FINANCES: English Football League clubs need to adopt a "common sense" approach to their finances and embrace the prudence shown by rugby and cricket clubs if they are to avoid financial meltdown, according to an influential report published yesterday.

In a comparative study of the financial health of professional clubs in both codes of rugby in England, county cricket, the Scottish Premier League (without Celtic and Rangers) and the English first division, the accountants Deloitte & Touche conclude that spending controls, specifically salary capping, are vital to the long-term financial health of the Football League.

"UK football may still lead the commercial race in terms of income generation but there are definitely some areas in which it can learn from other sports," said Gerry Boon, head of Deloitte's sport unit, which produced the first report of its kind this year.

The disparity between football and the other major professional sports is most graphically illustrated by the ratio between income and wages for the season ended 2001. In the first division the average club was in deficit as soon as it paid the salaries, with a wages-to-income ratio of 101 per cent.

Salary capping is currently under discussion by the Football League and the G14 group of elite European clubs.

Football First Division clubs make more money than the other three sports put together, but they are a long way from turning a profit. In terms of income the first division dwarfs the other sports: the 24 clubs generate £205 million, £61million more than the combined turnover of clubs in the two rugby codes and cricket.

Yet, with a wages-to-turnover ratio of 101 per cent and an average salary of £175,000, the average club was in debt as soon as its wages were paid. After this wage inflation and all other costs have been reckoned up, the clubs' average income of £8.6million was transformed into a debt of £4.2million by the end of the year.