PSL franchises asked to cut salaries to reduce loss, confirms Wasim Khan
In a bid to reduce losses incurred by PSL franchises, the Pakistan Cricket Board (PCB) has reduced the salary cap to assemble a full squad from USD 1.38 million to USD 1.1 million. Since the start of the tournament in 2016, PSL franchises have all struggled to turn a profit from its operations.
In January this year, the original five teams — Islamabad United, Karachi Kings, Lahore Qalandars, Peshawar Zalmi and Quetta Gladiators — reported losses in the range of PKR 200 million to 700 million (USD 1.4 million to USD 5 million approx) after just the first two seasons. On Monday, the national board met with representatives from all six teams — Multan Sultans being the sixth — to bring down the salary cap. It was also confirmed that the teams would be exempted from paying their bank guarantee, a combined value of USD 14.51 million, ahead of the 2020 season.
"We had fruitful discussions with our valued partners and we have found a way forward. In the days ahead, our preparations for the HBL PSL 2020 season will continue in full swing, we are committed to staging the entire edition in Pakistan and the franchises are on-board with us," Wasim Khan, PCB's Chief Executive, was quoted saying by ESPNCricinfo.
The PCB had earlier classified their salary cap of USD 1.38 million purses into five categories: Platinum (USD 570,000), Diamond (USD 270,000), Gold (USD 180,000), Silver (USD 140,000), and Emerging (USD 25,000) with provision for an extra USD 175,000 for supplement players. In comparison, other T20 leagues around the world like IPL franchises spend USD 11.8 million on players, CPL USD 0.764 million, Global T20 Canada USD 0.65 million, while the postponed Euro T20 Slam had a pocket of USD 0.65m approximately. According to an internal PCB document, it is learnt that this understanding of PSL players featuring in other leagues for less money was a major factor in the pay cut.
The financial structure and the falling value of the Pakistani rupee against the US dollar have caused plenty of friction between the PCB and PSL franchises. As some consolation to the team owners, the PCB has agreed to lock the conversion rate to PKR 138.50. Further, the board has also given assurances that it will engage with a consultant to evaluate the financial model and find a middle ground.