The road to ruin: How years of excess have finally caught up with Rangers
Scottish football doesn’t make headline news. At least, not for the right reasons. In fact, supporters north of the border have started to adopt a fresh twist on the ‘Kate Adie rule’ when it comes to mentions in the mainstream UK media.
Just as residents of any strife-torn region once viewed the arrival of Ms Adie as a sure sign that the body count was about to treble, so Scottish ‘fitba’ punters know that one of their clubs topping the news agenda south of Selkirk is a clear indication of impending Armageddon.
Last year it was the bullets, bombs and, to use the local dialect, bampots issuing death threats against Celtic manager Neil Lennon. Now Rangers, without a doubt The Establishment club, aren’t so much on their uppers as renting uppers from a shell company currently classified as an unsecured creditor.
Administration is a reality. Liquidation is a possibility. We may well be witnessing the death of a club boasting 139 years of history, a world record of domestic titles, generations of tradition – some more honourable than others – and a fan base who thought the rocks would melt in the sun before ‘The Rangers’ slipped out of existence.
Frozen dreams: a statue of Rangers legend John Greig looks out over a gloomy Ibrox
If the scale of the scandal unveiled over the past week has come as a shock even to those of us who have detailed the slow decline of Rangers, it’s understandable that anyone with only a passing interest in the Scottish game should be truly stunned.
Rangers. Aren’t they one of the biggest clubs in Britain, if not Europe Don’t they attract 50,000 fans to games against such illustrious opposition as St Albion and Queen of the Raith
Sweet ghost of Sir Alf, didn’t they once boast not only England captain Terry Butcher but Paul Gascoigne, Gazza himself, on their books How on earth did it come to this
If there has been a swiftness about their descent into insolvency, the events leading up to this point have been more gradual. Indeed, while current owner Craig Whyte is responsible for simply failing to pass on 9million in PAYE and VAT during his nine months at the helm, the real seeds of Rangers’ downfall were sown more than a decade ago. Back in 2000, then-chairman David Murray – Sir David, for now – famously declared: ‘For every fiver Celtic spend, we’ll spend a tenner.’
It was a bold statement of intent, a promise that he would invest in pursuit of domestic dominance and European achievement.
What we didn’t know at the time was that, for every 10 Rangers spent on impact buys and marquee signings, it might have been wise to have given three or four quid to Her Majesty’s Revenue and Customs.
Marquee signing: Paul Gascoigne arrived at Ibrox in 1995
To simplify a complicated case, what we do know is that, between 2001 and 2010, Rangers paid 48m into something called an Employee Benefit Trust – a legal mechanism that HMRC now argues amounted to tax avoidance. Effectively, it allowed the club to recompense employees with salaries and other payments in excess of what they could really afford.
Now the Chancellor wants to reclaim this cash – and, depending on who you believe, the eventual liability could be as high as 75m in tax and penalties.
But that isn’t what has pushed Rangers into seeking protection from their creditors. That ‘financial doping’, as rival clubs are calling it, is only part of the story at a club who ran up incredible – and unsustainable – debts during an era of market madness.
If there is a poster boy for the worst excesses under big-spending manager Dick Advocaat, it is certainly Tore Andre Flo, a 12m buy from Chelsea in November 2000. There were others, though. So many others. Ronald de Boer came from Barcelona for 4.5m, the Catalans also pocketing 6m for Mikel Arteta. Michael Ball became a 6.5m full back when he joined from Everton.
Questions about where the money was coming from were batted aside, the bombastic Murray always ready to underwrite another share issue or explore a new revenue stream. Pay-per-view, media partners buying a stake in the club… there was always a short-term solution.
And so they kept adding to their titles, kept running up the overdraft until the club with the marble staircase, the glittering trophy room and a reputation for doing things the right way saw their debt level breach the 80m mark.
12million man: Record signing Tore Andre Flo
From the mid-2000s onwards they started to rein themselves in, with a great deal of nudging from their bankers – who implemented cost-cutting that had fans wailing about this disastrous new age of austerity. Even the best-case scenario suggests the coming weeks and months will make the dark period under the control of Lloyds TSB look like days of wine and roses.
The headline writers loved the arrival of the new owner, the Whyte Knight now viewed in rather different terms. As we struggled to get a grip on this ‘ghost’ buyer with little in the way of a track record, his PR people briefed journalists to ‘just call him a billionaire’. The Lanarkshire businessman with a castle in the Highlands and a pad in Monaco paid 1 to Sir David Murray – but promised a 25m transfer war chest. He boasted of putting 33m of his own money in to clear debt.
None of these figures add up, with administrators now revealing that a 24m deal against future season-ticket revenues – ostensibly used for running costs – hadn’t been paid into the club’s accounts.
The police are looking into this, as are the Crown Office, while Whyte on Friday insisted ‘the administrators’ report will prove that every penny that has come in and gone out of Rangers has been properly accounted for’.
That didn’t stop Celtic boss Lennon from claiming Rangers should be stripped of their ‘tainted titles and trophies’ if found guilty of ‘financial doping’.
Lennon said: ‘A journalist recently used
the expression “financial doping” (in reference to Rangers) and, for
me, doping is a sporting term for cheating.
No sympathy: Celtic boss Neil Lennon
‘If it has had a direct effect on me in my playing days, I will come out and say something at that time.’
All the while, the nation’s politicians seem eager to fall over themselves not to offend Rangers supporters by insisting the club must be allowed to go on – even if it means stiffing the taxpayer in pursuit of a settlement.
Being asked to subsidise Rangers through their taxes hasn’t gone down well with supporters of other clubs, most of whom fall into two categories. There are those openly celebrating the demise of the great behemoth; Celtic fans have a song about eating jelly and ice cream when Rangers die.
Then there are those who publicly insist that tribal rivalries must be put aside for the good of the game, so that Rangers can be helped through this crisis. In private, even most of them are laughing like drains.
And the rest of this United Kingdom, while we can still call it that Looking on in amazement and wonder at the downfall of a mighty giant, laid low by years of excess and the gross mismanagement of a guy currently considered to be as wide as the Clyde – but not half as clean.
As a footnote, on Friday it was revealed that one of the owner’s advisers was a producer, director and occasional actor in adult movies. Given what most fans would say Whyte, Murray and others have done to Rangers, that only seems appropriate.