F1 2022 Season

[laughtersassassin]

I don’t know why, but somehow that would make it even more funny. I’m not sure it’s about not being tied down so much as it is avoiding plenty of tax.

Oh yeah for sure but it's standard practice in engineering. It's not at F1 thing. And I'm sure Newey has been employed by Red Bull like this way since long long before there was ever a cap. It's not something set up to try subvert it as in fact it has zero benefit from a cost cap point of view but it does have a a negative effect if this rumour is in fact true.

Essentially it would means Red Bull went over on the semantics that the FIA don't consider Newey an "employee". Although I actually doubt this rumour is true or atleast not in how it's being described.

Top engineers almost always set themselves up as contractors/consultants.

Otherwise you leave money and opportunities on the table.

I'm sure other teams will have similar with their engineers but if it's not a top 3 employee then it's irrelevant as only those are exempt.

 

[F-Red]

If Newey is a contractor, which according to companies house under Racing Services LTD would suggest he is, then he wouldn't be classed as an employee and just a supplier to Red Bull. So the services he's provided under this guise since joining Red Bull probably wouldn't be exempt under the cost cap, even if he's one of the top three earners at Red Bull.

 

[laughtersassassin]

If Newey is a contractor, which according to companies house under Racing Services LTD would suggest he is, then he wouldn't be classed as an employee and just a supplier to Red Bull. So the services he's provided under this guise since joining Red Bull probably wouldn't be exempt under the cost cap, even if he's one of the top three earners at Red Bull.

That's the theory by AMUS anyway. Although reading the rules it seems to say a contractor can qualify as a top 3 earner for exemption so that contradicts the entire rumor really.

We just don't have enough info

 

[laughtersassassin]

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Great little story this morning from Alfa Romeo

 

[Robertd0803]

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Great little story this morning from Alfa Romeo

That is awesome. Have goosebumps watching it.

 

[rimaldo]

great to see. lucky it was alfa romeo. had it been red bull they’d have had him working in their factories and refusing to pay him.

 

[slyadams]

Actually it's not.

Your top 3 paid employees are exempt from the cost cap

Allegedly Red Bull are saying he counts as top 3 as he is an integral part of the team and is in the top 3 paid.

However the rumour is as Newey is officially a contractor that he doesn't count as an employee and is therefore not exempt. Although I read the rules and it says contractors can qualify so not sure if AMUS got this rumour wrong.

(Top engineers in the industry often set themselves up as a consultant as you make a lot more money not being tied down)

Then the question becomes what happened in the dry run last season? Was he allowed to be counted as a top 3 exemption?

So at Merc Toto plus two others wouldn't count for them for example.

Sorry, I don't follow your logic. You're saying its not rediculous if he were excluded from the cap but then saying RB say he is top 3, but then say he's a contract, but is still not exempt.

Bottom line is contractors simply cannot be exempt if their work falls under the same criteria as employees. If that were not the case F1 teams would setup half their engineering groups as contractors.

 

[slyadams]

Oh yeah for sure but it's standard practice in engineering. It's not at F1 thing. And I'm sure Newey has been employed by Red Bull like this way since long long before there was ever a cap. It's not something set up to try subvert it as in fact it has zero benefit from a cost cap point of view but it does have a a negative effect if this rumour is in fact true.

Essentially it would means Red Bull went over on the semantics that the FIA don't consider Newey an "employee". Although I actually doubt this rumour is true or atleast not in how it's being described.

Top engineers almost always set themselves up as contractors/consultants.

Otherwise you leave money and opportunities on the table.

I'm sure other teams will have similar with their engineers but if it's not a top 3 employee then it's irrelevant as only those are exempt.

This isn't true tbh. I'm in engineering (not mechanical) and when the IR35 rules changed it became much harder to dodge tax by being a contractor. Sure by being a contractor you can take on other clients, but that presumes that your main gig doesn't fill your time. You also don't get any benefits so quickly becomes much less attractive than it used to be. Sure, within a company you'll always find a bunch of contractors running around, but usually its actually not just the top performers, its often just people who like to move around a lot.

 

[TheMagicFoolBus]

Sorry, I don't follow your logic. You're saying its not rediculous if he were excluded from the cap but then saying RB say he is top 3, but then say he's a contract, but is still not exempt.

Bottom line is contractors simply cannot be exempt if their work falls under the same criteria as employees. If that were not the case F1 teams would setup half their engineering groups as contractors.

