Premier League Salary Cap Rejected as PSR Overhaul Looms

Premier League salary cap discussions reached a pivotal moment after the league’s 20 clubs voted against implementing a fixed wage ceiling, instead opting to radically reshape financial controls through Profit and Sustainability Rules (PSR). The decision, made on November 21, 2025, will see the current financial landscape in English football undergo a major transformation, with new regulations set to take effect in the 2026-27 season.

Premier League Salary Cap: Vote and Outcome

Premier League salary cap proposals, which were a focal point of the recent shareholders’ meeting, failed to gain the necessary support. Of the 20 clubs, 12 voted against the wage limit, seven were in favor, and one abstained, meaning the cap will not be introduced. The idea behind the salary cap, sometimes referred to as “top to bottom anchoring,” was to keep spending on wages and transfers within five times the prize and broadcast revenue of the bottom team, but concerns over legal challenges and competitive balance ultimately saw the proposal fall short.

Major Changes Ahead: From PSR to Squad Cost Ratio (SCR)

The end of the 2025-26 season will also mark the end of the traditional PSR framework, which has limited club losses to £105 million over three years. In its place, the Premier League will adopt the Squad Cost Ratio (SCR) model. This new system stipulates that clubs can spend up to 85% of their total revenue (from football activities and player sales) on wages, transfer fees, and agent commissions.

The SCR is designed to provide a more transparent and robust system for monitoring financial health, aligning more closely with the SCR framework already used by UEFA in European competitions, where a stricter 70% threshold applies. Notably, while UEFA applies SCR by calendar year, the Premier League will align its rules with the domestic football season.

How the Squad Cost Ratio (SCR) Will Work

According to the Premier League’s official statement, clubs will also have access to a multi-year 30% allowance to exceed the 85% spending threshold. However, if a club uses this allowance, a levy is imposed and, once exhausted, strict compliance with the 85% rule is expected. Clubs failing to comply face possible sporting sanctions, such as points deductions or transfer restrictions.

These new measures aim to encourage sustainable investment, reduce regulatory complexity, and protect competitive balance in the league. For more news and updates about ongoing reforms, visit for more news.

SSR and Financial Resilience: Ensuring Long-Term Health

In addition to the SCR, the Premier League will introduce Sustainability and Systemic Resilience (SSR) assessments. These evaluations will gauge clubs’ short, medium, and long-term financial health through three core tests: Working Capital, Liquidity, and Positive Equity. The SSR framework is intended to ensure that clubs can withstand financial shocks, manage outgoings effectively, and maintain a healthy balance sheet over time.

Consultation and Implementation Process

Premier League officials have worked in close collaboration with club executives, finance and legal specialists, and external consultants to fine-tune these regulations. Since June 2024, clubs have trialed the SCR and Top to Bottom Anchoring (TBA) models on a non-binding basis, gaining valuable experience and feedback before the full rollout.

The league’s approach includes comprehensive stakeholder engagement, with input from the Professional Footballers’ Association (PFA), football agents, and independent analysts. This consultative process is designed to ensure that the new financial controls are both effective and fair for all involved parties.

The Premier League Salary Cap Debate: Balancing Fairness and Competitiveness

The debate around the Premier League salary cap highlights the ongoing challenge of maintaining competitive balance while allowing clubs to invest and grow. Proponents argue a cap would curb reckless spending and protect smaller clubs, while critics maintain it could restrict ambition and lead to legal disputes with players.

Ultimately, the Premier League has chosen a middle path, prioritizing sustainability and aligning with European standards without imposing strict wage caps. The new SCR and SSR frameworks are expected to provide a fairer and more transparent basis for club finances, while still enabling clubs to compete at the highest level.

Opinion: A Step Forward, But Challenges Remain

The rejection of a Premier League salary cap, in favor of a revamped SCR system, is a pragmatic response to the complexities of modern football finance. By moving toward a model already in use at UEFA, the league aims to ensure stability and fairness across the board. However, it remains to be seen whether these changes will truly level the playing field or simply add new layers of administrative oversight. As financial regulations evolve, the Premier League must balance innovation with caution to maintain its global appeal and competitive integrity.