Where it all went wrong for the Blues
WHY are Ipswich, so often considered the perfect role models, in such a financial mess?The answer, sadly, is that they failed to learn from past mistakes, in particular their relegation in 1995.
By Mel Henderson
WHY are Ipswich, so often considered the perfect role models, in such a financial mess?
The answer, sadly, is that they failed to learn from past mistakes, in particular their relegation in 1995.
That coincided with David Sheepshanks' appointment as chairman, when he admitted the club was "haemorrhaging money" and vowed not to let it happen again.
He has also made constant references to the construction of the Pioneer Stand in the early 80s, insisting problems encountered then – when he was not in the privileged position he enjoys today – would never be repeated.
Well, I am no financial expert, but I think it is safe to say that the club's current predicament cannot be compared to those previous occasions, dwarfing as it does the problems that existed then.
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I also recall the chairman insisting that the club's future – indeed its very existence – would never be placed at risk.
Today those words have a hollow ring to them because Ipswich have gambled and lost, with yesterday's application to the High Court in London a clear admission of failure on the part of Sheepshanks and his boardroom colleagues.
Not so very long ago Sheepshanks made it clear, by standing as a candidate for the Football Association chairmanship, that he wanted to run football in this country.
Now there must be a question mark against whether he will even be able to continue running his own club.
Look at Bradford, look at Leicester. Their chairmen have departed and been replaced, and it would be incredibly naive to believe that a similar change could not occur at Portman Road.
But, I hear you say, those two clubs went into administration. Town have only obtained a
temporary order and in a matter of weeks the situation will be resolved.
Don't bet on it. This is merely the start of what could be a protracted fight. Again, look at Leicester, where the new board is still waiting in the wings.
I accept and understand what Sheepshanks has said about the enormous gulf between Premiership and First Division incomes.
But I cannot agree when he claims: "We have been beaten by circumstances utterly beyond our control."
I believe they bit off more than they could chew with their investment in players, all based on
the heady days of one season
when performance far exceeded expectation.
I also fail to understand the chairman's assertion that the construction of two new stands and the borrowing of £25million is somehow not connected to the present problem?
How can that be so when Ipswich are committed to repaying the sum over 25 years at a fixed interest rate of 8.29 per cent?
The capital repayments are not due to start until September 2004. Roughly speaking, it means
having to find £50,000 per week until 2029 and if that isn't a strain, I don't know what is.
The debt has been described as a mortgage. I see the similarity, but, if you have a mortgage on your own property, you will know that payments must be maintained. Or else.
In the meantime Town will have to rely on creditors and suppliers either writing off the sums they are owed, or at least agreeing to scaled down payments.
The administrators must first ascertain the situation they have inherited and it could take them a month to fully assess the entire picture.
All Town have gained is valuable breathing space, during which a group of top-rank experts will put the club's accounts under the microscope.
They may discover that the situation can be resolved within the required period – that is the best case scenario – or they may be alarmed by the full extent of the problem.
Either way, they will charge for their services and this level of financial expertise will ensure a further hefty bill to be paid alongside the scores of others that remain unsettled.
Sadly for Ipswich, even administration doesn't come cheaply.