New Canada Soccer boss says organization’s $4-million operating deficit ‘not sustainable’

The newly appointed CEO and general secretary of Canada Soccer has provided an update on the governing body’s finances and the news isn’t good.

Kevin Blue, who took up his post on March 14, says the governing body’s budget for fiscal 2024 shows a $4-million operating deficit on total expenses of $30 million.

“While it is common for non-profit sports organizations to operate at surpluses or deficits depending on annual circumstances, the current level of Canada Soccer’s operating deficit is not sustainable and cannot continue in the future,” he wrote in a social media post Saturday.

Canada Soccer has yet to divulge its 2023 financial picture, which is expected at its annual general meeting in Montreal in early May.

Blue said Canada Soccer must boost annual revenues by between $10 million and $12 million “to robustly fund its programs and serve its stakeholders — from grassroots up to the national teams.”

“We need to establish a better financial engine for soccer in Canada so our sport can benefit from upcoming opportunities,” he wrote.

An increase in player fees is one of his proposed solutions. Blue said he has put forward two possible plans to increase rates, which he notes have not changed since 2017.

The first aligns fees with the Consumer Price Index.

“We are discussing a tune-up of the player levy for CPI along with a proportional adjustment of membership affiliation fees,” Blue said.

Those membership fees come from provincial organizations and Canada’s MLS teams.

‘Strategically important investments’

Blue said Canada Soccer would have collected an additional $5.84 million in revenue since 2017 had the player levy been adjusted for CPI.

The second concept is an “incremental investment” to fund the launch of Project 8, the domestic women’s league under construction by former Canadian international Diana Matheson, and youth national teams.

“These are timely and strategically important investments,” said Blue.

Player fees accounted for $6.6 million of Canada Soccer’s $47.6 million in revenue for the year ending Dec. 31, 2022. The deficit for that year was $6.3 million.

Expenses in 2022 totalled $53.9 million (compared to $47.6 million in revenue) in part due to the cost and length of the Canadian men’s World Cup qualifying campaign.

Canada Soccer was $5.3 million in the black in 2021.

Blue said “the majority” of Canada Soccer’s effort to raise revenue will “involve incremental commercial and philanthropic activity.”

Blue added he plans to speak to stakeholders, including Canadian Soccer Business and national team players, “in the development of a forward-looking plan to strengthen the broader commercial and philanthropic foundations of our sport.”

“Alignment of key stakeholders on several fronts is necessary to build higher levels of confidence with commercial and philanthropic partners so we can generate more value for all. This is an urgent task on which we must all work together toward a future where domestic football in Canada is properly supported on a solid and sustainable financial basis.”

Canadian Soccer Business, which shares the same ownership group as the Canadian Premier League, looks after Canada Soccer’s broadcasting and sponsorship rights.

Canada Soccer, which does not hold an ownership stake in CSB, is believed to receive some $4 million a year under the controversial deal as “the beneficiary of a rights fee guarantee.” That amount has been boosted by some $500,000 each year leading up to the 2026 World Cup.

Labour dispute continues

Both the Canadian men’s and women’s teams are embroiled in a lengthy labour dispute with Canada Soccer.

The Canadian Soccer Players’ Association, which represents the Canadian women’s team, has filed a $40-million lawsuit against 15 current and former board members of Canada Soccer alleging “negligence and breach of fiduciary duty” over the controversial CSB deal.

While Blue notes that 2024 budgeting came before his arrival, “I generally agree with the analysis that was performed and I can assure stakeholders that there is a plan in place.”

“The decision-making process for our (fiscal ’24) budget considered the availability of cash reserves, projections of future costs and revenues, and the harm that would be done to our programs by increasing the already-significant cost reductions that Canada Soccer has been forced to make,” he said.

The women’s previous labour deal expired at the end of 2021. The men are negotiating their first formal agreement in the wake of forming their own players association, the Canada Men’s National Soccer Team Players Association.

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