Are Parachute Payments Now Just ‘Trampoline Payments’?

Are Parachute Payments Turning Into ‘Trampoline Payments’?

Ipswich Town, Southampton and Leicester City begin their push for Premier League promotion this season – and for at least two of them, the odds already look heavily stacked in their favour.

They are three of just four Championship clubs receiving parachute payments in 2025-26, alongside Sheffield United, who dropped down a year earlier.

According to football finance expert Kieran Maguire, these payments are creating an elite cycle:

“The Premier League is quietly morphing into a 24/25-team elite, where newly promoted clubs often can’t compete financially and are swiftly relegated, while parachute payments give relegated clubs a springboard back up.”

In fact, in each of the last five seasons, two of the three promoted Championship teams were parachute clubs.

What Are Parachute Payments?

Parachute payments are Premier League-funded solidarity payments to relegated clubs for up to three years, helping them adjust to reduced Championship revenue – especially with TV income dropping sharply outside the top flight.

The EFL wants to scrap them and secure a bigger share of Premier League revenue for all clubs, arguing they distort competition. The Premier League insists they help promoted sides remain competitive.

EFL chairman Rick Parry has called the widening gap between parachute and non-parachute clubs a “major concern” – a gap that continues to grow.

The Financial Gap in Numbers

Maguire’s figures reveal just how wide the divide has become:

• 2014-15 revenues: Parachute clubs averaged £31.8m vs £16.1m for others.

• 2023-24 revenues: Parachute clubs averaged £62.9m vs £26.7m for others.

• Wage bill gap: £10.4m in 2014-15 vs £43.3m in 2023-24.

• Squad value: £157m for parachute clubs vs £19m for the rest.

This financial muscle allows parachute teams to invest in stronger squads, making automatic promotion more likely – and keeping the Premier League’s membership pool largely unchanged.

A Glimmer of Opportunity?

While the top two Championship spots are harder than ever for non-parachute clubs, the play-off race remains open.

Last season, Sunderland, Coventry, and Bristol City reached the top six without parachute payments, and Sunderland even upset Sheffield United in the final to win promotion.

With only four parachute clubs this year, there’s space for ambitious sides like Wrexham and Birmingham City – both promoted from League One – to challenge for a play-off spot.

Verdict:

Parachute payments may have started as safety nets, but in today’s Championship they are looking more like trampolines – bouncing the same clubs back into the Premier League. Unless reforms are made, the promotion race may stay tilted towards recently relegated sides.