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That this House has considered e-petitions 583310 and 584632, relating to football governance.
It is a pleasure to serve under your chairmanship, Ms Elliott, for this hugely important debate, and it is great to see so many Members in attendance and on the call list, even more so after a thumping 1-0 victory for England against Croatia. I am sure that Members from Wales and Scotland may not be feeling as perky, but obviously I look forward to the big game on Friday, when I expect England to give Scotland a sound thumping.
In this place, we often split along party lines in our debates, but I am confident that there will be an unusual level of consensus here today, because I think we all recognise the vital role that football plays in the communities that we have the privilege to represent. Before I get started properly, I must thank all those who took the time to share their views with me before this debate. I heard a wide range of opinions on this issue, but across the board—from club owners and ex-players to the fans who are the lifeblood of the game—it is fair to say that there is now widespread acceptance that change is needed.
I also thank Our Beautiful Game, the campaign group that includes senior figures from the game, such as David Bernstein, a former Football Association chairman, and Gary Neville, as well as my hon. Friend the Member for Maidstone and The Weald (Mrs Grant), who really got this debate rolling with her private Member’s Bill earlier this year. I thank Our Beautiful Game for lending its time and expertise to help me to prepare for today. I will give a special mention to my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch), who is leading the fan-led review of football for the Minister’s Department. I thank her for that and for the time that she has shared with me.
I have been a supporter of Leicester City since I was a wee boy of 16 years old—52 years. I say that because it does not have to be a big team for people to support it. Does the hon. Gentleman agree that fans care about the nature of the team? They care about more than the price of a ticket. They care about the integrity and history of their club. They care about team pride. That is what it is all about, and that is what fans want. They do not want a super league; they just want to support their club.
In advance of the debate, I spoke to members of the Foxes Trust, who were very complimentary about the dialogue they have with Leicester City’s owners. I know the hon. Gentleman was buzzing from Leicester City’s recent FA cup victory, and I am sure he will be cheering on Blighty in the upcoming game against Scotland; I will not put him on the spot with that one, but I am sure he will, secretly.
I could not agree more with the hon. Gentleman. Football clubs are massively important to the history and identity of their communities. In fact, communities were built around such clubs, as we saw in Bury. My hon. Friend the Member for Bury North (James Daly) has banged on relentlessly about that; I do not think there is any doughtier a champion for Bury football club’s return to its proper ways. In Burslem, the mother town of Stoke-on-Trent, is Port Vale, surrounded by the terraced houses of the old potbank workers. It very much is the beating heart of the community, as the Minister saw at first hand when he recently came to visit.
As Angus says about the 50+1 model, having fans in charge of key voting rights around the club would help to stop the clear greed of some owners and would allow clubs to be run in a way that benefits the fans, local communities and the good of the game. Clearly, there are some good owners who run their clubs sustainably and allow fans a good level of access to the behind-the-scenes running of the club. My bias will be obvious, but I will mention the Wembley of the north, Port Vale football club’s Vale Park, and Stoke-on-Trent’s second team, Stoke City; obviously I was being sarcastic there, before I get a deluge of abuse on Facebook. I am very lucky to have Port Vale in my constituency and Stoke City FC within the community. Both are run in a truly sustainable and fan-friendly way. To give just a few examples, Stoke City offer free travel for their fans and have frozen their season ticket prices for 14 successive years. Port Vale recently became the English football league community club of the year, having distributed more than 300,000 meals to local people in need during the pandemic. It also has the Port Vale Foundation; with the Hubb Foundation, it was one of the early pioneers in the holiday activities programme, which started in 2017 with the Ay Up Duck programme.
My hon. Friend has just made the key point. The fixed costs and wage structure of 99% of teams involved in English football are completely unsustainable. The wages paid out currently are simply unaffordable. My team, Bury, had 3,000 or 4,000 people watching every two weeks, and players were paid thousands upon thousands. How do we address that problem?
I know that Gary Neville is actually working on the salary cap committee that the EFL has set up to have a look at that very thing. My hon. Friend is right. Although Gary Neville used the term “redistribution of wealth”—as a Conservative, that made me shudder at the idea of socialism coming down the line—he meant that, at the end of the day, the Premier League holds all the wealth.
