House of Lords
UK Entrepreneurs
(1 week, 1 day ago)
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Lord Londesborough
To ask His Majesty’s Government what steps they are taking to encourage entrepreneurs to start up businesses in the United Kingdom.
Lord Londesborough (CB)
My Lords, in begging leave to ask the Question standing in my name on the Order Paper, I declare my interests as set out in the register.
Lord Leong (Lab)
My Lords, the Government continue to provide support for entrepreneurs, including through start-up loans via the British Business Bank and programmes such as growth hubs across England and the Help to Grow: Management course across the UK. The Government will also publish a small business strategy next year, which will outline our vision for boosting scale-ups and helping all types of small businesses to thrive and grow, empowering entrepreneurs to innovate, export and create jobs across their regions.
Lord Londesborough (CB)
I thank the Minister for his response and I am delighted to see a fellow entrepreneur on the Front Bench—unlike in the other place. Fundraising for start-ups, in the quarter to September, dropped by almost 50% to a six-year low. Both start-ups and scale-ups have been hit by the toxic trio of measures: hikes in capital gains tax, hikes in employers’ national insurance, and hikes in the minimum wage running at three times the rate of inflation. First, on behalf of entrepreneurs, I ask: when will we see meaningful measures to encourage, rather than punish, job creation and risk-taking? Secondly, whatever happened to the Chancellor’s pledge to run
“the most pro-growth Treasury in our country’s history”?
Lord Leong (Lab)
I thank the noble Lord for his kind words. We have something in common in that we both founded our respective publishing companies in the 1980s, in the tail-end of the recession and through very challenging economic times. The difference is that he went on to build a huge business empire, compared with mine.
There were definitely fewer funding rounds for start- ups in the last quarter. The age of FOMO—the fear of missing out—on investment, which caused a spike in the last couple of years, has to a certain extent come and gone. However, angel investment, such as EIS with tax rebates of 30% to 50%, remains robust and I am pleased that the Chancellor has now given certainty that this will stay in place until 2035.
The Government’s new modern industrial strategy—
Lord Leong (Lab)
Well, the noble Lord asked a pretty long question so I am trying to respond to him. The Government’s new modern industrial strategy— Invest 2035—for high-growth areas such as advanced manufacturing, AI, creative industries, life sciences and others, will drive our growth mission. The Government will publish a small business strategy next year, which will include further measures to encourage greater entrepreneurship and provide a strong business environment.
Lord Clarke of Nottingham (Con)
Does the Minister agree that the best way to attract investment to this country is for the Government to demonstrate some economic competence and fiscal discipline? Will he therefore agree that the Government should stop promising that in no circumstances will they ever raise the basic taxes of this country, which provide most of our revenue, and will stop piling on additional debt, which it is their duty to begin to get under control? If we continue to simply freeze our tax revenues and pile on more debt, very few people will find this a very attractive country to come to.
Lord Leong (Lab)
My Lords, most of the 95% of UK businesses, which employ something like 16 million people, will not be affected by any of the tax rises. I do not wish to remind noble Lords of the black hole we inherited, but we had to make difficult decisions to restore economic stability and fund our public services. We are doing the hard job early and fixing the foundations in one. After all the chopping, changing and chaos of the last few years, we now have a stable, pro-business, pro-worker Labour Government, offering certainty, consistency and confidence. That is what investors, businesses and entrepreneurs want.
Lord Sahota (Lab)
My Lords, in spite of Black Friday and the run-up to Christmas, many small high street businesses report low footfall and a concern about their continued viability. Many of those businesses will be looking forward to the Government’s business rate reform. Could the Minister outline what other steps will be taken to support Britain’s high streets and to safeguard their place at the heart of our communities?
Lord Leong (Lab)
My Lords, high streets are the beating heart of our communities, but for far too long, too many of them have been neglected and more and more empty lots are boarded up. We are giving local councils the tools to take back control, putting local communities first, re-energising town centres and driving local communities and opportunities. New measures were announced in the Budget to freeze the small business multiplier for most properties; to lower business rates for leisure, retail and hospitality; and to provide access to finance, committing some £250 million in 2025-26 for small business loans. Now shutters on our great British high streets will be lifted, delivering real action across the board.
Lord Kennedy of Southwark (Lab Co-op)
We will have the Liberal Democrat Front Bench next, please.
Lord Fox (LD)
My Lords, when the Minister answered the noble Lord’s original Question, some of it got missed—happily, that was what I was planning to ask. Most entrepreneurs start as small or medium businesses before they become big, powerful businesses. It is very clear that the rise in NIC has hit those businesses disproportionately. As a result, there is less money for them to invest for growth and innovation. When the Treasury was considering that rise, it must have traded off future growth for short-term tax revenue. Was that the view of the Treasury at the time and why was it the view of the Treasury at the time?
Lord Leong (Lab)
My Lords, as much as I would love to indulge the noble Lord with an answer, I had best leave all Treasury questions to my Treasury colleagues. As I said earlier, most small businesses will not be affected by the employers’ national insurance rise. At the end of the day, we need confidence and to attract investment to this country, and to allow small businesses to have access to funds. I mentioned the tax reliefs earlier. The EIS, SEIS and VCT are tax reliefs where investors can gain 30% to 50% tax relief immediately and pay no capital gains tax. Those are the tax reliefs that businesses want; and to scale up, there is access to funding from the alternative market and from crowd- sourcing funds, such as Republic Europe and Crowdcube.
Lord Brownlow of Shurlock Row (Con)
My Lords, I declare an interest in having started several businesses, the first of which went on to pay £2 billion in tax. I have learned a bit about starting businesses. I would have liked to hear something from the Minister that did not include the phrases “fixing the foundations” or “the £22 billion black hole”. Given all that he has said, why has market and business confidence collapsed since 4 July?
Lord Leong (Lab)
My Lords, I thank the noble Lord for his question. The Government are committed to attracting investment. That was illustrated in our recent International Investment Summit, where £65 billion was pledged in this country, showing confidence in the Government. I remind noble Lords that in the past few years, FTSE 100 companies have been sitting on a gross cash pile of close to £160 billion, with pre-tax profits ranging from £500,000 to around £2 billion. Shareholders’ dividends have been rising three times faster than wages. We should pay staff well and pay suppliers on time. If more money is spent, companies will make bigger profits—it is a win-win situation.
Baroness Neville-Rolfe (Con)
I have listened to the Minister. Does he acknowledge that the measures announced in the Budget, such as the increase in capital gains tax, make the UK look like a less attractive place for entrepreneurship?
Lord Leong (Lab)
My Lords, I am afraid that I do not agree. Are we saying that entrepreneurs, before starting a business, will ask themselves, “Am I not going to invest and start a business because national insurance has gone up?” No, they will not. They know that this country is still the best place to start a business. This country is the start-up capital of Europe and attracts the best people to start their businesses here—and it is best place to start them now.
Higher Education Sector
(1 week, 1 day ago)
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Lord Blunkett
To ask His Majesty’s Government what steps they have taken to promote the attractiveness of the higher education sector, and what work is being undertaken by the Department for Education and the Foreign, Commonwealth and Development Office to promote the sector internationally.
Lord Blunkett (Lab)
My Lords, I beg leave to ask the Question standing in my name and draw attention to my declaration of interests.
The Minister of State, Department for Education (Baroness Smith of Malvern) (Lab)
My Lords, this Government are committed to maintaining our world-leading higher education sector and promoting its attractiveness internationally. The Secretary of State for Education, in her first speech, set out the valuable contribution that international students make to our universities, communities and country. We are also working with FCDO and DBT colleagues on a new international education strategy, to ensure that we are maximising the impact of our education system globally.
Lord Blunkett (Lab)
My noble friend and I know, to our cost, how difficult it is to get the Home Office—or the ONS, for that matter—to change its mind about anything as the world changes around it. Given that international students pay very large sums of money to receive a service and bring enormous amounts of funding and cultural improvement to our country, is it not time to persuade the Home Office to take international students out of the migration statistics?
Baroness Smith of Malvern (Lab)
My noble friend is right in several of his comments, including that international students enrich our campuses and communities, form lifelong friendships, become global ambassadors and contribute to the economic benefits of this country—which is why they will always be welcome. The Office for National Statistics is of course independent in producing its statistics, but I encourage people to look at the detailed breakdown of migration statistics that it also provides, which identifies different elements of migration. As I have always done in my ministerial life, I will continue to listen to my noble friend and do what I can to work on the priorities that he puts to me.
Baroness Coussins (CB)
My Lords, one of the problems with the Turing scheme not being reciprocal is that it is much harder for universities to form international partnerships. Have His Majesty’s Government assessed the impact of that on the sustainability and reputation of our higher education sector?
Baroness Smith of Malvern (Lab)
It is right that the Turing scheme funds UK students to engage internationally in all stages of education, but it is not the case that there are not also other forms of support, including through our colleagues in DSIT, for international partnerships in the areas of both research and teaching and university co-operation. If we look, for example, at the value of transnational education, where UK universities have sites in or relationships with other countries, we see a growing sector, and these are all areas that we will want to look at in the international education strategy.
Baroness Barran (Con)
My Lords, this week saw the most extraordinary announcement from the Office for Students that it was suspending its activity in relation to new registrations, new applications for degree-awarding powers and new applications for university title until at least August 2025 to allow it to focus on the financial sustainability of the sector. Does the Minister agree with me that this sends the most terrible message to students both in this country and overseas, and risks undermining the financial sustainability it seeks to achieve?
Baroness Smith of Malvern (Lab)
No, I do not agree with the noble Baroness. In fact, the message that it sends is that this Government, unlike the last, are determined to ensure that we put universities on a firmer financial footing. We are not willing to sit by, as the last Government did, while universities face considerable financial pressure. That is why we asked the Office for Students to refocus on the issue of financial sustainability, to help to create a secure future for our world-leading universities, and it is also why we were willing to take the difficult decision to increase tuition fees this year, in order to provide some additional finance for universities in very straitened times.
Lord Kennedy of Southwark (Lab Co-op)
We will hear from the Lib Dem Benches next, please.
Lord Addington (LD)
My Lords, I thank the Chief Whip. If we are going to make sure that the universities are accessible to our own students, can we have an indication of what level of support we are expecting to get from foreign students, and have that discussion out in the open quickly?
Baroness Smith of Malvern (Lab)
It is already the case that the earnings that come from international students’ contribution to universities are helping to subsidise the cost of domestic students. There is not a lose/lose here. Having international students and welcoming them into this country has benefited our domestic students and benefited universities’ research capacity.
Viscount Hanworth (Lab)
Does the Minister not recognise that we are in the process of destroying our universities through swingeing cuts to their staff that have been occasioned by their financial distress? A denuded universities sector will not be attractive to foreign students. Moreover, the present conditions of service of university staff deter people from joining the academic profession.
Baroness Smith of Malvern (Lab)
Yes, this Minister does recognise that, which is precisely why this Government, unlike the last Government, have taken action to put universities’ finances on a more sustainable basis. It is fundamentally important that we can protect our world-leading universities sector, ensure that the staff doing such an important job there are supported and attract students, both domestic and international, to the benefit of them and of our country.
Lord Patel (CB)
My Lords, following on from the comments made by the noble Lord, Lord Blunkett, which I support, we have something like 113,000 PhD students in the country, of which 43,000 are international students. They are highly talented. They would like to stay here when they complete their studies and, for this to happen, the Government need to introduce more stability in migration policy for both students and post-docs. If they stay here, because they are talented and have completed their PhDs, they will grow our economy and innovate, so I hope the Minister will have some comments to make about how this could happen.
Baroness Smith of Malvern (Lab)
The noble Lord is right that it is important that the graduate route visa has been protected. It allows international students, in the case of PhD graduates, to stay for an additional three years to contribute and look for work. I think that that is appropriate, given the contribution that they make, as the noble Lord says.
Lord Johnson of Marylebone (Con)
My Lords, I draw attention to my interests on the register. I share the shock of my noble friend Lady Barran at the OfS’s decision to suspend applications to the register. This sends a terrible message to investors around the world and will deter institutions that want to follow trailblazers such as Dyson, NMIT, LIS and TEDI in bringing innovation and choice to our higher education system. If the Office for Students cannot handle the duties that Parliament has given it, should it not delegate back to the Quality Assurance Agency the quality assurance function that it has taken from it?
Baroness Smith of Malvern (Lab)
Well, I simply reiterate the point that it is important that this Government have gripped the issue of financial sustainability and have asked the OfS to focus on it. The OfS has made its decisions about where to focus its capacity to enable it to do that. I take seriously the point that the noble Lord made, but it is the role of the OfS as the regulator of the sector to regulate, to ensure that we have the sort of quality that—I disagree with the noble Lord—will continue to attract students, researchers and others into the UK.
Baroness Fox of Buckley (Non-Afl)
My Lords, over the years, many international students, especially from less democratic countries, were attracted to UK universities because of their reputation as beacons of free speech. Tragically, more recently such students have complained that they find British campuses as censorious as at home. In this context, will the Government reinstate the shelved Higher Education (Freedom of Speech) Act? On a related point, will the Minister reassure us that this legislation was not withdrawn to appease repressive regimes that like the UK university brands but dislike legal commitment to academic freedom?
Baroness Smith of Malvern (Lab)
I can absolutely assure the noble Baroness that that was not the case, as I have said repeatedly in this House. But it is the case that the last Government’s freedom of speech legislation would have been overly burdensome on universities and would potentially have had unintended consequences. As I have also said, we will come back soon, following our pause of the legislation and our wide engagement with stakeholders, to spell out the next steps for this Government in protecting academic freedom and freedom of speech in our universities.
Shared Prosperity Fund: Wales
(1 week, 1 day ago)
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Baroness Wilcox of Newport
To ask His Majesty’s Government what progress they have made towards giving decision-making over the allocation of the Shared Prosperity Fund to democratic representatives in Wales, as set out in the Labour Party Manifesto 2024.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)
This Government are committed to restoring relationships with devolved Governments and showing the utmost respect to the devolution settlement. We are working closely with the Welsh Government to discuss our commitment to restore decision-making on structural funding to representatives of Wales. My noble friend will be pleased to hear that my colleague, Minister Alex Norris, will meet his ministerial counterpart in the Welsh Government this week to discuss this very important issue.
Baroness Wilcox of Newport (Lab)
I thank the Minister for that Answer, because the era of doing things to Wales, rather than with Wales, is surely at an end. When will proper devolved decision-making reflect both our distinct Welsh needs and UK-wide objectives? While I am on my feet, let me say llongyfarchiadau mawr—many congratulations—to the Wales women’s football team on reaching the Euro 2025 finals and making history.
Lord Khan of Burnley (Lab)
My Lords, I add my congratulations to the Wales women’s football team on reaching the Euro 2025 finals.
My noble friend makes a very important point. Having worked alongside her for many years, I have deep respect for her passion for the prosperity of local government in Wales. This Government know that uncertainty about local allocations is causing concern for our partners in local government. My department is working tirelessly to confirm local allocations and we intend to publish them shortly. I am pleased that we have been able to announce that the fund will continue for a further year. This transitional arrangement will provide a period of stability in advance of wider local growth funding reforms beyond March 2026, when we will work with the Welsh Government to honour our manifesto commitment to return decision-making on these funds to representatives of Wales.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, llongyfarchiadau i chi on bringing football into this Chamber—a rare event these days, of course. The shared prosperity fund was a central part of the Conservatives’ levelling-up agenda, which involved the allocation of funds to elected local authorities, which know their communities best. Given that the shared prosperity fund already works with local authorities throughout Wales, what benefit will be achieved by extending decision- making powers to Senedd Members, who are not always known for their sensible financial decision-making?
Lord Khan of Burnley (Lab)
My Lords, I politely disagree with the noble Baroness. The previous Government funded many local growth programmes, including the UK shared prosperity fund. However, they did not make adequate provision in the Budget to do so. This Government have been clear that they will take the difficult but responsible decisions to ensure we fix the foundations of our country’s finances and, more importantly, meet the commitment in our manifesto. From March 2026, we will work with our Welsh Government counterparts to ensure that the allocation of that money is decided by people in Wales.
Lord Watts (Lab)
My Lords, the previous Government announced a levelling up fund, but we saw a lot of words but no funding. Will this Government’s attempt to level up be more successful in getting more resources to the regions that need them?
Lord Khan of Burnley (Lab)
My noble friend raises an important point. Many aspects of levelling up did not work, not just in Wales but across the United Kingdom. The Government are having a transitional year, during which we will work with our Welsh Government counterparts to ensure what is best for local projects and local communities. As for the future, the answer is yes: we will ensure that the Welsh Government have enough time to plan and decide on structural funding so that they have the best ability to put the money into their local communities.
Baroness Humphreys (LD)
Llongyfarchiadau mawr i dîm merched Cymru o’r beinciau yma hefyd—congratulations to the Welsh team from these Benches as well. I draw your Lordships’ attention to my registered interests. I thank the Minister for his announcement. It will bring some clarity about what will happen to the voluntary sector in Wales in the next 12 months. There has been uncertainty, added to which the third sector will be hit by the NICs rise, which will lead to higher costs that will need to be covered in any follow-up funding. Will the Minister ensure that the input and involvement of the third sector is sought through the NCVO and the WCVA, and that multiple-year funding agreements are in place to ensure the continuation of vital projects?
Lord Khan of Burnley (Lab)
My Lords, the noble Baroness makes an important point. The short answer is yes: we will ensure that our counterparts in Wales have those discussions. I will pass the message on to my honourable friend in the other place so that the third sector is also a part of his discussions with the Welsh Government on how we can work closely together as central government, devolved government and the third sector.
Baroness Smith of Llanfaes (PC)
My Lords, at present, Wales gets 23% of the shared prosperity fund. If the SPF is included in local government funding in England, this risks money being redirected through the Barnett formula. Will the Minister agree that a needs-based formula is better than a population-based formula for funding?
Lord Khan of Burnley (Lab)
I understand the noble Baroness’s point. However, we have to recognise that there were no plans from the previous Government for the funding going to the devolved Governments. We have brought in a transitional year to prepare for post March 2026. All these conversations are yet to be had. I cannot make any particular comment on them, but I will come back to the noble Baroness once we finalise our proposals for after March 2026.
Lord Evans of Rainow (Con)
My Lords, can the Minister give a definition of shared prosperity? Can he enlighten the House on what role private sector business will have in that shared prosperity in Wales?
Lord Khan of Burnley (Lab)
I thank the noble Lord. As I said to the noble Baroness, Lady Smith, we are having discussions with all counterparts. However, it is important to recognise that people in Wales will have a huge say on how that money will be invested in terms of local growth, businesses and working together in partnership.
Lord Hain (Lab)
My Lords, I associate myself with my noble friend Lady Wilcox’s question, including her congratulations for our magnificent Welsh women footballers. Does the Minister agree that the previous Conservative Government penalised Wales massively, including by pretending that the shared prosperity fund could somehow substitute for European Union economic funding? Taken together, the £243 million loss of rural EU funding and the £772 million shortfall in EU structural funds add up to more than £1 billion. So much for making Brexit work; for Wales, it has been absolutely disastrous.
Lord Khan of Burnley (Lab)
My Lords, I agree with my noble friend. The previous Government made no plans for the UK shared prosperity fund past March 2025. We will extend the fund for a transitional year. Many local growth programmes, including the UK shared prosperity fund, were funded by the previous Government despite them not making adequate provision in the Budget to do so. This Government have been clear that they will take difficult but responsible decisions to fix the foundations of the country’s finances.
Lord Harlech (Con)
My Lords, I declare my interest as a business owner in Wales. You cannot have prosperity without good infrastructure. Since 2023, the Welsh Government have cancelled all roadbuilding projects. I have asked this question before: will the Minister seek to have discussions with his Senedd counterparts about getting some of those roadbuilding projects going again?
Lord Khan of Burnley (Lab)
I have great admiration for and friendship with the noble Lord from the previous Government, when I was an Opposition Whip and he was a Whip. These are the conversations that my honourable friend Alex Norris MP is currently having, so I would not like to pre-empt them. I will also be visiting Wales to meet my counterpart in my portfolio, and I will raise that particular point.
Baroness Hayter of Kentish Town (Lab)
We look forward to welcoming the Minister to Wales. Can he say, more broadly than the fund, what action the Government are taking to spread growth and prosperity more evenly across Wales?
Lord Khan of Burnley (Lab)
My noble friend makes an excellent point. The UK Government are committed to addressing regional inequalities and supporting growth across the whole of the UK. Through the Council of the Nations and Regions, we will address this, working with devolved Governments. As well as the shared prosperity fund, we are taking other initiatives. For example, we will continue to support the four city and growth deals which cover the whole geography of Wales. Through the freeports and investment zones programme, we are delivering significant economic interventions into each corner of Wales, with freeports established in the north-west and south-west of Wales, and great progress has been made on establishing investment zones in north-east and south-east Wales. When I visit Wales, I promise that I will learn a few words of Welsh.
Georgia: Political Situation
(1 week, 1 day ago)
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Lord Harries of Pentregarth
To ask His Majesty’s Government what representations they are making to the government of Georgia about the political situation in that country following its recent elections.
The Parliamentary Under-Secretary of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)
My Lords, the Minister of State for Europe, North America and the Overseas Territories raised concerns about Georgia’s political trajectory with the then Foreign Minister Ilia Darchiashvili on 9 October. The Minister made a statement on 27 October to support election observation findings and calling for irregularities to be investigated. He made a further statement yesterday calling on the Georgian authorities to de-escalate the situation and reverse their path away from European values.
Lord Harries of Pentregarth (CB)
I thank the Minister for her reply. The situation in Georgia is extremely worrying, as I am sure she agrees. The Georgian people are firmly orientated towards Europe, but President Putin is manipulating the whole situation to draw Georgia into the orbit of Russia. There are sinister signs of KGB tactics at work, with opposition members having secret files on them. The pivotal figure is Bidzina Ivanishvili, who owns much of the business and media in Georgia and controls the Georgian Dream party behind the scenes. Will His Majesty’s Government follow the example of the Baltic states in sanctioning Bidzina Ivanishvili and his cronies?
Baroness Chapman of Darlington (Lab)
The noble and right reverend Lord knows what I will say about sanctions specifically, which is that we do not pre-announce our sanctions or our intention to designate any subject of our sanctions. However, he is absolutely right to highlight the track record of Russia in interfering in democracies, not least in Georgia. I recommend that noble Lords who are interested in this look at the OSCE interim report on these elections, which highlights some serious concerns.
Lord Blencathra (Con)
My Lords, as the first ever elected chair of the new Council of Europe expert group on observing elections—that sounds grander than it actually is—I was the only Brit on the Council of Europe delegation to Georgia three weeks ago. I have done nine of these, and it was the first time that I ever experienced personal intimidation and my vehicle was sabotaged. I draw the Minister’s attention to the joint press release issued the next day by the Council of Europe, the OSCE and NATO. It is a very watered-down version of what happened because, inevitably, the OSCE and NATO wanted not to be too nasty to Georgia. I also draw her attention to the PACE report that was published last week, which exposes the massive intimidation by Georgian Dream, orchestrated at a very high state level. I suggest to her that that report is quite authoritative, and it casts doubt on the whole election result
Baroness Chapman of Darlington (Lab)
The noble Lord is completely right, and I respect the fact that he was there so recently and took part in that process. I will read the PACE report; I have read excerpts from it, but I will read it in full, as he suggests. We are deeply concerned, as he alluded to, about the intimidation not just of observers but of voters, as well as the whole atmosphere around the elections and in the period leading up to them. I thank the noble Lord for the work that he has done and for bringing it to this House’s attention.
Lord Purvis of Tweed (LD)
My Lords, does the Minister agree that it is the young people of Georgia in particular who need to be commended, because they are seeking to exercise their democratic and civil rights and they have been persecuted? I heard what the Minister said with regard to sanctions, but the United States has issued restrictions on those who have persecuted young people since the elections. Does the Minister agree that no Georgian official who has orchestrated attacks on young people in Georgia exercising their rights should have preferential visa access to the United Kingdom or be able to exploit certain conditions where the United States has said they are not justified?
Baroness Chapman of Darlington (Lab)
We take close notice of what our allies are doing in relation to Georgia at the moment. I sometimes feel, when the noble Lord, Lord Purvis, asks these questions, that he has something specific in mind and is inviting me to guess what it might be. We will be using all the levers at our disposal to try to do right by the people of Georgia who, as far as anyone can tell, have not changed their desire to seek a democratic outcome. We have concerns that we think need to be investigated. It is up to the people of Georgia to choose who governs them and to choose whether they tilt to the West or to Russia. That is their choice, and it must be a choice that is made freely.
Lord Cromwell (CB)
My Lords, perhaps at one level there is a certain irony in the UK involving itself in the EU accession desires of other states. More seriously, I associate myself with all the comments that have been made, including by the Minister. It is essential that we keep pressing the Georgian Dream party, which fought long and hard to get candidate status to join the EU, on why that has now been put on the back burner, particularly given the protests that have arisen directly from it.
Baroness Chapman of Darlington (Lab)
That is a question on many of our minds. However, I do not think we are trying to involve ourselves in any other country’s decisions relating to accession or otherwise. The principle that we seek to stick to is that this must be a choice made by the people of Georgia freely and democratically, and free of interference from other states.
Lord Callanan (Con)
My Lords, it is clear from the experiences of my noble friend Lord Blencathra and other observers that the recent parliamentary elections in Georgia were indeed seriously flawed. There were many credible reports of Russian interference—something that, sadly, seems to be happening with increasing frequency in various other countries as well; there were similar allegations in Moldova, Romania and other countries. Is the Minister working with international partners to counter this malign influence in the democratic systems of so many of our partner countries?
Baroness Chapman of Darlington (Lab)
Yes, I can confirm that we are doing that, and our Minister of State, Mr Doughty, is having many meetings at the moment—bilaterally and multilaterally—to try and make that very point.
Lord Dodds of Duncairn (DUP)
My Lords, like the noble Lord, Lord Blencathra, I had the honour of being part of the OSCE election monitoring mission last month and we witnessed the intimidation and election malpractices of the Georgian Dream party. But what we also witnessed was the tremendous courage, dedication and work of NGOs, and of many young people in particular, at the polling stations and throughout the length and breadth of Georgia. Can the Minister tell us what can be done with our international partners to strengthen support for and solidify the work of those NGOs?
Baroness Chapman of Darlington (Lab)
We are very clear that what we have seen the NGOs and civil society more generally experience in Georgia recently is unacceptable, and we will work in any way that we can. This is something that is quite deep-rooted—our concerns about this are not just new and relating to this election, as we have seen cyberattacks and risks to cybersecurity in Georgia that we have tried to work to strengthen and protect it against. The truth is that this is getting more and more difficult, and these elections have really brought things that have been going on for some time to a head.
Lord West of Spithead (Lab)
My Lords, does my noble friend the Minister agree that this exemplifies why we must thwart Putin in Ukraine, because his malign influence in places such as Georgia, Transnistria, Moldova and, indeed, the western Balkans is becoming worse because he is becoming emboldened and causing real difficulties. His malign influence is causing huge destruction of some of the constructs that we put in place after the Second World War.
Baroness Chapman of Darlington (Lab)
I have spoken many times in this House about this Government’s unwavering support for Ukraine and the fact that we will be alongside it for as long as it needs us. The noble Lord is right to raise that, but it is also true that the impact of Russia’s illegal invasion of Ukraine is causing fear among other states and influencing some of the decisions they are taking. Our position will always be that it is for the people of any nation to decide which way they wish to look. You can see some of this playing out in Georgia, and it is something that we are very mindful of and are keeping a careful watch on.
Lord Ahmad of Wimbledon (Con)
My Lords, in agreeing with the noble Lord, Lord West, I also say to the Minister that we must reassure Georgia because Russian aggression was first impacted on Georgia with South Ossetia and Abkhazia. What assessment have the Government made to ensure that the territorial sovereignty of Georgia is fully protected?
Baroness Chapman of Darlington (Lab)
The noble Lord is absolutely right, and the territorial integrity of Georgia must be respected by all, including Russia, and we will be firm in that position.
Road Transport (International Passenger Services) (Amendment) Regulations 2024
(1 week, 1 day ago)
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Lord Hendy of Richmond Hill
That the draft Regulations laid before the House on 28 October be approved.
Relevant document: 7th Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 2 December.
Financial Services and Markets Act 2023 (Addition of Relevant Enactments) Regulations 2024
(1 week, 1 day ago)
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Lord Livermore
That the draft Regulations laid before the House on 31 October be approved.
Considered in Grand Committee on 2 December.
Proceeds of Crime Act 2002 (Search, Seizure and Detention of Property: Code of Practice) (Northern Ireland) Order 2024
(1 week, 1 day ago)
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Lord Hanson of Flint
That the draft Order laid before the House on 31 October be approved.
Considered in Grand Committee on 2 December.
Football Governance Bill [HL]
Wednesday 4th December 2024
(1 week, 1 day ago)
Lords ChamberRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Watch Debate Amendment Paper: HL Bill 41-III Third marshalled list for Committee - (3 Dec 2024)
Lord Kennedy of Southwark (Lab Co-op)
My Lords, before we commence Committee, I remind noble Lords that we need to make substantial progress on the Bill. This is now the third day in Committee, so there should be substantial progress today.
Clause 2: Key definitions
Amendment 19
“(3) For the purposes of this Act a “specified competition” includes—(a) the Premier League,(b) the English Football League, and(c) the National League.(3A) The Secretary of State may by regulations made by statutory instrument amend the competitions specified in section (3).”
