Sir Alex Ferguson identified the problem first, at least in public. In Durban last summer the Manchester United manager ventured the opinion that Chelsea were unlikely to improve much under Luiz Felipe Scolari since he was largely reliant on experienced players who had reached their peak, an observation that was reasonably reported as a high-handed dismissal of the Brazilian manager’s ageing squad.

Ferguson expressed annoyance at this interpretation, but if anything the Scot was guilty of understatement. Had Chelsea maintained the performance levels achieved by José Mourinho or Avram Grant they would not have dropped 14 points in their past eight matches to leave them off the pace in the Barclays Premier League title race.

Chelsea’s board contend that the players are good enough and their problems are the result of key individuals underperforming, but the truth is that Scolari lacks the resources to compete. A squad that was once the envy of the world is now relatively threadbare, as shown by the options available to both managers at Old Trafford on Sunday. With only Michael Essien injured, Scolari’s hands were tied after the half-time introduction of Nicolas Anelka, with a reserve full back, Juliano Belletti, and an unproven striker, Franco Di Santo, his subsequent substitutions. Ferguson brought on Michael Carrick, leaving Carlos Tévez, Paul Scholes and Anderson on the bench. Rio Ferdinand, Owen Hargreaves and Nani were out injured. Scolari deserves sympathy given this mismatch.

The dramatic decline from the days when top internationals such as Eidur Gudjohnsen and Hernán Crespo were regularly left in the stands has many causes, most notably a series of mediocre signings, reduced investment and a failing youth system that is in the process of being disbanded. Frank Arnesen, the chief scout and head of youth development, has been unable to deliver a player for the first team since being poached from Tottenham Hotspur four years ago and though the Dane is clinging on to his job, his contract is unlikely to be renewed at the end of the season.

Arnesen is not the only guilty party. The transfer policy overseen by Peter Kenyon, the chief executive, has been little short of calamitous. Of the four players Chelsea signed last year at a cost of £50 million, Anelka is the only one to have made a positive impact. The errors seem more deep-rooted, because the likes of Steve Sidwell, Tal Ben-Haim and Claudio Pizarro came and went without contributing anything in a single season, while, given his subsequent progress, the decision to sell Lassana Diarra to Arsenal for just £2 million 18 months ago must rank as one of the biggest mistakes in the transfer market of recent times.

Such problems have been exacerbated by Roman Abramovich’s apparent decision to tighten his purse strings as Chelsea seek to become self-financing, but it is difficult to blame the owner given the way they have spent some of his money. The Russian appears to have adopted a “feast or famine” approach, with Scolari suffering as a result of the mistakes of his predecessors.

In mitigation, Chelsea were aware of the need for an overhaul 12 months ago — with Grant preparing a list of transfer targets including Fernando Torres, the Liverpool and Spain striker, and Franck Ribéry, the Bayern Munich and France midfield player — but they kept faith with the players who had taken them to their first Champions League final. The club acknowledge that such a clear-out must take place this summer, but by then it may be too late. The transfer values of those they want to sell, such as Drogba, Florent Malouda and Salomon Kalou, will have dropped, while Ferguson is likely to be celebrating another title triumph on a beach in South Africa.

The overhaul picture

Chelsea’s squad is in line for a revamp this summer, with only a handful of players guaranteed to remain at Stamford Bridge

Go Didier Drogba, Florent Malouda, Salomon Kalou, Branislav Ivanovic, Alex

Stay John Terry, Frank Lampard, Petr Cech, Michael Essien, John Obi Mikel

Uncertain Nicolas Anelka, Joe Cole, Deco, Michael Ballack, Ashley Cole