Fan-led Review and Football White Paper

Commons Urgent Question

The following Answer to an Urgent Question was given in the House of Commons on Monday 20 February.

“Our national game has become a worldwide sport, loved and followed by millions. The growth of the Premier League, English football’s top division, is an achievement to be celebrated. Our grass-roots game is a force for good to bring people and communities together across the country. However, the findings of the fan-led review made it clear that the underlying financial and governance structures that support English football are unstable and fragile. The review highlighted the perverse financial incentives that encourage clubs to overspend on chasing success. I pay tribute to my honourable friend the Member for Chatham and Aylesford, Tracey Crouch, for her considerable work in this area.

The issue is exacerbated by poor corporate governance. Some clubs lack scrutiny of decision-making, are poor at communicating with fans, and lack transparency in decision-making. Defective industry self-regulation throughout football has led to a high and growing risk of financial failure among clubs. Indeed, one of my first meetings as the Minister for Sport was with fans’ groups. I heard at first hand how poor ownership and governance can leave clubs at the mercy of careless owners.

This structural weakness, along with the risk of breakaway competitions such as the European Super League, threatens the stability of the football pyramid as a whole and risks leaving fans powerless and our national game in peril. The unique importance of football clubs to their fans and local communities means that the social cost of financial failures and the loss of clubs would be significant. That includes the risk of irreversibly damaging our valued cultural heritage.

Reform is needed to avoid those failures and prevent those impacts arising. It is clear that the game is in need of significant reform. As I have stressed to the football authorities on several occasions, there is much that football could already be doing to protect the game. This includes reaching a much-needed agreement on a new package of financial redistribution for the football pyramid, and, again, I urge them to solve this issue.

The Government responded to the fan-led review in April 2022, and we will publish a football governance White Paper this week. This will set out a clear and well thought-through package of reforms that will ensure that the foundations of the game are strong and the game can continue to thrive.

I make a commitment that Ministers will come before the House to make a Statement with a full announcement on how we intend to reform our national game for the future and for fans, and we look forward to ensuring that honourable Members have the opportunity to fully scrutinise those proposals.”

My Lords, the publication of the White Paper responding to the fan-led review has been promised more times than Brighton & Hove Albion has suffered from dodgy VAR decisions.

Oh!

I was expecting a bit of support. This is no laughing matter, actually, because we have had 13 years of government prevaricating and dithering on this issue. We have had an excellent report produced by Tracey Crouch in another place. I am wondering whether the Secretary of State is going to be able to publish the White Paper this week, as was promised just yesterday. In the meantime, clubs such as Bury, Derby, Southend, Scunthorpe and Crawley have all had very unfortunate financial situations obliged upon them by owners. This is really important, and we need to get it right. There needs to be a fully effective football regulatory body at the core of the White Paper. Can we have from the Government today a definitive answer, first, that the paper is going to be published this week and, secondly, that we will have legislation before the next general election?

My Lords, this is indeed an important matter. That is why it was a manifesto commitment, why the Government acted on it, why we commissioned Tracey Crouch to lead the fan-led review, why we accepted in principle the strategic recommendations she made and why we are grateful to everyone who gave their thoughts towards it. The Government have been at the forefront of work to reform our national game and ensure that it is fit for the future. The importance of this to clubs such as the ones the noble Lord mentioned is well known. The review that Tracey Crouch led shone important light on several significant and complex issues. It is right that we have given them due attention and we will be publishing our White Paper later this week and legislation will be set out in the usual way.

My Lords, if the Minister agrees that there is no other show in town, will he make sure that these clubs have a realistic future and take this opportunity to not only produce the paper and legislation but to state exactly what the Government want back from the clubs? We have this wonderful hub within the community to support grass-roots football and other sports. Will the Government make sure to let everybody know, if they are going to make this change, that they will be undertaking that these clubs take action that supports grass-roots sport and not simply youth teams used to select talent?

I do not entirely agree that this is only show in town. While it is important, and the White Paper will set out more detail, we have said all along that clubs need not wait for that White Paper or for a regulator to be up and running to get their own house in order. There are things that the football authorities can and should take forward, such as financial redistribution throughout the football pyramid. We have urged them to do that in the meantime and continue to do so. The noble Lord is right that this is an important area and that is why the White Paper will set out the work that the Government are taking forward.

