F1 budget talks hit dead end

Another day, another statement. This one, from the FIA, again suggesting that the wheels are coming off the negotiating process between the FIA and the team's body (FOTA) and that it is FOTA's fault.

As I posted yesterday in the Ross Brawn story, the teams want to talk about 'resource restriction' which they control, rather than 'budget caps', which an outside agency controls on behalf of the FIA.

The teams feel that it is a fundamental right of a competitor to manage its own business autonomously. They are also concerned about how it would work if there was a disciplinary hearing, of the kind we have seen in recent years involving racing incidents, where a team was investigated for 'financial irregularities'. A manufacturer could not afford the damage to its image that this might entail.

So FOTA put a plan to the FIA for a system of financial self-regulation, which it believes would achieve the same ends as a budget cap, but without the intrusion. That is what the two sides met yesterday to discuss and this is what the FIA has to say about it today,

"As agreed at the meeting of 11 June, FIA financial experts met yesterday with financial experts from FOTA.

"Unfortunately, the FOTA representatives announced that they had no mandate to discuss the FIA's 2010 financial regulations. Indeed, they were not prepared to discuss regulation at all.

"As a result, the meeting could not achieve its purpose of comparing the FIA's rules with the FOTA proposals with a view to finding a common position.

"In default of a proper dialogue, the FOTA financial proposals were discussed but it became clear that these would not be capable of limiting the expenditure of a team which had the resources to outspend its competitors. Another financial arms race would then be inevitable.

The FIA Financial Regulations therefore remain as published."

In other words, the budget cap stays, take it or leave it.

The FOTA teams last week went over the head of the FIA president Max Mosley, questioning his style of governance and appealed to the FIA senate and FIA World Council to 'facilitate solutions' in this week's meetings, which they described as a final opportunity to find a solution.