Lord Parkinson of Whitley Bay (Con)
My Lords, I rise in that spirit to move Amendment 19. In doing so, I thank the Committee for indulging my request not to take it at the end of business late in the evening on the previous day in Committee but to start with it today.
We began a very important debate on this matter on Monday evening, but it came well past 10 pm and got rather confused, so I thought it would be helpful if we return to this amendment to look at the issue again with cooler heads, particularly in the light of the letter which the Minister undertook to write and which she has very helpfully circulated to those of us who were in Committee on Monday. I thank her very much for doing that and for turning it around since the previous day of our debate.
I will not repeat the arguments that I made about the issue at hand in my Amendment 19, which is about including specific competitions in the Bill, but I will briefly remind the Committee—particularly for the benefit of those who were not here on Monday evening—that I was sceptical of the Government’s arguments for why the leagues in scope should not be put in primary legislation. The arguments that the Minister advanced on Monday, and in her letter this morning, related to the need for legislative agility and the requirement for the Government to retain the ability quickly to alter the relevant competitions should they change, or should the names of the leagues change slightly, as she set out on Monday.
As I said then, and as the Delegated Powers and Regulatory Reform Committee of your Lordships’ House has said in its report on this Bill, codifying the leagues in scope in the Bill does not preclude the possibility of making future alterations. The second part of my Amendment 19 would allow the Secretary of State to alter by statutory instrument the leagues in question, if they should change in future. That is the same method of alteration as currently set out in the Bill, so the pace at which those changes could be made, should the Government require them, is unchanged. What would be different is the starting point. My amendment would give competition organisers and football clubs the certainty they need, and surely deserve, to start planning their financial matters and regulatory compliance, since they would know from the outset whether they would be included in the scope of the Bill.
The other reason for returning to this matter today is so that we can talk properly about hybridity. This is fundamental to the Bill; it came very late in our debate on Monday, and the questions that it throws up require some answers. I do not think that the Committee was particularly satisfied with where we got to on Monday, so I hope we can make more progress today.
I have been advised by the Clerk of Legislation that my Amendment 19 could make this Bill hybrid. I believe the noble Lord, Lord Bassam of Brighton, and the noble Baroness, Lady Taylor of Bolton, have been similarly advised about their Amendment 21. However, this Bill is, to all intents and purposes, already doing hybrid things; it is just not doing them explicitly.
The Government are clear about who they want to target with this Bill, and have said so in their Explanatory Notes and in comments outside this Committee. However, they do not want to say so in the Bill because that would afford those clubs and leagues the opportunity to petition Parliament directly about this new law which directly affects their organisations. If putting the leagues that the Government have publicly stated that they wish to see regulated into the text of this Bill makes it hybrid, should we not confront that question and refer it to the Examiners?
As I have mentioned before, the Government did not previously use the possibility of hybridity as an argument against placing the leagues in scope in the Bill. That might have been because they were not aware that doing so would make the Bill hybrid. I was certainly not aware of that until I was alerted to it by the clerks after I tabled this amendment. I think that was also the case for the Minister, who said on Monday,
“in the explanation of this group of amendments that I received from officials earlier today, they made it clear that following the tabling of Amendments 19 and 21, issues have been raised about hybridity. That was the point at which hybridity was raised with me”.—[Official Report, 2/12/24; col. 1018.]
The Minister made it clear on Monday that that was the first time she was aware of the issue. I do not doubt her sincerity, but I was a little surprised when she said it, because the email I received from the Clerk of Legislation alerting me to it was copied to her noble friend the Government Chief Whip. He was certainly aware on 26 November—that is, last Tuesday—that this raised questions of hybridity. I do not know what discussions they had in the light of the email that he received, but it would be helpful to know.
That is rather incidental. The fact is that we are all now apprised of this issue and understand that the Bill is seeking, by not putting the leagues on the face of the Bill, to deny private businesses and much-loved organisations the right to petition Parliament about the impact this Bill has on their affairs—as is their right when a Bill is designed in a way that would affect certain groups more than others.
On Monday, I drew the Committee’s attention to Clause 91(5), which establishes that secondary legislation made under the Bill once it becomes an Act of Parliament to allow the Secretary of State to specify the leagues in scope is to be treated as if it is not hybrid. It is important to draw noble Lords’ attention to that again. It says:
“If a draft of an instrument containing regulations under this Act would … be treated for the purposes of the Standing Orders of either House of Parliament as a hybrid instrument, it is to proceed in that House as if it were not a hybrid instrument”.
That appears to demonstrate that the Government were aware, in at least some regard, that there are hybrid implications to this Bill.
We have special provisions relating to hybrid legislation for a reason. They are intended to protect private interests from being unjustly affected by the laws that we pass here. It is disagreeable to skirt around these rules by pushing potentially hybrid provisions into secondary legislation, and to tuck away at the end of a Bill measures to do the same in relation to secondary legislation brought by it. On Monday, the noble Lord, Lord Goddard of Stockport, and others reminded us of the report of your Lordships’ Delegated Powers Committee entitled Democracy Denied? I raised concerns on Monday that this would be another instance of the democratic rights of those organisations being restricted, if we were to proceed in this way.
I was keen that we return to this matter at the start of today, our third day in Committee, because I want us to ensure that, when the Bill becomes law—as all parties want—it has been scrutinised as thoroughly as it should be. I am conscious that we can do our duty here as legislators to examine the consequences for football. But, with some honourable exceptions—such as my noble friend Lady Brady and the noble Lord, Lord Triesman, on the Benches opposite, to give just two examples from across the Committee—not many of us in your Lordships’ House know as much about the implications of the Bill for football as football organisations themselves would be able to say if they could petition Parliament.
I am grateful for the opportunity to return to this question of hybridity. I am grateful to the noble Baroness for her letter to us. I hope that she will respond to the concerns raised both today and on Monday, and I look forward to her response. I beg to move.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
My Lords, I take the opportunity to rise early on this group to establish the Government’s position on an issue the Committee clearly cares about. The Committee debated Amendment 19 at length on Monday evening and asked me to write on the points raised. I was not confused, and I do not feel that the Committee was sitting unusually late for discussions on important legislation. I also do not think that the leagues are confused about which leagues this legislation will apply to. I have since written to the noble Lords, and a copy of that letter has been placed in the House Library.
I also want to put this rationale on record and reassure noble Lords that this power is both reasonable and the result of extensive evidence-based consultation with all key stakeholders in the industry. This power ensures that the competitions in scope can be amended in a timely manner, and it ensures that the scope of the regime remains relevant. It future-proofs for future innovations and protects against circumvention.
On the noble Lord’s point, I note that the previous Government included an equivalent provision in the Media Act 2024—the noble Lord himself brought that provision before your Lordships’ House. I hope this provides the explanation that he was after. We have now debated the amendment at length, and I have clearly outlined the Government’s rationale for the power. I hope the noble Lord opposite is now able to withdraw the amendment so that we can continue progress on the Bill past Clause 2, and I look forward to continuing discussions on this matter ahead of Report.
Baroness Brady (Con)
My Lords, I refer the Committee to my interests, which are declared in the register. I defer to other noble Lords who have experience of the technicalities of hybridity and parliamentary procedure, but I hope it is helpful and illuminating in this context to raise the issue of consultation with clubs. We are creating legislation that will profoundly affect 116 unique institutions, from Premier League clubs through to the National League community clubs. But it is important for everyone to understand that the consultation with these affected businesses by the current Government has been remarkably limited—almost unbelievably so.
Just seven Premier League clubs—mine was one of them—were granted a brief half-hour meeting with the Secretary of State over the summer. Following this cursory engagement, significant decisions were made that could fundamentally affect the future of English football, most notably with the inclusion of parachute payments within the backstop mechanism. I say again: seven clubs out of 20 have been seen for just half an hour since the Government took office and before they made that seismic decision.
This is particularly concerning given that fundamental issues still remained unresolved. We still lack any clarity on UEFA’s position regarding state interference, for example. This clearly creates profound uncertainty for clubs competing in, or aspiring to, European competition, as well as our national teams. We do not know what the ownership test will look like. This causes significant uncertainty for potential investors as to whether they are able to own a club.
I have listened with real interest to this debate on hybridity. Can the Minister help my understanding here? Can she confirm that, if my noble friends are correct and hybridity is a live question for the Bill, this would give clubs at all levels a real opportunity to present their specific circumstances to Parliament? For example, would it mean that National League clubs could explain their concerns about the regulatory burden and the concerns of the many that they say “would not survive” this regulation? Would it mean that Premier League clubs could have more than half an hour to detail the very serious implications for them, and the risk that we may harm the competitive balance of the Premier League, which we have all agreed that none of us wants to do?
That would be especially important, given that the impact on Premier League clubs is very different from that on other stakeholders in the Bill, as the Premier League is the only party that provides funding to any other part of the football pyramid. The backstop is clearly designed as a mechanism to gain direct access to, and apportion, Premier League revenue and no one else’s. It would allow the IFR to do this even if it was against the Premier League clubs’ will, or even without the clubs’ agreement, even if it was to have a detrimental effect on the clubs and the overall competition that it removes revenue from.
I have spoken to many of my colleagues across the whole football pyramid. We are all alarmed about, and puzzled by, the lack of discussion on the Bill with Ministers. Does the Minister agree that we all want to get the detail of the Bill right, and can she see any downsides to providing meaningful opportunities to hear from all clubs across the football pyramid affected by the legislation?
Lord Markham (Con)
I must admit that, probably like other noble Lords, I am scratching my head over this. As the Minister said earlier, it is very clear that the leagues know who we are talking about here and that a large section of the Bill is talking about the whole arrangement, and in Clause 6 about the distribution agreement, the pyramid, the parachute payments and all that. There are only two instances where that counts, in the payments from the Premier League to the other leagues, so it is very clear that we are referring to Premier League and English Football League clubs. I do not think there is any doubt about that at all. As I was taught as a kid, if it walks like a duck, looks like a duck and quacks like a duck, it is probably a duck.
I am pretty sure that this is a hybrid Bill already. I am not an expert, but I cannot see why it is not a hybrid Bill because, as the Minister just said, it is very clear to everyone which leagues we are referring to. The argument that somehow we could not change things if things changed, or if league structures changed, just does not stand up. Just as we are going to nominate which competitions we are talking about under secondary legislation, we could do exactly the same if there was any change in the format of the leagues. The Minister wrote in her letter about trying to stop people gaming the system, but we have a very easy way to stop them gaming the system. It is set up there already—you can change it in secondary legislation, just as the Government intend to do in defining the competitions involved in the first place.
I cannot see any reason why we would not call it as it is. It is as if we were somehow trying to stop the clubs having the proper amount of consultation. As my noble friend Lady Brady just said, it is clear that there has been very little consultation to date. The clubs themselves have said that there was very little consultation. The people here who are members of those clubs probably know more than anyone else about this.
I believe that we are all united in this Committee in wanting the best for football. That comes through very clearly in every conversation we have had. I know that colleagues from right across the spectrum want what is right for football, and I know that the Minister wants what is right for football—so why not give clubs the opportunity to be properly consulted and have proper input on something that is going to profoundly affect the whole game?
Lord McLoughlin (Con)
My Lords, I will very briefly support my noble friend Lord Parkinson’s Amendment 19. I do so as chairman of the Delegated Powers and Regulatory Reform Committee, although the noble Lord, Lord Rooker, chaired the relevant meeting in my absence. My noble friend’s amendment addresses a serious issue. I would have thought that, given the committee’s report on this, the Government would have at least considered the arguments and sought to alter them.
As noble Lords have noted, our committee’s eighth report highlighted that this Bill, as drafted, does not make the fundamental definition of English football clear. The committee was concerned because this Bill leaves us wanting. It leaves us with no definition in primary legislation of what it seeks to address; it is a Football Governance Bill that does not define what part of football it will govern and leaves such a key part of the definition of the Bill to come later in secondary legislation. As my noble friend has pointed out, certain parts of it say that the secondary legislation, if it were to be hybrid, should be ignored as hybrid. That gives a very wide-ranging power which we should be cautious about.
The memorandum explains that
“the rationale for regulatory intervention is based on market failures in the professional men’s game, and problems or harm that most typically and markedly arise in clubs of a certain size and type (typically professional clubs)”.
It then gives four different reasons why the Bill does not explicitly state that it intends to regulate the top five tiers of the professional men’s game. These reasons have been covered by other Members, so I will not go over them.
The Government argue that they need to define the scope in secondary legislation to allow them to change it in future. However, should they need to amend which leagues are in scope, they could still amend primary legislation to alter those leagues by statutory instrument. There is no change to that in my noble friend’s amendment. We have seen hybrid Bills before. I took one through the other place as Secretary of State for Transport, dealing with a rail link from the West Midlands to London. They are more complicated, but people know how to do them and know what regulations need to be abided by.
This amendment is not asking us to decide whether the Bill is hybrid; the Government are being asked to accept that there is inherently a form of hybridity in this Bill regardless, and that they must therefore allow it to go before the Examiners to see what they find. The Government should give very careful consideration to what the amendment says.
Lord Moynihan (Con)
My Lords, my noble friend Lord McLoughlin has made an incredibly important point. While I do not think that this is the moment for us to test it, we should give due consideration to whether this ought to go before the Examiners after Committee and before Report, particularly because the Minister has today said that the leagues are not confused about which leagues this legislation applies to.
We are grateful to the Minister for writing to us today. She stated in her letter that:
“The initial intended scope of the top five tiers of Men’s English football is built on a strong evidence base and extensive consultation with all key stakeholders”.
Nothing could be clearer about exactly who this Bill is meant to refer to. Yet, in this whole long Bill, there is no reference to the five tiers of men’s English football and we have no idea whether the Secretary of State will ultimately keep to that or not. We are going through legislation about which we have no clarity to whom it refers. That is, if not unprecedented, extremely rare. It is important that we heard from my noble friend Lord McLoughlin, not least because, to repeat what his committee said in its report:
“The argument that something should not be fixed in primary legislation because it might need changing in future would be an argument against having any primary legislation”.
I urge the Minister to listen carefully to my noble friends and to make sure that the Government at least place what we are talking about in the Bill, so that we know which clubs it refers to and where the onerous powers contained in it for the potential state-appointed regulator will fall. Without that, we are talking in a vacuum.
Baroness Taylor of Bolton (Lab)
My Lords, one of the amendments in question is in my name and that of my noble friend. I am surprised that Members opposite think that the previous Conservative Government would have introduced a hybrid Bill. I remind the House that this Bill is almost identical to the one they introduced and I am surprised that they thought that that might be hybrid. That Bill was discussed in another place at quite some length, but this question was not raised. As I understand it, the Bill would not have received a Second Reading had it been deemed to be hybrid at that time, so I do not think there is any question that this Bill is hybrid now. It can be made hybrid only if one House or the other passes an amendment that makes it so.
Lord Goodman of Wycombe (Con)
To follow that point directly, I raised the original question of hybridity following an intervention by my noble friend Lord Markham, at which the Minister nodded. The Minister has since written to us, and I am grateful for her letter setting the situation out. I want to respond to what has been said in the following way. The noble Lord, Lord Bassam, who is in his place, has at various times produced a copy of the Bill as it was under the last Conservative Government and pointed out, as the noble Baroness just said, that the two Bills are, in certain respects, almost identical.
Lord Bassam of Brighton (Lab)
The Bills are 95% identical. That is why we are somewhat surprised that noble Lords opposite are so opposed to its content. There is only one fundamental policy difference in it.
Lord Goodman of Wycombe (Con)
I am grateful to the noble Lord for intervening, because it buttresses the point I want to make. The Minister made it very clear on Monday that she was not aware of the hybridity issue that would arise were the leagues to be named in the Bill until that afternoon. It is evident, therefore, that someone in the department, as my noble friend said from the Front Bench, was aware of the hybridity issue under the last Government and under this one. I raise this as a member of the Delegated Powers Committee; when we received the view of the Government about why the leagues were not named in the Bill, the hybridity issue was not mentioned. It seems to me intuitively quite wrong that so important and real an issue should not have been named when the communication was made between the Government and the committee.
I am told that, procedurally, the people who speak on the Government’s behalf to those who brief us on the committee about the Bill are not obliged to tell the committee about the hybridity issue. If there is something as important as the hybridity issue, should the committee not be made aware of it somehow? I am grateful to the noble Lords opposite for raising the point about the Bill being much the same under the two Governments, as it is germane to the point I want to make.
Lord Mann (Lab)
My Lords, in one of the quaint ways that the Commons has of occasionally putting people, for whatever reason, on obscure committees, I found myself for 15 years on the hybrid Bill committee —one of the more obscure joys of life. I should just say that it was not the noble Baroness, Lady Taylor, who put me on it.
Lord Mann (Lab)
There are vast numbers of Bills that could in theory be called hybrid Bills but are not, such as the Great British Railways Bill. It is a nonsense argument, and there are millions of football fans waiting to see some change made.
The thing that triggered the origins of the Bill, with Boris Johnson and others, was a European super league. If Parliament ever attempted to say that the clubs that tried to form a breakaway European super league have a specific hybridity status—in relation to the people, having voted for manifestos that wish to stop this, being able to do so—the whole concept of how we make rules of law would come into question. This Bill is not hybrid and could not be hybrid, in exactly the same way that vast numbers of other Bills which have an impact on various private businesses are not hybrid. I think many noble Members realise that.
Lord Goddard of Stockport (LD)
The noble Baroness, Lady Taylor, has hit the nail on the head. We did a bit of research as well; the question of whether this is a hybrid Bill was asked in the other place, and it confirmed that it is not, so it comes to us with that confirmation. The letter from the Minister is really helpful, in that it clarifies that position for these Benches, and we will be happy if the mover withdraws the amendment.
The best thing would be to retire this amendment gracefully today, bring it back on Report and if need be, force a vote on it and let people decide. This is endless. The Chief Whip said, “Let’s be brief”. We are now 30 minutes in, rehearsing the rehearsal of last week’s four hour debate.
The noble Baroness, Lady Brady, said that seven Premier League clubs met the Minister. I presume that the Minister invited all the Premier League clubs to that meeting; they would not have been selected. If only seven bothered to turn up, again, that gives you a clear—
Baroness Brady (Con)
I can confirm to the noble Lord that only seven were invited. They were selected.
Lord Goddard of Stockport (LD)
To be helpful to the Committee, could the noble Baroness, Lady Brady, give us the names of the seven clubs? That might shed some light on what is going on here. There seems to be an illusion that the Premier League was suddenly born out of the ether, and then provides for all. Players such as Ryan Giggs, Phil Foden and Alan Shearer do not just suddenly materialise; they come up from the other divisions. I get what the noble Baroness is trying to do, and I respect her position, but you have to look at this in a holistic way. This is about a regulator regulating for the five divisions, and if it is not blindingly obvious to anybody what those five divisions are, they may be sat in the wrong place.
Lord Parkinson of Whitley Bay (Con)
My Lords, I am grateful to the noble Lords who have taken part in this debate. It has been worth while having it again, painful and irritating though it may be. I am sorry if that upset the Minister—it certainly was not my intention to do so. I did it because this issue matters.
By the Minister’s own admission on Monday, she did not know about the issue of hybridity until it was raised with her on Monday. Does she think that a few hours’ consideration, along with all the other matters we gave attention to in Committee on Monday, and a few minutes’ debate in Committee late on Monday evening, is sufficient to dispose of an issue as fundamental as this?
As I said in my opening remarks, the Government Chief Whip knew about this issue at the same time I was alerted by the clerks, on 26 November, almost a week earlier. I am grateful that he stayed to listen to our debate on this group. Maybe he, if not the noble Baroness, can tell us what discussions he had in light of that issue being raised with the usual channels on 26 November. This is about engagement with the people, organisations and businesses that this new law will profoundly affect. I was shocked to hear what my noble friend Lady Brady said about only seven hand-picked clubs being given just half an hour of—
Baroness Brady (Con)
As requested, I will clarify who the seven invited clubs were: West Ham, Crystal Palace, Brighton, Liverpool, Spurs, Everton and Brentford.
Lord Parkinson of Whitley Bay (Con)
I am grateful to my noble friend for providing that information to the Committee. As I am not the world’s greatest aficionado of football, I will leave it to others judge whether that is a representative spread of the beautiful game, but I am interested to hear from the Minister the rationale by which those clubs were selected. I would like to know whether she was present at the half-hour meeting with those clubs and, if she was not, how much time she has given to engaging with clubs before bringing this legislation before your Lordships’ House and asking us to pass it.
As my noble friend Lord Markham set out, the changes the Government have made to the Bill since the last Parliament—on backstops and parachute payments—make this a substantively different Bill. I disagree with the noble Baroness, Lady Taylor of Bolton: this is not a virtually identical Bill; there are some substantial differences in policy terms, to do with parachute payments and so on. I think she would agree that those affect certain leagues and clubs more than others, and engage the question of hybridity and to what extent this Bill is targeting certain groups differently from others.
As with the amendments of the noble Lord, Lord Bassam, and the noble Baroness, my Amendment 19 was a probing one to see whether we could provide clarity in the Bill for those whom it will regulate, so they know from the outset what they must do and that they must comply with it. Like the noble Baroness, the first I knew was when we received the advice from the Clerk of Legislation explaining that this would make the Bill a hybrid one.
It is worth saying that I agree with the noble Lord, Lord Goddard of Stockport, that the previous Bill, when it was in Committee in another place, was not a hybrid Bill and it was right to conclude that. The question is, if we give that explicit information to the English Football League, the Premier League and the National League, so they know that they are going to be covered by this law—which the Government, in their Explanatory Notes, say they will: something they are happy to say outside the House but are not happy to say in the Bill, because that would afford them the right to come and speak directly to Parliament—then it is a question well worth pausing on, and I make no apology for returning to it today.
I am proud of the way your Lordships’ House scrutinises legislation; we go through things sometimes slowly, more slowly than Governments would wish— I have stood on the other side of these Dispatch Boxes and share the pain the Government Chief Whip and the noble Baroness are feeling today. This is a shining example of the importance of your Lordships’ House and the excellent advice we receive from its clerks. Thanks to that advice, two successive Lords’ Ministers for this Bill have been alerted to the fact that it could become a hybrid Bill if it is said in it what it is trying to do. That is an important point to have returned to in Committee, and I would like to understand from the Minister why, when we pass this law, we should not tell the people it is going to affect that it is going to affect them.
Baroness Twycross (Lab)
My Lords, I welcome the opportunity to respond to the debate. I have already outlined the Government’s position on an issue that the Committee clearly cares about. I can confirm to the noble Lord opposite that I am clear that this position is correct and, if the noble Lord is concerned that I am upset, then I am slightly surprised. I am more concerned that the noble Lord thinks we should still be confused about matters on which I have written an extensive letter to noble Lords earlier today. The House debated Amendment 19 at length on Monday evening and asked me to write on the points raised. I have done so, and a copy of the letter has been placed in the House Library. I do not really want to repeat my explanation of when a Minister might have to nod; however, I will do so if that is raised again.
I hope we can work through any residual concerns swiftly so that your Lordships’ House might be able to lend its scrutiny, which I agree is important, to the other very important parts of the Bill. I understand the noble Lord’s desire to have in the Bill upfront clarity as to which competitions will initially be in scope of the regulator’s regime. However, as I explained on Monday night, and in my letter, there is a sound policy rationale for the approach taken in Clause 2.
Lord Parkinson of Whitley Bay (Con)
Does the Minister recognise that my Amendment 19 seeks to allow that to happen? In its second part, it keeps the provision for the Secretary of State to make, by regulation, amendments if the name changes. I take on board the point she made on Monday and that she repeated in her letter about the policy intent here, but my amendment, if she accepted it, would allow that to continue to happen. It would also give the clarity from the outset to the leagues that are going to be regulated.
Baroness Twycross (Lab)
As I previously explained, I do not think that the leagues that are likely to be regulated by this legislation in the first instance are in any doubt, but I will answer the noble Lord’s point about why we are not going to put the top five leagues in the Bill and take a power to amend it. I believe I have set out very clear reasons for the approach taken on defining the scope of the regime. The Bill delivers the effect intended, closing any loopholes that would allow avoidance of the regime, while allowing for agility in responding to any potential changes in the structure of the football pyramid. This is a clear, simple procedure that can be consistently applied to the competitions initially designated as being in scope, as it can to any future competitions.
We have heard from numerous noble Lords opposite about their concerns over the number of delegated powers in the Bill, and I hear those. I have set out why specifying the leagues in scope in the Bill is a potentially flawed approach and open to avoidance. At best, this approach leads to superfluous or unnecessary provisions in drafting. At worst, it could undermine the entire regulatory regime. That is why the approach in the Bill that the Government have taken, and that the previous Government took, is the right one. For that reason, I am unable to accept the noble Lord’s amendment and hope he withdraws it.
Lord Parkinson of Whitley Bay (Con)
I am sorry to hear that from the Minister; it does not give us much more than we had in the debate on Monday. I thank her for restating it, but I do not think it has engaged with the point that my amendment seeks to provide, which is allowing that flexibility to answer all the policy questions that she has set out, but also giving the clarity in law to the leagues that will be regulated by the Bill. As far I can see, the only material difference between accepting my Amendment 19 and proceeding in the way she wants to is that it would allow those leagues to petition Parliament and make their voices heard more clearly. That would be a good way of hearing from those who will be affected by this law.
I was struck by the sage advice from the noble Lord, Lord Goddard, who is acting as referee on this matter. This is something we will have to return to, and I am grateful to the clerks who alerted me to it. We will have to think about the question of hybridity and the right of football clubs and leagues to make their views known on this legislation, as the Minister and I have both just come to understand. The Committee has, through the course of this and Monday night’s debate, been able to begin considering it, and we should continue to consider it between—
Lord Bassam of Brighton (Lab)
If the noble Lord insisted on this being included in the Bill, what would his response then be to further proceedings on the Bill?
Lord Parkinson of Whitley Bay (Con)
I am interested in making sure that the Bill passes. I have been very clear from Second Reading onwards that we want to see it pass, that we want a regulator to be set up and that we want football to be protected and well governed. However, we want it to be done in a way that is not unduly burdensome, is proportionate and genuinely protects what is a hugely enjoyed pastime, a vital export and a group of hugely successful businesses for this country.
Thanks to the noble Lord’s Amendment 21 and my Amendment 19, we are given the opportunity to pause and consider whether we can have deeper and more fruitful conversations with those leagues and clubs to make sure that we get this legislation right. That is a question worth pondering with greater patience than I think we have seen from the Government Benches so far. I will certainly continue to consider it, and I hope that other noble Lords will do so too. For today, and in the interest of making further progress with our Committee deliberations, I beg leave to withdraw.
Lord Parkinson of Whitley Bay (Con)
My Lords, in moving Amendment 20, I will speak also to my Amendment 22. These amendments, while technical in nature, address some important issues underpinning the Bill: the preservation of integrity, clarity and fairness in football governance across the whole nation, alongside the safeguarding of competition and community interests.
My amendments are necessary on the basis that the English football pyramid is littered with examples of English teams playing in Welsh or Scottish league systems, or vice versa. I understand that Cardiff City FC has played in the English football pyramid for 104 years, famously winning the FA Cup in 1927, and, more recently, reaching the FA Cup final in 2008. Its participation in the English football pyramid does not make Cardiff an English club—at least, it would take a very bold person to say that to a group of Cardiff fans.
Similarly, in the case of Wrexham AFC, as I am sure that many noble Lords are aware and have been aware for longer than I have, Wrexham has been in the English football system even longer than Cardiff, having joined an early English football league known as the Combination as far back as 1890. It is, proudly, the third-oldest professional association football team in the world. Although the club has suffered from financial hardship down the years, Wrexham has recently had new life breathed into it by its purchase four years ago by the Canadian actor Ryan Reynolds and the American actor Rob McElhenney. The attendant publicity from the docuseries “Welcome to Wrexham” had a significant impact on the club’s renown, leading to it acquiring a new, global fanbase, without precedent for a team that was in the fifth division at that point. I had the pleasure of visiting its Racecourse Ground when the club was supporting Wrexham’s excellent bid to become the UK City of Culture for 2025. I saw how rooted the club was in its community and the great work it was doing on behalf of the whole wider area.
I hope that those two historical examples provide instructive and relevant information on the point that I intend to make. It is foreseeable that, if the Bill is read on its simple meaning, it could apply only to English clubs. That could lead to a grave lacuna whereby the regulator is instructed to regulate English clubs only but not all football clubs in the English football pyramid. I know that that is not the intention, but with my probing amendments, I hope to seek clarification on that point.
We do not want a case where Swansea AFC, Cardiff City, Wrexham AFC, Newport County, Llansantffraid and others could be in a unique position where they play football against regulated clubs but are themselves unregulated. I have added my name to the amendment tabled by my fellow Northumbrian, the noble Lord, Lord Beith—I believe he was born in Cheshire, but his 42 years representing Berwick-upon-Tweed makes him a Northumbrian in my eyes—who is seeking reassurances for a team closer to home for us both. I hope that the Minister will be able to allay the concerns that he has raised through his amendment as well and set our minds at rest on this important matter. I beg to move.
Lord Beith (LD)
My Lords, I am grateful to the noble Lord for his introduction to what I am going to say about Berwick Rangers. I declare an interest as having for some years been the honorary president of Berwick Rangers Football Club, which has existed for 143 years. During virtually the whole of that time, it has played in Scottish leagues, despite its stadium being in England. My amendment is there simply to secure clarification, which I am confident the Minister can give—although clarification would not necessarily survive subsequent amendment of the parts of the Bill to which I shall refer.
