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Premier League wages have broken through the £850m barrier, a report by Deloitte has revealed.

Its annual review of football finances showed Premiership wages jumped 9 per cent to £854m in the 2005/06 season.

And with the new lucrative £1.7bn television rights deal coming into effect next season, player salaries are expected to surpass the £1bn mark in the very near future.

Chelsea spent the most on wages in 2005/06 at £114m, followed by Manchester United (£85m), Arsenal (£83m) and Liverpool (£69m).

The Deloitte report also found that the Premiership was still the top-earning league on the planet.

The 20 Premiership clubs made £1.4bn in turnover in the 2005/06 season, according to Deloitte.

And this figure is expected to jump to a whopping £1.8bn in 2007/8.

Dan Jones, Deloitte: "The new broadcasting rights deals - providing an additional £300m of revenue to the Premier League clubs in 2007/08 - and other revenue increases will drive overall turnover up to almost £1.8bn."

Manchester United, the new Premiership champions, topped the English revenue league, generating £167.7m in 2005/06.

Chelsea was second on £152.8m, with Arsenal (£133m) third and Liverpool fourth (£121.6m).

However, just nine Premiership clubs actually made a pre-tax profit in 2005/06, down from 14 in the previous season.

Deloitte partner Dan Jones said: "We believe the relatively small changes in Premier League clubs' financial results over the past three seasons represent the calm before the storm.

"The new broadcasting rights deals - providing an additional £300m of revenue to the Premier League clubs in 2007/08 - and other revenue increases will drive overall turnover up to almost £1.8bn."

Revenue generated by clubs in Italy's Serie A reached a combined value of £1bn in 2005/06, followed by Germany's Bundesliga and Spain's La Liga (both £0.8bn) in joint third.

Looking ahead, Deloitte expects Premiership clubs to shell out a staggering £300m on new players in this summer's transfer window.

Paul Rawnsley, director of Deloitte's Sports Business group, added: "Whilst wages will rise, clubs do have the opportunity to increase the importance of performance related pay structures.

"This will both insulate the business in future when on-pitch results are not so good, and also help motivate and reward players and management for winning.

"We also hope and expect to see a further enhancement of the clubs' level of investment in supporter and community schemes in the future."