To bridge the gap with Celtic, Graeme Souness believes that his former club Rangers need to invest around £50 million.
According to him, the addition of three or four high-quality players could significantly change the dynamic between the two rivals.
However, there’s an issue that cannot be ignored. Speaking on the William Hill podcast Three Up Front, the former Rangers manager highlighted the financial reality facing the club when he said: ‘Rangers don’t have the money right now. If they were to spend £50m, it’d be nip and tuck between the two of them.’
This observation has become more pertinent in the wake of a 3-0 defeat at Parkhead, a result that has reignited the discussion among supporters about the necessity of external investment.
The financial gap between Rangers and Celtic off the pitch is increasingly being mirrored on it. With Celtic on course to secure another £40 million through participation in the Champions League, many Rangers fans are now looking to a Middle Eastern sovereign fund or a wealthy Texan billionaire as their best hope for financial salvation.
Rumours of outside interest have already surfaced. Prior to their loss to Celtic on September 1, a report in City A.M. claimed that Rangers were the target of a £150 million takeover by an American consortium.
The article suggested that several shareholders at the club might be open to selling their stakes. However, the largest shareholder and former chairman, Dave King, quickly poured cold water on the speculation, dismissing the report entirely.
Even if a wealthy benefactor were to come forward, waving a cheque book, the introduction of UEFA’s financial sustainability rules two years ago would make it incredibly challenging to match Celtic’s spending power.
These rules are even stricter than the Financial Fair Play regulations that resulted in Everton being heavily penalised. UEFA’s new framework makes financial compliance a prerequisite for participating in European competitions.
These rules, which were formulated after discussions with the European Club Association, European Leagues, FIFPro, supporters, the European Commission, and other governing bodies, aim to ensure that clubs are financially stable and do not overextend themselves.
They were designed with long-term sustainability in mind, and the implication is clear: a club cannot simply spend its way to the top, as was once the case with Manchester City, Paris Saint-Germain, or Chelsea when they were taken over by wealthy individuals or state-backed funds.
Football finance expert Kieran Maguire explained the situation further during an interview with Mail Sport.
Maguire, who also co-hosts the Price of Football podcast, noted: ‘What UEFA have said is that, for every £100 that Rangers or Celtic generate from ticket sales, TV money, and commercial deals — plus the average of their player sales from the last three years — they can then spend in this calendar year £80 of that on player costs. Player costs are wages, agents fees, and transfer fees amortised. If Rangers sign a player for £10m on a four-year contract, they have £2.5m costs going into the accounts every year on that player.’
This season, clubs are allowed to spend up to 80% of their revenue on player wages, transfers, and agents’ fees. Next season, however, that figure will drop to 70%.
While it’s difficult to predict exact figures, it’s clear that Celtic, with their regular Champions League appearances and successful player-trading model — which has seen the profitable sales of players like Jota and Matt O’Riley — will have a significantly larger financial cushion than Rangers.
Put simply, 70% of Celtic’s income will allow them to spend far more than 70% of Rangers’ income. There is no quick fix for the Ibrox side, no magic wand that can be waved to close this gap overnight.
Maguire went on to elaborate: ‘When Rangers won the Premiership (in 2021) and qualified for the Champions League, with television money on the back of that, they narrowed the gap. But they had to keep moving forward, and they didn’t. Celtic have now returned to being dominant on the pitch — and off the pitch, they don’t seem to have the internal conflicts which appear to afflict Rangers.’
He continued: ‘I speak to John Bennett (Rangers chairman) and get on well with him. I have spoken to Stewart Robertson, the former chief executive, as well. They came on our podcast. I’m a Brighton fan and I keep an eye on Rangers because Connor Goldson was ex-Brighton and Jamie Murphy left us for Rangers as well. But I have no partisan position in this, and it’s clear that Celtic have moved ahead. How Rangers catch up is now the question. I think it needs Celtic to do a lot of things wrong and Rangers to do an awful lot right at the same time before the gap can be eliminated.’
The financial regulations put in place by UEFA are not without challenges, and as Manchester City and Leicester have demonstrated, such rules can be contested.
Clubs facing Financial Fair Play (FFP) charges in the English Premier League might engage top sports lawyers like Nick De Marco to delay or challenge sanctions. However, UEFA has made it clear that clubs hoping to compete in its tournaments must adhere to the financial rules.
Penalties for breaching these regulations can range from hefty fines to expulsion from European competitions. Given how much more lucrative European football is compared to the domestic Scottish Premiership, being banned from UEFA tournaments is a scenario that Rangers simply cannot afford.
Maguire offered further perspective: ‘If you take a look at the value of the domestic Scottish TV deal, then winning it brings in roughly £4m. Yet Celtic would get £2.5m for winning one game out of eight in the new Champions League format. Simply for being there they will get £30m, and that’s not the case in the Europa League where Rangers will play.’
He added: ‘That’s why it’s very challenging for Rangers now. I read John Bennett’s comments in the summer, and they were pretty sombre. If I was a Rangers fan, I would have to take that on board. John hasn’t caused the problem, he is simply calling it out as it is and, as football fans, we sometimes don’t want to hear the cold, hard facts. But Rangers have a lot of hard work to do in a country where finishing second is finishing nowhere so far as the fans are concerned.’
The gap between Rangers and Celtic is as much a financial issue as it is a footballing one. While significant investment could help level the playing field, UEFA’s financial regulations mean that simply spending big is not an option.
Rangers face a daunting task as they seek to catch up with their city rivals, and it will take a combination of savvy business, smart player acquisitions, and perhaps a few missteps from Celtic for the balance of power in Glasgow to shift once again.