It appears to me that none of the regulatory provisions applies to a team in a competition that has not been specified by the Secretary of State. Under Clause 2(3), the Secretary of State does not have power to specify a competition in which the majority of the teams are not English teams. Thus, the Secretary of State could not designate the Scottish League, or the Lowland League or the Scottish Cup, in all of which Berwick play or have played.
Furthermore, Clause 15 makes it clear that operating licences are required only for a club operating a relevant team, which is defined in Clause 2(1) as a team participating “in a specified competition”. That would not apply to Berwick Rangers, because competitions in which they play could not, under the Bill, be specified. However, references in the same clause to a club with a stadium in England does raise in people’s minds the question about whether the Bill could be extended to Berwick—which would not be the Government’s intention, I am quite sure. Not only do they not seek to extend the Bill to Berwick Rangers, I do not think they are trying to move into the world of Scottish football, which, as the noble Lord, Lord Reid is well aware, is quite distinct in many respects, some of them desirable, some of them perhaps less so.
It has been the privilege of Berwick-upon-Tweed to play in Scottish football for almost the whole of its existence. Indeed, it has led to occasions on which we have played Glasgow Celtic, when I was able to welcome the noble Lord, Lord Reid, who came with the team for that fixture. We have played Glasgow Rangers on a number of occasions, defeating them in 1967 and holding them to a draw in the Scottish Cup on another occasion. To have a club playing such distinguished teams is obviously an asset to a town and, if there is any regulatory structure to be put in place, it should be the same one as for other teams in the Scottish league in which they play.
Berwick’s notable history is a very powerful case for making sure that any legislation deals properly with it. I am confident that the Government have no intention of causing us problems in this respect, but it would be helpful if the Minister could give us some clarification and would keep the matter in mind if there is any redrafting of this part of the Bill.
Lord Watson of Invergowrie (Lab)
I just want to make a point that has emerged in this short debate—or has become obvious to me in it. The first thing is to say to the noble Lord, Lord Parkinson, that I take issue with his characterisation that England is “littered” with clubs from Wales. There are only four. There is another one at level 6, Merthyr, but that is not the point I want to make. I am concerned, looking at Clause 2, that subsection (3) refers to
“teams that are members of … or … participate in”
competitions being
“exclusively or predominantly English teams”.
However, Clause 2(4) says a team
“is an ‘English team’ if the ground at which the team customarily plays its home matches is in England”.
These are contradictory because, as we have heard, there are two Welsh clubs in the Championship, one in League One and one in League Two. So I think perhaps on Report there will have to be an amendment, which I am happy to bring forward if it is helpful to the Minister.
I also take the point that the noble Lord, Lord Beith, makes about Berwick Rangers, who made a contribution to Scottish football over many years. I was sorry to see them drop out of the Scottish League and I hope that they will soon be back. But they do play in Scottish football still at a lower level. It is unusual; UEFA, the governing body for European football, is very strict on clubs not playing their matches in another country. The practice of Welsh clubs playing in the Welsh FA Cup and representing their teams and cities in Europe was stopped by UEFA. Now it is only the much smaller Welsh clubs that are able to do that, because UEFA said that clubs had to choose which jurisdiction they were playing under. The only other example I can think of within the UK is Derry City. For reasons that might be quite obvious, since Derry is right on the border of the Republic of Ireland, they play in the League of Ireland, not the NI Football League.
Lord Addington (LD)
I will make one small and quick point. We talked about this being for fans and the traditions of the game. These accepted historical changes to the structure are something that most people involved in football accept. I hope that when the Minister replies she will accommodate them. If not, a small amendment would be appropriate.
Lord Harlech (Con)
My Lords, I support all the amendments in this group. I spoke at Second Reading on issues affecting Welsh clubs and it is a pleasure to speak to this group of amendments.
The New Saints perhaps offer a different Welsh perspective from those that we already have heard. TNS FC, known for a brief period as “Total Network Solutions” after a sponsorship from a local IT firm, are a Welsh professional football club that play in the Cymru Premier League but is based completely in England—in Oswestry, Shropshire. I declare an interest as that is where I was born. TNS are the most successful club in the Welsh league structure, with 16 league titles to their name. Recently, they became the first side playing in the Welsh system to qualify for the group or league stage of any European competition after reaching the league phase of the UEFA Conference League. They play in the Welsh league because the club was formed in the village of Llansantffraid, on the Welsh side of the border, in 1959, later merging with Oswestry Town, based in Shropshire, in 2003.
TNS FC sit at the pinnacle of Welsh domestic football, while occupying the peculiar position of being a club based in England. Does the Minister not agree that it would be unfair that TNS would be the only club playing in the Welsh top division to be regulated? Would it not create a difficult situation for Welsh football if a club with Welsh roots, playing in the Welsh league but geographically situated in England, had to comply with regulations that other teams in their league would not, perhaps creating a competitive disadvantage?
Lord Parkinson of Whitley Bay (Con)
I thank noble Lords for their support for this group and apologise to the noble Lord, Lord Watson of Invergowrie. “Littered” was probably not a well-chosen word. I meant it in the sense of an adorable litter of puppies that enhance the joy of all of us. I am grateful too to my noble friend for giving another example in the shape of TNS. They seem to be the football league equivalent of him—both a Shropshire lad and a man of Harlech. I am grateful to the noble Lord, Lord Beith, for setting out his Amendment 23 and hope that the Minister can allay the concerns that have been raised on behalf of all these clubs and others in similar situations.
Baroness Twycross (Lab)
I thank the noble Lords, Lord Parkinson of Whitley Bay and Lord Beith, for their amendments to Clause 2 and the opportunity they present for me to clarify this matter.
Amendments 20 and 22 in the name of the noble Lord, Lord Parkinson, would allow the Secretary of State to include in the regulator’s scope competitions that are not exclusively or predominantly made up of English teams. This would mean the loss of an important protection that, as currently drafted, ensures Welsh football competitions could never be brought into scope. The noble Lord will be aware that sport is a devolved matter for Senedd Cymru, the Scottish Parliament and the Northern Ireland Assembly. Therefore, if intervention of this nature was deemed necessary within Welsh, Scottish or Northern Irish football, it would be for their respective legislatures to take forward.
While I am on the subject of Welsh football, I take this opportunity to congratulate the Welsh national team, who qualified for the Women’s Euros last night. It is the first time in their history they have qualified for a major tournament. This is a fantastic achievement and one I am sure your Lordships will want to join me in celebrating.
Baroness Twycross (Lab)
On Amendment 23, I understand the aim of the noble Lord, Lord Beith, to ensure clubs are not inadvertently captured by the regulator’s regime or left out—for example, where they are based in England but compete in the Scottish league system. I reassure him that the Bill already sufficiently protects against this risk. Only clubs competing in competitions specified by the Secretary of State will be subject to regulation, and the Secretary of State can specify only English competitions. Therefore, clubs such as Berwick Rangers, which is part of the Scottish pyramid, cannot be subject to the scope of the regulator as long as they do not play in English competitions. Conversely, clubs playing in those specified English competitions, including Welsh clubs, will be regulated.
I am happy to meet noble Lords to discuss this further if that would be helpful but, for the reasons I have set out, I am unable to accept the noble Lords’ amendments. I hope that they will not press them.
Lord Parkinson of Whitley Bay (Con)
I am grateful to the noble Baroness. As she could hear from the cheer, I think we all associate ourselves with the congratulations that she offered to the Welsh women’s team. It is marvellous news. I thank her for the reassurances. As the noble Lord, Lord Addington, said, these are some of the quirks of our history that we celebrate through football, which we play across these islands. I am grateful to the noble Baroness for the clarification she has set out and I beg leave to withdraw my amendment.
Lord Moynihan
Lord Moynihan (Con)
My Lords, in moving my Amendment 27, I will also speak to my Amendments 28 and 29. These amendments seek to omit reference to the “influence” a person can have over the activities of a club being considered for a licence to operate as a professional football club in England.
Walking through this maze of state-imposed regulation on professional sport, for the purpose of the amendments I assume that the Government intend to allow the government-appointed regulator to determine who is a fit and proper person to be granted a licence on the question of their “influence” over a club’s activities. If we try to seek clarity in the Bill, we are immediately referred to Schedule 1, where, in keeping with this hydra of a Bill, we are once again left totally in the dark. It says, at page 83:
“The Secretary of State must prepare and publish guidance about the meaning of significant influence or control for the purposes of this Schedule”.
So the Bill continues to blindfold parliamentarians before they take the knee and kick off their important scrutinising role, which is the central purpose of your Lordships’ House.
Perhaps the best way to seek clarification from the Government is to work through a specific example. Newcastle is majority owned and financially controlled by the Saudi sovereign fund, the PIF. The PIF became the majority shareholder and de facto owner of the club, with 80% of the shares acquired in October 2021. The chair of the PIF is Crown Prince Mohammed bin Salman, son of Saudi Arabia’s King. MBS, as he is known, runs the Saudi Government.
For once, the noble Baroness, Lady Taylor, cannot pray in aid that this is an inherited Conservative Bill, because in the Conservative Bill there was a protection against the Government-appointed regulator investigating whether, for example, the Crown Prince and chair of the PIF was a fit and proper person to exercise control over Newcastle through his chairmanship of the PIF. The current Government deleted the very protection that the Conservative Government put in the Bill that required the regulator to,
“have regard to the foreign and trade policy objectives of His Majesty’s Government”.
This removal was a direct result of UEFA’s insistence to the current Prime Minister that this protection politicises sport. When faced with expulsion from the European Championship in 2028, which, incidentally, is to be hosted in the United Kingdom and the Republic of Ireland, and asked to jump, he said “How high?” and deleted the protection, clearly without the Government considering the consequences. This is a classic example of the need to beware of unintended consequences.
When the Prime Minister heads off to Saudi Arabia this month to promote trade and relations with Saudi Arabia, what will he say when the Crown Prince asks, “As I exercise influence over the PIF and since the PIF owns Newcastle, am I to be subject to detailed investigation by the regulator as set out in your Bill, and is there anything the regulator will not take into account about me as a ‘person of influence’ over the future of Newcastle United?”
Sadly, I can assure the Committee that for anyone who has read the Bill, the answer to Newcastle fans is that, unlike under the Premier League or UEFA rules, the Crown Prince is to be subject to investigation by the regulator. That is exactly what the Government intend the regulator to do, because they have removed the one protection it had. So let the Prime Minister be in no doubt that the answer he has to give to the Crown Prince and the PIF, which is investing billions in global sport and encouraging full British co-operation with the growth of boxing, golf, the International Olympic Committee’s Esports and tennis, to name just a few recipients of Saudi influence in global sport that is celebrated by many professional sports in this country, all of whom benefit from it.
When the Minister comes to answer, the Committee is looking for simple clarity. Yes, the regulator has full rights to use his or her many powers to investigate and opine on the suitability or otherwise of any owner who exercises a degree of influence over, for example, Newcastle United. That is just one example of such detailed and intrusive investigation which exists solely in the powers of the proposed regulator but nowhere else in football—not in UEFA, FIFA, the EFL or the Premier League. The intrusive investigation which this phrase leads to will be replicated across the Premier League unless we accept my amendments.
We have a clear understanding of the first meaning of an “owner”, which is those who control or exercise control over a club, and shareholders are a good example. However, to understand the second phrase, the concept of “influence” over a club, we need to understand what the Government mean by “influence”. What is deeply disturbing is that, from other parts of the Bill, it is clear that the definition conflicts with the approach to ownership of the government regulator, the Premier League, UEFA and the EFL, all of which would be conflicted with the government regulator’s role. I predict that it would be mired in litigation for years to come and lead to capital flight by current owners in the Premier League and other leagues, so I owe it to the Committee to explain briefly why.
The starting point is whether there is a difference in the definition of an owner between what is in the Bill and in the Premier League’s rulebook. If there is a difference, what will this mean in terms of whether a newly identified owner would have to go through a test or whether they would still be defined as an incumbent owner who, incidentally, will have to go through extensive new tests under this legislation?
This Bill tells us that the regulator must identify an “ultimate owner” as opposed to companies that have ultimate control. How is this defined in the Bill and what does it mean? At what point in the process must the ultimate owner be identified? For example, can he or she be identified for a provisional licence? I would argue that they have to be. If new individuals are identified, will they have to go through the full owners and directors tests as new prospective owners or will they be treated as incumbents?
Lord Markham (Con)
Before I speak to the amendments in my name, I start by thanking my noble friend Lord Moynihan. This is yet another example where, as we understand this Bill further, we see more and more complexities and unintended consequences which will have a profound impact on the sport that we all love. Those points were very well made by my noble friend, and I look forward to the Minister’s response to them.
My amendments are trying to be helpful and practical, given the complications set out by my noble friend around how you determine who is an owner or who has influence on it all. At the very least, as proposed in Amendment 30, the regulator must inform who it considers to be counted as an owner. I hope noble Lords would agree that that is a fairly sensible move, given that such a person might not consider it themselves but might be deemed to have influence.
Just as we require a certain competence from officers, Amendment 177 suggests that owners should be subject to a similar assessment.
We are all mindful of the numerous situations we have seen where there is a timeliness to the acquisition of a club, particularly in the context of rescuing a club or where there are certain deadlines, as happened in the case of Abramovich and Chelsea. Amendment 186 states that the regulator must make a decision about an owner or an officer within one month. Officers can be critical to the running of a club as well, so we need timeliness there.
My two further amendments, Amendments 188 and 189, propose that where the regulator is seeking to act retrospectively—as has been pointed out, this gives it the power to reopen the issue of ownership and officers—there needs to be a high bar before it is allowed to go in; otherwise, before we know it, it could be investigating and unpicking the officers and owners of every club. Once again, this is a massive example of just how overbearing we are in danger of setting up this regulator to be.
Amendment 188 says that the regulator can investigate the current owners only if it believes that there is a reason for them not being suitable. It is trying to put an evidential burden or barrier on that. Similarly, Amendment 189 is about trying to determine the fitness of current officers only if it already has information in place suggesting that those current officers are not fit. Otherwise, if we add up all the multiple hundreds of officers of the hundred or so clubs, we would be setting up a whole logjam of investigations, which I would hope that all noble Lords think does not best serve the interests of those clubs or football as a whole.
Lord Jackson of Peterborough (Con)
My Lords, I support the amendment in the name of my noble friend Lord Moynihan and I commend him on his comprehensive demolition of the Government’s case. I have fundamental problems with this clause, as it stands, in respect of ownership. As my noble friend rightly says, it goes way beyond the admonitions and existing legislation of, say, the various Companies Acts. It is much more draconian and prescriptive than anything we have seen in company law. It is quite sensible, and not ignoble, for all Governments to take a value judgment on who is a fit and appropriate person to be a company director and to trade and take part in commerce. We all understand and support that, but what we see here is very oddly drafted legislation. It seems to me that it may be a reaction to the trade policy clause that existed in the original Bill, which was withdrawn.
At the same time, the Bill is extremely opaque, permissive and open-ended in the power that is bestowed on the Secretary of State. Looking at the schedule, I am very uncomfortable about giving those sweeping powers, not least because there is a differential between the “significant influence”, as contained in the schedule, that a director or a person involved in a football club may have and what we read in Clause 3, which is just “a degree of influence”. What does a degree of influence mean?
It is not all a case of the Saudi royal family and Newcastle United. We are talking about 116 clubs. Is “influence” popping into the dressing room at half-time and saying, “Great match, guys; here’s a beer”? Is it saying, “If you play better next year, my company might sponsor you more favourably”? It may seem ridiculous to use those examples, but this wording is so unclear—so opaque and permissive—in asking to give Ministers very significant powers that we need to think carefully, again, about whether it is appropriate to let it remain in the Bill.
For that reason, I strongly support the eloquent and comprehensive case made by my noble friend Lord Moynihan and, in passing, of course I support the amendment from my noble friend Lord Markham. This is a bad clause. It will give rise to very big risks of litigation. Ministers should think carefully about whether it remains in the Bill and we should think again, perhaps on Report.
Baroness Evans of Bowes Park (Con)
My Lords, Norwich City were very fortunate to have Michael Wynn-Jones and Delia Smith as majority shareholders for the past 26 years. They have been fantastic custodians of the club. They joined the board when Norwich were in a perilous financial position and helped steward the club through the highs and lows of six promotions, six relegations, two play-off finals and 15 managers. Of course, Delia was not averse to some direct fan engagement with her “Let’s be ’avin’ you” rallying cry, which we all know and love.
In October, Norfolk Holdings, a group led by the principal owner of the Milwaukee Brewers, assumed majority control of the club, so a new chapter has begun. While Michael and Delia have relinquished control, they remain committed fans, as they always have been. I know that all Canaries are extremely grateful for their unwavering commitment to the club.
Baroness Fox of Buckley (Non-Afl)
My Lords, in the debate on an earlier group we heard some dilemmas around the fact that, for example, Welsh teams such as Wrexham might not be in scope of the Bill. It is possible that Rob McElhenney and Ryan Reynolds will be relieved to discover that they might not be. Those following Wrexham’s progress will know that they spend a great deal of time complaining about the ridiculous regulatory framework that the football club has to negotiate. It is not football regulation but every other—as they say—bonkers regulation that means they cannot build. There are many hoops that they have to jump through.
This is slightly important because, when we have this discussion about suitability and fitness, we constantly see it as scrutiny because we are wary of charlatans. Everybody that has ever been involved in football is anxious about types of owner who might not have football at their heart, but the reality is that many owners of football clubs and many people with influence over them love the game and are nothing but great influences on the clubs. That is obviously why Rob McElhenney and Ryan are well-known heroes worldwide now. But there are also corporate interests that can be just as beneficial and important.
One reason why this is so tricky, why it needs to be clarified and why I am glad to see these amendments in this group is that any discussion about suitability and fitness that gives so much intrusive and overbearing power to a regulator has to be queried to understand exactly what it will mean. The last question from the noble Baroness, Lady Evans, was important: what happens if there is a clash?
Outside of football, the debates on who is suitable to run what are subject to all sorts of subjective and sometimes malicious trouble, caused by people who do not have the best interests of the clubs at heart. If noble Lords have ever spent any time with football fans, they will know that many do not think that their club’s owners are suitable or would pass any suitability test—as I will tell you over a pint. It might well be the gripe of the day.
My point is that the Bill has to be reined in, in terms of how much power has been given to make decisions that are not straightforward or scientific. Until we recognise that there is a danger of unintended consequences, the Minister might—not through any desire to—open a can of worms that will be damaging to many football teams.
Baroness Brady (Con)
My Lords, I rise to speak about ownership definitions and tests proposed in the Bill, and particularly to support Amendments 27 to 29 tabled by my noble friend Lord Moynihan.
Although everyone can support proper scrutiny of football club ownership, I have concerns that the current provisions create unnecessary complexity and uncertainty. It is important that we are clear about the purpose of the Bill in this respect. As my noble friend’s amendments demonstrate, the Bill proposes a new definition of ownership that goes beyond current football tests, introducing the concept of influence. This goes beyond the football authority definitions, which focus only on control. Yet the Bill provides little detail about how this extended scope will work in practice or what problems it aims to solve. It will apparently be for the Secretary of State to decide what is meant by “influence”.
Equally concerning is the lack of clarity regarding existing owners. As has already been asked, do the Government envisage using these new powers to retrospectively challenge current ownership arrangements? If not, why create a broader definition than the existing tests? If they do, this represents an extraordinary intervention into private property rights that demands much greater scrutiny.
The Premier League has significantly strengthened its owners tests, including in relation to the Abramovich case, and sanctioned individuals. What evidence suggests that parallel tests, with differing criteria, would improve outcomes, rather than creating uncertainty and potential legal conflict? Without such clarity, we risk creating a framework that deters responsible investment, while failing to address any real problems in football governance.
Let me be clear about another point. As my noble friend Lady Evans pointed out, the EFL is, I believe, very happy to give up its own ownership test to the regulator because it views the exercise as costly and time consuming—that is its right. But the Premier League fully intends to maintain its own ownership tests—why should it not? It is a fundamental right of a members’ organisation to determine its own composition, and the Premier League really is a membership body. We have only 20 clubs, not 72, and it is a fundamental part of how we drive forward the Premier League, grow in international markets and make collective decisions about the future of the game, together with the FA.
Determining who can come into the group is therefore a key part of how we collectively run the Premier League as equal shareholders. I would argue that we have one of the most sophisticated ownership tests in world sport. Yet the Bill would introduce a parallel test, and it would do so without defining its contents. Naturally, this creates immediate uncertainty.
The Bill is troubling, too, on detail. The planned test, which will be for the regulator to create and define at some stage in future, would appear to include more subjective elements than the Premier League’s existing criteria. That would be very strange. Surely it would be quite a good idea if prospective investors and owners could know with confidence, from the outside, whether they qualified to buy a football club. I would be grateful if the Minister could answer a simple question: is the test provided for in the Bill going to be a subjective or an objective test? It obviously cannot be both. As my noble friend Lady Evans said, the practical implications run deeper. What happens when the regulator approves an owner, but the Premier League does not, or vice versa? Can the IFR force the Premier League to take in an owner that it does not want? The Bill makes no provision for resolving such conflicts. Instead, I worry that it creates the perfect conditions for prolonged litigation—exactly what proper regulation should avoid.
Of course, all this uncertainty is likely to be very damaging to investment. Put yourself in the shoes of an investor examining Premier League football as a potential opportunity. They now face not one ownership test but two, both with different criteria. One test is not even defined in legislation. Either could result in rejection. Both could trigger lengthy legal challenges. What serious investor would begin spending the millions of pounds required to explore a transaction in football —on the investment bankers, the lawyers, the due diligence, the regulatory compliance, the tax advisers and the rest of it? Why would we want to introduce such fundamental uncertainty?
I worry that, without far more clarity in the Bill, we risk deterring the very kind of responsible, long-term investors that football needs and wants. I urge the Minister to carefully consider these points. At a minimum, we need clarity on: how conflicts between tests will be resolved; exactly how and why the IFR’s test is intended to be materially different from the existing tests; what provisions exist for managing litigation; why the definition of ownership is wider than that used by the football authorities today, and what the implications are; and, above all, how investment confidence will be maintained.
The goal of proper ownership scrutiny is, of course, completely correct, but we must achieve it through clear, workable mechanisms and not parallel systems that create uncertainty and confusion.
Lord Bassam of Brighton (Lab)
My Lords, I enter this debate from a slightly different angle—and I make no apology for that. My concern is linked more to what I might describe as preventing another Wimbledon, or to “Wimbledon-proofing” the legislation. That is what the amendments that we have in this group attempt to assert.
This is important, because Wimbledon was a warning shot across football when it happened—when Wimbledon Football Club was transported 61 miles away from its home community to Milton Keynes. Only one other club has had to move further than that, and that was Brighton & Hove Albion when we were shunted inexplicably—well, rather explicably, in the end—to Gillingham to play our home games. I know that I could go on about that for a long time, but I want to prevent that sort of thing happening in future. As part of the determination of suitability, we are trying to get a commitment—and perhaps the Minister can help us—that issues related to where the home ground is will be an important part of the test as to whether a person is a fit and proper person to become an owner of a regulated club. That is what our Amendment 182 seeks to clarify.
Fans need that long-term security. They need to understand that the people who take ownership of a much-loved community asset are there for the longer term and have a longer-term interest in the community and its football club. We need that because the majority of clubs most likely to be affected by this legislation are those smaller clubs with which there is a great affinity and community bond. I hope that the Minister can assure us that one of the relevant considerations when looking at a new owner will be their commitment to ensuring that the ground stays pretty much where it is and that fans are consulted about any changes to be made to it.
Lord Jackson of Peterborough (Con)
I read with interest the noble Lord’s Amendment 182. The wording says of the commitment to the home ground
“with said commitment to be codified in such form as the IFR may determine”.
Does he agree that it could undermine any existing contractual relationship and bring uncertainty into the business activities of that club, were this amendment to be adopted?
Lord Bassam of Brighton (Lab)
I do not think that it would. It is designed to stop owners disposing of the assets. I will give the noble Lord the example of Brighton, because what happened there is very instructive. Back in the 1990s, it was taken over by some rogue owners —Bellotti, Stanley and Archer. Apart from becoming local hate figures, they sold the stadium before they had anywhere else to locate the football club. Then they tried to blackmail us politicians in Hove Council and Brighton Council—we were not a unitary at the time—into providing them with a completely unsuitable site for relocation, with no planning permission and no business plan at all. That was wrong, and it destroyed that club for a period of time. It has taken us a long time to recover from that. It has taken the support of fans and the good will of good local politicians to rebuild Brighton into the excellent and well-run club that it is today. Now, I would say that, wouldn’t I? But it is the truth, and that was the situation.
This amendment is quite personal to me. I did not go on marches, protest or do what I could as the leader of the council to see that position undermined. I would hope that the noble Lord opposite, as a supporter of Peterborough, would have a similar passion for his club. That is the reason for this amendment. We want to make sure that we provide fans with that security and knowledge and understanding of the importance of that commitment.
Lord Addington (LD)
My Lords, briefly, if we are talking about influence, it is reasonable that we know what it means. As the noble Lord, Lord Bassam, has said, this is an example of why we have this Bill. There have been rogue owners, and one of the traditional ways they come in is by looking for a property deal on the site. It is important to remember that as an example of what happens when you get this wrong. We need to balance these two points together. I hope that, when the Minister comes to answer, she will at least start to shed light on how we will seek to do this.
Lord Mann (Lab)
My Lords, I have talked to quite a number of major new investors in English football and have not found one who opposes the general principle of having a regulator. They are quite relaxed about it, yet they are the major new investors. I think one reason is that, when people invest, they often find some hidden nasties that had not been disclosed about the investment and its finances. That extra element of transparency is not necessarily a discouragement to investors; it can be an encouragement, particularly to reliable, long-term investors.
If you talk to a random selection of football fans, one case that will always quickly crop up is the Glazers buying Manchester United, not with their own money but with leveraged buyouts. I am rather more benign about the Glazers, because their intentions were always very open: they were borrowing money from reliable sources and attempting to make a profit. I would not be too comfortable about that if it were my club, but it cannot be denied that what they did was clear, transparent and out in the open. Anybody who thinks that there are not people today who the fans believe are generous and beneficial owners who have put lots of their own money in, but who have in fact borrowed the money from sources that are not public, are being rather naive, because that is still a model through which people buy football clubs. Football clubs are easy to move money in and out of and speculative investment has proven over the last 20 years, particularly in English football, a reasonable bet and may continue to be so. Indeed, the whole case of the Premier League is that it will continue to be so, so the regulation being proposed is not necessarily an anti-business case.
There is another interesting aspect that does not come to light because we do not know about it. I hear from current and recent professional players about the impact and influence of agents. Are there now agents who are sufficiently powerful in the game, with the corporate entities they have created to own footballers and, more critically, footballers’ rights, that their unseen investment in a club could have an influence in ways that the wider public, including the fans, do not know about? It seems to me, from a fan perspective, that that is a problem for the health of the game. On balance, the good, long-term investor who could make good money —that seems to be a rational motive—will be in favour of this element of transparency and not against it.
Lord Evans of Rainow (Con)
My Lords, it is a pleasure to follow the noble Lord, Lord Mann, with his very pertinent points on agents and fans. I rise briefly to support my noble friend’s Amendment 27 and to make a point about owners being fit for purpose, fans’ interests and consultations and unintended consequences. Along with other noble Lords, I spent last Friday afternoon with the shadow regulator. I asked whether they were aware of how unpopular they could be. I used the example that has already been used of Newcastle United, which has a new owner and a sovereign wealth fund, and the fans are excited because of the potential that brings. That is great, but what would this regulator make of the new ownership? Compare and contrast that with the previous owner, Mike Ashley.
Noble Lords will be aware of what Newcastle fans thought about Mike Ashley: in their eyes the team was underperforming and he was not investing in the club and its players. However, he was probably being prudent and working within the constraints of the rules of the game, and the regulator might have judged him to be a perfectly fit and proper person to run and own that club. I ask noble Lords to imagine a situation where the regulator says to a sovereign wealth fund owner, a country such as Saudi Arabia, “I do not believe you are a fit and proper person to take over and own this club”, but the fans think it would be wonderful. The regulator could end up in a situation with literally tens of thousands of protesters going down to Manchester from clubs like Newcastle.
As the noble Lord said, Brighton and Hove Albion supporters are very passionate, and he clearly did a good job there as a council leader. However, we know that fans will travel all around the country to support their team and we could end up with the unintended consequence of the regulator denying the potential of an owner to buy a club based on his set of rules and regulations, but tens of thousands of fans would disagree and we could have a situation where they would go down and protest. That could be one of the unintended consequences, so perhaps the Minister could let the House know whether the Government have thought of that.
Lord Watson of Invergowrie (Lab)
My Lords, I support Amendments 182 to 184 in the names of my noble friends Lady Taylor and Lord Bassam. I do so, as my noble friend Lord Bassam said, specifically in relation to Wimbledon—not AFC Wimbledon, at which I happen to be a season ticket holder, but Wimbledon, the previous club, which has now been moved 60 miles up the M1 to Milton Keynes. I want to focus on the situation prior to that happening, and that is why these amendments are relevant.
