Raith Rovers face financial challenges
Raith Rovers are the latest Scottish club to admit that they are facing tough financial times. A loss of £80k was incurred in the year to June 2011 and a similar loss is projected for this season. These may not seem large figures given the losses run up by some English clubs, but they have to be placed in the context of turnover.
Raith are concerned that they might have to switch to part-time football and would then no longer be competitive in Division 1. However, other clubs may face a similar choice, in which case the playing field would level out. The downside is that lower fitness levels might produce less attractive football in a competition that struggles to attract paying customers.
Raith's boss blames their troubles on the recession and the fact that people would rather put petrol in their cars than pay to see a football match. Does this explanation hold in Kirkcaldy, the birthplace of famous economist Adam Smith? Discretionary spending does get hit in a recession, but the English Premiership has been remarkably recession proof up to now, although a double dip recession could have a bigger effect (although I think a 'long stagnation' is more likely).
There are fundamental structural problems with Scottish football and various attempts have been made to address them, but they are not easily resolved.