Newcastle United could bolster transfer kitty in 'pure profit' FFP loophole

Across the Premier League circuit, clubs are talking about ways of being inventive going into the summer transfer window and more importantly how they can avoid becoming another victim of points deduction.

Newcastle United were forced to sit on their hands during the January window in fear of emulating the likes of Nottingham Forest and Everton who had their points docked in the top-flight table. Despite a crippling injury crisis and the 10-month UEFA ban of Sandro Tonali, Newcastle were pushed into taking an almighty gamble when it comes to their prospects for the 2023/24 campaign.

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That they sit on the brink of qualifying for Europe is testament to the work of the coaching team for managing with what they had at their disposal and salvaging a potential prize out of the fire. True, Eddie Howe and his backroom team have been backed by £400m over the last three seasons.

But whether that should guarantee turning a club from perennial relegation battlers into European contenders is up for debate. In short, Howe has done it with a mix of exciting signings and players he inherited that were originally signed to either win promotion from the Championship in 2017 or retain Premier League status from 2017/18 onwards.

What is the transfer loophole that Premier League clubs are talking about?

FFP and PSR rules are a major consideration for Premier League clubs this summer and Newcastle are no different. The rule book states that when a transfer fee is made it is then divided by the length of the contract and paid across that term which is the "amoritisation" figure clubs talk about.

But there is a difference with homegrown players and the reward for developing players, training them and introducing them to Premier League success is that when they are sold, the deal, in the eyes of PSR, that will hit a club's bank account as pure profit in one big hit.

So if Newcastle were to sell a homegrown player for say £30million or more that would instantly bolster their spending potential for that window. This doesn't mean Newcastle absolutely have to do it, but it's certainly an option and they wouldn't be alone.

It doesn't sit well with Newcastle's history and is a pet hate of supporters

Down the years the sales of Geordie players has not gone down well with the paying punters after sales of Paul Gascoigne, Peter Beardsley, Chris Waddle and Andy Carroll caused conflict within the fanbase.

Seeing all four leave for the brighter lights of clubs like Liverpool and Tottenham Hotspur sparked fury for supporters. More recently the exit of Bobby Clark to Liverpool before he'd even had the chance to shine at first-team level was one of the last painful acts of the Mike Ashley era.

But as clubs grapple with new rules and try to plot their way to the top, a fresh look may be required. The pay off would have to be seeing top stars come in the other direction.

That would be the big difference here rather than the profits of sold stars going into the back pocket of the chairman.

The high-profile examples of other clubs cashing in

Manchester City did it with Cole Palmer after accepting a £42.5million bid from Chelsea last summer with the England international proving a major success at Stamford Bridge. Chelsea themselves cashed in when selling Mason Mount to Manchester United for £55million to inject more funds into the spending pot.

Should Newcastle go down that road, they won't be the first while CEO Darren Eales has already hinted at sales before, using Jack Grealish's Aston Villa transfer to Man City as an example. Eales' stance this season was: "On any player, at any time, it depends on circumstances. It's difficult to hypothesis but, if we're offered £1bn for one of those players, then no one could argue against that making sense."

The big homegrown sale that Newcastle could take advantage of

Newcastle senior scout Mick Tait has been spotted at Chelsea in recent times compiling reports on various players but one of them is believed to be Conor Gallagher. The England midfielder is set to be sold by the Blues this season as they look for a "pure profit" sale.

Homegrown Gallagher's fee is said to be around £50million and Newcastle have expressed an interest before. Chelsea want to sell to fund an incoming deal for Ivan Toney.

Gallagher has been at Chelsea since the age of eight and has rose through the ranks. If Newcastle were to sell they could make money on Academy products such as Elliot Anderson, Lewis Miley or Sean Longstaff, but it would be a tough decision to make given Howe has leant heavily towards having players who understand the ethos of the club in his side.