My Lords, the Minister mentions the football pyramid. I point out that on an average weekend more supporters attend Football League matches than Premier League matches. Will he give the House an assurance that when the Government publish the White Paper this coming Thursday, supporters and the Football League will get precedence over the Premier League?

Financial redistribution throughout the pyramid is important to help clubs of all sizes and at every level. Our position has always been that an industry-led solution to the issue is the ideal. We have been pushing the Premier League and the EFL to come to a resolution on this issue and continue to urge them to do so. If no deal is forthcoming, it is clear that action will be needed to find a solution that protects the game, and we will set out more detail in the White Paper.

My Lords, I draw attention to my register of interests. I know the Minister is aware that I authored the independent review into duty of care back in 2017. One of the things I asked for was an ombudsman. Bearing in mind all the governing bodies that have been in the press, as well as the fan- led review, is now not the right time to raise sports governance up the political agenda and implement at least some of the recommendations that were made?

I was grateful to have the opportunity to discuss safeguarding with the noble Baroness and others in a recent debate about sport in the Moses Room. She is right that these matters are vital to make sure that everybody can participate in and enjoy football. The White Paper will set out some of the work that the Government will be taking forward but on these issues work must continue in other streams as well.

My Lords, will the Government take the opportunity of this discussion about the governance of football to address one of the great scandals of the professional game, which is the many millions of pounds that leak out of football to agents? Hundreds of millions of pounds throughout Europe find their way from supporters’ pockets into the hands of agents. When I was an agent in the talent business, the artist paid the commission, not the producer. This is a terrible scandal and this is an opportunity for somebody to commission a report to understand just how much money is leaking out of football into the hands of agents, who contribute absolutely nothing.

We are grateful to those who invest in football but we want to ensure that the money flows throughout the pyramid to encourage people to nurture talent, take up the game and play it to the best of their ability. The White Paper will set out some of the work that we are doing to take that forward, but we will be mindful of my noble friend’s points.

My Lords, will the Government’s White Paper deal with issues such as the ownership of Birmingham City Football Club? It is owned by a company that is registered in the Cayman Islands and its shares are traded on the Hong Kong Stock Exchange. Its single largest ownership block appears to be a Mr Wang Yaohui, a fugitive from China who now resides as a Cambodian diplomat but whose name does not appear to have any substantial listing in the club at all. What are fans meant to do when we have this appalling ownership structure with no transparency?

Support Villa.

So far, the football authorities have washed their hands of this.

The Government are fully aware of issues such as those raised by the noble Lord. Sadly, there are too many examples of why action is needed to reform football governance and make clubs sustainable in the long term. Through tougher tests for owners and directors, we intend to ensure that clubs have suitable custodians with suitable business plans. Later this week, the White Paper will set this out in more detail.

My Lords, can my noble friend the Minister say now and through the White Paper what is going to happen to tackle issues around equity, racism and discrimination in the game, particularly regarding stronger regulations and codes of conduct?

We want everybody to enjoy the national game, whether they are spectating or playing it; great work is being done to open the game up and ensure that, no matter their background, everybody can do so. There is our review of women’s football, which is finally receiving the attention that it has deserved for so long and inspiring young girls around the country to play football. All of this is important.

My Lords, is not one of the most crucial factors affecting football clubs—indeed, the whole of the professional game—the chasm that exists between the Premier League and everyone else, as my noble friend mentioned? I just want to know what, if anything, the Government plan to do to deal with this. It has a catastrophic effect on clubs being relegated from the Premier League, which lose not only money but, nine times out of 10, their attendances and their best players. We also know about the multi-million-pound game in the play-offs, which results in a team getting into the Premier League, or not, from the Championship. This really is a poison at the heart of the system. I suppose I should declare an interest as a long-time season ticketholder at Stoke City.

We are proud to have many world-class players and clubs in this country. We are grateful to those who invest in them and nurture rising talent in the game, but an important part of doing that is ensuring that the finances flow through the pyramid and inspire people at every level. More details will be set out in the White Paper.

My Lords, when we last discussed this, I mentioned a report that was produced for the Council of Europe and deals with the questions of agents, financial disparity in clubs, and fans’ participation. The Minister had not read that report; I hope that he has now done so. I am being very modest in not saying who wrote the report, but I hope that some of its excellent suggestions will be included in the White Paper.

My Lords, I am afraid that I still have not read it but I think I undertook last time to make sure that my right honourable friend the Sports Minister was aware of it. I have done so. I will look at it as soon as I have read the White Paper, which is out later this week.