The Minister spent what probably felt like a long 10 months locked in a room with the head of the Premier League and the head of the EFL to come to some sort of consensus on bailing out clubs such as my beloved Port Vale in Stoke-on-Trent North, Kidsgrove and Talke. It should not have taken 10 months to come to that conclusion. Ultimately, football is for the fans, and in that moment, the fans were almost forgotten. I am very grateful to the Minister, who spoke regularly with me and other Members from across the House to keep us informed about what was going on in the negotiations. I am very grateful that he was able to bang heads together and get that important deal over the line.
Stoke City football club is owned by those who run Bet365, and although it would openly submit that it is not in need of financial support, it is very aware of clubs around it and below it that are, including Port Vale, which gets similar crowds to Bury. We need to see a fair share of the money in football trickling down, particularly to the grassroots, where the future generations will be coming through.
Those in the premier league have so much power that they can set their own punishment. The big six premier league clubs have been able to decide their own punishment for trying to break away and join the ESL, paying just £3.6 million each as a gesture of good will. Let us put that into context. These clubs spent more than £150 million over the last year on agents’ fees alone, and they seem to think that offering £3.6 million each is a suitable punishment for trying to destroy our beautiful game. Football has proven itself incapable of sorting itself out, and there is now a widespread consensus that an independent regulator is needed.
It is always a pleasure to serve under you as Chair, Ms Elliott. I thank the hon. Member for Stoke-on-Trent North (Jonathan Gullis) for his excellent introductory remarks and my Neath constituents for signing the petitions, and I congratulate Wales on securing a draw in their first Euro match last Saturday, despite not playing their best.
The anger and furore over the recent efforts of six English premier league clubs to a form a breakaway European super league sparked universal condemnation from fans, yet it demonstrated the importance of football to the sporting community and wider society, and was evidence of a deep disconnect between football clubs and the communities they once represented. Many clubs are now global business, far removed from the supporters and communities from which they were established.
At the heart of the problem is ownership. The defining feature was once supporters and their interests, but now the footballing model pushes clubs into greater financial insecurity at the hands of unscrupulous owners with scant regard for fans and communities. Fans are taken for granted, and it is taken for granted that they will always support their club, irrespective of their having no say in how it is operated. The UK Government’s fan-led review is welcome, but wholescale reform is needed, putting ownership at the forefront.
Fan ownership has been part of a campaign that the Co-operative party has been conducting for the past 20 years. In 2007, the Labour party and the Co-operative party founded the fan ownership organisation Supporters Direct and campaigned for funding and resources to enable supporters to start fan-owned trusts and then progress to take over their clubs. We fought for supporters to have a place on club boards, so that fans could have a voice. We campaigned for the community shares model often used in supporters’ trusts and to strengthen community asset legislation to prevent the sale of football grounds.
It is a pleasure to serve under your chairmanship, Ms Elliott. Football governance has been debated in Parliament and has been the subject of parliamentary and Government reports over the last 10 years. What all those reports have in common is a consensus that there needs to be more independent regulation and supervision of what happens within football, to stop bad things happening.
Many financial failures could have been resolved before they happened if there had been proper independent scrutiny of the finances of the clubs. Issues around ownership could be resolved if there were a fit-and-proper person test that could be administered against people when they buy clubs or during their management of those clubs. Time and again, we have seen that no such effective operation exists and that the football leagues simply do not have the resources to enforce that. Too often, when a club gets into difficulties, fans speak up, but find the football authorities can do nothing to help and, when they turn to Parliament, we do not have any legislative power to intervene.
If the fan-led review, the latest football governance review, is to be meaningful in its outcome, it needs to recommend an independent regulatory body that can oversee the financial management of clubs, have the power to intervene when things go wrong, see accounts to ensure clubs are spending within the limits of their rules and not overspending, and ensure that clubs are being run in a sustainable way, so that they are there for the future. These are the basic common failings. Why do they exist? Because football does not have an effective governing body in this country. It is run by a combination of vested interests that do not always agree with each other and at league level it is run by a rule book that is set and voted on by the chairs of the clubs themselves. Historically, they have not been interested in independent scrutiny of what they do.
