LUCA VIALLI would still be Watford's manager if it was not for the ITV Digital disaster, Tim Shaw has claimed.

Faced with a shortfall in income of up to £3 million for the next two years, the chief executive maintains the club could no longer afford the Italian's reported salary of £600,000 per annum, although it is believed Vialli's intransigence over cuts to his footballing staff ultimately led to his dismissal last Friday.

Shaw explained the departure of Vialli should mark the end of staff cuts, although the club are still intending to settle the contracts of up to two unnamed players, having agreed to release Swiss international Ramon Vega this week.

Former England under-21 manager Peter Taylor and ex-Crystal Palace and Brentford boss Steve Coppell are widely tipped to be leading the race to become Vialli's successor, although Shaw insisted the Hornets have not approached any potential candidate about the manager's position, and he expects the process to take several weeks, but with the aim of having a new man at the helm during pre-season.

Despite rising speculation about Vialli's future in The Watford Observer during April, Shaw then dismissed suggestions that the manager was about to be sacked as "absolute garbage".

"Frankly, what has changed between then and now is this issue of ITV Digital, and the fact that there is, without any question, going to be no settlement outside of a court hearing," the chief executive explained.

"Back in April, there were enough noises coming from both the league and Carlton and Granada that there would be a settlement that would have avoided us having to take various other cost-cutting measures that we are currently doing.

"What has happened, subsequent to then, is there is very little chance of any sort of settlement in the immediacy, and we have had to cut our costs.

"We took a decision last year to appoint Luca with a philosophy that came with it, which we entirely supported. The reality is that the investment is a good deal higher than the average is for the First Division, and, within the current circumstances, there is no way we can continue to fund that investment.

"My opinion is that if wasn't for that, and there had been a settlement of the TV situation, Luca would still be our manager.

"The only slight aspect on the footballing side is that we did want to make a change for footballing reasons on the coaching side.

"Now, obviously, when you make a decision like that you discuss it with the manager, and that has an impact on him. I think it would be quite wrong not to bring that into the equation as well."

Shaw refuted suggestions that by sacking Ray Wilkins, and making three other members of the backroom team redundant, the board hoped to force Vialli's hand and make him resign.

"Three of them were done for cost-cutting measures," he said. "There was more of a footballing reason behind Ray, although one also has to accept there is a cost implication there as well.

"All I would say is it wasn't a Machiavellian plot to get rid of Luca."

Having sacked Vialli and Wilkins, made three other staff redundant, and, this week, agreed to settle the contract of Vega, many may feel these moves make little financial sense in the current climate because those involved will need their contracts settled.

Shaw said: "I am not going to comment on specific numbers or issues where clearly we have to come to agreement with the individuals concerned.

"However, there is some kind of perception out there that this organisation comes up with what they perceive to be a good idea and do it without thinking through the consequences.

"We would not have carried out what we've done unless, as a board, we were certain that it was going to be result in significant cost reduction for this football club.

"If we had to settle the entire contracts for all of these people it would be an utterly pointless exercise, but that is not the case. This will make a significant cost reduction for this club. Let's get rid of that misconception once and for all."

In fact, rather than jeopardise the future financial stability of the club, Shaw insisted such moves "massively improves it".

There is also a widely held view that when Graham Taylor stood down as manager, Watford were in the black.

Although the Hornets recorded a £4.5 million loss for that year, the club were not in debt, and Shaw added: "Are we in debt now? No we are not."

While the collapse of ITV Digital has forced a massive financial rethink, asked whether, with hindsight, the board had exacerbated the current problems by paying such high salaries to players, Shaw responded: "We appointed Luca Vialli, first and foremost because the guy had an incredible track record of success, both as a player and a manager, and that is why we did it.

"We gave him a budget on transfers to spend, knowing what we were doing, and that we were perfectly prepared, and in essence are continuing, to support it. So that part of it which is non-ITV Digital is supported by the directors that made that decision.

"In hindsight, were all the transfers good transfers? No they weren't. In hindsight, did we allow, not too big a budget perhaps, but the construction of the budget, by which I mean no proper capping to the salaries was that a mistake? Absolutely.

"I want to make clear the board of directors fully accept their responsibility for mistakes that were made. I said that when we put players on the transfer list back in February, and I say it again, and we stand by those mistakes, and we will pay for those mistakes, as we always knew we would do.

"Nevertheless, the mistakes we made were in an attempt to progress the club because we appointed a chap that's been very, very successful in his career and we had 100 per cent faith in the guys that he said he wanted to bring to the club.

"That's not a criticism of Luca because we all make mistakes as I'm saying, but the reality is that was the thinking behind our decisions."

With the wave of football staff cost-cutting seemingly at an end, newly installed caretaker manager Ray Lewington's future at Vicarage Road is secure.

Furthermore, the reserve team boss will be allowed to apply for the vacant top job, and Shaw explained: "We know Ray, we know his strengths, and I guess it would be fair to say we would welcome an application if he wants to do it."

If another manager were to be by appointed, he would be required to keep Lewington on, suggesting the board have learnt their lesson from the controversy surrounding Kenny Jackett and Luther Blissett's departures in the wake of Vialli's appointment last year.

"I think it's fair to say it would be a stipulation for a new person to take on board what's here already," explained Shaw.

With Lewington's future safe, this would appear to enhance the prospects of Coppell, given the pair previously worked together at Crystal Palace.

However, former Brighton & Hove Albion boss Taylor is also widely tipped, and his agent, Andrew Mills, reportedly said: "I think it was obvious that Peter would be linked with the position and it is a situation that he is watching with great interest.

"I have spoken with Watford following Vialli's departure and I am really waiting for them to contact me after a board meeting at which point they will let me know what their thoughts are.

"I think the official line is that we are awaiting their response but I have spoken to them it is always slightly tricky at this junction."

Shaw explained: "We haven't approached anyone. We've been approached by loads of people, and the way we're addressing it is we're drawing up a criteria that we want this guy to fit.

"We will then, from the huge list of people that have expressed an interest, pick people that we want to interview. So it's not going to be a short process.

"We have no pre-conceived ideas of who the new manager is going to be, but what happened last year was that once we'd drawn up the criteria, the best guy by a country mile, in terms of track record, was Luca Vialli.

"We would, unless something quite incredible happened, definitely have someone in place before the start of the season.

"I think the ideal would have been we would have had a manager in a permanent role at the beginning of the pre-season. Having said that, Ray Lewington is an excellent guy to have as a caretaker, so I'm not worried at all.

"But it would be nice for people to know, I think as an issue of certainty, who the guy is not long into the pre-season if we can achieve that timescale."

Asked about the criteria the board will employ, the chief executive, stressing it was his own view because the full list had not been drawn up yet, explained: "We do want a proven track record. We want somebody that understands the lower leagues, particularly the First Division.

"Again, stating the obvious, we need someone that we know will be comfortable working with a limited budget if that is how it ends up for us. It's not necessarily the case, but I would say it is very likely to be, especially in the short-term. So we need somebody that feels they can develop the squad that we have here without the need for major amounts of money to be invested.

"Through all of this, and the awful situation we've found ourselves in, trying to look positively we have a fairly talented squad of players.

"Yes, we have one or two gaps, but we must not lose sight of the fact that come the start of the season, with the right direction, the right guy at the helm, and if the whole thing's settled down a bit, we have a decent chance of a successful season.

"It is vital that it is not completely doom and gloom because when we come through this, and we're putting in these steps to make sure the club do come through this difficult time, then there is a fair degree of light at the end of the tunnel."

June 21, 2002 13:00