Salary cap: EFL proposes League One and League Two cap on wages

League One and League Two clubs would have to operate under squad salary caps, according to proposals put forward by the English Football League.

Third-tier sides would be given a £2.5m ceiling for salaries, while the sum would be £1.25m for the fourth tier.

The plan, as reported in the Telegraph newspaper, would also see clubs given automatic points deductions if players are not paid on time.

The EFL hopes to have the cap in place for the 2020-21 season.

Meanwhile, clubs would be given a vote on the introduction of maximum 20-man squads.

If approved, it would mean only 20 senior professionals at each club, with eight homegrown players - those produced from the club's academy system - within that group.

EFL chairman Rick Parry recently told MPs the game needed "a reset post-Covid", because of the prospect of a £200m hole in finances throughout the three affiliated leagues, including the Championship.

It is suggested clubs would have a season's grace in which to comply with the new measures, while clubs relegated from the Championship would also require a transition period given the disparity in player earnings and income between the second and third tiers.

Salary caps exist in English rugby union's Premiership, in which member clubs can spend £7m per season, and rugby league's Super League, which has a limit of £2.1m.