The economics of Maltese football: where did it all go wrong for Pembroke?

Despite clinching a promotion to the Premier League, Pembroke Athleta SC will play in the third tier of Maltese football, the National Amateur league, during the 2022/2023 season, in a decision to forfeit their deserved place in the top tier, citing financial difficulties.

The club had finished top of Section A in the Challenge League, unbeaten and with 48 points.

But Alex Calleja, president of Pembroke for 23 years, told MaltaToday that the reason behind this controversial decision was the club’s overspending during the 2021/2022 season.

He explained that throughout the season, the expenditure had doubled, highlighting that this occurred throughout a period of economic turmoil, following the pandemic and the war in Ukraine.

“I will not whitewash my problems. At the moment it is not possible to generate enough funds to make up for the €100,000 in debt,” Calleja said. “I wanted to end the season debt free. Our desire was to play in the Premier League however I don’t want to sacrifice the club in the process. By playing in the National Amateur League, the club can survive.”

Calleja said that debt kept accumulating after the club had to fork out an €80,000 investment in the club’s infrastructure, pointing out that as a coastal village, the fencing and the walls of the Pembroke grounds required constant maintenance.

The team also had to pay €40,000 in VAT over the past year. “Where are you going to find that amount of money? We were falling into a sinkhole, with no end in sight.”

Calleja emphasised that over 500 athletes depend on the club altogether, and that he had to protect all the work that had been put into the club over the years. “Less than 50% of the Premier League clubs have their own premises. Our reality is different as we have athletes training at our facilities till 11 o’clock at night. I’m always thinking of tomorrow and I don’t want to jeopardise what we’ve built over the years.”

“I am already feeling much better thanks to this decision. I had not slept for six months, as all those financial problems were taking a toll on me and my family,” Calleja, the owner of Yorkie Clothing, said.

Calleja admitted to having committed a mistake when postponing his decision to play in the Amateur League. “We should have taken a step back two years. It was my mistake and I assume responsibility for it.”

Under Calleja’s reign, Pembroke had played in the Premier League for two successive years, during the 2015/2016 and the 2016/2017 seasons. Asked how the club managed to survive five years ago and not today, Calleja explained that at the time the club required a €180,000 budget but that it had now skyrocketed to €450,000.

Calleja attributed this to the rising wages, which he said had doubled over the span of five years. “A lot of foreign players are now playing in Malta and this has led to an increase in the wage expectations of Maltese players.”

He also said that since the MFA had upped the standards and staffing requirements for the Premier League teams, the wages had become heftier.

Calleja did however acknowledge that Maltese football was improving, attributing it to a more professional coaching approach.

Alex Calleja, president of Pembroke for 23 years, told MaltaToday that the reason behind this controversial decision was the club’s overspending during the 2021/2022 season

The decision to stay on

Three club committee members had issued a statement expressing their complete disagreement with Calleja’s decision, saying this went against the values and spirit of fair play and sportsmanship, and that Pembroke had received various offers of assistance from local and foreign investors.

Asked for the reason why Pembroke did not manage to secure any foreign investment in order to settle their debts and participate in the Premier League, Calleja said the foreign investors that came forward were not trustworthy.

“It would have possibly left us in a bigger mess,” Calleja said, having been unimpressed with the attitude and credentials shown by one particular foreign investor, who did not even disclose his financial situation. “I wanted to safeguard the assets of the club and wasn’t willing to risk compromising my club and my family, for the sake of playing in the Premier League.”

The reality of small clubs

Calleja sounded his frustration over the fact that the club is not backed the community of Pembroke, as much as the top Premier teams. “Pembroke is an expensive place to live in and people are moving out. That means that the majority of the residents are not rooted in the community and they have no enthusiasm for the club. In order to compete in the top tier, a club requires the support and the financial backing of its fans.”

He said we was disappointed that in the previous season, only one homegrown player featured in the squad, adding that he did not even feature in the plans of the coach, should Pembroke have played in the Premier League.

He spoke fondly of the investment and work that the club has put into the nursery and said that by playing in the Amateur League, more nursery players had a chance to play for their team. “In the Premier league we would have featured players who did not have a real passion for the club. In the Amateur League we will now give prominence to our homegrown players, who have a history with our club.”

Calleja spoke about the harsh realities of Maltese football and said that clubs like Pembroke were not much of a benefit for the Premier League. “The attendance and support in the stands are what makes football attractive. When we played in Premier, we used to have seven people in the stands. If you can’t provide decent support, you shouldn’t compete in Premier. This is my personal belief.”

He said that he believes the Malta Football Association should revamp the rules for “satellite clubs” like his,  arguing that such clubs should serve the purpose of developing players for the bigger clubs.

He said that the current situation for Maltese clubs was not sustainable, because the local scene was not attracting the right talent to help clubs make decent revenue. “We can’t keep on spending thousands with no return on investment. The players that are coming in are not big enough to bring in the much-needed investment. Football in Malta has no future.”

“The presidency of Maltese clubs is a revolving door. Everyone gets into it enthusiastically and with the best of intentions, but when one realises that money is simply pouring out his pocket, one would have no option but to re-evaluate. Many act as though tomorrow never comes. A club should not spend more than it could afford,” Calleja said.

Former Prime Minister Joseph Muscat was recently appointed chairman of the Malta Professional Football Clubs Association, which represents 14 premier league clubs.

Calleja believes that Muscat’s new venture in Maltese football is very positive, and discounted the political baggage of the former Labour MP. “He is extremely talented and he looks at things differently than your average Joe. You need a person of great stature to shake things up... Malta is a small country, and talented individuals are very few.”

The vacant spot left by Pembroke in the Premier League will now be filled by Santa Lucija FC. Club president Robert Micallef (right) said the club’s biggest expense remains tied to the wages and stressed that clubs had to be realistic with their expenses

Santa Lucija FC reinstated in the Premier League

The vacant spot left by Pembroke in the Premier League will now be filled by Santa Luċija FC. They had originally been relegated to the Challenge League, after ending the season second from bottom with 27 points.

MaltaToday spoke with the club president Robert Micallef, in order to understand better what it takes for a relatively small club to participate in the top division.

“I certainly can’t speak for Pembroke but all I can say about our club, is that from day one we set up a budget within our limits. We were responsible with the club’s administration and we ensured the house was in order,” Micallef said.

“It is also quite expensive to participate in the Challenge League (First Division), especially if you want to be competitive. If you play in Premier without any silverware ambition, it doesn’t cost you much more than the Challenge League.”

Micallef said the club’s biggest expense remains tied to the wages and stressed that clubs had to be realistic with their expenses.

His club’s ambitions for next season remain modest and realistic. “Our expectations can’t be bigger than us, but football is not just about what happens inside the pitch. You need to have determined people working for the club. It’s not just about having 10 Maradonas on the pitch. What we can’t do financially, we are doing by organising ourselves well... if clubs do not have the highest ambitions, it does not make sense to compete.”