Ironically, in one of the debates on the Bill last week I talked about state intervention and mentioned the Taylor report. It was that report, published in, I think, 1991, which said that our grounds at the top level must be all seated. Wimbledon’s ground was too small and too cramped, with houses round about it, for that to be done, so they moved from there to a ground share with Crystal Palace, ostensibly on a short-term basis—it turned out that they would be there for more than 10 years, but that is not really relevant to this. The point is that the owner eventually sold the ground from under the fans to a supermarket chain, and subsequently sold the club to Norwegian owners. The point is that the fans were nowhere consulted in any of this, although they made their views clear. But the point is that the home ground is key to any football club and there has to be the long-term commitment to that.
My noble friend Lord Bassam talked about going up to Milton Keynes. The previous owner of Wimbledon FC wanted to move it to Dublin. That was a serious proposal. Thankfully, it came to nothing, of course. On this issue of whether a club can move, that is why the regulator is important. It is maybe lost in the mists of time that, when Wimbledon FC were about to be moved, the FA and the Football League opposed it, and the FA, totally wrongly, set up a commission, which gave the club permission to move to Milton Keynes. It was famously said that retaining the club in Wimbledon would be
“not in the wider interests of football”.
Well, 25 years later, Wimbledon FC, now in Milton Keynes, gets crowds of about 6,000 and AFC Wimbledon, the new club, gets crowds of about 8,000—so noble Lords can work out what is in the wider interests of football from that.
My concern is about the commitment to the club’s ground. It is important that, unless we can get a long-term commitment for when ownership is going to change, there is no reason why any ground could not be sold off, with a new owner claiming, “Well, I’ve had such and such an offer from a supermarket chain, I can’t possibly turn it down. I’ll build a new ground some time in the future, but I don’t know when”. That is why the word “codified” in Amendment 182 is particularly important. It needs to be nailed down, because the importance of the home ground cannot be overstated in terms of the investment of fans into their football clubs.
Lord Parkinson of Whitley Bay (Con)
My Lords, I am conscious that the noble Baroness, Lady Grey-Thompson, has not been able to be with us today to speak to her Amendments 187A and 187B; I know she has a commitment to chairing some Welsh sports bodies, which I know the Committee will understand and support. I just wanted to draw the Committee’s attention to the two amendments that she tabled, which have been grouped together with the others that we have debated here. As her explanatory statement sets out, they aim to provide a route for the regulator
“for other individuals and groups of people, who may have more inside knowledge than the average fan, to act as whistleblowers and raise any concerns they have about the suitability of an owner or officer”.
It is regrettable that the noble Baroness has not been able to be here to set out the case more fully, but I am sure that noble Lords will pay attention to that and consider those amendments as well.
Baroness Twycross (Lab)
I thank the noble Lords, Lord Moynihan and Lord Markham, in her absence the noble Baroness, Lady Grey-Thompson, and my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton for the amendments in this group. It is absolutely right that clubs have suitable owners, a point made by the noble Baroness, Lady Evans of Bowes Park, among others. That is why a new statutory owners’ and directors’ test is a key element of the regulatory regime.
In response to the point made by the noble Lord, Lord Moynihan, the current tests have proven ineffective. They result in a drawn-out process that still allows unsuitable owners into the system. We have seen numerous instances of unsuitable owners and officers causing harm to clubs and detriment to their fans—that stops now. The definitions ensure that those who are responsible for clubs can be identified and tested. They cannot hide behind complex ownership structures to avoid this, as existing tests currently allow. My noble friend Lord Mann made a strong case for strong tests, and my noble friend Lord Watson of Invergowrie added his own experience of Wimbledon.
The noble Baroness, Lady Evans of Bowes Park, asked a number of questions around the owners’ and directors’ tests. In response, I will say that football authorities can still conduct their owners’ and directors’ tests if they choose to do so, but the regulator’s test is set in statute. Any owner who fails the regulator’s tests will be removed and any prospective owner must pass the regulator’s tests before taking ownership, no matter the results of the league’s tests.
Given the importance of this issue, I welcome the opportunity to clarify the Government’s position further. I start with Amendments 27, 28, and 29 from the noble Lord, Lord Moynihan. The definition of an ultimate owner is an important part of the Bill, and we are confident that we have the right definition that achieves the Bill’s aim. The current drafting takes its lead from the precedent of other Acts that use “influence or control” together, including the Companies Act “persons with significant control” regime and the economic crime Act “beneficial owners” regime. This ensures that an individual who exerts significant influence over a club, more than that of any other owner, can still be identified as the ultimate owner, even if they do not have formal legal control.
Lord Moynihan (Con)
That is an exceptionally helpful and clear answer; now she has given us the Government’s view on what “significant influence” means. Why, then, do the Government not put that in the Bill, rather than simply say that at some stage in the future it will come forward under secondary legislation?
Baroness Twycross (Lab)
The Government’s view is that we do not need to put it in the Bill.
Lord Moynihan (Con)
It is absolutely critical to achieve the clarity that the noble Lords, Lord Mann and Lord Watson, have been talking about, and I agree with them completely. What is needed is clarity for investors. It is absolutely essential that it goes in the Bill; it is critical to the definition of ownership and to the whole regulatory framework that is being placed in a hugely lengthy enabling Bill. The clubs and owners at the EFL and the Premier League need clarity. The Minister has very kindly given the Committee clarity on the definition, as she sees it, of significant influence, so what is there to resist in terms of placing it in the legislation so football clubs can consider it in detail?
Baroness Twycross (Lab)
I am happy to meet with the noble Lord and discuss this further, but in our view this is not required in the Bill but will become clear from the work of the regulator. We think this will be clear in practice.
This is also a term and a part of the Bill that was within the iteration of the Bill laid before Parliament by the previous Government, notwithstanding the noble Lord’s right to object to the Bill that his Government may have laid before Parliament.
Lord Moynihan (Con)
I am sorry to intervene again on that, but that is actually not correct. The one area of the Bill that is actually different from the previous Bill is the requirement on the regulator to have regard to the foreign and trade policy objectives of the Government, which is why we used the example of Newcastle. The Minister has not answered the very clear question: as chairman of the PIF, does the Crown Prince, who exercises control over the PIF, now exercise control over Newcastle, and as a result would be captured by the regulatory requirements of the Bill and not by the Premier League requirements?
Baroness Twycross (Lab)
My Lords, earlier, I said that I was not confused. I am now slightly confused, because noble Lords were very clear earlier in Committee that any issue with the legislation that might lead to UEFA objecting to it was problematic; now, the Government have removed a part of the Bill that was problematic and objected to by UEFA, that risked us being able to compete as a country in leagues within overseas competitions. So, I am slightly confused on that point, but as I said, I am happy to meet the noble Lord.
The other point is that the Companies Act guidance on this is long and complicated. In our view, it has more detail than is appropriate for the Bill, and I assume that the previous Government took the same view.
Lord Moynihan (Con)
Can I clarify this point once and for all? Anything—not just the clause on the Government’s foreign and trade policy objectives—that could put a stop to our entry into European competition or World Cup competition should not appear in the Bill. I have argued consistently that anything that would cause the independent bodies regulating international football—UEFA and FIFA—to stop our clubs competing in international tournaments should be resisted at all cost. UEFA intervened and said that the clause to which we were just referring was a political clause and should be removed from the Bill, and the Prime Minister immediately removed it—but the moment you remove it from the Bill, there are unintended consequences.
Baroness Twycross (Lab)
We cannot pre-empt or direct the regulator, which will make objective decisions on a case-by-case basis. However, I repeat that I am very happy to sit down with the noble Lord to discuss and go through the unintended consequences that he appears to be concerned about. I will move on.
I turn to Amendment 30 tabled by the noble Lord, Lord Markham. When a club applies for a provisional licence, it has to submit a personnel statement setting out its owners, ultimate owners, officers and senior managers. The regulator will then approve the personnel statement, subject to any modifications, once it is satisfied that it is accurate. The club must then publish it, and this must be updated on an ongoing basis to ensure that it stays accurate. This, therefore, already provides clarity to the club, owners and fans as to who the owners, ultimate owners, officers and senior managers are.
A core part of ensuring that clubs have suitable owners and directors is the fitness test, which Amendment 177 seeks to expand. Let me be clear: the individual fitness test criteria for owners—honesty and integrity, and financial soundness—have been carefully designed. They are based on precedent and are specifically relevant to whether someone is suitable to be an owner of a football club. This amendment seeks for an owner’s competence to be assessed too. We do not believe that this would be relevant in the regulator’s assessment of someone’s fitness to be solely an owner. Some owners are hands off, and so their competence is not strictly relevant. If an owner also meets the definition of an officer, the regulator will be able to test them as both an officer and an owner. Therefore, as an officer, their competence would be assessed. However, an owner simply having a financial interest in the club does not mean that they make decisions that an officer would about how it is run on a day-to-day basis.
I turn to Amendments 181 and 183 in the name of my noble friend Lady Taylor of Bolton on the information that must be provided as part of a prospective owner’s application. I agree with the intention of the amendments —that the regulator will need information about an individual’s fitness in order to make an assessment—which is why Clause 28(2) already does that. It gives the regulator the ability to require information from an individual about their fitness. In fact, the Bill goes even further: it recognises that information about an individual’s fitness may come from, or be corroborated by, another source. That is why the Bill establishes information-sharing gateways with organisations such as the National Crime Agency. Specifically on Amendment 183, there is a risk that this amendment incentivises applicants to submit large volumes of unrequested information to the regulator, which could make it more difficult for the regulator to process applications efficiently.
The Government recognise and support the intent behind Amendments 182 and 184 in the name of my noble friend Lord Bassam of Brighton: to ensure that football continues to be played in a club’s home ground and that owners are committed to this. However, in many instances, neither clubs nor club owners own their home grounds. This amendment would therefore place a requirement on prospective owners to commit to something that may not be in their control. The Bill already has a number of comprehensive home ground protections to safeguard against inappropriate sales or ill thought-out relocations, including duties on the club itself about selling the club’s home ground or relocating from it—an issue that my noble friend highlighted effectively today. Under the current proposals in the Bill, the regulator can hold senior managers to account if they are responsible for breaching these duties.
Amendment 186 from the noble Lord, Lord Markham, and Amendment 187 from my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton concern the timelines and deadlines for testing prospective owners and officers. I absolutely agree and understand that timely decision-making about the suitability of new owners and officers is highly important. Without deadlines, we have seen league determinations drag on, unable to reach a decision and leaving clubs in limbo. We believe it is important that the regulator has the time to conduct tests with an appropriate level of scrutiny, but it also needs to make decisions in an appropriate time- frame to ensure that clubs are not unnecessarily impacted in what is a fast-paced industry—I think all noble Lords can agree on that. That is why the regulator will be bound by a statutory timeframe, as well as by its objectives, general duties and regulatory principles.
We are confident that, with these existing provisions, the regulator will already conduct tests as quickly as reasonably practicable. However, putting a specific deadline in the Bill would restrict the flexibility for this deadline to be amended in future. That is why we have proposed that the determination period, including the maximum amount of time by which it can be extended, will be set by the Secretary of State in secondary legislation. This will ensure that the regulator is bound by it but that there is still flexibility for the deadline to be amended in future. I hope noble Lords agree that future-proofing is a key consideration for this and any other legislation.
In the spirit of the debate, although the noble Baroness, Lady Grey-Thompson, is not in her place, I will speak briefly to Amendments 187A and 187B in her name. They concern whistleblowing on the suitability of an owner or officer, as the noble Lord, Lord Parkinson, highlighted. I share the noble Baroness’s desire to ensure that concerned parties can blow the whistle on unsuitable owners or officers. However, I assure noble Lords that there is no need to amend the Bill to allow this. It is already open to anyone, including all those listed in Amendment 187A, to share relevant information with the regulator. Therefore, we do not see the need to create a separate obligation in the Bill for individuals to report information to the regulator.
The noble Baroness, Lady Evans of Bowes Park, raised a number of pertinent issues covered by the subjects raised in Amendments 188 and 189 in the name of the noble Lord, Lord Markham. They seek to ensure that the regulator can test an incumbent owner or officer on their fitness only if it is in possession of information that gives it concern about whether the individual would meet the applicable fitness criteria. The Government very much agree with the intent behind these amendments, so I would like to reassure the noble Lord that the intent of these amendments is already delivered in the current drafting of the Bill. Clauses 34(1) and 35(1) give the regulator the powers to test incumbent owners or officers on their fitness if the regulator
“is in possession of information that gives it grounds for concern about whether the individual meets those criteria”.
If the regulator is not in possession of such information, it will not be able to test an incumbent owner or officer. The definition of an incumbent is clearly set out in Clauses 34(3) and 35(2). For the reasons I have set out, I will be grateful if the noble Lords do not press their amendments.
Baroness Evans of Bowes Park (Con)
I am very grateful for the Minister’s very clear answer on the Premier League and the regulator’s suitability test clashing. She said that the regulator is statutory and therefore would override the Premier League saying that it wanted someone the IFR did not. It may be a very unusual situation, but does it therefore follow that, if the Premier League decides through its test that an owner is unsuitable but the IFR decides that they are, the IFR can, in effect, impose an owner on a club? The Minister answered half of my question, and I am very interested to hear about the other half. If she cannot answer now, can she write to me?
Lord Hayward (Con)
Before the Minister sits down, perhaps I could make a comment. The Minister has been very helpful in offering meetings to discuss a whole range of issues that arise, which we greatly appreciate, and to write beforehand. On one thing which she touched on—I will obviously have to read Hansard very carefully to check, because she moved on fairly quickly—was why companies legislation was not acceptable for the Bill. I just register that I would like when we meet to discuss this more fully. She referred to Companies Act legislation being very lengthy, but I am not clear on why, if it is acceptable in general Companies Act legislation, it is not acceptable here. We can discuss that, but I just wanted to register it at this point so that when we meet, it is a subject for conversation.
Baroness Twycross (Lab)
I am happy to go into more detail on that point when I meet the noble Lord and I will ask my officials to contact him to set up a meeting.
Lord Moynihan (Con)
I thank everybody who has participated on this set of amendments. I heard a somewhat surprising answer from the Minister just now and I hope that it might be clarified. My noble friend Lady Evans put the question to the Committee as to which regulator takes precedence. My clear understanding of this Bill is that, through the licence procedure, the regulator we are setting up will take precedence over anything that the Premier League may choose to do. Indeed, that would be part of the contract of the licence issued by the proposed regulator, and that would take priority over, for example, the suitability and fitness tests, the degree of political interference or whatever the league might wish to do on the licensing of a club. However, I heard the Minister perhaps giving a somewhat different answer and, again, I would be grateful for clarification. A meeting is gratefully accepted and I look forward to meeting with the Minister, but, more importantly, these specific points need to be covered in writing to all members of the Committee, because I think there is wider interest than among just those whom she has kindly and graciously offered to meet.
I am sorry she did not respond to my noble friend Lord Parkinson’s question about Qatar. For the record, I am a great believer that sport is a catalyst for change. You know, when you win the right to host the World Cup, that you are shining a torch into the inner recesses of that country, which few other opportunities do. It means the world’s press and the football fans of the world are very conscious of what is happening in your country.
There is no doubt that hosting the World Cup in Qatar had significant influence on important social and employment changes that took place in that country. The fact that the ILO had an office there, worked there beforehand with the Government, was pushing for changes and continues to be there, is a great example. It is the only country in the Middle East that has that office. It is a great example of the power of sport for good and the power of sport for change. So I am sorry the Minister did not respond to that point, because I think it is an exceptionally important one.
I regret to say that I have not been persuaded by the Minister’s defence of retaining influence on the face of the legislation and yet not defining it, saying that it is for secondary legislation. It is one of many, many things that are for secondary legislation. For example, once the regulator identifies the owners and ultimate owners at the stage of the licence application, the regulator can, as the Minister said, make use of its powers under Clause 34 to determine the suitability of those owners. That includes whether the owner meets the individual fitness criteria and whether they have a source of wealth connected to serious criminal conduct. Serious criminal conduct is an extremely important concept that needs defining. If we look further towards the back of the Bill, it comes under “minor definitions” and will be for the Secretary of State to come forward with secondary legislation to define what he means by serious criminal conduct.
Lord Markham
“(5A) The IFR must give a notice to all persons it considers to be an officer of a club for the purposes of this section informing them that they are considered as officers under this section.”Member’s explanatory statement
This amendment requires the Regulator to inform every individual that it considers an officer of a club.
Lord Markham (Con)
This looks at the tests around the officers and I start by saying that we are all united in the Chamber in wanting good management in place, so the officer tests involved here, I think we would all agree, are well intentioned, because it all comes down to good managers. However, at the same time, I think we are quite aware that a lot of the things we are talking about here are beyond the directors and Companies Act tests that are in place. We are extending to a new category of officer, or senior manager, and we are putting new responsibilities on them. The amendment tries to be quite simple. First, the Bill is not clear who an officer is. It talks about having one or more club affairs that they are responsible for. So, first, we are trying to get clarity by letting those people know who they are.
That is important because we are talking about having some pretty serious and quite intrusive checks on them. Again, those are well intentioned—there are amendments coming up later in Committee where we will go into what those checks should be—but they are quite intrusive; they are looking at your criminal record and whether you have been involved in any court or tribunal. Maybe they are all very good tests, but I think people should be aware of them, because they might not be certain that they are actually an officer of a club. So, again, this is making sure that they are aware of it before they take something on.
Thirdly, and probably most importantly, not only are we giving them director-style responsibilities but we are potentially putting even wider-reaching penalties on them, of 10% of club revenue or £75,000, which many people would say is quite a deterrent. I am not talking about the big clubs. A lot of this refers to clubs that are pretty small, maybe run by a handful of people and for which a £75,000 penalty is pretty big. At the very least, they need to be aware that they are taking on those sorts of responsibilities and that should be outlined. That is what Amendment 31 tries to do.
Regarding Amendment 179, again, we talk about one of the tests being financial soundness. I think that we would all agree that, around an owner, that is right in terms of their financial soundness. I would like an officer or senior manager of a club to be financially sound too, just for their own good sake, but that does not necessarily make them a good or bad manager. They are not personally putting money into that club. Therefore, whether or not they have run up a lot of debts is not relevant to their ability to carry out the duties that we would want them to undertake.
Many of the 116 clubs are quite a bit smaller and often depend on people working on a voluntary basis. Those people suddenly having all their finances investigated and it being determined whether they are deemed sound or not, when we are not asking them necessarily to contribute any money to those clubs, is not proportionate. It might deter people who could probably be very helpful in the running of that club. I beg to move.
Baroness Twycross (Lab)
I thank the noble Lord, Lord Markham, for these amendments. I agree that it is important for transparency and accountability to fans and officers that it is clear who a club’s officers and senior managers are. That is why this is already an integral part of the Bill. When a club applies for a provisional licence, it must submit a personnel statement. In that personnel statement, the club must set out its officers and senior managers, which the regulator will approve once it is satisfied that it is accurate. The club must then publish it and keep it updated. Therefore, this already provides clarity to clubs, officers and fans as to who has a role in the running of their club.
On Amendment 179, it is essential that clubs have suitable officers. The regulator has a key role to play in this. It is officers who exercise a significant level of direct control over the day-to-day operations of the club. These can include financial decision-making. That is why it is vital that the regulator ensures that these decision-makers are financially sound. It includes assessing the personal finances of anybody where they have held a position of responsibility. This will help to identify any concerns or irregularities that would impact on their ability to act as a suitable custodian of a football club. For example, I am sure that noble Lords will agree that if a club’s chief financial officer has bankrupted companies in the past, that is a relevant fact for the regulator to consider. Ultimately, these tests should help to prevent fans suffering the consequences of poor leadership and financial mismanagement, as has often been the case to date.
I hope that such clarity gives reassurance to noble Lords on these points. For the reasons I have set out, I would be grateful if the noble Lord did not press his amendments.
Lord Markham (Con)
I thank the Minister for her replies. While we understand financial soundness in the context of a chief financial officer, in terms of the senior managers, as referred to in the Bill, we are talking about non-financial duties. I think that most people who run a club would say that the chief operating officer or the person responsible for the actual operations of the ground on the day is a key person. I am sure that they would be drawn into this definition and so would have all their finances investigated. Do not get me wrong: we want people as far as possible to be in a financially good position but, as I mentioned before, their personal finances are not necessarily relevant to whether they can be a good operating officer who can run the club very well on match days, with all the decisions involved with that. My fear is that we will deter people who are sometimes the backbone of the running of a lot of the smaller clubs from wanting to take on that sort of role because they know such intrusion will take place.
Those are the things that I am talking about. I absolutely get it when it is a financial director—the Companies Act and directors’ responsibilities cover that for finance directors. People who are not finance directors but who may be very involved in the operations are where the concern lies. I hope that we can cover this in more detail later on, but at this point I beg leave to withdraw my amendment.
Baroness Taylor of Bolton
Member's explanatory statement
This amendment is a consequential amendment following on from the above
Lord Parkinson of Whitley Bay (Con)
I think anyone in Committee anyone can move an amendment, so I am very happy to move Amendment 33. I am curious as to why the noble Baroness has not moved it and perhaps she can set out why, as it is a sensible one and I was intending to speak in support of it.
Amendments 32 and 33 sought to ensure that the chief executive of the new independent football regulator could be appointed by the whole board and not just by the chairman of the board. That would seem a sensible improvement in terms of collective decision-making and an additional safety valve to ensure that the appointment of the chief executive was not a politicised move. I know that a number of noble Lords have significant board experience and may have views on the merits of this.
I was also keen to come in because the amendment allows us to ask the Minister for an update on the appointments, because we are scrutinising this Bill not knowing who the chairman of the new regulator will be or the board. I understand that the deciding panel met to sift applications for the non-executive roles on Monday—I do not know whether she can confirm that—and that people who have applied have been asked to hold the 17, 19 and 20 December for interviews. Can she say now or in writing whether that is still the timetable on which the Government are operating? That would be helpful, because when we took the Online Safety Bill through, we knew who held the regulatory roles at Ofcom and could have some dialogue with them. Anything more that the Minister can say, now or in writing, about the timetable by which these important figures are appointed might aid the discussions that we are able to have in parallel to the scrutiny of the Bill about the people who will be taking forward these important roles.
I beg to move Amendment 33, so that the noble Baroness can have time to respond. I do not know whether the noble Baroness, Lady Taylor, wanted to say why she was no longer in favour.
Baroness Twycross (Lab)
I thank the noble Lord, Lord Parkinson, for the opportunity to respond to the amendment. The Government recognise the intent behind it, which is to ensure that the decision on the appointment of the chief executive of the regulator has the appropriate input and scrutiny. I reassure my noble friends and others that the Bill already suitably achieves this.
As per paragraph 5 of Schedule 2, the chair must consult the other non-executive members of the board, as well as the Secretary of State, before appointing the chief executive. The chief executive will have the responsibility of appointing a portion of the board—namely, the executive members. For this reason, I am sure noble Lords can see that it would be circular and impractical for the entire board to collectively appoint the chief executive.
I am happy to discuss this at greater length but I hope this reassures the noble Lord. I would therefore be grateful if he could withdraw the amendment.
Lord Parkinson of Whitley Bay (Con)
Is the Minister able to say any more on the timing of appointments? If not, I would be very happy for her to write. The processes to appoint the chairman and the board members began before the election. As I understand it, that process has continued but the Government extended the window of applications for people applying to be the chairman. That closed. I believe the sift took place on Monday, and people are being asked to hold dates next week and beyond for interview. Is the intention to try to make an announcement while the Bill is before your Lordships? Might we know who the new chairman and board members are, or has the timeline slipped?
Baroness Twycross (Lab)
Whether we get the result while your Lordships are debating the Bill is a moot point, given the length of time we are taking to get through Committee. The noble Lord is correct, though: the timetable for the interviews is the same, and they are intended to take place on 17, 19 and 20 December.
Lord Parkinson of Whitley Bay (Con)
In which case, I beg leave to withdraw the amendment.
Baroness Taylor of Bolton
Member’s explanatory statement
This amendment creates an objective test for whether a proposed IFR director has a conflict of interest, rather than leaving it for the person appointing that director to determine whether the director being appointed has a conflict of interest.
Baroness Taylor of Bolton (Lab)
My Lords, this amendment tries to probe what might happen and what protections there may be in cases of conflicts of interest in respect of members of either the board or the expert panel. My noble friend Lord Bassam and I have tried to be somewhat specific in our amendments about where conflicts of interest might apply. We have talked about consultants and organisations that might derive half of their income from one of the organisations that might be involved in a competition.
I hope that that can lead the Minister to talk about some of the difficulties that might arise if we do not get the right people in these positions working with the regulator. It is extremely important that anybody in this capacity is independent. We do not expect them not to have any interest in football but we do expect them not to have any financial interest that might at some stage create a conflict. If anybody is employed by a club or an organisation that is dependent on money from one of the leagues then difficulties could arise. Given the framework that has been established, which could be very robust and could help the regulator very clearly, we need to make sure that there are not conflicts of interest that could cut across this new regime.
Lord Addington (LD)
My Lords, these amendments seem quite reasonable. It would be interesting to see whether conflicts of interest at this level are addressed. I hope the Minister has a nice succinct answer that means we can all go away and move on to the next group. Having said that, I shall sit down and allow her to give it.
Lord Parkinson of Whitley Bay (Con)
My Lords, again, there is good sense behind the amendments that the noble Lord and the noble Baroness have tabled in this group. They address a critical issue about ensuring transparency and fairness in the governance of our beloved game.
Amendment 34 seeks to introduce an objective test to determine whether a proposed director of the new independent football regulator has a conflict of interest. Under the previous framework, the decision was left in the hands of the appointing party, leaving the process vulnerable to subjective interpretations and, potentially, political interference or favouritism, which I am sure we all want to strive to avoid. By introducing an objective test, the amendment would remove that ambiguity and ensure that potential directors are rigorously vetted before they take office. That is an important suggestion that would uphold the values of fairness and accountability in football.
Amendment 35 would take that further by requiring all directors of the independent football regulator to not only undergo this rigorous vetting but publicly declare any potential conflicts of interest. This would be a vital step in increasing transparency and holding accountable those who wield the new powers the Bill brings about. We on these Benches all agree that the integrity of the sport must be upheld through adherence to ethical standards and think that the amendments are an important step in that direction. The chief executive officer of the independent football regulator will be given the task of maintaining a register of these declared interests, ensuring full transparency and accountability in football governance.
Similarly, Amendments 43 and 44 would extend this principle to members of the expert panel, ensuring that they too declare their interests. Again, the independent football regulator’s chief executive will be responsible for maintaining a register of interest for the expert panel, providing an additional layer of transparency. By implementing these measures, we would reinforce the importance of ethical conduct and accountability across the regulator’s board and its expert panel, both of which will be key to the fair and transparent governance of football under the new regulatory regime.
Finally, Amendment 331, which would expand the nature and definition of a conflict to include a situation where the perception of a conflict may arise, also has some merit. Perception is often just as important as reality in maintaining trust. By introducing non-exhaustive examples, the amendment would ensure that we address conflicts of interest in a comprehensive and forward-thinking manner.
I am grateful to the noble Baroness and the noble Lord for tabling the amendments, which represent a robust and progressive framework for managing conflicts of interest in the governance of the sport. They would introduce clear, objective tests, require declarations of interest and ensure transparency through the form of the public registers, all of which are important. I look forward to hearing what the Minister has to say.
Baroness Twycross (Lab)
I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton for tabling these amendments. The Government acknowledge the intent behind them, which is to fortify the Bill’s provisions for dealing with conflicts of interest. It is essential that the regulator can deliver its regime, free from undue influence and vested interests.
I reassure my noble friends that the Bill already sufficiently makes certain that the regulator will be free from conflicts of interest. This is supported by public law principles and non-legislative measures that are already in place. As with all public bodies, members of the regulator’s board will be subject to the Cabinet Office’s code of conduct for board members of public bodies, which sets out clear requirements regarding the appropriate disclosure and management of conflicts of interest. It includes a responsibility on board members to openly and honestly declare any interests that could give rise to actual or perceived conflicts. Any breach of these requirements would be a breach of the member’s terms of appointment.
The Bill also places an additional onus on the appointer to check for conflicts that have not otherwise been declared, both at the point of making the appointment and on an ongoing basis from time to time. In addition, paragraph 16 of Schedule 2 requires members of the board to declare their interests in any matters which fall for consideration by the board, and for this declaration to be recorded.
On Amendment 331 in the name of my noble friend Lord Bassam, the Government are confident that the existing definition of conflict of interest is appropriate and will capture the correct issues. The expansion of the definition proposed by my noble friend would also see perceived conflicts explicitly forbidden. We believe this is disproportionate and goes beyond the normal interpretation of conflict of interest. For example, almost all noble Lords here support a football club. In an extreme interpretation, that alone could be a perceived conflict. All in all, we are confident that the Bill, supplemented by public law principles and non-legislative measures already in place, provides comprehensive safeguards to identify and manage conflicts of interest appropriately. For these reasons, I am unable to accept my noble friends’ amendments and ask my noble friend to withdraw her amendment.
Baroness Taylor of Bolton (Lab)
I am grateful to the Minister for emphasising that the potential for a conflict of interest is there and potentially quite significant. I accept that we all have an interest. If an interest in football was a perceived conflict then we would all be in great difficulty, but I think it is important to emphasise that we are talking about potential financial conflicts of interest. I am grateful to the Minister for putting that on the record. I beg leave to withdraw the amendment.
