The English Football League has warned that rising club losses pose a “systemic insolvency risk” after the Professional Footballers’ Association launched legal action over new League One financial rules. EFL chief executive Trevor Birch said the reforms are intended to protect clubs’ long-term futures, arguing that financial sustainability and player protection should go together rather than conflict.

From 2026-27, League One’s permitted wage spending will fall from 60% to 50% of turnover under new Squad Cost Rules. Average player expenditure in the division has risen from £3.8m to £8m over five seasons, while average losses grew from £2.3m to £7.3m; Championship clubs recorded average losses of £21.6m last season. The PFA says the changes could suppress players’ wages and believes they required agreement through the relevant negotiating committee.