The state of our national game has been a story of rich man, poor man, with the very rich clubs with billionaire owners seeking to make themselves even more revenue. We have seen that with Project Big Picture and the European super league. At the same time, much-valued and cherished local clubs such as Bury, Bolton and Wigan have not survived, or are struggling to survive. The major organisations in England—the Premier League, the Football Association, and the English Football League—are becoming both unable and unwilling to act responsibly in the interests of the wider game of football, and of supporters and their communities. It is therefore important to review the ownership structures and mechanisms of football clubs in this country so that they can be made to act responsibly, and to look at the governance of football clubs going forward so that they can be obliged to behave responsibly and conduct themselves in a manner that satisfies all the stakeholders in the game.
There are also a wide variety of levels of effective engagement and communication between clubs and their supporters throughout the various leagues in England. This can be improved in a number of ways, such as by allowing fans on to club boards and examining new methods of allowing fans to take some ownership of the club they support. In addition, carrying out comparisons between the organisation of leagues in other countries and those in this country could yield some answers. The often-cited 50+1 model in the German Bundesliga may not be implementable in England—although the Prime Minister has threatened that—but there may well be other ways of increasing fan influence over club decision making that fall short of that model. There is also some discussion about the ownership of golden shares, which could give some special ownership rights or privileges to fans, enabling them to bring additional influence to bear on decision making.
The governance of English football is broken; our national game, the beautiful game, is certainly in crisis; and now is the time for fundamental reform, reform that can only be achieved through the creation of an independent football regulator. This was the central recommendation of “Saving Our Beautiful Game—Manifesto for Change”, a report co-authored last year by a group of which I was a member. These experienced individuals, with a deep interest in football, brought everything together and produced a document that has proposed the creation of an independent football regulator. That regulator would be absolutely independent; would be funded from within football, not by public money; and would not require Government to run the game, which is extremely important.
The impact of an independent regulator would be more far-reaching than any of the specific responsibilities it would have, because an independent regulator would change the culture of the business of football in our country. Such a step would be a crucial milestone in the long-overdue process of rebalancing our national game, to make it a game that works just as much for the grassroots, the community, and the lower-league clubs as it does for the big six in the premier league. An independent football regulator would be an affirmation from this place that football is part of our history, our culture and our communities, and deserves protection.
I pay tribute to the Minister for the leadership he has already shown on this issue in recent months. I am also delighted that the concept of an independent regulator is to be considered by my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch). She is well suited to the task, and I know she will carry out a review that is both broad and forensic, and that places the opinions of the fans at its very heart. We know that an independent football regulator would enjoy enormous support from the footballing public across the country. The fact that the petition reached 100,000 signatures in less than 12 hours speaks for itself.
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The recent debacle of the European super league, which for football was the equivalent of the 2008 banking crisis, shocked everyone involved in the game. It showed why there is a real need to shake things up. Let us be clear: had the so-called big six succeeded with their breakaway attempt, football as we know it in our country would have died. Our premier league, the most watched and indeed the best league in the world, would have been split apart, and the pyramid of English football would have crumbled.
It was quite right that the ESL was met with disgust and ridicule across the board, and I am very pleased that for now it has been seen off. However, we know that football is now big business and the ESL is not the only reason why change is needed. Fans already had long-standing concerns.
There have been many examples of the identity of football clubs, which are essential to the identity of so many communities, being changed, with fans unable to resist that change. A couple of glaring examples spring to mind: the relocation of Wimbledon from its traditional home in London to Milton Keynes; and the decision by the owner of Cardiff City to change the club’s colours from the traditional blue to red.
Inappropriate owners may come in and run clubs in an unsustainable way, with devastating impacts on their local communities. Two examples of this came recently, with the sad demise of Bury in August 2019 and Wigan entering administration in July 2020. Unless we change the way football is run and ensure that clubs are treated not only as businesses but as community assets and heritage brands, these events will be repeated.
That brings me on to the first of our petitions, on the 50+1 model, submitted by Angus Yule. Angus launched the petition because he feels that this model of ownership would ensure that the decisions of our clubs fall into the hands of a collective of people who care about the good of the game, instead of just one owner. In Angus’s opinion, elite clubs especially are now run as businesses, with profit appearing to come before anything else and with fans’ loyalty exploited through expensive tickets and merchandise.