“6A No person may be appointed to the Board if that person currently has any broadcast or media interests or any role in a television or media broadcast which relates to football.”Member's explanatory statement
This amendment prohibits any person who currently has any interests or roles in a television or media broadcast that relates to football from being appointed to the Board.
Lord Parkinson of Whitley Bay (Con)
My Lords, I will also speak to my Amendment 40. This flows from the discussion we have just had about financial conflicts of interest but looks at the broader issues of a person who has a current broadcast or media interest, or any role in a television or media broadcast relating to football, being appointed to the board of the independent football regulator. It seeks to prevent conflicts of interest relating to those who take part in television, radio and podcasts that are linked to football.
The concern here is that any person with that sort of involvement in such media or broadcasts would have, by the very way that they carry it out, publicly held opinions about the game that they would be expressing frequently and sometimes in a live environment where questions could be put to them. We would not want to see people with vested interests that might conflict with the proportionate and reasonable exercise of the regulator’s functions put in a position where their thinking about how they carry out their duty is scrutinised in that forum and in that way.
As my noble friend Lord Markham pointed out on a previous group, this is a new regulator that will have enormous power to determine the specifics of the rules and regulations that football clubs will have to abide by. That includes the levy rules set out in Clause 53, which states that the amount the regulator will be able to charge clubs is to be determined in rules established by the regulator. Again, the details are not set out in the Bill but are to follow. There are some limits on what that levy could be, but the exact amount that will be charged and how that levy will be scaled to take account of the different financial situations of clubs are to be established and amended by the future board of the new regulator.
So the level of intrusion into the affairs of clubs is not entirely settled by this Bill. It will be decided by the people who are appointed to run and oversee this regulator. That is why we will be interested to know who these people are in due course. We wish all those who have applied to take on these important roles good luck in their efforts to be the inaugural holders of their posts. However, it is very clear that the board and, specifically, its chief executive will in very large part set the direction of the regulator, its tone and the means by which it goes about its work.
That is why it is important that we make sure that nobody can be appointed to the board, particularly in the first cohort, who has any conflicts of interest or who might be swayed once in office. Of course, in doing that we do not want to preclude anybody who has experience of the operation of football clubs or great knowledge of the game being appointed to the board. Those sorts of skill sets will clearly be needed. If we have people who have been involved in the running of football clubs, they may be quite powerful and important people to speak out against excessive regulation and mission creep. I hope that through this amendment we can have a debate about the public-facing elements of their role and the way they go about it.
Baroness Taylor of Bolton (Lab)
I am not sure the noble Lord has made his case for why somebody who has an interest or a role in television should not be a member of the board. I am sure that there are commentators who may say things from time to time with which the noble Lord may disagree, but that is irrelevant. We are talking about people who have a degree of expertise about the game, and I cannot see why somebody whose job it is to comment on the game of football cannot have a role in this.
Lord Parkinson of Whitley Bay (Con)
I am happy to say a bit more. This is a probing amendment, and I am keen to hear the views of others. My concern is about how public facing a figure this new regulator is to be. I am mindful of comparisons with debates on legislation that I have taken through. We benefited in the scrutiny of the work of Ofcom and the new online safety regulatory regime from having the noble Lord, Lord Grade of Yarmouth, here in your Lordships’ House. He attended and sat through all our debates in Committee and on Report but did not speak because he felt that it was important that he heard the views of Parliament but did not actively participate in the debate about the regulatory regime that Ofcom would be following once Parliament had given it its instructions. The self-denying ordinance that he applied and the rules of debate in your Lordships’ House made it easier for him than it might have been had he been a commentator on television or frequently appearing on television and in media interviews and being asked about the work.
I am sure we want to see the regulator held accountable publicly as well as to Parliament, and I look forward to our debates on later groups about how we ensure greater accountability to Parliament for the work that it does. I am sure that fans will have strong views about the work of the regulator, just as they do about how referees conduct their duties during matches. However, I wonder whether somebody who is taking on this role, potentially one with a large and unlimited salary, should be combining that with ongoing media interests in which they have a commercial interest in adding to the drama and to public debate about the game. I will be grateful for the Committee’s views on that matter.
Lord Berkeley of Knighton (CB)
I imagine that this could be a rather tricky area, for the reasons we have just heard. I can see that someone who has great expertise —an ex-international, for example—would be useful on a board and may be asked occasionally to comment, which would not mean a great deal of compensation or money. I am sure the noble Lord does not want to see those sorts of people excluded.
Lord Addington (LD)
My Lords, Amendment 36 seems to be taking a sledgehammer to a nut. If you have some expertise and you are commentating, you may well be qualified to be in that role. There is a balance to be struck here. The Minister might ask, “What would be an unacceptable position within the media that would exclude you from this role?” If you are a senior executive with Sky, in the current situation, that would exclude you, but what if you happen to be a commentator, say, for a local paper dealing with your own local team, and possibly going on further? Would that exclude you? I would be interested to know if the Minister or the Government have an opinion on this, because there is clearly a balance here, as the noble Lord has just pointed out.
Lord Markham (Con)
This is exactly why we want to have these sorts of debates in Committee. Funnily enough, I put my name to this amendment. As noble Lords know, when I talk about media interests, I do so as a former director of a pay TV company. I was thinking about media interests less in relation to broadcasting and more that—the noble Lord, Lord Birt, will know this—when you are making sports media rights bids, all information is good information. You would then be party to a lot of privileged, and maybe even inside, information.
I agree that there is a balance to be struck, because these are exactly the sort of people you want involved in the regulator as well; but if they have a current role that involves them bidding for media sports rights, that would probably rule them offside—if you will excuse the pun. Again, that is exactly why we bring issues such as this to Committee to discuss.
Lord Birt (CB)
There is a potential conflict on both sides. There are many different roles in media but obviously, it is a single role that might be filled here. I would feel very uncomfortable if someone were sitting in both camps, were I to be in the decision-making capacity ever again in a broadcast organisation.
Lord Londesborough (CB)
My Lords, I shall address Amendment 40 in the names of the noble Lords, Lord Parkinson and Lord Markham.
Before I do, I have remained silent for the last few days, taking in what has been said. I have a problem with Amendment 40, which I will come on to in a moment, but I want to reflect on the role of the regulator and the CEO. We are now on day three in Committee. It is important that both sides—I am trying, as a Cross-Bencher, to act as an honest broker—work productively and do not lose sight of what the majority of us want, which is to establish a new regulator with a clearly defined remit that does not stray into areas of overregulation or overreach.
That is not to say that issues such as environmental sustainability, CSR, women’s football or player welfare are not important; they are, but if we do not focus tightly on the core responsibilities of the regulator, I fear we are going to end up with a very complicated Bill that lacks pragmatism and leaves the regulator, whose salary I will come on to in a moment, in a pretty unworkable and unpopular role, at increasing expense to the football clubs in terms of the licence fees. I am thinking here particularly of the clubs in tiers 3, 4 and 5.
I would like to bring back a bit of financial perspective to this debate. Remember, financial sustainability is really what brought us here. Yes, there is fans’ engagement, but we have rather lost sight of that. The Premier League is the richest and most-watched league in the world, a fantastic creator of jobs and a multibillion-pound generator of exports. However, we have warning lights flashing on our dashboard that we ignore at our peril.
Total debt across the Premier League is fast approaching £4 billion—not the £2 billion that one of your Lordships mentioned on Monday—and that figure comes from the University of Liverpool. Losses across the Premier League are running at close to £1 billion per annum, per season. As we have heard, typically, 16 to 17 of its clubs generate losses, while in the Championship 80% of clubs have negative equity, and not one of those clubs generates an operating profit outside of player trading.
Having said that, I appreciate that we need to strike a balance and not interfere unnecessarily. I have listened carefully, this week and last week, to the noble Baroness, Lady Brady, among others, when she spoke about the danger of overreach and the need to be careful that we do not kill off the ambition, aspiration and calculated risk-taking of clubs—in other words, that we do not kill off the excitement and jeopardy of the game, which of course involves financial risk. That is a really important point.
Taking that into consideration, we need to be disciplined and define the parameters of the IFR with an eye on realism, pragmatism and effectiveness. The Bill runs to 120 pages, with 99 pages of Explanatory Notes. We have 340 amendments, which, thankfully, are reducing—and I think we are still on page 4. That is not a great advert for productivity.
Anyway, that is enough background from me. I return to Amendment 40. We are going to need a CEO of the highest calibre for the regulator, and that CEO is going to have to show great leadership skills and profound and relevant domain experience. Capping his or her salary at £172,000 per annum will simply make the recruitment of a high-calibre CEO that much more difficult. I appreciate that we need to control costs, but that is not the area in which to do it.
Lord Hayward (Con)
I echo the comments of the noble Lord, Lord Birt, about a conflict of interest. I take the point made by the noble Lord, Lord Addington: making small or one-off contributions because you have been asked to, given that you hold that particular role, is very different from having a specific and clear role in the media. There would be a conflict of interest if you held both positions and were contributing on a regular basis. I cannot see that it would be perceived by the average fan as acceptable to have someone who held both positions.
My noble friend Lord Parkinson has included in his amendment the word “currently”. I assume that he would accept someone giving up one role specifically to take up another—I think that is what he is referring to—but I certainly take the view that any substantial media interest would be utterly unacceptable for someone in these circumstances. Millions of football fans would take the view that they were pro a particular point of view at any given point.
I share the view of the noble Lord, Lord Londesborough, on salaries, particularly because it is always dangerous to put a salary in legislation. What happens if you have inflation? First, you have to change the primary legislation, and there is no indication of inflation adjustment in the amendment.
Those are small observations, but I agree with the noble Lord, Lord Birt, and the direction of my noble friend Lord Parkinson’s amendment—that there should not be a prima facie case of conflict of interest in these circumstances.
Baroness Twycross (Lab)
I thank the noble Lord, Lord Parkinson, for tabling these amendments and thank all noble Lords who have contributed to what I thought was a very thoughtful discussion. As with the previous discussion on this matter, the Government would like to reassure noble Lords that the Bill already sufficiently makes certain that the regulator will be free from conflicts of interest, irrespective of sector. This is supported by public law principles and non-legislative measures already in place. As I said previously, the Bill requires members of the board to declare their interests, and this declaration is to be recorded.
Taking Amendment 36 first, we are confident that there are comprehensive safeguards to root out and manage conflicts of interest appropriately. For example, a board member would not be permitted to take part in any discussion relating to a matter if they had a significant direct or indirect interest in it. Failure to declare an interest would also be a breach of the board member’s terms of appointment. In response to noble Lords who asked me for a definitive view, my view is that beyond these comprehensive existing provisions we do not think it is necessary or appropriate arbitrarily to rule out specific sectors or sector interests such as television, broadcast or media.
On Amendment 40, we acknowledge the importance of the regulator offering value for money. It will be required to lay its annual accounts before Parliament and the Comptroller and Auditor-General for scrutiny. The regulator will also be subject to pay remit guidance in the same way central government departments are to ensure pay rises are justifiable. This will ensure value for money for taxpayers. However, having a maximum salary in legislation risks the regulator being unable to attract the right talent, potentially leaving it without the skills and expertise it needs to deliver its objectives—a point the noble Lord, Lord Londesborough, made very succinctly. We agree with the point around the need to control costs. A fixed salary in legislation is also inflexible to inflation and market changes, and it could become rapidly outdated, as the noble Lord, Lord Hayward, pointed out. For these reasons, I am unable to accept the noble Lord’s amendments and ask that he withdraw or not press them.
Lord Parkinson of Whitley Bay (Con)
I am very grateful to the noble Baroness for that response and to noble Lords who took part in the debate. This is a strength of the Committee stage—I can see the furrowed brows with the opinions being weighed up and I am grateful to noble Lords who have engaged with the probing amendment I tabled in this way. I hope, if nothing else, it has been useful to the Secretary of State who, as we know from the Minister’s responses in the previous group, is soon to make her decision about who ought to chair this new regulator and who should be on the board. I hope that the points that noble Lords across the Committee have made will be taken back and inform her deliberations.
I take on board what the noble Baroness said and indeed the point that the noble Lord, Lord Londesborough, raised about the need to make sure we are paying enough to attract the calibre of person that is going to rise to the task ahead of them. On pay and salary, I am grateful as well to the Minister for what she said and was struck particularly by what she said about pay restraint. I know from my ministerial experience that, when public bodies want to push for pay rises above what would be normal in the private sector or across the economy more generally, then that comes to Ministers. If there is that sort of oversight and check and balance in the system to ensure that the regulator’s salary costs are not spiralling as quickly as we feared, then that would be a good thing. With gratitude to the Minister and to all who took part, I beg leave to withdraw my amendment.
“6A “(1) Any person appointed to the Board must agree to appear before any relevant Parliamentary Committee.(2) A relevant Parliamentary Committee is any Committee of the House of Commons, or House of Lords, or of both Houses, which has notified the Secretary of State, in writing, that they have assumed the function of scrutiny of football regulation.(3) Any person appointed to the Board may not take their position unless they have been approved by a resolution of each relevant Parliamentary Committee.”
Lord Parkinson of Whitley Bay (Con)
My Lords, as well as moving my Amendment 37, I will speak to my further amendments in this group, Amendments 38 and 123. In the letter which she kindly sent to the Committee earlier today, the Minister displayed her familiarity with and affinity for Erskine May and, even if I did not have unbridled delight as to the contents of the letter, I was pleased to see this reference to one of our great constitutional experts and authorities on legislative procedure.
In that spirit, I would like to quote another revered expert on constitution matters, the great AV Dicey, who expounded that:
“The principle of Parliamentary Sovereignty means neither more nor less than this, namely, that Parliament … has, under the English constitution, the right to make or unmake any law whatever; and further, that no person or body is recognised by the law of England as having a right to override or set aside the legislation of Parliament”.
In more recent times, the Constitution Unit at University College London has set out particularly relevant arguments for the importance of parliamentary accountability. In its 2023 briefing Parliamentary Scrutiny: What is it and why does it matter? the unit rightly said that:
“Government accountability to parliament is central to our democratic system”.
I think this all demonstrates that the right of Parliament to oversee and hold public bodies to account must be upheld dearly as well.
This new regulator, which we are bringing about through this Bill, will at the start of its existence have recourse to public funds. It is crucial that any body which has funding streams derived from the taxpayer at any point should be accountable to and scrutinised by Parliament. That is what Amendment 123 requires.
Amendment 37 seeks to ensure that any person who is appointed to the board of the regulator must be approved by a parliamentary committee, and Amendment 38 requires the chief executive to appear before a parliamentary committee at least once a year if they have been so invited. This ensures that anyone who is going to be holding any formal position in this new regulator can be scrutinised by parliamentarians before they can be appointed.
Following on from the debates in the two groups that we have just had about conflicts of interest, it may be that rather than setting it out in the Bill, as the probing amendments sought to do, the parliamentary oversight that we could bring about this way might be able to give us the reassurances we seek that the people who are given these awesome new responsibilities are doing so without conflicts of interest or the pressures on them that we wish to resist. I beg to move.
Baroness Brady (Con)
My Lords, I support this group of amendments, which I think are very helpful because they will help to tease out one of the real challenges at the heart of this Bill—how to achieve the right balance of proper oversight with the absolute necessity of delivering regulatory independence. We should, of course, acknowledge the natural instinct to ensure democratic accountability of any new regulator. Given the cultural and economic importance of football to our nation, Parliament should rightly maintain some oversight of how this new body exercises its considerable powers.
The question “Who regulates the regulator?” is beginning to be asked more and more often, not least in relation to the many clear failings of UK regulators, and rightly so. However, I believe we must also tread with real care here. Football’s international governing bodies, UEFA and FIFA, have clear provisions against state interference in the game. While their primary concern has historically been direct government control of national associations, they could well choose to interpret these provisions more broadly. We have already seen their willingness to act even in response to the mere creation of this regulator, and we have seen the Government’s instant removal of a clause in this Bill relating to foreign and trade policy. This tension means we must achieve a delicate balancing act: too little accountability and we clearly risk regulatory overreach; too much involvement of the state and our democratic institutions and we risk creating leverage that could be used against English football’s interest.
I have already spoken about some of the risks here. If Select Committee oversight and IFR responsibility to both bodies was seen as political interference, it could feasibly create that leverage we have warned about whereby clubs participating in European competition, or even England’s tournament participation, is put in jeopardy. We have already seen concerning signs of how these tensions might play out. In just a short time since this Bill’s introduction, we have witnessed numerous attempts to expand the regulator’s scope from environmental sustainability to ticketing prices and kick-off times to corporate responsibility requirements. I am concerned about how this pressure might intensify with direct parliamentary oversight.
Members of the other place, responding quite correctly to constituents’ concerns, might press the regulator to intervene in broadcast arrangements or ticket allocations, or elements that go to the heart of competition tools that should be reserved for the leagues. Select Committees could demand action on issues far beyond the regulator’s core financial sustainability purpose. Each intervention, however well intentioned, risks creating exactly the kind of state interference that could threaten English football’s international position.
We have seen this pattern in other sectors: regulatory mission creep that is driven by political pressure and external events. Football’s unique international framework makes this dynamic particularly dangerous. Every expansion of scope and political intervention creates new vulnerability to UEFA and FIFA leverage. I would be grateful if the Minister, when she responds, could explain how the Government intend to manage these competing demands. How will they maintain appropriate accountability while preventing political pressure from expanding the regulator’s remit? How will they ensure that parliamentary oversight does not become a backdoor for state intervention in football’s affairs? What safeguards will protect against the regulator being drawn into issues that should remain matters for the football authorities only?
Finally, I would be grateful if the Minister could confirm whether this issue has been directly discussed with UEFA and, if so, what its view is on how the IFR’s independence should be preserved in this respect. It seems clear that without comprehensive assurances on every single aspect of the IFR and how it will operate, we risk inadvertently subjecting English football to permanent external control. The irony of creating this leverage will be quite incredible. In seeking to protect our game through regulation, we must not end up permanently compromising its independence and losing control of English football for ever.
Baroness Taylor of Bolton (Lab)
My Lords, when the noble Baroness, Lady Brady, started speaking, I thought that we were going to have a first. She started off by agreeing with the noble Lord, Lord Parkinson, on some points that I would agree with him on. Then she went totally against that and said that a Select Committee might be too interfering. I point out to her that the Select Committee that covers DCMS has, for many years, talked about the problems in football such as ticket pricing and the timing of matches. That has not impinged in any way on any international arrangements.
We have to make a clear distinction between Parliament and the Executive, because we are not talking about state control or government control. What we are talking about in this amendment is a proper accountability for any regulator. As I mentioned at Second Reading, I have the privilege of chairing the Industry and Regulators Committee of this House. We had a report about who regulates the regulator, so it is strange that the noble Baroness should use those words. This is not about regulating the regulator; it is actually about holding regulators to account. Both Houses have a very important role to play in making sure that regulators are held to account by Parliament.
I go further: if some of the regulators had been held to account more closely by Parliament in recent years, we would not, for example, have the crisis that we have today in the water industry. There has been a failure of Parliament to hold regulators to account.
My Amendment 89 is not grouped with these amendments but covers very similar points and the same principle. I hope that the Minister will give us an assurance that Parliament will have a role to play in holding all regulators to account, including the independent football regulator.
Lord Jackson of Peterborough (Con)
My Lords, it is a pleasure to follow the noble Baroness, Lady Taylor of Bolton. Her words are born of great experience—not just the dark arts of the Whips’ Office, I know, but many years of speaking up for her constituents in the other place. I think she ended up agreeing with my noble friend Lord Parkinson of Whitley Bay.
I support this amendment because of my experience of four years on the Public Accounts Committee in the other place. I had the great privilege of serving under the excellent leadership of the noble Baroness, Lady Hodge of Barking, who was a superb chairman. That is not to take away from the work of Meg Hillier, who recently did an excellent job in that role.
My point is that the noble Baroness, Lady Taylor, mentioned the division between the Executive and Parliament. Our worry on this side, and the reason we put forward this amendment, is that we see too many powers being vested in the Executive and Parliament having too few.
Lord Hayward (Con)
Since my noble friend is referring to a letter that was addressed to me, I assure him that in the debate on another amendment I shall return in far greater detail to this letter, not least because the first heading of the letter refers to “Exact cost”. I never asked for exact costs. I preferred to use the word “probably”.
Lord Jackson of Peterborough (Con)
Your Lordships and I can rely on my noble friend’s forensic interrogation of the letter and the Bill generally. I know that we will come back to this issue.
I mentioned proportionality and a final example is the framework document, which has a strange description on page 2 of the letter. It says:
“DCMS as the sponsor department will agree a ‘framework document’ with the Regulator”.
It will be up to a parliamentary committee to look at what the point of that framework document is and whether its delivery by the regulator is efficacious. We need to know about the accounting officer. We need to know about the role of the National Audit Office and how it will intervene and work with the department, the regulator itself and any parliamentary committee. The levy, the proportionality and the cost are all areas where Parliament has a very important role to play.
I think we have reached the turning point in trusting regulators to discharge their duties without appropriate and close examination by legislators. That is our job and the job of those elected in the other place. Because the weather has changed for regulators, we no longer implicitly trust them to be full of experts and to do their job effectively. As my right honourable friend the former Prime Minister Rishi Sunak said, “In God we trust, everyone else bring data”. I am not just looking at the right reverend Prelate when I say that. The serious point is that we need to see that the regulator is doing its job. We cannot rely on just undertakings and assurances. We need the proper statutory function of a committee to oversee the work of the regulator. On that basis, I warmly support my noble friend’s excellent amendment.
Lord Moynihan of Chelsea (Con)
My Lords, it is a pleasure to follow my noble friend Lord Jackson and to support the three amendments tabled by my noble friend Lord Parkinson. I spoke a few days ago about how the Premier League became so successful, so popular and such an enormous contributor to the soft power of this country around the world, as well as to our finances in the many billions of pounds of taxes it pays. I spoke about the very delicate nature of entrepreneurial activity and the danger that comes from overregulation.
As noble Lords will know, I am not keen on the whole idea of this regulator—particularly one that is given so many powers in such an enormous Bill. But there is only one thing worse than a regulator given many powers and that is one given untrammelled and unscrutinised powers. Therefore, if we are to have this regulator, it is absolutely crucial that there is sufficient scrutiny of what it does.
We know that regulators like to regulate. People who are attracted to the idea of supervising other people like to get really involved and talk about what they would like to happen and how they can make that happen. They want to have the powers to make it happen—and preferably without scrutiny. I do not know how many Members of this Committee have had the experience of many years of scrutiny by regulators who decide, “You’re a wrong ’un and we’re going to go after you”. The process becomes the punishment.
And as many noble Lords have asked already this evening and earlier, who is going to come into this game? Who is going to apply their entrepreneurial flair if they believe that an untrammelled and unsupervised regulator is going to be able to second-guess everything they do, consider their fitness and will be able—from what we were told earlier—to reach into their funds and, through the backstop, extract them for whatever purpose, unchallenged, unsupervised and without any scrutiny. I submit to noble Lords that these amendments, if we are to have a regulator, are absolutely crucial for the regulator’s good functioning and for the future success of this wonderful part of our economy.
Lord Goddard of Stockport (LD)
On these Benches, we broadly support these measures. It is a pleasure to follow the noble Lord, Lord Moynihan of Chelsea, because he speaks his mind and I like that. There is no ambiguity in what he is trying to say; he just says it. That, to me, is refreshing.
In supporting the amendments from the noble Lords, Lord Parkinson and Lord Markham, with respect, we do not need Erskine May or Burke. It should be common sense to us that the regulator must be accountable to Parliament. We are the heart of democracy and the social fabric of the country, and we are funding it. So, if there were an overwhelming reason why the Government did not want this, I would find it unfathomable; the regulator should be accountable.
The noble Baroness, Lady Brady, was passionate in what she said, and I understand the pitfalls she can see coming, but this is really about regulation and accountability. That is the fine line that we draw. We are not overregulating but we need that accountability. I suppose it is about scope and the number of times we may be calling people, and which Select Committees can call them. I would suggest it should not be just any Select Committee; it should be pertinent to the business.
The Government will ask that the amendments be withdrawn today, but could they commit that this will be somewhere in the Bill? Without an agreement that the regulator will be held to account by Parliament and will report to Parliament, this group of Peers—the small and happy band that we are—will be less than supportive of not supporting this, if that makes sense.
Baroness Evans of Bowes Park (Con)
My Lords, building on what was just said—this comment is not particularly for the Government but is perhaps a reflection for both Houses—as this will be a completely new regulator, there should potentially be a committee of both Houses, unusual though it may be, with representatives from both sides. It might be quite useful for a committee to be set up to look at this regulator, not least because of all the issues we have been discussing, as it is something completely new.
Baroness Taylor of Bolton (Lab)
I am grateful to the noble Baroness for giving way. The Industry and Regulators Committee, with outside organisations such as the Institute for Government and others, has looked at what might be appropriate going forward. There is a real concern that we do not have a drumbeat of accountability for all regulators, so some new mechanism might be appropriate, potentially even in the way that the noble Baroness suggests.
Baroness Fox of Buckley (Non-Afl)
My Lords, perhaps I could have a clarification. The noble Lord, Lord Parkinson, said that he had lots of experience of regulators. He referred to the Online Safety Act and Ofcom and his dealings there. I found it incredibly unhelpful to be constantly told by Ministers at that time that something was not up to them, it was up to Ofcom, even when we were making a decision about what the Ofcom regulator was going to do.
There are times when it feels as though Governments of any political stripe can outsource authority to a regulator. They tell the regulator what to do and then, when you try and hold somebody to account, the Government say, “Oh no, it’s the regulator that makes that decision”. So it actually removes any accountability. I am very keen on a mechanism for accountability and I am very anxious that, when we constantly stress that they are independent, arm’s-length regulators, that can be a way of avoiding any kind of political accountability.
However, I am also sensitive to the issues raised by the noble Baroness, Lady Brady, about the kinds of things you can imagine happening if there is accountability at Select Committee level. I want accountability and I can take on board what the noble Lord, Lord Jackson, said about the forensic way that Select Committees can hold people to account. That sounds very positive. But it depends which one it is and who is on it. I can imagine the political fads of the day. You can imagine a Select Committee saying, “Why aren’t you doing more on”—my favourite topics—“EDI or the environment?” or “Where’s your environmental target? You’re not doing enough on that, are you?”
We have to be quite precise about the principle. On the one hand, there is the very important principle of parliamentary accountability. On the other, we also have to ensure that that does not become political interference, because it could. There could be a kind of pressure from Parliament for the regulator to adopt political priorities rather than football priorities.
Lord Markham (Con)
We have had three days of debate and it is fantastic that we have an outburst of consensus. On all sides of the Committee, we seem to agree that we are putting a lot of trust in this regulator. We have had long and thorough debates about what its objectives should be. I come back not to Erskine May or other writings but to the Gorbachev and Reagan saying, “Trust, but verify”, which I always remember. There is consensus around the Committee about how vital parliamentary scrutiny is for what we think is such an important role. I hope that, when the Minister responds shortly, she will take on board the consensus view of the Committee and respond positively.
Lord Parkinson of Whitley Bay (Con)
I will briefly encapsulate some of what we have heard and respond to the point of the noble Baroness, Lady Fox of Buckley. She is right: it was a chastening experience to stand at the Dispatch Box as a Minister and repeatedly have to say that something was a matter for the independent Ofcom, the independent Arts Council, the independent board of the BBC, or the Betting and Gaming Council. There are good reasons why many of those organisations are independent of government, and that independence should be carefully guarded. However, given the additional role that Ministers in this House have, and in providing parliamentary scrutiny, the distinction that the noble Baroness, Lady Taylor, makes between the Executive and the legislature comes to the heart of it.
I am grateful to my noble friends on these Benches for expressing some of the concerns that they would raise if they were on a parliamentary committee overseeing the work of this regulator. As the noble Baroness, Lady Fox, reminded us, the concerns could go in all directions, and that is the beauty and importance of parliamentary accountability. This is an important regulator doing hotly anticipated and important work, and I am grateful for the consensus, which my noble friend Lord Markham points out, on the need to find a way to make sure that it can continue to be accountable to both Houses of Parliament.
Baroness Twycross (Lab)
I thank the noble Lord, Lord Parkinson of Whitley Bay, for tabling these amendments, which relate to the transparency and accountability of the regulator. The discussion was interesting, and I found my noble friend Lady Taylor’s expertise on this matter particularly helpful to our debate. I look forward to discussing this further with her.
The noble Lord, Lord Goddard of Stockport, raised some interesting points. I stress that the Government recognise that it is vital that the regulator is transparent and able to be held accountable by Parliament and others. A number of provisions in the Bill already ensure this. The exercise of the regulator’s functions will be reviewed in the regulator’s annual report. The Secretary of State and Parliament will be able to scrutinise these reports, which will be laid before Parliament. The regulator’s chair and non-executive directors will be required to go through the public appointments process, as is appropriate given the weight of the role and responsibility for other appointments to the regulator. The chair of the regulator will already be subject to pre-appointment scrutiny with the relevant parliamentary Select Committee. However, as far as I am aware, there is no precedent for board members to be expected to go through such an extensive process as the chair is expected to, and neither has the relevant parliamentary Select Committee sought this. We therefore do not think that such a requirement is proportionate or necessary.
