By Chris McLaughlin

Rangers and Celtic may have to cope with smaller squads

Over half of all professional football clubs in Scotland are planning to cut wages and squad sizes in the face of economic uncertainty.

The latest figures are part of an exclusive BBC Scotland survey carried out to gauge what effect the financial downturn is having on the game.

Over 80% of all chief executives and chairmen interviewed admitted they are suffering because of the credit crunch.

And most said they expected the problem to get worse.

"It's the players at the top end of our game who could be in for a shock in the next few years. Too many have had it too good for too long," said one Second Division chairman.

"In the lower leagues there's not much fat left to trim."

Salaries in Scottish football have already been slashed in recent years as clubs realised they were living well beyond their means.

Spiralling debts were addressed by cutting wages and tempering the expectations of those picking up the cheques.

Now, most clubs believe more cost cutting is needed to help satisfy the banks.

When asked if they planned to lower wages or cut squad sizes, 52% of clubs said yes. Others said that they already had and would continue to monitor the situation closely.

Figures also obtained by BBC Scotland show a dramatic dip in transfer activity during the January window. Year on year, the movement of players fell by 11%.

"It's certainly the quietest window that I remember," said Sandy Bryson of Scottish Football Association's registrations department.

"We also witnessed many more loan deals this time as opposed to cash transfers."

Despite the fall in transfers and the promise to cut costs, most chairmen believe the quality on the pitch won't suffer. Indeed, 86% felt that there would be no compromise in playing standards.

Many chairmen in the lower leagues believe they may benefit from what some are calling a "drip, drip" effect from the bigger clubs.

"There's no doubt that good footballers are going to be looking for clubs when squad sizes are trimmed," said a Division Three chairman.

"We would like to think we'll benefit from that as players realise that they too must cut their cloth accordingly."

Chris McLaughlin's series on the state of Scottish Football finances concludes on Thursday 19 March 2009.

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