The National League has told clubs that taking out loans is no longer an option.

It means the hopes of a restart in National League South and North depends on a U-turn from the DCMS.

Without a change in the terms of funding, it seems inevitable that the National League South season will be declared null and void.

After receiving a grant of £10million in October for the season to start, the league was hoping that the second tranche of government funding – due now – would also be in grants.

Instead, that money has been offered in loans which led to the ‘vast’ majority of clubs in National League South opting to take a two-week break in the hope that the league can get the DCMS to rethink their plans.

Clubs were told by the league on Friday evening that the option of the league taking a loan and distributing to clubs was off the table.

Many clubs had voiced concerns over this option after there were claims that the initial £10million was not distributed on missed gate receipts by the league, as it was originally intended for.

The news was confirmed by National League North Chester chief executive Jim Green.

He wrote: “The National League has confirmed to clubs the board is no longer considering the option of the league taking a loan and distributing to clubs.

“It adds clubs taking loans is not ‘seen as sustainable and viable’ (correct) so it appears the season now rests on a U-turn from DCMS.

“National League states the reason Step 1 is continuing is because the majority of clubs wished to continue, whereas at Step 2 the majority wished to ‘take at least a short break’ so the board decided to treat them separately.

“National League says it will ‘continue to challenge the position on what we believe was the original intimation on grants’ but accepts the risk no suitable further funding may be available.

“In the ‘coming days’ the National League will present clubs with a formal proposal on the status of the 2020/21 season to consider and vote upon.

“It seems Step 2 is heading for null and void and without financial support it’s difficult to see how some clubs in Step 1 can continue much longer.

“It’s an absolute mess. The National League should be feeling pretty embarrassed and ashamed this evening.

“There has been a lot of lobbying but I understand there is no sign of DCMS changing its mind and insists it must have a consistent approach across all sports.

“DCMS adamant it did not promise National League support from January onwards would be grants. National League believe this is what was ‘intimated’.”

Patrick Chambers, chairman of National League South Hungerford, said: “This is purely down to the fact that no funding is currently available by way of grant to finance clubs in the absence of fans, despite assurances back in October that further grants would be available for January, February and March if still playing behind closed doors.

“Hungerford Town FC would not have commenced the season on any other basis and triggered player contracts.

“This is an absolute disgrace and we have been misled in no uncertain terms.

“At the Zoom meeting last Wednesday, I was assured that both the FA and National League were at those meetings with the DCMS back in late September, early October and that they are 100% certain that loans were never discussed and believed funding would be available by way of grants.”

A potential null and void for National League South would mean there will be no relegation from the National League.

• We're shocked by National League South suspension

• National League South season stopped

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