My understanding was that it was only there to keep the status quo in tact.
Equally, the FFP in the championship are just as ridiculous.
If the clubs are not going to abide by the system rules then it should be scrapped. Unfortunately with the amount of sponsoring opportunities available it just provides too many loop holes.
Furthermore, I never understood why clubs such as ourselves who have been prudent with our finances have been placed under such restrictions because others have been reckless with their spending. The strict rules and punishments should be on those who continue to make substantial losses - not on those who break even and make profits like ourselves and Newcastle for example.