The regulator will be expected to work alongside the parliamentary process, which already allows committees to compel witnesses to attend. If a committee wished to invite a relevant member or the chief executive to appear before it, the Government would certainly expect them to fulfil this. These amendments would set an unprecedented and rigid approach to committee invitations that we do not feel is appropriate to place on the regulator. It would also not be appropriate for the Government to dictate to parliamentary committees who should appear before them—that is surely a matter for committee members themselves to determine.
Almost all of Amendment 123 dictates various actions in relation to parliamentary committees: who should appear before them, what they should scrutinise and when they should do so. I am sure the noble Lord agrees that parliamentary committees are quite able to take these decisions themselves and do not need the help of any legislation to do so. On the expert panel, the legislation already sets out a number of requirements to publish decisions and reasons for them. For these reasons, I am unable to accept the noble Lord’s amendments and ask that he withdraws Amendment 37.
Lord Parkinson of Whitley Bay (Con)
I am grateful to the Minister for that response. I recognise many of the lines she uttered; I have uttered those and similar on previous Bills. For me, the most important contribution was that of the noble Baroness, Lady Taylor, who has given greater thought to this over a long time.
The Minister is right: it is not for the Government to tell parliamentary committees whom to call as a witness and how to do it. But there is a growing concern that there are so many ways in which the Government have devolved power to powerful regulators that can accrue—in the way that the Bill achieves—new powers or go in new directions through secondary legislation that does not get the sort of scrutiny that we are giving the Bill at the moment. Perhaps some broader mechanism needs to be found for looking at the work of not just this regulator but regulators in general. As I say, that was a feeling that gnawed at me when I stood at the Dispatch Box opposite. We will probably not crack the answer as we look forward to a well-earned dinner break, so, with gratitude to the Minister, I beg leave to withdraw the amendment.
Fracture Liaison Services
(1 week, 1 day ago)
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Lord Black of Brentwood
To ask His Majesty’s Government what progress they are making towards universal provision of fracture liaison services in England by 2030.
Lord Black of Brentwood (Con)
My Lords, it is a privilege to introduce this important debate, in which I declare an interest as co-chair of the All-Party Parliamentary Group on Osteoporosis and Bone Health. I am very grateful to all those taking part. I hope that, together, we will again demonstrate the strength of feeling on this issue across all parties in the House, and our determination to ensure action. It is a particular pleasure to welcome the noble Baroness, Lady Merron, to her place for her first debate on osteoporosis as Health Minister. She has always been immensely supportive on this issue, and I know how seriously she takes it. Her leadership will be crucial in advancing the cause of fracture prevention in the days ahead, and I look forward to hearing what she has to say.
Fractures caused by osteoporosis are one of the greatest threats to people living well in later life, affecting half of women and a fifth of men over 50. They are the fourth most-harmful health condition, measured by disability and premature death. They have a profound impact on those who suffer from this debilitating condition —as I saw in the case of my own mother, whose later years were blighted by it—and on those who care for them. Yet—this is perhaps the most upsetting aspect of this debate—they are entirely preventable with safe and affordable therapies.
Fractures impose devastating costs on people and the health service. The hospital episode statistics show that hip and other fractures are second and fourth on the list for total bed days lost to unplanned admissions to hospitals. Most of these patients are, on further investigation, found to have osteoporosis. Hip fractures alone cost the NHS £2 billion annually and are “heart attack-level” events that burden hospitals and our desperately overstretched social care system.
However, it need not be that way. Half of these patients had a previous fracture that could and should have flagged them as being at risk. That is where fracture liaison services—FLS—come in and why the Government’s commitment, made during the election, to making them universal was so welcome. The Secretary of State for Health and Social Care told the Daily Mail, which, alongside the Sunday Express, has been a steadfast campaigner for universal FLS—I pay tribute to them—that one of his first acts in government would be to task NHS England with developing a rollout plan so that every part of the country could access these vital services. I commend his leadership and vision.
As I said, the Minister has also been a determined campaigner. I recall her urging my noble friend Lord Kamall—whom I am delighted to see taking part this evening and who has also been extremely supportive —to acknowledge back in 2021 that two-thirds of people were not receiving the treatment they needed for osteoporosis. Three years on, that figure remains tragically unchanged. The postcode lottery for FLS means that 90,000 people are still missing out on urgently needed bone medications.
In 2021, we also learned through a freedom of information request that only half of NHS trusts in England had a fracture liaison service in place. Yet again, almost nothing has changed since. Progress should be so easy, but the truth is that we are stagnating and, in the case of broken hips, that inaction costs lives. Earlier this year, the noble Baroness who is now the Minister from the other side of the Chamber asked my noble friend Lord Markham when would the Government’s
“promise to establish more fracture liaison services actually be delivered?”.—[Official Report, 5/2/24; col. 1443.]
We need to ask that again today, because time is running out. Fracture liaison services are the proven solution to the public health crisis of preventable fractures, offering a perfect fit with the Government’s laudable focus on moving from sickness to prevention and on getting people back into work.
FLS are the world standard in this area. They ensure that, after a person suffers their first fracture, they are assessed for osteoporosis, put on treatment and helped to stay on it. That prevents this horrible disease progressing and reduces significantly the chance of further broken bones. In areas without an FLS, the story is different. Many patients who suffer their first fracture are fixed up in A&E and then forgotten about. No assessment for osteoporosis is carried out and no anti-osteoporosis medication is prescribed. Far too many therefore end up back in hospital with multiple, more severe fractures. Over a quarter of hip fracture patients die within 12 months. That is a human tragedy.
FLS are perhaps the most powerful example that we have of preventive healthcare, which is why the Government’s commitment to rolling it out to every trust by 2030 is so critical. There is strong consensus in this House that this is the right thing to do. The Government support it, the Opposition support it and the Liberal Democrats support it. I can recall few other subjects where all parties are so united. So, in the interests of patients, the NHS, the taxpayer and the wider economy, let us get on with it, and fast. While 2030 may seem far away, the scale of work required to deliver universal FLS is substantial. We cannot afford to let this critical deadline creep up on us.
The Royal Osteoporosis Society’s data, scrutinised by Department of Health and Social Care officials, shows that universal coverage would save 750,000 hospital bed days in just five years, prevent 74,000 fractures and save almost 9,000 lives—that is 9,000 people who are someone’s mother or grandma, husband or dad. The ROS, whose campaigning work on this issue has been exemplary, has identified six integrated care boards ready to go. They are like horses at the starting gate: eager, ready and waiting for the Minister and her colleagues to fire that starting gun. If we do that now, we can just about bring those ICBs online by April. The ROS has proposed following this with 12 more ICBs in 2026, 2027, and 2028 respectively.
This proposal is a practical and cost-effective road map to real change. If those ICBs come online as planned, by 2029, FLS will save over 300,000 hospital bed days—that is 60,000 extra elective surgeries that the NHS can deliver by the next election. Further delay is not acceptable; if those first six ICBs do not start until 2026, by 2029 FLS in England will save only half the bed days—that means 30,000 fewer surgeries. Push it back two years and the benefits get pushed back even further into the future, with more preventable fractures, more lives lost, and more pressure on the overstretched NHS.
Many health initiatives take a decade to pay off, but the department has seen the comprehensive analysis which shows that these services break even within 18 to 24 months. All that is needed is a modest pump- priming fund to cover the first two years. Then, after break-even point, the cost savings can keep them sustainable within local budgets. I understand that the former Secretary of State, Victoria Atkins, identified funds within her budget for this very purpose as part of the major conditions review before the general election. Releasing this funding now would kick-start the rollout of FLS.
While the human cost of fractures will always be the most compelling reason to act, we cannot ignore the need to help older workers stay in the labour market, an important aspect of public policy. Independent analysis shatters the stereotype that people with osteoporosis are all retired, and lays bare the cost of inaction to our economy. Each year, osteoporotic fractures in working-age adults lead to over 1.5 million work days lost due to sick leave and carer absences, costing employers £130 million annually. The OBR has identified musculoskeletal conditions, a definition that includes osteoporosis, as the second greatest driver of long-term sickness. This has to change.
When we last debated this subject in September 2023, I ended with these words:
“This is a big strategic challenge for the whole of our society. Bold, visionary leadership from the Government could change the terms of the game, improving the lives of tens of thousands, relieving pressure on our beloved NHS and saving money for the taxpayer. We have such a huge opportunity here to save and change lives. I implore the Government to take that opportunity”.—[Official Report, 14/9/23; col. GC 232.]
I make no apology for repeating those exact same words, with a new Government and a new chapter opening in the history of the NHS. Let us give people with osteoporosis back their lives and the future they deserve, and let us start now. Again, I implore the Government to act, and I beg to move.
Baroness Donaghy (Lab)
I am grateful to the noble Lord, Lord Black of Brentwood, for moving this debate so clearly and comprehensively. I hope that this is not an example of winning the argument, winning the campaign and then losing the starting gun. We need three things to happen immediately. We need that transformation fund to pump-prime fracture liaison services for the first 18 to 24 months when, as the noble Lord, Lord Black, has said, it is estimated that they will start paying for themselves. We need to allow the six integrated care boards that are ready now to begin commissioning services to go ahead, if necessary with some of that transformation fund to support them and, if necessary, before the national rollout plan.
We need clear leadership from the Government and the NHS so that there is a deliverable timetable to ensure that the half of the population not covered by fracture liaison services will be covered by 2030. Just one year’s delay will halve the total hospital bed days saved by 2029, compounding the burden on the NHS. Leadership is vital, because patients find it challenging to keep taking common osteoporosis medications, because they must be taken in a particular way and can cause side-effects. Patients do not feel better from taking them; they reduce long-term fracture risk rather than addressing any current symptoms. One GP who is extremely knowledgeable and committed in this area described how difficult it was to keep patients motivated to take their medication because of ignorance of the subject, no visible changes and the pressures in the system which mean failures to follow up. In England, only 36% of potential patients are reached.
Also, access to diagnostic services varies by region. There is a shortage of DEXA bone density scans and a shortage of radiographers. NHS England indicated that, in September 2024, 56,366 patients were waiting for a DEXA scan and 18.5% had been waiting for more than the target of six weeks. Believe it or not, that is an improvement on the 33.6% waiting more than six weeks in September last year.
I am a member of the Royal Osteoporosis Society and I believed, when I joined it 12 years ago, that we had no osteoporosis in our family. I then discovered, 18 months ago, that my only brother had been diagnosed with it. This can hit in the most unexpected circumstances. I therefore urge the Government to give some indication of when the rollout may happen and when that transformation fund might become available.
Baroness Bull (CB)
My Lords, I thank the noble Lord, Lord Black of Brentwood, for securing this debate and for his tireless work in championing fracture prevention. I also ask the House to note that I am an ambassador for the Royal Osteoporosis Society.
Over the past 30 years, osteoporosis and bone health have been a blind spot in the women’s health policies of successive Governments. Some 50% of women over 50 will suffer fractures due to the condition, and the vast majority of the 90,000 people missing out on anti-osteoporosis medication are women. For this reason, the Fawcett Society, the British Menopause Society, Mumsnet and Gransnet are among the many charities and organisations supporting the Better Bones campaign.
The noble Lord, Lord Black, raised the idea of pump-priming new fracture liaison services with a time-limited transformation fund. I want to highlight the compelling example of exactly this approach in Wales, where the noble Baroness, Lady Morgan of Ely, has shown courageous leadership on the issue. In February 2023, as the then Welsh Health Secretary, the noble Baroness, Lady Morgan, made a bold commitment to mandating fracture liaison services in all health boards within 18 months. By September 2024, that target had been met, with every acute health board in Wales now providing fracture liaison services—an extraordinary achievement, but it did not happen by mandate alone.
As we heard, fracture liaison services quickly prove their value, breaking even within just 18 to 24 months. Beyond this point, they become cost-saving, preventing fractures and reducing hospital admissions to more than cover their ongoing costs. This is why pump-prime funding is so crucial, as it bridges that short window before the benefits become fully realised. The noble Baroness, Lady Morgan, recognised this when she pump-primed new fracture liaison services. As a result, Wales achieved universal coverage in under two years, showing what can be accomplished when ambition is backed with resource.
During the last QSD on this matter, the noble Lord, Lord Evans of Rainow, responded for the Government and warmly endorsed the idea of what he called a “fracture tsar” within NHS England. Unfortunately, the previous Government did not follow through to establish such a role. The APPG on osteoporosis also noted the need for strong, visible leadership across local systems to get these services up and running. Osteoporosis falls between the cracks of clinical specialties, which is one reason it has been neglected historically. The APPG’s 2022 report recommended the appointment of a “national specialty adviser”—a tsar by another name—to address the lack of ownership and cut across historic boundaries between medical specialisms. I hope that this Government might take action on this where the previous one did not.
The Welsh example shows that a universal fracture liaison service is achievable, but it requires strong leadership and pump-priming to succeed. The Minister has been a steadfast advocate for universal fracture liaison services over many years. I hope that, in responding, she will confirm that the Government are willing to put both leadership and funding in place, so that the ambition for universal coverage is no longer just a commitment but becomes a reality.
Lord Shinkwin (Con)
My Lords, earlier on today, I googled the meaning of the phrase, “It’s a no brainer”. Apparently, it applies to a question that is very easy to answer and, although it did not give an example, I suspect we could all think of one. As my noble friend Lord Black of Brentwood said, there is unanimity across your Lordships’ House on this.
As someone who lives with a bone condition, I am something of a reluctant expert on fractures, or at least on the excruciating pain they cause. The crunch as the bone fractures is immediately followed by the weird sensation of there being a void, because suddenly the broken bone cannot bear any weight. There is literally nothing there, and into that vacuum comes this all-consuming shockwave of pain. I make this point because some may assume that rollout is not urgent because, as my noble friend Lord Black of Brentwood mentioned with regard to hip fractures, it is not normally life-threatening. But this ignores the unnecessary human, as well as financial, cost.
I think of Stephen Robinson, a forklift truck operator, who suffered chronic, agonising back pain, dismissed for years as muscular by his GP. The doctor insisted that he should leave his manual job if he wanted his pain to improve. Eventually, the choice was taken away because the pain was so severe that Mr Robinson had to leave work altogether at 61. He remembers “living in the chair, drugged up to the eyeballs, counting the minutes until I could take the next painkiller”. My Lords, I have been there. It is not nice. A private DEXA scan is not easy to afford when you are unemployed, but it showed that Mr Robinson had 10 undiagnosed spinal fractures. An early assessment through a fracture liaison service would have given him back years of his life and saved him so much unnecessary pain.
In contrast, Alison Smith retired at 60, feeling fit, healthy and ready to embrace her new-found freedom. But nine months later a fall left her with fractured ribs and an alarming sense that something was wrong. Seen quickly by medics, she was referred to a fracture liaison service, which identified severe osteoporosis and started her on treatment. With the support of the fracture liaison service team, Alison received lifestyle advice and ongoing care, which prevented any further fractures happening and saved the NHS and the taxpayer money.
In conclusion, any further delay in the rollout of these vital services would represent an inexplicable, unjustifiable false economy, because it is actually costing money not to proceed with universal provision. I look forward to the noble Baroness the Minister giving us reason to hope.
The Lord Bishop of London
My Lords, it is very good to participate in this important debate on the fracture liaison service, especially since the issue of prevention in healthcare seems to be gathering pace. I thank the noble Lord, Lord Black, for having moved this debate.
We have heard that the fracture liaison service identifies people at risk of osteoporosis and reduces the risk of long-term fractures. Treatment provided by the fracture liaison service is often excellent, and often nurse-led. But, as we have heard, there are just not enough of them. Like many aspects of healthcare that we discuss in your Lordships’ House, provision varies by region, and there are also other inequalities of access to these services. We know that bone density decline can be accelerated by other factors, including smoking, diet and other illness.
We often discuss the fact that those living in the most deprived areas have consistently worse health outcomes and are therefore likely to be most impacted by the lack of coverage of this service. We have already heard in the debate that another element of inequity is that osteoporosis impacts women more than men: 50% of all women over 50 are affected. Last month, a study showed that menopausal women of Chinese and black African backgrounds are almost 80% less likely to be prescribed hormone replacement therapy, and less likely to receive appropriate care during menopause. While this debate is not about hormone replacement therapy, it has a lot to do with equitable access and is therefore significant to this debate.
Fracture liaison services demonstrate genuine value for money, as we have heard, and the Government should be keen to recognise and promote this. It is through services such as these that the shift from sickness to prevention and from hospital to community will happen. Evidence shows that for every pound spent on a fracture liaison service, £3.26 is saved. Given that hip replacements take up 1 million acute bed days a year and are often preventable, rolling this out is an important decision in forwarding the Government’s agenda on the NHS.
We have heard already in this debate that many ICBs may well be ready to go with such services. However, the Royal Osteoporosis Society reported earlier this year the closing of the South Nottinghamshire Fracture Liaison Service, with the ICB citing serious financial pressures and the lack of a government mandate as reasons for stopping commissioning the service. Commissioning pressures on the part of ICBs is an issue that often comes up when we talk about prevention, particularly shifting from acute to preventive services. I know that ICBs face serious financial pressure and challenges from acute services that often override prevention; however, if the Government are going to prioritise prevention and reduce health inequalities, there must be a way for ICBs’ commissioning decisions to stand against that pressure.
I welcome the promise of 100% coverage by 2030, so I look forward to hearing from the Minister what actions the Government will take to make that happen. Will this be considered in the formation of the NHS 10-year plan, so that health inequalities can be prioritised?
Baroness Ritchie of Downpatrick (Lab)
My Lords, I begin by thanking the noble Lord, Lord Black of Brentwood, for securing this vital debate. I welcome my noble friend the Minister to the Front Bench and declare an interest as a breast cancer survivor who is osteopaenic and therefore required to avail of bone density examinations in Northern Ireland, where there is excellent provision of fracture liaison services and where research has shown that there is 100% coverage. I hope that my experience and those of many people in Northern Ireland will be helpful to my noble friend in seeing the benefit of such service provision to many people, particularly those in the older cohort of the population.
We have seen encouraging signs in recent weeks that the Government are ready to act decisively on bold, proven ideas. There is a growing appetite for initiatives that will tackle ill health, reduce pressures on the NHS and keep people in work. Fracture liaison services, as we all know, are a perfect example across all three: a gold-standard, internationally recognised intervention that was invented here in Britain and has been adopted across the world. Yet, unfortunately, around half the trusts in England still lack access to this life-changing service.
We now have six integrated care boards across England that are ready to take action. These ICBs have done the groundwork, mapping pathways, securing local support and developing clear plans to establish high-quality fracture liaison services, so I ask my noble friend when they will be able to do that. Crucially, there is a clear road map to take us from these early adopters to full national coverage by 2030. With a phased rollout approach, we can learn from these trailblazers and build momentum over the coming years. What is needed now is targeted pump-priming funding to bridge the short 18 to 24-month period before fracture liaison services become cost-saving—an approach that has already proven successful in Wales, as pointed out by the noble Baroness, Lady Bull.
It is not just the ICBs that are ready to act. Across the country, there is a coalition of support poised to make universal FLS a reality. A shadow national implementation steering group has convened to support the Government in making FLS one of its early successes in prevention—a true example of a Darzi reform in action. Its members include the Royal College of Physicians and the Royal College of GPs, as well as Age UK and several other expert societies: pooled expertise to help the Government make quick progress.
What we need now is a clear plan setting out how these services will be delivered by 2030 or even sooner. The groundwork has been done, the support is in place and the opportunity is here; let us not waste it. By acting now, the Government can turn their ambition into reality, saving lives, easing NHS pressures and strengthening the economy. Acting together, along with the Government, we should take this opportunity and make it happen. I look forward to the Minister’s response outlining how that will happen.
Lord Brownlow of Shurlock Row (Con)
My Lords, it is a pleasure to follow the noble Baroness, and I thank my noble friend Lord Black for securing this debate. I refer noble Lords to my interests, as listed in the register, as a member of the osteoporosis APPG and a supporter of the Royal Osteoporosis Society.
My father and mother taught me that, “If you have nothing useful to say, don’t say anything”. I am afraid that, being seventh on the list this evening, I will not trouble noble Lords with the carefully timed and crafted four-minute speech I have prepared, because I follow six excellent and comprehensive speeches. But I will make two quick points.
First, I thank and congratulate Her Majesty, Queen Camilla, who has been associated with the Royal Osteoporosis Society for 30 years and its president for 23 years. I know politics is not business, but I hope the Government recognise that there is a business case here, on behalf of the patient and the taxpayer. I urge the Government to follow the recommendations they made when in opposition. The Government of the day promised, if they had been returned, to make speedy progress on the rollout of FLS across this country.
Baroness Quin (Lab)
My Lords, I join in the congratulations to the noble Lord, Lord Black of Brentwood, on initiating this debate. I know, as another long-standing member of the all-party group, how active he has been in promoting the goal of a proper system of fracture liaison services.
I remember initiating a similar debate on NHS provision for tackling osteoporosis not long after I joined your Lordships’ House, way back in October 2007. At that time, I was focusing on the patchy provision and availability of DEXA scans across the country, and highlighting the postcode lottery whereby, while you might be identified as needing access to services aimed at preventing osteoporosis, whether those services were available depended very much on where you happened to live. It is therefore very frustrating that, even now, so many years later, we are still complaining about postcode lotteries and that, in England, we still do not have the nationwide system of fracture liaison services which everyone who has spoken in this debate has favoured.
As a long-standing supporter of devolution, I also find it frustrating that England, the most populous country, has once again been lagging behind the rest of the UK. I firmly believe that if devolution is to count as a UK success, it should be a process that fosters high standards of service to all our citizens in whatever part of the UK they live. I also hope that, perhaps with the emergence of regional mayors in England, there will be a renewed effort, supported by the Government, to tackle inequalities in healthcare provisions in different regions of our country.
I accept of course that my noble friend the Minister who will reply to the debate and the Government of which she is part have been in office for only a very short period of time. I am very pleased that the current Secretary of State for Health, in already committing himself to rolling out a system of fracture liaison services across the country, fully recognises not only the benefits this will bring to NHS patients but the financial savings to the NHS in the long term through the establishment of these much-needed preventive services.
I pay warm tribute to the Royal Osteoporosis Society for the work it has done over the years in raising awareness of osteoporosis and the various ways it can be prevented and tackled. It has been particularly successful in promoting national media coverage of the issue, which in turn has increased public awareness and public consciousness of its importance.
In correspondence with me, the Royal Osteoporosis Society has made the point that fracture liaison services fit very well into the recent update on the National Health Service from the noble Lord, Lord Darzi, particularly in the three key shifts that he highlighted and deemed necessary: a move from sickness to prevention, from analogue to digital, and from emergency-based care to community-focused models. Surely it is the case that fracture liaison services offer a practical example of how we can deliver on all three of these worthwhile aims, and do so in the short term as well as the long term.
Many speeches this evening have made very telling points, and I am sure the Minister will have listened carefully to them. Like others, I look forward very much to her reply to this debate.
Lord Rennard (LD)
My Lords, it is a great pleasure to take part in a debate in which there is such strong consensus. The noble Lord, Lord Black of Brentwood, is again to be congratulated on raising this vital issue of fracture liaison services and asking the new Government about progress towards achieving the previous Government’s target of 100% coverage by 2030. In 2021 we were given the figure of 51%—or 63 out of 123—NHS trusts across England having fracture liaison services. There is now 100% coverage in Scotland, Wales and Northern Ireland, so it is disappointing if the figure is still the same 51% for England.
We have heard how osteoporosis affects 3.5 million people in the UK, causing more than half a million fractures each year, and that, according to the Royal Osteoporosis Society, two-thirds of the people who need treatment are missing out, leaving them vulnerable to further life-altering fractures—and we have heard how women are disproportionately affected. Both the Sunday Express and the Mail on Sunday have been mentioned for partnering with the Royal Osteoporosis Society to campaign for an end to the postcode lottery that leaves so many people without fracture liaison clinics.
The new Government have promised to roll out a plan to ensure that every part of the country has access to FLS. All the main parties in the general election promised this, but we have heard tonight that investment needs to be made now if the Government are to achieve the target by 2030.
We have heard how the Royal Osteoporosis Society has estimated that just a £30 million investment in fracture liaison services could prevent 74,000 fractures, including 31,000 hip fractures, over five years—but, we are all asking, will this expenditure take place and will it be soon? The issue of providing universal cover for fracture liaison clinics may not create such big headlines as those about cancer treatments or accident and emergency waiting times, but, as we have heard, the issue affects so very many people. The political will really must be there if we are to address the need to reduce the number of hip and other fractures.
I have always advised people that whichever party wins an election, the Treasury stays in power, and that the Treasury often adopts a very short-term approach demanding a rapid return on any investment. This approach needs to change across the health and care sector if we really want to move towards more prevention and needing less cure. As the noble Baroness, Lady Bull, said, fracture liaison services provide a relatively rapid return on that investment.
There are still considerable challenges. The clinical workload of those expected to undertake roles within the services is immense. Rheumatology services were hit enormously by Covid and years of underinvestment. We can work with multidisciplinary teams and new technologies such as AI in order to streamline care, improve efficiency and help clinicians to manage growing demand, achieving economies of scale, but technology alone is not the answer; we also need meaningful investment in preventive services.
Lord Kamall (Con)
My Lords, I thank my noble friend Lord Black for securing this debate. As noble Lords have acknowledged, he has championed this issue in this House and outside. In fact, I recall that during one of my earliest Oral Questions as a Minister, my noble friend explained to me the vital role that fracture liaison services play in identifying and treating osteoporosis; that osteoporosis is considered a silent disease, causing over half a million broken bones each year—one every minute; and that there are as many deaths from fractures as from lung cancer and diabetes.
As my noble friend Lord Black and indeed the noble Baroness, Lady Bull, said, fractures caused by osteoporosis affect half of all women and a fifth of men over 50. As the right reverend Prelate mentioned, those from lower-income households have a 25% higher risk of fractures, a higher mortality rate and slower recovery times from hip fractures. As the noble Baroness, Lady Donaghy, said, it can be unexpected. Each year, 1 million acute hospital bed days are occupied by hip fracture patients, and around £2 billion is spent on hip fracture care. I pay tribute at this point to my noble friend Lord Shinkwin, the noble Baroness, Lady Ritchie, and others for sharing their experience. That really brought it home and made it about more than figures.
As we move to a system of preventive healthcare, FLS have a huge role to play since they systematically identify people aged 50 or over who have had a fragility fracture in order to reduce the risk of further fractures. The Royal Osteoporosis Society, to which many noble Lords have paid tribute tonight, estimates that fracture liaison services reduce the risk of a patient refracturing the same bone by up to 40%.
Unfortunately, despite the attempts of previous Governments, only 51% of trusts in England currently provide fracture liaison services, covering only 57% of the population, as alluded to by the noble Baroness, Lady Quin. Earlier this year my right honourable friend Victoria Atkins, then the Secretary of State for Health and Social Care, pledged to expand fracture liaison services to every integrated care board in England and achieve 100% coverage by 2030, a target repeated in the Conservative Party manifesto. But as the noble Lord, Lord Rennard, and others have said, there is consensus—there is no political disagreement on this issue. Indeed, the Minister used to press me from this Dispatch Box when I was in her position.
In June this year, the then shadow and now current Secretary of State for Health and Social Care said that delivering a rollout plan for fracture liaison services would be an area for “immediate action” if Labour won the election. Noble Lords understand that these are still early days for the Government, but I am sure that my noble friend Lord Black and other noble Lords who have spoken in this debate wish to understand what the Secretary of State for Health and Social Care meant by “immediate action”. I have to concede that that sounds a lot better than “in due course”—a phrase I tried to avoid when I was a Minister, but not always successfully.
Unfortunately, no plan for the rollout of these life-changing diagnostic and preventive services has yet been released by the Government. Are they working on a rollout plan for fracture liaison services and, as the noble Baroness, Lady Donaghy, said, when do they intend to publish it—preferably avoiding the answer “in due course”? Can I tempt the Minister into sharing some clues or details on what might be in the plan? I know that many noble Lords of all parties and none support expanding this vital, preventive and effective service to as many people who need it as possible. Fracture liaison services are a world-beating preventive approach that we can all be proud of. If expanded, it would be good for those suffering from osteoporosis, good for the NHS and good for the Treasury.
The Parliamentary Under-Secretary of State, Department of Health and Social Care (Baroness Merron) (Lab)
My Lords, I congratulate the noble Lord, Lord Black, on securing this important debate and pay tribute to his very effective campaigning over many years. I am always touched when he refers to his mother; personally, I always feel that his campaigning shows great respect to his mother, and I am sure that the whole House appreciates that. I also enjoyed, as I am sure the noble Lord, Lord Kamall, did, his reminder to me and the now Opposition Front Bench of what we said when we were on the other side, and we are suitably—not chastened exactly—brought to book by his comments.
I thank other noble Lords for their many insightful and accurate contributions. As I am sure noble Lords will be aware, I have much sympathy with many of the points that have been made. I know this is an issue close to many, either because of their own experience or that of those to whom they are close.
As we have heard, including from the right reverend Prelate the Bishop of London, inequalities in access to and the quality of fracture liaison services have a significant impact on so many people across the country. Over half a million people in England alone suffer a fragility fracture every year. More than 40% of those will suffer another fracture within a decade. As the noble Lord, Lord Black, so powerfully illustrated, fracture liaison services can play a vital role in reducing the risk of refracture, improving quality of life and, importantly, increasing the number of years that can be lived in good health.
