IFR Proposes Five-Month Loss Buffers for High-Risk Clubs

The Independent Football Regulator has opened a six-week consultation on risk-based cash reserves for clubs in the English Football League and the National League. Higher-risk clubs would need to hold one month of wages plus five months of operating losses, built in stages by summer 2030, according to the official consultation published on 10 November 2026.

Key facts

• Consultation open from 10 November 2026 to 18 December 2026, with the Supervisory Strategy published the same day.
• Starting table applies to EFL and National League clubs. Premier League clubs will be risk-assessed, but with no standard starting reserve at this stage.
• Lower risk: one month of wages. Medium risk: add two months of operating losses. Higher risk: add five months of operating losses.
• At least two thirds must be cash, UK gilts, US Treasuries or money market funds in the club's name. Up to one third may be committed, unencumbered transfer receivables.
• Ratings from summer 2027; one third of the buffer by summer 2028, two thirds by summer 2029, and the full amount by summer 2030.

What the regulator is proposing

The proposal is part of the IFR's licensing regime for the 116 clubs in England's top five men's divisions. From the start of the 2027/28 season those clubs will need a licence to compete. They will hold provisional licences first and must meet the "appropriate financial resources" test for a full licence by May 2030, with annual financial plans due from May 2028.

The Liquidity and Licensing Technical Consultation published on 10 November 2026 sets a starting table only for EFL and National League clubs. The baseline is one month of forecast wages, meaning player and non-player pay plus employment costs, with a risk layer added on a cash-flow basis. The figures are starting points. The IFR says it will adjust them for each club's liquidity, debt, business model, and governance, and review the framework in 2028 after the first financial plans and stress tests are in.

Qualifying assets are tightly drawn. Two thirds of the buffer would have to be unencumbered cash, gilts, US Treasuries or money market funds held in the licensed entity's name. The remaining third could also use committed but unencumbered transfer receivables. Undrawn overdrafts and unsold players would not count.

Why the buffers matter commercially

The commercial issue is that many clubs treat owner cash as a same-week payroll facility, and the regulator wants a cushion sitting inside the club instead. The Supervisory Strategy says most clubs do not generate enough cash from day-to-day operations to cover expenses, some owners inject funds more than once a month, and many clubs could default on payroll within days if that funding slowed or stopped.

For a loss-making Championship or League One club, five months of operating losses plus a month of wages is a material cash commitment. Clubs that already use specialist football lenders will need to check whether cash pledged against a facility still qualifies. The consultation also shuts off a private-credit shortcut: squad-value loans and unsold player registrations cannot meet the reserve.

A higher-risk club would have to lock up more cash than a lower-risk rival, or cut costs and owner dependence until its rating improves. Promotion would not automatically release the cash: a club that built a Championship buffer would be expected at least to keep it in the Premier League. The IFR says it would consider relegation arrangements club by club.

IFR chief executive Richard Monks, quoted by PA and City AM, said the State of the Game report had shown "just how serious the financial issues have become at some of our clubs" and "an urgent need to take action."

Premier League clubs are not in the starting table

The IFR is not proposing a standard starting reserve for Premier League clubs, arguing that liquidity risk looks less acute there and that those clubs generally have better access to commercial financing. They will still be risk-assessed, and some may be told to hold more liquid assets than they do now.

What the State of the Game already showed

The buffers follow the draft State of the Game report, published on 13 October 2026. The IFR said English football generates more than £9bn but that 94 per cent of clubs are loss-making. More than a quarter of clubs would be unable to survive more than 30 days if owners pulled funding, and nearly two thirds of EFL and National League clubs were described as technically insolvent. The average Premier League club, the report said, now earns more than eight times the average Championship side.

IFR chair David Kogan wrote that some clubs are "among the richest and most competitive in the world" while others are "standing on the edge of financial disaster." The reserve rules target that owner-funding cliff and are separate from the £20.3m annual levy proposed from 2027/28 to fund the IFR. Compliance with Premier League, EFL or National League spending rules would not automatically satisfy the cash test.

What happens next

Responses close on 18 December 2026. The IFR then intends to update the Supervisory Strategy and its licensing rules and guidance. From summer 2027 it will tell each club its rating and reserve figure each year. Clubs that anticipate falling short are told to make contact early, or face tighter licence conditions such as extra liquidity, lower spending, or a debt restructuring.

The consultation also covers the annual financial-plan template and a proposed power to transfer a licence between legal entities inside a club's structure, a point that will matter in takeovers and holding-company changes.

Sources: IFR Liquidity and Licensing Technical Consultation, consultation paper (November 2026), IFR Supervisory Strategy (November 2026), IFR State of the Game announcement, 13 October 2026, PA via ESPN, City AM.