So it sounds like you agree with Red Bull then?

 

[slyadams]

So it sounds like you agree with Red Bull then?

I don't know because I don't know what RB have said, it all seems to be conjecture. My opinion is that it is irrelevant if Newey is an employee or a contractor, if he's in the top 3 he should be one of the 3. If this means RB are then under cap, so be it.

However, I havn't read all the rules, and there is a proviso to this: what part of the employee's pay is exempt? Is it just the salary, what about NI, pension contributions etc.? If those aren't exempt then they should be calculated as if the worker was an employee and added.

 

[TheMagicFoolBus]

I don't know because I don't know what RB have said, it all seems to be conjecture. My opinion is that it is irrelevant if Newey is an employee or a contractor, if he's in the top 3 he should be one of the 3. If this means RB are then under cap, so be it.

However, I havn't read all the rules, and there is a proviso to this: what part of the employee's pay is exempt? Is it just the salary, what about NI, pension contributions etc.? If those aren't exempt then they should be calculated as if the worker was an employee and added.

Agreed with everything you've said here - wasn't trying to have a go just curious!

You're right though; it's a bit pointless speculating with it all being so vague. This is the one place where I have sympathy for Red Bull, the FIA dithering and not adhering to their own pledges for transparency isn't doing them any favours.

 

[laughtersassassin]

This isn't true tbh. I'm in engineering (not mechanical) and when the IR35 rules changed it became much harder to dodge tax by being a contractor. Sure by being a contractor you can take on other clients, but that presumes that your main gig doesn't fill your time. You also don't get any benefits so quickly becomes much less attractive than it used to be. Sure, within a company you'll always find a bunch of contractors running around, but usually its actually not just the top performers, its often just people who like to move around a lot.

I'm just saying being a contractor is understandable here and in engineering in general. Seen some claiming it was Red Bull trying to get around the cap which is nonsense considering he has likely been a contractor since a long time before the cap was introduced.

If anything based on the rumour this just shoots Red Bull in the foot as it would make an otherwise exempt employee into one that is not exempt.

There is no benefit to Red Bull to do it

 

[dinostar77]

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Great little story this morning from Alfa Romeo

Absolutely brilliant.

 

[dinostar77]

great to see. lucky it was alfa romeo. had it been red bull they’d have had him working in their factories and refusing to pay him.

If it was RedBull the finding goto operation would have cost £1mil on the books and around £250 in real life.

#cheats prosper.

 

[mariachi-19]

If it was RedBull the finding goto operation would have cost £1mil on the books and around £250 in real life.

#cheats prosper.

Jesus Christ, this is motor racing. If you ain’t cheating, you ain’t trying.

 

[Cheimoon]

However, I havn't read all the rules, and there is a proviso to this: what part of the employee's pay is exempt? Is it just the salary, what about NI, pension contributions etc.? If those aren't exempt then they should be calculated as if the worker was an employee and added.

From what I've read, it appears that everything related to staff benefits is exempt from the cap to avoid teams from cutting in those. (Which is a good thing!)

 

[arthurka]

I liked Red Bull a lot but they are fast becoming intolerable.

 

[laughtersassassin]

Jesus Christ, this is motor racing. If you ain’t cheating, you ain’t trying.

Facts.

 

[dinostar77]

Jesus Christ, this is motor racing. If you ain’t cheating, you ain’t trying.

 

[Bepi]

Is this the most absurd F1 season ever??

 

[Fluctuation0161]

Is this the most absurd F1 season ever??

Probably not. But the last 2 seasons back to back might be the most absurd successive seasons ever.

 

[ZIDANE]

Is this the most absurd F1 season ever??

Maybe but I imagine F1 is more popular now and talked about than in other years. F1 was getting known for being boring and dominated by one team at a time (past 20 years). Now every country wants to host and manufacturers want to join. Ferrari had the pace but fell off however teams will catch up to RB. We just need the FIA to sort itself.

 

[dinostar77]

https://www.gpblog.com/en/news/1469...ill-be-more-severe-than-points-deduction.html

Whats more severe than a points reduction?

Does bernie know something?

We know the penalty has to be harsh otherwise thw floodgates will open. If mercedes start to overspend on purpose as they have said they will (if fia are lenient on RB penalities) then ferrari will follow suit. Budget cap is dead.