A small club, Milton United football club, raised £1,000 for a local lad, Ashton Hulme, who is getting a top-quality prosthetic leg. Sadly, due to a rare type of bone cancer, he lost his leg, and the academy at Crewe Alexandra have been doing fantastic work to support Ashton and his family at this difficult time, with more than £110,000 raised by local givers. As the hon. Member for Strangford (Jim Shannon) said, there are great clubs in the Premier League, such as Leicester City football club. The Foxes Trust tells me that it is broadly happy with how the club’s owners operate and the access it gets to the inner running of its club.
There are many more examples of owners who do not operate in this way, so I agree that there needs to be some reform, giving fans greater input into their clubs. There must surely be a way to protect key aspects of clubs, which are so much more than just businesses, so that their identities are not changed unrecognisably and they are run sustainably. However, the 50+1 model is not realistic for English football. It is hard to see how this kind of ownership structure could be brought in. I also have concerns about the impact it could have on our game. A range of voices, unsurprisingly including club owners but also fan groups, have said that the 50+1 model could seriously discourage investment.
In Germany, which made the 50+1 model famous, Bayern Munich has now won the Bundesliga nine years in a row. There is no significant investment into other clubs in the German league—unless we look at RB Leipzig, for example, where the fans and supporters are all Red Bull employees. One could say that that brings the beautiful game in Germany into disrepute. I do not think that anyone wants to see such things in our country. The 50+1 model is not the only reason, but it does seem to prevent ambitious owners coming forward. Frankly, owners will not want to invest in a club without being able to control its direction. If the 50+1 model is not the answer, what is?
One way to safeguard clubs for fans was suggested by Gary Neville. We could look at the 50+1 model as a veto or a voting structure rather than an ownership structure. Something along the lines of a golden vote on key decisions could be viable. To make changes to the club on heritage issues such as the name and location of the stadium, owners would need to seek the approval of supporters. Another option, as suggested by the Football Supporters’ Association, would be to let supporters buy equity in their club up to a certain percentage—10% or 15%, say—to give them a real say in how the club is run.
As well as giving fans more say in how their clubs are run, wider issues in football need addressing. That is really the crux of the debate and brings me to the second petition, which calls for the introduction of a new, independent football regulator. The petition, which was started by Alex Rolfe, calls for the Government to use the fan-led review of football’s governance to establish an independent regulator. Alex says:
“Like a referee, an independent regulator would safeguard our beautiful game impartially.”
He says that a regulator
“could protect the game against another attempt at a super league or other efforts to put money ahead of fans.”
Gary Neville and Alex agree that, like water companies, energy providers, financial services and the media:
“Football matters to millions and should also have a regulator of its own.”
It does seem that without an independent regulator, the glaring issues in English football will not be resolved. There is no overall leadership, so vested interests continue to prevail. The financial disparity between rich and poor has become obscene, frankly. The game is devoid of agreed priorities. The high-ups in football all know what the problems are, but to date there has been no collective will or incentive for the decision makers to get on with sorting it out.
As many of the people I have spoken to before today have spelled out, the issues are financial disparity and unsustainability, owner suitability rules, a power structure that is fundamentally out of balance, societal issues such as racism and homophobia in the game, and the exploitation of clubs and fans. Gary Neville put it well when he said that the banking crisis was the moment an independent regulator was needed. The European super league is the equivalent crisis in football, and if we are to ensure that the game remains something that we can enjoy as fans, as well as export around the world, the crunch time has arrived.
I will give a few examples to illustrate the scale of the problems. The team placed 20th in the premier league—thankfully, it is not my team, Fulham, which my grandmother indoctrinated me into supporting at the age of five—gets £100 million, whereas the winner of the championship gets just £6 million. Financial sustainability is in real danger, with clubs in the championship spending £837 million on wages despite receiving only £785 million of income in 2018-19.
What would that independent regulator look like? We all agree that for a regulator to have real bite, it must be independent of current structures such as the premier league clubs and the FA. It must sit above the existing bodies and be able to enforce targets and judgments without the game structures. As voices such as the former Governor of the Bank of England Lord King have emphasised, the regulator will need an emphasis on financial as well as legal knowledge, to enable it to decide on new ways of distributing funds to the wider game, based on a funding formula to spread funding more fairly throughout the English football pyramid. This will also be important in introducing a new, proper, robust process to check owners before they take on a club. Indeed, it is not just the fans I spoke to who agreed on the need for a proper test of an owner’s suitability; that opinion was also shared by the owners I spoke to.
