million euro – more than 23 million euro extra – and fellow last-eight finishers Liverpool earned 88.06m euro.