 

[Fully Fledged]

https://www.gpblog.com/en/news/1469...ill-be-more-severe-than-points-deduction.html

Whats more severe than a points reduction?

Does bernie know something?

We know the penalty has to be harsh otherwise thw floodgates will open. If mercedes start to overspend on purpose as they have said they will (if fia are lenient on RB penalities) then ferrari will follow suit. Budget cap is dead.

There's the possibility of a season ban. I think that was only for a major overspend though. I think the ban for a minor was a 1 race ban.

 

[dinostar77]

There's the possibility of a season ban. I think that was only for a major overspend though. I think the ban for a minor was a 1 race ban.

Nothing stopping the FIA from doing a masi and rewriting the rulebook on the fly.

I'd like to see RB get a ban on in season car development for at least 12 races for next season.

 

[laughtersassassin]

Obviously no details have come out so we don't know how bad or not this is yet.

Their hasn't even been a full investigation into any teams. Meaning the Adminstration have just looked at costs submitted and told each team if they had a cost in the excluded list that shouldn't be there.

I've watched some videos and basically what can happen is as follows.

If Red Bull take an Accepted Breach Agreement then they can't lose any points. They can be reprimanded, Fined and lose wind tunnel time.


If Red Bull take it to the panel as they claim to be innocent then a full investigation is then launched where they could be found anywhere from innocent to having penalties such as points deductions, wind tunnel time, fines and reprimands.

For now we know very little, so lots here are jumping the gun.

Based in past times of "cheating" drivers are never really punished as while they benefitted they weren't complicit. Spygate, Ferrari Alleged engine cheating, Racing points Pink Mercedes and Mercedes illegal tyre test to name a few.

All examples where we saw no driver punishment so thats the closest precedent we have to go on.

But really we got to wait for more info to know just how bad or tame this is. Like it'll be important to know what has changed versus the dummy run for example.

One problem with this entire process is it takes ridiculously long which will just make this whole process a farce each year.

Shame it can't be much much quicker.

But basically it's actually in Red Bulls interest to take an ABA wether they feel they are guilty or not as taking it to the panel is the only way they could possibly lose Max's title.

It's a bit like an appeal in football where even if you feel your are in the right you often don't appeal as you are guaranteed a worse punishment.

Also just to note it took 60+ days for us to hear about Williams ABA so this thing isn't going to be sorted anytime soon it seems. And if Red Bull take it to the panel to claim innocence then it probably won't be sorted till 2023.

 

[hobbers]

Extrapolating an awful lot from one senile dudes incomprehensible 3 word reply there

But it feeds another 4 weeks of uk tabloid headlines

 

[goalscholes]

We should wait for the final decision to be sure.

But when only one team has broken the cap, it is strong evidence that teams had a good understanding of how to stay within the limit.

Then when you see the team that broke the cap had the most to gain, and were trying every dirty trick in the book at the time (touching other cars wings in park ferme, making up infringements so their opponents had to take apart their car and put it together again before a race etc.) you can make a pretty educated guess at what likely happened.

Especially when that team has again been the most vocal this season about the budget cap needing to be increased, whilst poaching staff and introducing more upgrades than their rivals.

 

[hobbers]

Zak Brown's suggestions for punishments for budget cap overspends all seem like very good ideas.

He thinks an overspend of $1m means $2m should be taken off the next seasons cost cap, plus wind tunnel reduction as a more punitive element. And reduce the minor/material threshold from 5% to 2.5%.

 

[sun_tzu]

Jesus Christ, this is motor racing. If you ain’t cheating, you ain’t trying.

Looks like redbull were really trying (according to McLaren at least)

McLaren F1 boss Zak Brown has written a letter to governing body the FIA in which he says Red Bull breaking the budget cap "constitutes cheating".

Brown calls for penalties that will hit Red Bull financially and on the track.
"Any team who have overspent have gained an unfair advantage both in the current and following year's car development," he writes.

Brown adds the FIA should "communicate subsequent action and penalties at pace to maintain the integrity of F1".

https://www.bbc.co.uk/sport/formula1/63256734

 

[ArjenIsM3]

Looks like redbull were really trying (according to McLaren at least)



https://www.bbc.co.uk/sport/formula1/63256734

Great, another team boss trying to influence both public opinion and the FIA through the media.

 

[sun_tzu]

Great, another team boss trying to influence both public opinion and the FIA through the media.

Another team boss unhappy one of the teams they are competing against are cheats

 

[Gringo]

To be fair thats not a bad shout to deduct a teams spending the following year.