Supporters’ groups and those with experience of the game at the highest level agree that the regulator must not have any role in how the game is played. For example, it must not have a role in deciding on the place of VAR—the video assistant referee—in football, but must be limited to governance issues. There is also the question of how long a regulator would need to operate for. There seems to be a consensus among a cross-section of people involved in football that the FA should really be the regulator. However, it is a commercial organisation, as well as having some regulatory functions, so it does not really work. It is also reliant on the Premier League for its income, so is not independent in any meaningful way. An independent regulator could be set up, lead change in the game for a few years and then hand over to the FA once it has been made fit for purpose.
On the societal problems in football such as racism and homophobia, as well as representation of different groups, there are already targets in place. However, a regulator could enforce those targets and punish those who continue to pay only lip service to them. As David Davies—former executive director of the FA and member of the Our Beautiful Game campaign group—has said, football has the power to be a fantastic force for good. How to enable it to be a power for good is the question.
The Football Association and governing authorities should welcome community ownership as a necessary means to safeguard clubs and ensure their survival. Football clubs are too precious to their communities and supporters to be at the mercy of unregulated, unscrupulous owners, and suffer weak governance from the Football Association, which is unwilling to take on those with vested interests in the game. A robust, effective, independent regulatory framework, with statutory backing, is vital to safeguard football.
Unless supporters can influence or have ownership of clubs or assets, we will continue to be second-class spectators. The 50+1 rule is the ownership model in the majority of German football clubs; commercial investors are unable to gain a majority share and supporters retain a majority of voting rights. The rule would not be suitable for shared ownership of the top English premier league clubs that have invested millions of pounds, but would be suitable as a voting structure. The five parts of the game should work together for the benefit of football.
Football clubs are unlike any other business. They deserve to be run in a sustainable way. The community should expect that they will be there for future generations to enjoy. They are cultural assets, really. Yes, they can be run in a commercial way and they can be competitive, but they have to be run in a sustainable way as well.
In other industries, such as broadcasting, we have regulators in place with certain special powers that mean they can intervene and even withdraw the licence to broadcast, should they need to. Such a regulator in this country for football would similarly need a golden share. I believe it should be independent of all the existing football bodies, including the FA, have a strict and limited remit regarding the financial performance and governance of clubs, and have very clear powers to intervene and even to put clubs into a form of sporting administration if things go wrong.
The review should also consider other aspects of commercial pressure in football that can have a detrimental impact, particularly the relationship between agents, clubs and players, where agents can end up representing all three parties in a transaction. It is difficult to break that model when clubs want to sign players. These are other financial issues that a regulator could look at. This is a reform that has been long needed to make football sustainable.
There is a view that foreign owners should be treated differently for a variety of reasons, some relating to human rights and some political. Those views could be put under the remit of the football regulator and taken into consideration when the licensing process takes effect. However, in my view, where clubs have been shown to have conducted themselves responsibly over the years, there should be no attempt to not grant a licence when the owners of the club are not responsible for the behaviour of the Government or regime of the country in which they reside, or from which they come. The review should not be an excuse to bash foreign owners who have made investments in, and brought tremendous footballing talent to, this country.
There is no doubt in my mind about the need for a regulator who can exercise his or her powers through such a licensing system. Too often, clubs have not taken their responsibilities seriously, or indeed have not accepted that they have them. Their financial responsibilities have been made clear, but clubs should have additional responsibilities in how they engage with fans, and social responsibilities to ensure that players and fans do not engage in behaviour that would bring the game into disrepute. By that, I do not just mean violence or hooliganism: I believe in taking a firm stance on issues such as racism and homophobia. In my view, the regulator should have the power to do what individual football clubs, the Premier League, the FA and the English Football League have failed to do over the years, which is to properly regulate and police the game so that clubs have responsibilities as well as rights. That approach is far preferable to commentators, fans, and even Government Ministers giving their views from the sidelines, and nothing changing in the process.
Association football is the most popular sport in the entire world and is played by more than 250 million people in over 200 countries. It was born in England over 150 years ago, and it has a huge connection with communities across the length and breadth of our country, but if we want to protect and preserve that fabulous heritage for generations into the future, our football governance needs emergency surgery, and it needs that surgery now. Let us drive through the radical change required, let us create an independent football regulator, and let us make the governance of this beautiful game, which we all know and love, fit for the 21st century.