Up to 1,250 jobs will be lost if Liberty Media pushes through plans for budget cap. Liberty has been accused of being idealistic and lacking in substantial consultancy.

The major constructors have threatened that it would be the case, but a recent report has warned that up to 1,250 jobs will be lost within the F1 industry if Liberty Media pushes through a £114million-per-yer budget cap as part of its 2021 vision, as reported by gpfans.com earlier today.

A recent report from The Daily Mail, in association with Formula Money, has revealed that if the proposed spending cap is confirmed, UK-based teams, found in Motorsport’s heartland, would be forced to cut their staff by almost one third. Salaries represent the biggest cost for many teams and are the main cost that will be culled as drivers’ earnings and marketing are exempt from the cap. It is thought that some teams may be able to redistribute their staff to other divisions but this is not a guarantee.

It is clear what F1 is trying to achieve. The reasoning is sound, and the owners believe that they can increase revenues enough so that all teams benefit from the sport being marketed more effectively. But another Formula Money report, found on Forbes, suggests that if Liberty are indeed to introduce a cost cap, then it isn’t going far enough. The report states that Force India were the best performing F1 team to ever go bust in terms of grid positions and, therefore, revenue generation, and their annual expenditure was already under the proposed spending limit. And yet, they still had to be saved from bankruptcy in July. If this is the case, then what is the point of the cap at all?

The suggestion is also that reducing the amount teams can spend brings the smaller teams closer rather than raising their level up, which might not do much for the spectacle. The spending cap may well come, but how much it is and what other stipulations are implemented alongside it remain unsure.

Liberty Media has been accused in the past of being idealistic and lacking in substantial consultancy when it comes to sweeping changes. This is another example of a well-meaning, but ill-founded, regulation that needs to evolve before it can make F1 better for all.