Many noble Lords referred to the postcode lottery, including my noble friend Lady Quin and the noble Lord, Lord Rennard. Noble Lords spoke of the difference in access coming at a substantial cost. I agree; it is not only a cost for the NHS and social care, but there are also many personal costs of life-changing injury and increased mortality and morbidity. This cannot continue.
Today’s debate refers to the progress towards universal provision by 2030. The noble Lord, Lord Black, and other noble Lords powerfully advanced the case for moving swiftly and the potential consequences of not doing so. It was suggested that there was funding from the previous Government for the expansion of fracture liaison services. All investigations show that no funding was ever confirmed or announced, including as part of the Major Conditions Strategy. I remind your Lordships’ House that the 2030 ambition for the rollout of fracture liaison services was first announced by the previous Government on the day after the election was called. On that point, I am very grateful for the understanding of a number of noble Lords, including the noble Lord, Lord Kamall, and my noble friend Lady Quin, that these are early days for the Government, but I will attempt to be helpful.
This mission-led Government will expand access to fracture liaison services, alongside, importantly, delivering 40,000 more appointments each week and increasing diagnostic capacity to meet the demand for diagnostic services. Why? It is because fracture liaison services play a vital role in the mission to build an NHS for the future, where waiting times are reduced and more care is moved to the community, closer to where people need it. We have to be honest about the scale of the action needed, as noble Lords will know that this Government have been. I will make some points about the background and the challenges ahead. As the Chamber will understand, it will not be solvable overnight.
My right honourable friend the Secretary of State commissioned an independent investigation into the NHS as one of his first actions in government. The findings by the noble Lord, Lord Darzi, laid bare the fact that the NHS currently has the longest waiting lists, the lowest patient satisfaction and a deterioration in the nation’s underlying health, with widespread problems for people accessing services. This includes fracture liaison services.
In response, the Government announced the 10-year plan, which will be published next spring. The plan will be shaped by input from the public, patients and health and care staff through an engagement exercise—on which noble Lords heard me answer a Question from the right reverend Prelate earlier this week, who was good enough to raise it again today. The exercise was launched as:
“The biggest national conversation about the future of the NHS”.
It will include consideration of the three fundamental long-term shifts for health reform, as emphasised by my noble friend Lady Quin and the right reverend Prelate: hospital to community, analogue to digital and changing from sickness to prevention. I agree with noble Lords that fracture liaison services encapsulate all three. This is a long-term challenge and will take time to deliver, so the plan will consider what immediate actions are needed to get the NHS back on its feet and get waiting lists down, as well as long-term changes.
We are continuing our close working relationship with NHS England to tackle issues related to provision of fracture liaison services, which are a crucial prevention service. The noble Lord, Lord Black, my noble friend Lady Donaghy and the noble Baroness, Lady Bull, along with other noble Lords, suggested a number of potential solutions. We are considering a wide range of options as we seek to identify the most effective ways of improving the quality of and access to the fracture liaison service model and the interventions it provides. I look forward to continuing work with noble Lords and being able to bring more information to this House.
My noble friend Lady Ritchie referred to the role of ICBs, and this point was raised several times helpfully in the debate. As noble Lords are well aware, fracture liaison services are commissioned by ICBs and are making decisions according to local need. National expectations of ICBs and trusts for the next financial year will be set out in the 2025-26 NHS planning guidance. I know that the matter of finance has been raised a number of times, including by the right reverend Prelate.
Along with many noble Lords here, we have benefitted from continuing engagement with the Royal Osteoporosis Society and a number of partners. The noble Lord, Lord Brownlow, rightly paid tribute to the role of Her Majesty the Queen. I felt that was an extremely important recognition with which I want to associate myself. In our engagement with our stakeholders, we are looking at the best ways to support the systems that work.
The noble Lord, Lord Shinkwin, raised matters relating to those of working age. It is the case that osteoporosis and the risk of repeated fragility fractures remain significant contributors to economic inactivity. I was pleased to hear the noble Lords, Lord Black and Lord Shinkwin, recognise the significance of musculo- skeletal conditions as drivers of long-term sickness absence. It is absolutely the case that those conditions are the second leading cause of sickness absence and the leading cause of a reduction of years lived in good health and employment.
There is much joint working going on between DWP, DHSC and NHS England under the Getting It Right First Time teams to deliver a programme, working with ICBs to reduce waiting times and improve data and referral pathways. The recent Get Britain Working White Paper included an announcement of £3.5 million in funding for this year to provide a model for musculo- skeletal community services to kick-start economic growth.
The noble Baroness, Lady Bull, and the right reverend Prelate raised women’s health. The noble Lord, Lord Black, was kind enough to draw attention to my previous interest in the issue of fracture liaison services. That now chimes in very well with one of my responsibilities, as I am the Minister for women’s health. I am dismayed at how often women’s health needs are not considered when designing services, and even worse are the additional stark inequalities referred to by the right reverend Prelate. I assure your Lordships’ House that it is a priority for us to ensure that all women receive the high-quality care that they deserve.
I close by restating our commitment to expanding access to these vital fracture liaison services. The work continues, and I look forward to updating noble Lords a number of times as we make progress together.
Football Governance Bill [HL]
Wednesday 4th December 2024
(1 week, 1 day ago)
Lords ChamberRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Watch Debate Amendment Paper: HL Bill 41-III Third marshalled list for Committee - (3 Dec 2024)
Baroness Taylor of Bolton
Baroness Taylor of Bolton (Lab)
My Lords, Amendment 39 is grouped with Amendments 41, 46 and 48. This is a pretty straightforward amendment, simply seeking to change in the Bill the word “may” to “must”.
For context, the Bill as it stands says that a non-executive member of the board “may” be removed from office in certain circumstances. That is clearly appropriate and something that we should expect. Similarly, the Bill says that an executive member “may” be removed in certain circumstances. Again, that is something that we should expect and is totally appropriate.
However, the circumstances in which such a removal can take place are actually rather serious. They are laid out quite clearly as being when the person is
“guilty of serious misconduct … has a conflict of interest … has failed to comply with paragraph 6(4)”,
which is about information on conflicts of interest, and
“is unable, unfit or unwilling to carry out their functions”.
I think we would all agree that, whether we are talking about a non-executive or executive member of the board, we need to take such issues seriously.
That is why I ask the Minister why it is only “may” be removed and not “must” be removed, because these circumstances would seem to justify removal. If anybody falls foul of the items identified here, there really has to be a presumption that they will be removed, and so the word “must” might be more appropriate.
Lord Addington (LD)
My Lords, the difference between “may” and “must”—or may and shall—is a pretty old parliamentary debate, but the noble Baroness has something here. I read through the amendments and thought, “It’s pretty clear. How could they stay if they’d done these things?” It will be interesting to hear the Minister’s response. I know that “may” probably means “must” in certain circumstances, but if we could just have it clarified, we might get through this very quickly. It is very worth while having it clarified in this case.
Lord Hayward (Con)
My Lords, I understand the point that both the noble Lord, Lord Addington, and the noble Baroness, Lady Taylor, are making, but I am always hesitant to say that something “must” happen. I speak here as someone who spent many years as a personnel/human resources director, acting as the final stage of appeal in disciplinary matters. As the noble Lord implied, I know that there is a debate in legal fields, because nowadays lawyers generally do not like being bound by something that tells them that they “must” act in a certain way.
It does not seem to be appropriate to insert “must”. The noble Baroness said that there would be a presumption—and I think so too. As the noble Lord said, these are very serious offences, but until one is confronted by a set of circumstances, I hesitate to bind anybody to a certain decision. There may be special circumstances where one is found guilty of only one of the categories and circumstances, so I am not convinced that “must” should be inserted in place of “may”.
Lord Jackson of Peterborough (Con)
My Lords, I want partly to echo what my noble friend Lord Hayward said. Given that the individuals concerned will be non-executive directors of a de facto non-departmental public body, they would be covered by the existing code of conduct for non-departmental public bodies, which I think dates from June 2019. It may have been updated by the previous Government; I do not think that the current Government have looked at it. Equally, they are governed by the Nolan principles, with which we are all very familiar—I am as familiar as anyone else, having been a special adviser and currently being a non-executive director of two non-departmental public bodies.
My point is about the restrictive nature of this wording. This is quite an unusual situation, where the individuals responsible for bringing disciplinary issues to the attention of the appropriate authorities in the independent football regulator will have no leeway whatever under this legislation. If it passes the threshold of criminal activity in civil law, legal representatives—the judiciary, magistrates and others—would have no leeway on this. Therefore, you would circumscribe the existing internal procedures.
Those of us who have a role in non-departmental public bodies know that there is a proper process. You would have a verbal warning. I also have a master’s degree in human resource management and have been an HR manager in my time—there are almost as many of us in this place as there are lawyers.
Lord Jackson of Peterborough (Con)
Okay, maybe not. My point is that employment lawyers are very wary about something as definitive as this, which involves disciplinary procedures. The noble Lord, Lord Addington, made a very valid and fair point that, at the very least, we need to know the potential scenarios and circumstances that may arise. That would allow us, without any concern, to accept this in the Bill. At the moment, it is overly restrictive, and it could give rise to unfairness and onerous intervention directly by Ministers. On that basis, at the very least, we need to have more information about this before Report. Like my noble friend Lord Hayward, I feel deeply uncomfortable about having such prescriptive wording in primary legislation.
Lord Parkinson of Whitley Bay (Con)
My Lords, I am grateful for the thought that noble Lords have given to the amendments in this group and to the noble Baroness, Lady Taylor of Bolton, and the noble Lord, Lord Bassam of Brighton, for tabling them so that we can consider them. As the noble Lord, Lord Addington, rightly said, one of the first things that people do when they receive a new government Bill is to go through it and look for the “mays” and the “musts” and consider why they have been put there and what the counterargument would be if the other word were used.
I am grateful to my noble friends Lord Hayward and Lord Jackson of Peterborough, who have brought their professional and personal backgrounds and their qualifications to the scrutiny of this. Like them, I think that we must be careful of being too prescriptive here and of limiting the role of the professionals we are appointing, particularly as this is an independent regulator. We want it to act independently and have a bit of professional discretion. However, the noble Baroness and the noble Lord, Lord Bassam, have an important point that motivated them to bring the amendments, which would limit the discretionary ability of both the independent football regulator and its chief executive officer in cases of misconduct or where an individual is not able to perform his or her duties, whether they are a non-executive director, an executive director or a member of the expert panel.
Clearly, if this new regulator is to enjoy the support of fans and the businesses and clubs that it regulates, it must uphold and be seen to be upholding the very highest standards. It is good to pose the question of whether this discretionary power should be written in the Bill as it is. The discretionary power as written would allow the independent regulator the ability to keep an individual in place, even in cases where he or she is guilty of misconduct, has a conflict of interest, has failed to provide appropriate information to the chief executive or is unfit, unwilling or unable to carry out his or her functions. That is quite a serious list of reasons, so I can see why the noble Baroness, Lady Taylor, and the noble Lord, Lord Bassam, have posed this question to the Committee. While I share some of the scepticism that my noble friends have set out, I am more sympathetic than might be expected.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
I thank my noble friend Lady Taylor of Bolton for introducing the amendments in this group. The Government acknowledge and understand the intent behind these amendments, which is to fortify the Bill’s provisions for dealing with conflicts of interest and unsuitable board and panel members.
It is essential that the regulator can deliver its regime, free from undue influence, vested interests and misconduct. I reassure my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton, who is not in his place, that the Bill, supported by public law principles and non-legislative measures already in place, already sufficiently makes certain that the regulator will be free from conflicts of interest and misconduct.
Amendments 39 and 41 relate to the board. As with all public bodies, members of the regulator’s board will be subject to the Cabinet Office’s Code of Conduct for Board Members of Public Bodies, which the noble Lord, Lord Jackson of Peterborough, raised. I can also confirm that they will be subject to the Nolan principles. The code of conduct sets out clear requirements regarding the appropriate disclosure and management of conflicts of interest. This includes a responsibility on board members to openly and honestly declare any interests that could give rise to actual or perceived conflicts. Any breach of these requirements would be a breach of the member’s terms of appointment. Requirements on good conduct more broadly are also outlined in this document.
The Bill also places an additional onus on the appointer to check for conflicts that have not been otherwise declared at the point of making the appointment and on an ongoing basis from time to time. In addition, paragraph 16 of Schedule 2 requires members of the board to declare their interests in any matters which fall for consideration by the board, and for this declaration to be recorded.
I think I reflect the views of the noble Lord, Lord Hayward, when I say that, in the Government’s view, these amendments would represent an unacceptable constraint on the discretion of the chief executive and the Secretary of State to take the appropriate approach to managing issues with members of the board, such as conflicts of interest, on a case-by-case basis as circumstances dictate.
Amendments 46 and 48 concern the expert panel. I reassure noble Lords that, in the Government’s view, the Bill already sufficiently makes certain that the regulator will be free from conflicts of interest. The Bill places an onus on the chief executive, as the appointer of panel members, to check for conflicts that have not otherwise been declared at the point of making the appointment and, as with other processes, on an ongoing basis from time to time. In addition, paragraph 29 of Schedule 2 requires members of the panel to declare their interests in any matters which fall for consideration at a meeting of a committee they are on, and for this declaration to be recorded. In our view, these amendments would put in place too much of a constraint on the discretion of the chief executive to take the appropriate approach to managing issues with panel members, such as conflicts of interest, on a case-by-case basis as the circumstances dictate.
All in all, we are confident that the Bill already contains comprehensive safeguards to ensure the suitability of board and panel members. Therefore, I would be grateful if my noble friend would withdraw her amendment.
Baroness Taylor of Bolton (Lab)
My Lords, I am grateful to the Minister for outlining the provisions that she thinks adequately cover this point. However, if discretion still exists on issues such as being guilty of serious misconduct, then I have a concern. I am not sure that there should be discretion in a case of a serious misconduct. Maybe the point she raised about conflicts of interest and that conflicting with other parts of the Bill covers it, but I have this fear that, if there is discretion, the chief executive of the independent football regulator might be put under pressure by others. That can be a serious concern in any organisation. In a sense, I think these amendments would protect people from having to use discretion. If somebody was found guilty of serious misconduct, that would elevate the issue again.
Lord Hayward (Con)
I am particularly interested in what the noble Baroness just said about the pressure being imposed on a chief executive. If, having looked at a case in detail and correctly in terms of procedure and the like, he then gives way to pressure from elsewhere —it may well be political pressure of one form or another—would you not call into question whether you have the right chief executive in the first place?
Baroness Taylor of Bolton (Lab)
Yes. That is why we need to protect the chief executive or anybody else by not giving them this kind of discretion, which might leave them open to any kind of pressure. I am not sure it would be political pressure; it is quite likely to be internal political pressure with a small “p”, rather than political in the way that we discuss things. I ask my noble friend to consider this a bit further because, given the categorisation, there is a potential problem. I know she has taken an interest in this so, on that basis, I will withdraw the amendment.
Member's explanatory statement
This amendment limits the number of members of the Expert Panel.
Lord Parkinson of Whitley Bay (Con)
My Lords, I rise to move Amendment 42 and to speak to Amendments 45, 47 and 49, which are grouped with it. I am grateful to my noble friend Lord Markham who has put his name to them. These amendments seek to provide greater guidance on the operation of the expert panel that will be established under the Bill to ensure that those who are involved in the panel and its work are limited in number, do not have any broadcast interests, are limited in pay and must exercise their functions transparently. These amendments reflect our commitment to ensuring robust, transparent and impartial governance for football to safeguard the integrity of the game. I will speak now to Amendments 42 and 45 and say a bit more about Amendments 47 and 49 in my winding speech.
Amendment 42 would limit the number of members on the expert panel to no more than 20. The Bill already specifies no fewer than six, but the amendment would insert the words “or more than twenty”. It is in our view a sensible and pragmatic measure. Governance structures function best when they strike a balance between having diversity of experience and opinion and having operational agility and efficiency. By setting this range between six and 20, we think we can help to ensure that the panel is large enough to encompass a breadth of expertise while avoiding the pitfalls of having an unwieldy and bureaucratic decision-making body.
We have heard about a lot of the similarities between this Bill and its predecessor that was looked at in another place in the previous Parliament, but this is another instance where the Government have decided to make some changes to the Bill. When I was going through it comparing the previous version to this one, this change perplexed me more than others. When the Bill before the previous Parliament was introduced by the Conservative Government, we capped the membership of the expert panel at 20. Will the Minister explain the policy rationale behind making this change to the Bill and removing the cap?
In football governance, clarity and focus are surely paramount, so this amendment that in effect takes us back to the previous Bill is, as noble Lords might expect, in keeping with Conservative values of efficient, streamlined and effective governance and will ensure that the expert panel is equipped to make sound decisions without succumbing to the inefficiencies of an excessively large committee. I hope these arguments will resonate with noble Lords whatever their political allegiances.
Amendment 45 echoes the debate we had previously on conflicts of interest relating to the chairman of the panel and would prohibit individuals with current media interests relating to football serving on the expert panel much in the same way as my Amendment 36, which we looked at earlier. I do not think we need to rehash the philosophical arguments behind that. I hope that the Minister will dwell a little on the need to make sure that we ensure impartiality for members of the expert panel just as much as we would for the chairman.
Football is a sport that attracts passionate commentary and debate, particularly across the media. While, as we heard previously, live perspectives are invaluable in their own right, the work of the expert panel must remain beyond reproach. Again, I worry slightly that people with active media roles could risk stumbling into conflicts of interest or, at the very least, the perception of them, which could undermine the important work of the panel and its credibility.
Lord Markham (Con)
I thank my noble friend for introducing these amendments, which are also in my name. As in previous groups, he set out some of our concerns, particularly where there are media interests involved—by media interests we are speaking very much about involvement with media rights and, as we discussed earlier, inside information and conflicts.
Amendment 49 is all about the transparency of the process. The real value of an expert panel is that there are a lot of complicated issues. If anything, the last three days have shown us that this is a highly complex area and that we would be asking the expert panel to opine on a large range of issues. The strength of that panel will be its breadth.
One area of particular concern to me is the example I gave before about clubs which are in what you might call the start-up phase—for example, Brighton, as they were a few years ago, when they invested heavily in players as part of a well-reasoned plan to get promoted. I am concerned that a regulator, with its sustainability hat on, might say that that is not very sustainable.
However, I would expect and hope that the expert panel had a range of views. While some may be more of the button-down accountant-type who would have concerns about that, I would hope that others would be of a more entrepreneurial nature and would understand what these aspiring clubs were trying to do, and so give that balanced view. To me, that is exactly what a good expert panel should be doing. On transparency, being able to hear those minority views and take them into consideration overall is an important dimension to all of this.
We have plenty of good examples of this. In the Monetary Policy Committee you have so-called hawks and doves, and a lot of information is often gained by not just the majority view in the vote but the dissenting voices. You see similar things in Supreme Court rulings, where you have minority opinions. It is about trying to bring that sort of richness to this, so that we have a range of expert views, which we will all benefit from. That was very much the thinking behind Amendment 49. I look forward to the Minister’s views.
Lord Hayward (Con)
My Lords, I will make one or two comments in relation to this group of amendments. First, Amendment 42 seeks to set an upper limit. I strongly support that, whatever the number happens to be. Many years ago—not that many—I drafted the changes in legislation in relation to parliamentary boundaries for the Commons. Over the years, we had seen a steady drifting up, with ever-more Members of Parliament, as the Boundary Commission decided to duck a decision here or a decision there. Ultimately, we set a figure for the total number of Members of Parliament. I will not go into detail as to whether I think the figure is right now, but I had watched it drift ever upwards.
The debate about this House has included very heavily the question of the numbers that there should be in it. I am a strong believer that there should be a limit, and that the limit should be very substantially below where it is now. The numbers have just drifted up and up, because some people have appointed too many people into this House. I am therefore in favour of having a limit on the panel, because I can see the risks of not having one. I do not mind whether it is 20, or whatever it may happen to be, but I am in favour of some upper limit on any public panel in these circumstances.
I am not going to comment on the next two amendments, on the basis that I have done so already in previous conversations, but I will refer to Amendment 49. I agree strongly with the principles outlined in it. We are talking about a public body here. We are saying that the football clubs, which are regulated and licensed, must be open to comment from their fans. If the football clubs must be open to comment and scrutiny from their fans then surely the regulator and the expert panels must also be open to that same public scrutiny. It is not acceptable for people who are on that sort of panel to hide behind an overall decision. It would therefore be important to go down this sort of route.
I made an intervention on the noble Baroness, Lady Taylor. I do not think I misinterpreted what she said earlier—I apologise if I did, because she is not here at the moment. When I asked her about strong or weak chief executives, she expressed concern that the wrong chief executive might be in the position. If there is, and he is leading a weak panel, then people could hide behind it. I am strongly in favour of a public display of decision-making in that process.
I would not necessarily agree that the amendment has perfect wording. For example, in proposed new sub-paragraph (2)(d), whether or not you have “the reasons why” is another matter. However, one category that is not in here is the question of timescale, which has come up in other elements of our discussion. It must be right that, throughout the process of regulation, there should be timescales imposed. It is all too easy for people to drift on decisions, whatever they happen to be, and put them back and back.
We are talking here, as we have identified, about a very competitive industry, competing not only in the football world but in other worlds as well. To maintain the position of our competitive pre-eminence within that field, we need to ensure throughout that regulators abide by timescales. I therefore suggest that, on Report, not only in this amendment but elsewhere, there should be timescales involved, as well as the other classifications that are identified.
Lord Jackson of Peterborough (Con)
My Lords, I rise to support the three amendments in the name of my noble friend Lord Parkinson.
On Amendment 45, it is very important that we have Chinese walls around media interests and that we preclude, if possible, any potential conflict of interest. We are not talking about a corner shop; we are talking about very serious big business and huge amounts of money for broadcasting rights. The information that will be contained within this regulator and the expert panel is phenomenally important in terms of its commercial confidentiality. Therefore, it is appropriate to put in the Bill a protocol which precludes the possibility of any interference from those who have a vested interest in media, and particularly in the workings of the expert panel.
We can look at models across the world whereby you have to keep secret from many people confidential information that is market-sensitive and may affect stock and share prices. Some of the information in the United States’ Securities and Exchange Commission would fall into that category. This is not quite as lucrative, but it is very big business. Therefore, we need to protect individual clubs that do not have economic heft, and bigger clubs that may be affected by a leak of information or inappropriate use of information from the expert panel.
Amendment 47 strikes a balance on the ability to pay an expert the appropriate amount of money. You want someone who has accumulated knowledge, skills and experience of football on the expert panel, but you do not want to pay them more than, for instance, the Prime Minister is paid. You want to have a set amount, and I think it is appropriate to put it in the Bill, in primary legislation. We know that £91,346 is pretty much two and a half times the average salary. It is a decent amount of money for the services that will be provided by the members of the expert panel.
The amendment I support most strongly is Amendment 49 because, as Judge Louis Brandeis, a Supreme Court judge in 1913, said, daylight is the best disinfectant. That was not said by a British historian, as people think, but by a Supreme Court judge. He was absolutely right about this in all the ways government is conducted. This gets the balance right, because there will be Chinese walls between different functions within the independent football regulator. This is light-touch transparency. It would not divulge the intricate proceedings of the expert panel within the IFR, but it would allow people to make a value judgment on how key decisions had been reached and who had made them. There would be accountability and transparency, as you would know not only who was making a case but the reasons why they did not support a decision. It is right that we would not include detailed minutes of the deliberations of the expert panel, because that would not be in the interest of the game and good governance, but it would be important to understand how decisions were made.
If you put that together as a complementary mechanism, with parliamentary oversight and scrutiny of the independent football regulator as a whole, it is a very useful amendment for making sure there are key checks and balances. It would make sure that certain clubs are not dominating and certain other clubs are not being pushed out, and that everyone has an opportunity to have empirical evidence, data and proper facts put before the expert panel. Ultimately, the panel will be accountable, first, to the IFR, then to Parliament and then to the wider public, including the fans.
I am not saying that the IFR is exactly the same as the Securities and Exchange Commission, but, for those reasons, I think there is a framework here that can be used to make sure that we deliver a decent and effective IFR—but in a fair and equitable way that is open, transparent and, above all, accountable to the taxpayers and people of this country.
Lord Addington (LD)
My Lords, I will speak briefly. The middle two of these amendments are effectively a rehash of arguments we have already had—fair enough, so I will not comment on them. But, on the first one —about the numbers on the panel—and Amendment 49, what are the Government’s plans? Do they have any idea what would be a top number, or have they ever given this any consideration? That would be helpful to know—20 would seem to be a reasonable figure.
On the transparency of decision-making, the Government must have some idea, at the very least, about reporting, because it is almost impossible not to have some plan for reporting. If they have a standard or are thinking about one, it would help if we heard it now.
A couple of these amendments are well worth discussing, particularly the one on transparency. But I suspect that the Government have a plan for this—if they do not, they should have—and I look forward to being reassured by the Minister.
Lord Parkinson of Whitley Bay (Con)
My Lords, at the beginning, I said I would speak to my Amendments 47 and 49 in my winding-up speech, but I said what I wanted to say about them then, so I shall not elaborate on them now. I am grateful to my noble friends Lord Hayward and Lord Jackson of Peterborough in particular for their support, and obviously to my noble friend Lord Markham, who signed the amendments.
To pick up what my noble friend Lord Hayward said, this is not intended to be perfect wording—this is a probing amendment. He is absolutely right to refer to adding timescales as an important matter of consideration. My noble friend Lord Jackson gave another argument in our useful discussion about the dangers of having somebody with a current live media interest serving in different capacities in these roles. If they are privy to sensitive information about the leagues and clubs, which are multi-million pound businesses in many cases, a careless word or an evasive answer in an interview or on a TV show panel could give the game away—all too literally.
I simply reiterate the questions that I put to the Minister in my opening speech: whether she sees a role for a cap on salaries at all, and whether the Government intend to publish their expectations for remuneration, even if they do not set out a figure. We would be grateful to hear an explanation of the reason for the change between the last Bill and this one, on the removal of the upper limit.
Baroness Twycross (Lab)
I thank the noble Lord, Lord Parkinson of Whitley Bay, for tabling these amendments on the expert panel. The regulator’s independent expert panel will be responsible for making various important decisions across the regulator’s regime when and where it is appropriate. It is important that the panel has a range of expertise and experience to reflect this. The number of members of the expert panel is to be determined by the chief executive officer in response to the operational need. The Government do not want to restrain the effectiveness of the expert panel by introducing an arbitrary cap on the maximum number of its members. In our view, the regulator needs the flexibility to react in the event of high workload for the panel. The regulator would still need to deliver value for money, and has a regulatory principle encouraging this, so we do not believe that the CEO would appoint and maintain an unnecessarily large panel.
The Government acknowledge the intent behind Amendment 45 and other similar amendments to fortify the provisions in the Bill for dealing with conflicts of interest. It is essential that the regulator can deliver its regime free from undue influence and vested interests. I would like to reassure noble Lords that the Bill, supported by public law principles and non-legislative measures already in place, already sufficiently makes certain that the regulator will be free from conflicts of interest. For example, the Bill already places an onus on the chief executive officer to check for conflicts of interest at the point of making an appointment to the expert panel, and on an ongoing basis from time to time. In addition, the Bill sets out that the chief executive officer must ensure that the expert panel has the relevant range of skills, knowledge and experience.
It is possible that this amendment would limit the ability of the chief executive officer to do this, as it would restrict the pool of potential members of the expert panel. This, in turn, could hinder the IFR’s ability to fulfil its objectives. All in all, we are confident that these are comprehensive safeguards to examine and manage conflicts of interest appropriately. As noble Lords discussed earlier in relation to the composition of the board, we do not think it is appropriate to arbitrarily rule out specific sectors or sector interests.
I thank the noble Lord, Lord Parkinson of Whitley Bay, for Amendment 47. The Government very much appreciate the importance of ensuring that the regulator offers value for money. The regulator will be required to lay its annual accounts before Parliament and the Comptroller and Auditor-General for scrutiny. The regulator will also be subject to pay remit guidance in the same way as central government departments ensure that pay rises are justifiable. This will ensure value for money to taxpayers and operational flexibility for the regulator. Having a maximum salary in legislation would leave the regulator potentially unable to adapt to inflation and market changes. This could leave it without the expertise necessary to make critical decisions that allow the regulator to effectively deliver its remit.
Finally, I thank the noble Lord, Lord Parkinson of Whitley Bay, for tabling Amendment 49 on the transparency and accountability of the regulator. The Government very much agree that it is vital that the regulator is transparent and able to be held accountable by Parliament and others. Therefore, there are already a number of provisions in the Bill that ensure this. The exercise of the regulator’s functions will be reviewed in the regulator’s annual report. The Secretary of State and Parliament will be able to scrutinise these reports, which will be laid before Parliament. On the expert panel, the legislation already sets out a number of requirements to publish decisions and the reasons for them.
On this point, it is important for noble Lords to focus on the fact that transparency in decision-making is hugely important, but it is also really important that individual panel members can act without fear or favour, and that ultimately the regulator as a whole stands behind the decisions it makes. In my view and the view of the Government, it will also be necessary, in some instances, for details to remain private for commercial, personal or other sensitive reasons. For the reasons I have set out, I ask the noble Lord to withdraw his amendment.