 

[ZIDANE]

It is definitely one of the more sensible responses I've seen and glad he reiterates the need for transparency and to deal with this at pace.

FIA need to get a grip, for weeks now we've heard more about this from the teams.

 

[Cheimoon]

Zak Brown's suggestions for punishments for budget cap overspends all seem like very good ideas.

He thinks an overspend of $1m means $2m should be taken off the next seasons cost cap, plus wind tunnel reduction as a more punitive element. And reduce the minor/material threshold from 5% to 2.5%.

Additionally, he also says this (from @sun_tzu's link):

To avoid teams accumulating and benefiting from the multiplier effect of several minor overspend breaches, we suggest that a second minor overspend breach automatically moves the team to a major breach.

All very good ideas, but the one thing lacking is some retroactive punishment for the benefits already gained. I'd be in favour of a points reduction for the constructor in the season(s) affected.

 

[Buster15]

Jesus Christ, this is motor racing. If you ain’t cheating, you ain’t trying.

There is a difference between trying to stretch the technical rules and exceeding the agree cost cap. All the teams try the former. But only RB have been found to have broken the cost cap.

 

[Buster15]

Additionally, he also says this (from @sun_tzu's link):

All very good ideas, but the one thing lacking is some retroactive punishment for the benefits already gained. I'd be in favour of a points reduction for the constructor in the season(s) affected.

I would as well. RB always try to come across holier than thou, at the same time as gaining an unfair advantage.

 

[redshaw]

Don't like the idea of reducing next years budget for an overspend and having teams weigh up the timing of when to do it. Mainly though I don't want imbalances between teams each year possibly making a season more dominant for one particular car. We'll sacrifice spending/tunnel time next year for this year thinking skewing championships. It could inadvertently work the other way and help a team if there's one stand out team on merit though.

 

[goalscholes]

Zak Brown's suggestions for punishments for budget cap overspends all seem like very good ideas.

He thinks an overspend of $1m means $2m should be taken off the next seasons cost cap, plus wind tunnel reduction as a more punitive element. And reduce the minor/material threshold from 5% to 2.5%.

I don't think they should reduce the minor/ material thresholds now RB have broken the rules. Otherwise RB could technically could get less of a punishment for going more-over the budget than another team next year.

There are two key issues. The first is that the budget is adjudicated so late after the season. Surely it has to be possible to get an update of team spend throughout the season, and have compliance assessed much closer to the end of the season (i.e. before they hand out constructor winnings)? The punishment could then apply immediately to the next season.

The second is that the FIA is again being really opaque and negotiating punishments behind closed doors, without revealing any information. You'd have thought they'd have learnt their lesson. Ditch the dodgy negotiations with the FIA (who have weird vested interests to protect their own reputation), and make all overspend punishable, to a sliding scale. The punishment of going over should be much worse than the benefit received, so I'd agree with Zak that double the money taken off the next year's budget seems reasonable. Plus every million you are over, they should deduct 10% constructor points from that year (or next year if they need to pay out prize money ahead of adjudication) and wind tunnel time for the next season.

 

[pauldyson1uk]

I see you have already posted about this, a new twist in Budgetgate ?

Speculation has emerged that Red Bull chief technology officer Adrian Newey could be at the center of Red Bull's cost cap breach.

Following the FIA's audit of teams' accounts, Red Bull was found guilty of breaching Formula 1's financial regulations in 2021.

However, the governing body has classified Red Bull's transgression as "minor", meaning it represents less than 5% of the team's $145 million maximum budget, or less than $7.5 million.

A report last week from Dutch outlet De Telegraaf claimed that the bulk of Red Bull's overspend – estimated at between $1m and $2m – was linked to catering fees, free lunch for its over 1,000 members of staff, as well as to illness and absent employees.

But a new report from Ziggo Sport suggests the financial over-run could rooted in a dispute between Red Bull and the FIA over Newey's professional relationship with the Milton Keynes-based outfit.


F1's financial regulations exclude from the cost cap a team's top-three highest paid executives. As the man who oversees Red Bull's successful design department, Newey is paid big bucks to apply his genius and brilliance.

But technically, the British engineer is not an employee of Red Bull as his services are acquired by the team via Newey's engineering firm which is contracted to Red Bull.

Therefore, the retainer paid to Newey – or rather to his company – should not be excluded from the team's cost cap accounts.