EFL hand Reading six point deduction for failing to comply with budget restrictions

Championship side Reading have been handed a six point deduction with immediate effect after admitting to their failure to comply with budget restrictions, the English Football League (EFL) said on Tuesday.

The second tier side were first handed a six point deduction in 2021 after admitting to exceeding profit and sustainability limits, while a further suspended six point penalty was to be applied if the club failed to fulfil an agreed business plan.

On Tuesday, the EFL said Reading had "admitted to the two breaches" of that business plan following a review by an independent panel.

"The club will be required to agree a new budget with the independent Club Financial Reporting Unit for the 2023-24 season aimed at ensuring future compliance with the regulations," the EFL added.

Reading are now 20th in the league standings and one point above the relegation zone, with seven games left in the season.

In a statement, Reading said they had failed to adhere to the plan "despite radical changes implemented at first team level and right across the structure of the business ... and a rigid adherence to a strict league-monitored wage structure and transfer embargo.

"... as a result, the independent Club Financial Review Panel has been unable to ratify that the club has met its forecast for compliance.

"We have worked closely with the EFL and the independent Club Financial Review Unit throughout the process in our aims to achieve the targets set out in the agreed business plan..."

Reading, who next host 16th-placed Birmingham City on Friday, added that their transfer embargo would be lifted in the close season.