Ross Brawn has revealed that a "soft" budget cap will be introduced in 2019 before being stepped up for the 2020 season, and the matter has already been agreed upon by the teams and governing body, the FIA.
A budget cap has been the subject of much discussion but has always been met by strong opposition from the bigger teams. However Liberty Media have made fresh efforts to cut costs following their takeover and Brawn says the need for such measures has been highlighted by Force India's recent plight and the growing gap between the top three and the midfield.
"We want the grandees to still be the big names in the sport, we don’t want a system or a situation where there aren’t big targets to aim at. And at the moment, those targets are Ferrari, Mercedes and Red Bull," Brawn said.
"However, the void between those three teams and the rest of the field is too big. There are two divisions in Formula 1, and we want to stop that, we want to introduce constraints on the amount of resource you can use. And doing that involves both an economic perspective and a technical perspective.
"On the economic side we’re pushing through cost control initiatives. We only have to look at the situation Force India finds itself in to understand how crucial this is. The financial burden on teams is not sustainable in the long term and we are taking steps to put a limit on how much a team can spend."
To begin with, the budget cap will likely only impact the top few teams and won't see their budgets cut dramatically, but the limit will gradually reduce in the subsequent seasons with the hope of achieving a difference of just 10 to 20 per cent between the lowest and the highest spenders.
"The ceiling won’t be achievable for all teams, but it will reduce the differential between the teams that are at that limit and those that aren’t," explained Brawn. "At the moment I think a top team spends twice what a midfield team spends and if we reduce that margin to around 10 or 20 per cent, then there is something for the midfield teams to aspire to. There will still be an aura around the big teams, but a midfield team doing a great job will be able to compete.
"The good news is that with the FIA and in consultation with the teams we are progressing well on the economic initiatives. Work on the mechanism of a cost cap is going well. At the moment we are looking to introduce it in a soft form, with dry runs in 2019, and 2020 and then it will be become regulatory in ’21. I would say that barring some last-minute discussions that’s pretty much finalised now."
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