Quote:
Originally Posted by bathurst77
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TinyURL resolves to this for those of you who don't like the security concerns around using TinyURLs...
https://the-race.com/formula-1/red-b...en-budget-cap/
A key quote from that article...
Quote:
Both transgressions are expected to be classified by the FIA as minor breaches, which means they exceeded the budget cap by up to 5% of its value.
That means the breach could be up to around $7m, which is the equivalent of salary for dozens of members of staff and/or a significant amount of development work.
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Assuming the transgression is under the 5% boundary, this will be the most unshocking news I can imagine. Frankly I would be absolutely shocked if none of the teams pushed into the up to 5% overage territory.
And I will say I am relatively shocked that more teams have not pursued the same path. (looking at you Mercedes and Ferrari)
Here is a quote from myself from June of this year in the
Budget Cap thread around likely team strategies on how aggressive they might be with regards to not just the allowed budget cap value, but how close they might get to tickling the 5% over value (given the penalty should not be significant). Note, we were talking mostly about the freight topic, but I wanted to call out that smart teams are likely to push into the 5% overage range.
Quote:
Originally Posted by Richard Casto
I have not seen a specific value mentioned in any of the articles I have looked at. The financial regulations allow up to 5% overage without serious penalties kicking in. So it is expected that those teams with money will see how close to 5% over they can get.
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Basically, teams can play it two ways. Run up to the budget cap, and maybe even leave some money on the table. Or push the limits of the regulation. I believe the 5% number was built in to ensure teams could spend to the full amount, and allow a bit of creep over, but without incurring a significant penalty. As I called out in June, I expected that if teams were confident in their ability to track their expenditures, that they would push PAST the stated limit and maybe creep up toward the 5% limit. The thing is the report is compiled AFTER you have totaled up everything you have spent. So if you are edging close to the 5% value, you run the risk of something accidently happening (some expense you missed in your planning and it shows up in the final audit) and pushing you past 5% and creating REAL problems for yourself other than a bit of bad PR.
As the quote above says, a 5% overage would be about $7M. I have read a single post elsewhere (that is very much unsubstantiated) that the rumor is that RBR is over by $4M. If true, that is right in the middle of that overage range that doesn't run too much risk. Not too small, not too large.
If all of this is true. No doubt there will be lots of drama. Especially from those who are looking at the back side of RBR on the track. But if you go by the regulations, they should come out of it was a smack on the wrist. You can either think they were cheating, or they were pushing the limits of the regulations like is normal in F1.
We still need to see what the real details are, but if it plays out as I say, is the budget cap "broken" by this? I say no, but I can see that as both the FIA and the teams continue to learn how to work (and provide documentation) for their spending, I think it might make sense for that 5% value to drop down a bit. So the window for overage that doesn't trigger significant penalties could shrink. Lets say maybe 3% in an upcoming season. Still some wiggle room, but not much.
Richard