Lord Parkinson of Whitley Bay (Con)
I am grateful to the Minister for her responses to the points raised here. I am a little perplexed by the answer she gave on operational need, and her dismissing the argument for having an upper limit to the panel. It is not a party-political point. I said earlier that I was perhaps most perplexed by this change from the previous Bill to the current iteration. This is not a partisan point; there must have been some further thinking by the Bill team that worked on both versions, but I am confused as to what operational needs might mean that a panel of 20 could not do it. I will take that away and reflect on it and, if she has anything further to say, I am sure that in one of the meetings we have or in a future letter she can set it out.
On the salary point, I take what the Minister says about not carving it in stone and being limited to inflation, but there are other ways around it, such as pegging it to an equivalent salary in an equivalent profession. There might be ways around doing it so that there is flexibility for salaries to increase as inflation demands without them spiralling in a way that could undermine the work of the panel. In dismissing all these amendments as a group, we could end up in a situation with a potentially infinite number of panel members being paid a potentially infinite sum of money, so we are keen to probe where the limits of good sense are. We might come back to this issue with a bit of further thought, but in the meantime I am grateful and I beg leave to withdraw my amendment.
Member’s explanatory statement
This amendment removes the Secretary of State’s power to provide the IFR with financial assistance.
Lord Jackson of Peterborough (Con)
My Lords, every time I see a new enabling power, I think it cannot get any more egregious, but this is probably the best of the best so far—or the worst of the worst, as my noble friend Lord Hayward says from a sedentary position.
Lord Hayward (Con)
My Lords, I will correct my noble friend on one point in his introductory speech. He talked about the cost burden falling on the taxpayer. This is a Bill where the burden does not fall on the taxpayer; it falls on the football clubs. At each step, however many there may be, depending on debates on hybridity and the rest, we must remember who will finish up paying for this. It is a group of football clubs, their fans, their staff and their players.
I raised the question in Committee:
“The Government need to be honest before this legislation passes, and to identify the probable burden for each of the small clubs”.—[Official Report, 2/12/24; col. 996.]
The Minister committed to write to me in response, and she has done so. Earlier, I intervened on my noble friend Lord Jackson and cited a particular instance, the head bullet point in the Minister’s response whose heading is:
“Exact cost of the Regulator”.
I did not ask for the exact cost; I asked for a probable cost. With respect to my noble friend Lady Brady, my target throughout this has been the small clubs—the Wycombes, the Wigans and those sorts of clubs. They are not as well resourced as those in the Premier League and do not have international competitions that they may or may not be in. It is crucial that the small clubs have some idea of what they are going to be asked for.
According to the letter, the impact assessment, to which I have referred previously,
“provides a reasonable estimate of these costs”.
If it is “a reasonable estimate”, it will probably be possible to work out reasonably what the costs to the small clubs are. The Minister has used the word “proportionate” on different occasions. The calculation could be done only on revenue, turnover or staff. It is improbable that it will be staff; it will therefore be revenue or turnover. If you have a fixed number of clubs and already know the revenue and turnover of each of them, you can work out what the costs will probably be. I will continue to press throughout Committee and Report until we get an indication of what the costs are. It is not as if they are not available.
I am sorry that the noble Baroness, Lady Taylor, is not here. On this occasion, I have done not a word count but a page count. The impact assessment is 76 pages long and, on a conservative assessment, 29 pages provide projections of costs and benefits. I could have extended it more substantially than 29 pages, but on a small conservative estimate there are whole pages of graphs with options and alternatives. The noble Lord, Lord Jackson, referred just now to £140 million. That is not the top option but the “reasonable estimate”, to use the words of the Minister. It could be much higher.
If there is an analysis of potential costs on 29 pages of the impact assessment, it is a very short step to do a calculation of the impact on each club. When I say it is a short step, it is in the impact assessment itself, but I am asking for the costs to the clubs. Page 58 starts progress down that route. It says:
“Costs to the National League (organising body)”.
In other words, it has already gone part of the way there. On the next page, we read:
“Costs to National League clubs”,
and there are several paragraphs thereafter. So, the Government have already gone down the route of looking at the potential costs not only to the National League but to National League clubs.
If the previous Government felt that it was possible to ask an opinion poll company, Ipsos MORI, which I cited the other day, to do research on potential regional benefits and contributions that people might perceive from having a regulator, it should be possible for this Government to do research on what people might pay—to come back to my point about the revenue and turnover of these clubs, all they have to do is turn to Deloitte. Is that a company that we have never heard of? No. Deloitte is cited in the impact assessment on different pages. It talks about Deloitte’s research into football clubs on the back page:
“Deloitte analysis of club finances”.
That is all that has to be done.
The Government are so keen to display their research in terms of finances and costs that they have not only produced an impact assessment but “impact assessment key points”. What is the first title? “Cost methodology”. We are talking about something which the Government have gone a long way down already in the necessary assessments.
I will not challenge the figures—I may do so on another occasion. Taking the figures that are available, it is a very short step for the Government to say, “This is what it will cost for clubs of these sizes to operate and pay for the levy”. But I would add one important caveat, and it may be one of the two reasons why the Government do not want to identify the sums involved.
Lord Markham (Con)
My Lords, I thank my noble friend Lord Jackson for his Amendment 50, which looks to protect the taxpayer. I particularly support my noble friend Lord Hayward’s as ever forensic analysis, which really focused on the burden to the smaller clubs. These things easily get out of control and, as my noble friend mentioned, £140 million in anyone’s book is a lot of money, and that is just the central case—it is not even the highest example.
I will speak to my two amendments in this group: Amendments 171 and 253. Amendment 171
“restricts discretionary licence conditions to include only internal financial controls”.
Interestingly, this was the drafting of the original Bill that was brought before the other place before the general election. We have heard many times in the Chamber how this Bill is substantially the same as the original one. However, this time round there is a key change in the wording: instead of “internal financial controls”, the word “financial” has been taken out, so now it is just “internal controls”. I think we would all agree that there is a world of difference between looking at the financial management of a club, which is something that we would understand, particularly with regard to the sustainability argument, and why that might be in the remit. Removing “financial” from that, all of a sudden, so you are just looking at the internal controls of a club, is obviously a massive moving of the goalposts, if I may say so.
In trying to understand the thinking behind it, I looked at the Explanatory Notes. In those, it mentions that, broadly speaking,
“Internal controls refer to the system of policies and processes established by the management of a club that allow it to continue operating in an effective, orderly and efficient manner”.
That may seem innocuous, but it goes once more to the whole issue of mission creep. The Bill does not define internal controls—and remember that we are talking about 116 clubs, and we are saying that a regulator is suddenly going to have powers to explore those internal controls.
Again, the Explanatory Notes say that those internal controls are looking to make sure that the club is being run
“in an effective, orderly and efficient”
way, and that they help a club to operate in such a way. First, is that the role of a regulator, to get involved in the internal controls of every club, as to whether it is running efficiently? Suddenly, we seem to have appointed a management consultant on steroids, who will be looking into the cost of each club and opining on it. Surely that is not the sort of thing we want to do for 116 clubs.
Then, what does that bring in? Why not the IT department of a club? I think we would all agree that digital information technology comes into the definition of the effective, orderly and efficient operation of a club. So, are we now asking the regulator to do that? Maybe we should be hiring Capgemini, IBM and whoever else to start to get into it.
Suddenly, we start to see this mission creep. Then, we realise that the other parts we are trying to bring in, on having protection for clubs and the taxpayer in Amendments 50 and 253, become all the more important. Not only have we now got the concern that this regulator will be looking into every nook and cranny of the internal controls of a club, but who will be footing the bill for all of this? There is a blank cheque that either the taxpayer or the clubs are going to have to foot. I think we would all agree that we probably do not want either of them to do it, but as this is set up here and now, the regulator has absolutely been given the remit to do that.
In my Amendment 253, I am trying to make sure that at least this does not fall on the taxpayer; I think we would all agree that we do not want that. I must admit that I do not feel particularly comfortable about that, because I do not want it falling on the small clubs—or any of the clubs for that matter—but I am absolutely sure that I definitely do not want the taxpayer to be funding a regulator to look into the internal controls of 116 clubs and whether they are effective. However, I do not think that we want the clubs to have to do that either.
It is a long-established principle that the regulator is paid. I am familiar from my old media days with Ofcom being funded by the broadcasters, and that has to be appropriate, because we do not want the taxpayer to do it. However, what sort of control do the clubs have over this? All of a sudden, the regulator says that it is going in and to look at every single nook and cranny of their internal control to opine on whether they are efficient and effective—and the really good news is that they are going to pay for all of it as well. Is that really what we want from a regulator? I do not think it is. We started off with a very small mission and, suddenly, the regulator is looking into the internal controls of 116 clubs. I really do not believe that this is what we want.
That is why, in my amendments, I am first trying to return the regulator back to internal financial controls, which we can see a role for. Secondly, I am making sure that this does not fall on the taxpayer. However, if this falls on the clubs, we need to think about how we can give them some sort of control to avoid them having to pay a blank cheque for all of this.
Lord Birt (CB)
Most of what the noble Lord said would be done during an audit. All of these companies will have audit, and almost everything he mentioned will be conducted by the auditors. Plainly, it would be completely duplicatory for that to be done twice over. The issue is whether the regulator would have access to the audit. I agree with the noble Lord about the need to avoid cost, and wherever the cost falls, audits—as I am sure he knows—are ever more expensive, because the obligations on auditors are increasing the whole time. There is a lot at stake here.
Lord Markham (Con)
This is another example of the benefit of getting different brains on the committee. I absolutely hope that that would be the case, but it is probably a question for the Minister to answer. It is definitely logical.
Lord Addington (LD)
My Lords, I will make some brief comments. As I read the Bill, the Secretary of State providing some finance might be necessary, particularly in starting up. One of the things we do not want is an underresourced regulator blundering around making mistakes. A bad regulator is the worst outcome you can have, and that is usually because it lacks resources. When the Minister responds, can she give us some idea about when the power to give extra money would be used? This being done badly would be the worst result.
When the noble Lord, Lord Markham, talked about regulation, I am afraid I kept thinking about Fulham and Al Fayed. Are your internal control structures right? Are you doing something wrong? The damage that could be done by bad organisation immediately catches in the back of my throat. The regulation will not be straightforwardly financial; it is also about reporting structures, the care of your workforce, et cetera. Surely that should be covered by the Bill. These are questions about where you draw the line. If we have a regulator, does it regulate the whole thing? I think it has to; it cannot be just financial. If these are socially important structures—this is what we keep coming back to—we have to look at this question.
The noble Lord, Lord Hayward, has a point about the costs involved. I hope that we will get an answer when the Minister responds—at least a rough ballpark figure—because it will clarify what we will do. Those of us who approved the idea of a regulator think that it has to be properly resourced and that it has to cover the whole thing. I hope that the Minister can give us a little more guidance about what will happen and what the Government’s thinking is at this point, because they should have an answer by now.
Baroness Brady (Con)
My Lords, my understanding from the Premier League is that the Government’s estimated cost of the regulator is £10 million a year, and the Premier League considers that to be very low. We have heard a lot about how the regulator has been based on banking regulation, but the FCA costs £762 million a year and Ofcom costs £127 million a year.
It is worth noting that there are two critical but unrealistic assumptions in the impact assessment. First, it assumes perfect compliance, and, secondly, it focuses solely on ongoing compliance costs, such as information-gathering and engagement with the regulator and supporters. It does not account for the potential costs associated with, for example, licence conditions enforcement action that may arise through the commitments procedures. I completely agree with the noble Lord, Lord Hayward.
In earlier debates in Committee, I read out what Mark Ives, the general manager of the National League, said:
“We are concerned about the costs … The expectation of how much it is going to cost clubs at a National League level is a huge concern—it may be a small amount of money, but it is a lot to the clubs”.
He went on to say that many clubs in the National League are run by volunteers. We should give the clubs an idea of what it will cost, so they can work that into the budget. Each club should know whether it will be fully funded and fully staffed, so it can do the right job.
We have heard throughout Committee that the powers will be extended. The more that the powers are extended then the more complicated the Bill will be, the more staff they will need and the more costs there will be. Each club has to pay that cost because it has to have a licence. The way that you discharge the cost of the regulator is to add it to the licence. All 116 clubs, even though they are not listed in the Bill, will need to obtain one of those licences to operate.
Cost is a huge concern. It appears from what has been said that the Premier League would be picking up the majority of that cost. There is a big difference in the Premier League between those at the very top and those at the very bottom; they have very different pressures on their finances. I can only endorse what my noble friend Lord Hayward said and urge the Minister to give us an indication.
Lord Mann (Lab)
I am curious. There have been a lot of detailed discussions over the last three years with the Premier League and with Premier League clubs—I was involved in many of them. The Premier League was suggesting—it was not the only one—that for people in the Premier League, and the Premier League as an institution, a model of self-regulation would be a lot better. It would be helpful to know what costing the Premier League has built into its model of self-regulation, as it was certainly thrown around as an alternative for quite some time.
Lord Moynihan of Chelsea (Con)
My Lords, I support all three amendments in this group, particularly Amendment 253. I am delighted to follow the noble Lords, Lord Jackson, Lord Markham and Lord Parkinson, in their advocation of these amendments. I declared my interests on Monday, but this evening I have a fairly massive conflict of interest. I do not believe that I am alone in the Chamber in having been forced not to watch Chelsea breach all the principles of equity by beating Southampton 5-1 as we sat here. The poignant thrust of this conflict would be if my football friends started telling me that my staying away from Chelsea matches is good luck for the team. Therefore, it is not without anguish that I stand before your Lordships.
I go back to my earlier warnings about the dangers of regulators. Such dangers are stark in the clauses that we seek to amend and in the amendments themselves. The questions that your Lordships have raised in the debate boil down to what it will cost overall. That is what clubs will be asking, and then they will be asking what it will cost them. The third question that will come to the mind of the clubs—except those luckless ones in the Premier League—is around what they are going to get. We will talk about that in a minute but, to go back to what it will cost overall, we have heard over and again that we have no idea. There are estimates, which are clearly—
Lord Mann (Lab)
I have met plenty of clubs that have given an estimate of the likely cost, including across the Premier League. There is no ambiguity around the kind of sum that many Premier League clubs are citing as to what they expect the cost to be.
Lord Moynihan of Chelsea (Con)
I thank the noble Lord for that intervention but the fact remains that they cannot know what it will cost because, for a start, we do not have any certainty about what clubs will be in the scheme. We have been told what it might start at, but the Minister has said that she will not—
Lord Mann (Lab)
There have been extraordinarily levels of dialogue between the Premier League and the Government over a long period on this. The suggestion that the Premier League does not have some idea of the likely potential cost and has not spoken to clubs in relation to that is simply nonsense. I have spoken to clubs which have given specific estimates of what they anticipate it will be. Whether that is accurate or not, the idea that those figures have not been discussed at length is something of a fantasy.
Baroness Brady (Con)
I am sorry to intervene on the intervention, but I have not seen the noble Lord at any Premier League meetings; I have been to them all. I can assure him that we have never had a discussion about the potential costs, because we have never known what the potential costs are; no one has told them to us. We have looked at the impact assessment and that has given us a vague estimation, but to suggest that we have had a long, detailed discussion and debate, and that we understand and know what the costs are, is not correct.
Lord Moynihan of Chelsea (Con)
I thank the noble Baroness, Lady Brady, and the noble Lord, Lord Mann, for his intervention. He seemed to think I was talking about Premier League clubs. I was not. I was saying that the Minister had said that she did not want to specify in the Bill which clubs were going to be regulated, so the club does not know whether it will be regulated, and it certainly does not know how much it will cost it. The noble Lord might shake his head, but that is a fairly obvious point. We do not know who will pay. We also do not know what it will cost. I believe the noble Lord, Lord Hayward, talked about an estimate of £10 million—I beg your pardon; it was the noble Lord, Lord Markham.
Lord Hayward (Con)
If I might clarify for my noble friend: the noble Baroness, Lady Brady, referred to £10 million; I was quoting from the impact assessment, which says that £140 million over 10 years is the mid-point the Government are operating to.
Lord Moynihan of Chelsea (Con)
I beg the noble Baroness’s pardon for not attributing the £10 million figure to her. The fact is that we know that is ludicrous, because the cost of other regulators is way more than that.
I will make some headway. What will it cost overall? We do not know what the overall cost will be or what it will cost individual clubs. To talk a little bit more about that, imagine you are a local entrepreneur. There is a club in a little bit of trouble. They come to you and say, “You always wanted to own a football club. Why don’t you take over our club and then you can have one of those back-to-back league promotion successes that you’ve dreamed about and you’ll be famous in your community?”. You say, “Well, I’ve got a few bob. I don’t know how much, but yeah, okay, I’ll consider it”. It is one of those clubs that a noble Lord opposite talked about on Monday. I think the numbers cited were a turnover of £2 million and seven employees. You are invited to take over this club and bung in some of your money. You may not have a lot, but you may think you have enough. Then you say, “What’s going to happen?” My concern is that when you are told there is going to be a regulator that will tell you who to have on your board and all that, you will say, “Forget about that; as an entrepreneur, I don’t play that particular game”. But let us say you swallow that. Then you say, “How much is this regulator going to cost me?” The answer: “Dunno mate”. You ask, “Well, what could it be?” The answer: “Dunno”. So you turn your back and go off to sponsor the local cricket club or something like that. It does not work if you are not absolutely clear about what the cost will be.
Lord Markham (Con)
I ask the noble Lord this given his experience of consulting in a lot of entrepreneurial and start-up situations. I know that he has done lots of these types of moves. Clearly, when you invest in a start-up business or a club you will have business plans. They might be good or bad business plans, but they are normally based on an investment and an expansion. In this case, given that the regulator can say no to those business plans and that investment once it gets into it, I assume your investment proposition would suddenly be up a creek. I would like to hear the noble Lord’s opinion on what that will do to the investment proposition.
Lord Moynihan of Chelsea (Con)
The noble Lord, Lord Markham, makes a very good point. If some local worthies approach you and ask, “Will you invest in this club?” and you say, “Well, I’ve got to figure out what it’s going to cost me”, and they then say, “You’ve also got to figure out whether your plans are going to be acceptable to the regulator”, again, you would turn your back. Entrepreneurialism is the heartbeat of the economy, as several noble Lords have said in this debate over the past few days. This regulator proposal just turns entrepreneurs away from wanting to invest.
Lord Mann (Lab)
It would be helpful if the noble Lord could give examples of entrepreneurs wishing to invest in football who he has spoken to. I have spoken to a lot of entrepreneurs, including people who have invested smaller amounts in smaller clubs and larger amounts in Premier League clubs. They know exactly what they are anticipating and what they are going into. Of course, as part of their business plan, they are factoring that in. There is a figure, there is a concept, and investment has not gone down in the past 18 months. Indeed, further major investment in major clubs in English leagues is likely to happen soon. What is going wrong if they are all running away? Can he give a single example?
Lord Markham (Con)
I posed the question, and I can give an example of that. I have mentioned to noble Lords before that I have experience of the Brighton situation and know the board and the set-up there quite well. Brighton is a perfect example, and it is a shame that the noble Lord, Lord Bassam, is not in his place, because he is very familiar with it. It was a club without a stadium or good training facilities. An owner, Tony Bloom, came in and invested a lot of money in it, with a plan predicated on investing in players and doing a lot of analysis to get the best ones from around the world. It was absolutely a start-up scenario where he was heavily investing, and part of that was the concept of being able to yo-yo in terms of having parachute payments. He cited to me the example of West Bromwich Albion, which at that time had been promoted and relegated and promoted and relegated, but each time, because they had the parachute payment, they were able to become more sustainable.
Suddenly you get a situation whereby someone is thinking, “I want to do another Brighton like Tony Bloom, but I do not know what my cost base will be. I do not know whether the regulator is going to stop me going on with my plans because it thinks I am unsustainable or make me deposit a large sum of money as a financial buffer. I do not know whether my parachute payments, which are part of my plan, are then going to be taken away. Suddenly I’ve got a hell of a lot more risk involved”. I can only believe that that is going to dampen enthusiasm to invest in the first place. That is a very real example.
Lord Moynihan of Chelsea (Con)
I thank my noble friend. I apologise to the Committee for going over my allotted time, but I hope that it will appreciate that a great deal of that time was taken up not by me but by entirely welcome interruptions by other speakers.
In the interests of trying to move this on fast, I will stop talking about this issue of “What is it going to cost me?”, important though it is to have far more understanding of and far more limitations on the regulator’s ability to charge, and will move on to that of “What I will get?”. As soon as it becomes possible for a club to get money out of this arrangement, suddenly you have discussions about parachute payments and backstops; you have supplicants; you have lobby, lobby, lobby. It is called crony capitalism, state capture, rent-seeking. These are the dangers that you get when you involve the Government, and although we are calling it a regulator, this is a governmental action. It is essential that we limit the amount of money that that regulator has to play God with football in this country.
With those problems, it goes beyond just stopping the regulator spending beyond the levy amounts, as I understand Amendment 253 to say. We need to ensure that the levy amounts in the first place are suitably parsimonious and as little burdensome as possible to the clubs. I appreciate what the noble Lord, Lord Addington, had to say, but let us not be too free with other people’s money. I am sure it is not popular in all parts of this House to quote the great Baroness Thatcher, but she had the great remark, “You can spend other people’s money until pretty soon there isn’t any more”. Let us think about the impact.
Baroness Blake of Leeds (Lab)
I understand that the noble Lord received a number of interventions, but I think he is reaching the limit of his time. I would be grateful if he drew his comments to a close.
Lord Moynihan of Chelsea (Con)
I would almost have concluded in that space of time.
Once the method for determining the levy is agreed and the amounts are fixed, most surely the regulator should be prevented from spending any more than that. I thank noble Lords for their attention.
Lord Parkinson of Whitley Bay (Con)
My Lords, the noble Lord, Lord Mann, is right that we have had extensive discussion on the issue of cost, but if there has been lengthy dialogue on this point then it is because the answers have not been forthcoming in the way that the Committee has wanted.
I am particularly grateful to my noble friend Lord Hayward, who is doing an invaluable service not just for this Committee but for the smaller clubs on whose behalf he has spoken this evening, and in the way that he has gone through the impact assessment to try to get to the bottom of the cost implications for them in particular. I am glad that he will continue to keep at this important point, and I hope he gets some better and more detailed answers from the Minister as he does so.
My noble friend mentioned a letter that the Minister had sent him. Again, she has been kind in responding in writing to individual points that noble Lords have raised, but I ask her to share those letters with the whole Committee when the team sends them through. I think they are coming through to the individual noble Lords who have raised those points but they are not always being shared, and it would be a benefit to the whole Committee if we could all see those letters when they come. However, I am grateful to her, as I know those noble Lords are, for the speed with which she is responding in writing to the points that they have raised.
I am grateful to my noble friends Lord Jackson of Peterborough and Lord Markham for tabling their amendments in this very important group, which concerns the state funding of the regulator. That is a big issue that is worthy of debate, and I support the way that they have drafted them. I put my name to my noble friend Lord Markham’s Amendments 171 and 253, but I am happy to associate myself with my noble friend Lord Jackson of Peterborough’s Amendment 50 as well, which was the one that began this group.
My noble friend’s amendment seeks to strip away the broad powers that could be granted to the Secretary of State to provide financial assistance to the independent football regulator as she sees fit, subject to conditions deemed appropriate by her. Amendment 50 from my noble friend is an important amendment in seeking to safeguard the integrity and independence of the independent football regulator. We would like to think that one of the core purposes of the new regulator is to serve as a neutral body overseeing the governance and financial management of football clubs in this country. By granting the Secretary of State the power to provide it with financial assistance, there is a real and present risk that the independent football regulator’s independence could be compromised.
As with any independent regulator, it is crucial that the independent football regulator operates free from any external pressures, particularly from the Government. The role of the regulator should be to assess the game on its own merits without any concern about political influence or the priorities of the Government of the day. If we were to allow the Government to fund the regulator, we would be introducing the potential for at least the appearance of government influence over the regulator’s work and its activities.
Even if that influence were not overt or immediate, the mere existence of government funding could lead to the perception, and possibly the reality, that the regulator would become beholden to future Governments. That is a danger we must seek to avoid, as it would erode the public’s trust in the new regulator, undermine its effectiveness and hamper its impartiality. The Government have rightly made much of the changes they have made to the Bill in order to guarantee the independence of the regulator in the eyes of international bodies that have paid attention to the Bill, so I am sure that is something they want to avoid in this instance as well.
I hope the Minister will agree that the provision as it stands is concerning in the way that it gives the Government the power to impose conditions on how the regulator uses its funds. The consequences of that are worth considering. The Government could impose restrictions or directives on the work of the regulator, such as mandating certain areas of focus or influencing the scope of its investigations. It could lead to the independent football regulator neglecting crucial issues or, even worse, aligning its work with the agenda of the Government of the day. That sort of shift would diminish the regulator’s ability to act in the best interests of football clubs, players, fans and the broader football ecosystem which the Government and all of us are mindful of protecting.
The existence of that sort of conditional funding could set a dangerous precedent for other regulatory bodies. If government assistance became contingent on adhering to political agendas or priorities, then the independence of other regulatory bodies could be called into question, further eroding public trust in oversight.
I would like also to support my noble friend Lord Markham’s amendments in this group, Amendments 171 and 253. Amendment 171 restricts discretionary licence conditions to include only “internal financial controls”. In Clause 22, the Government allow discretionary licence conditions to relate to “internal controls”. It is important that, in a Bill such as this, the Government recognise the details of the Bill and make clear that the provision refers to financial controls as opposed to solely internal ones.
As my noble friend set out, “internal controls” is broad and open to wide interpretation. Without his amendment, the regulator could potentially impose conditions that extend beyond the presumably intended focus on financial oversight. That surely creates a risk of the sort of regulatory overreach that the Committee has been very concerned about, whereby the regulator might intervene or interfere in areas unrelated to the core objectives of this Bill, such as operational decisions or non-financial activities within football clubs.
If we were to insert “financial” as my noble friend suggests, we would ensure that the discretionary licence conditions relating to internal controls are focused exclusively on financial governance. This refinement would make the regulator’s powers more precise, ensuring that its interventions are effective, proportionate and fully aligned with its mandate to oversee the financial health of football clubs. We have heard, repeatedly and rightly, that the financial sustainability of English football is what the Government are most concerned about and what has led to the Bill that is before the Committee.
The non-financial resources threshold requirement as outlined in the Bill is designed to ensure that clubs have adequate resources, financial and otherwise, to operate sustainably, but the specific mention of internal controls as part of this framework needs to be carefully defined to prevent unintended consequences. Without this amendment, the regulator could use its powers to impose conditions on internal controls that have little or no connection to financial matters. That could include operational areas such as staff management, logistical decisions or club culture, none of which falls under the regulator’s core responsibility to ensure financial sustainability.
By explicitly tying internal controls to financial matters, my noble friend’s amendment reinforces the Bill’s focus on financial governance, while respecting the operational independence of football clubs. They are of course complex organisations operating in—
Lord Watson of Invergowrie (Lab)
I thank the noble Lord for giving way. I have bit my tongue for the last hour as I have watched the charade from the Benches opposite, all using up their entire allocation while interrupting each other, repeating themselves and slapping each other on the back. This is meant to be a debate. I raise it when the noble Lord is standing up not because I disagree with the fact that they are serious about what they are arguing. But had Mr Sunak waited until November and not called his election in July, the noble Lord, Lord Parkinson, would have been here with the same Bill in front of him, other than the issues that we heard have been changed so far—not the issues that we have been discussing for the last two hours or so. They would have been exactly the same. He would have been defending that Bill and now there is confected displeasure, if not outrage, with the way that the Bill is. Is that not hypocrisy?
Lord Parkinson of Whitley Bay (Con)
I am happy to use the time before the Committee to return to this issue but, as my noble friends behind me have said repeatedly, and as I have agreed to each time they have, I know that they would have been raising these points with me had I been at the Dispatch Box opposite. I know that because they were already raising them with me when I had the privilege of being the Minister, and I would be in the position of seeking to persuade them of the merits of the Bill. But I have also been clear, from Second Reading and all the way through, that we want to see this regulator established. We want to see it doing its work and doing so effectively, but we also see before us a Bill that is different, because of the election that was called and the result that happened.
We are interrogating particularly closely the changes that the Government have made to the Bill, of which there are many, and we have more concerns on these Benches, from my colleagues behind me, than we did before the election about the way we do it. As I have said before, the result of the election also puts us in a position on this side of the House to fulfil the duty that the noble Lord, Lord Kennedy, and the noble Baronesses, Lady Twycross and Lady Blake, dutifully fulfilled before the election: of making sure that government legislation is properly scrutinised. I make no apology for the fact that—
Baroness Twycross (Lab)
I have never filibustered a Bill to which my party had committed in a manifesto and to which all parties had committed. While the noble Lord is correct that I would scrutinise legislation when I was sitting on those Benches, I have never sought to filibuster a Bill to which my party had committed and which my party had laid before Parliament, intending to filibuster it to the point of getting us stuck in treacle.
Lord Parkinson of Whitley Bay (Con)
My Lords, I much regret the tone that the noble Baroness has adopted and what she says. That is not what we are doing. I sat here and bit my tongue, like the noble Lord, Lord Watson of Invergowrie, when I saw the Government Chief Whip asking one of his Back-Benchers not to move an amendment in order to try to proceed.
One of the great strengths of this House is the way in which we go through Bills in detail. We unearth issues, as we did in the debate on the group that we started today’s debate in Committee with. Neither I, as the prospective Minister in this House for the Bill in the last Parliament, nor the Minister opposite me was aware of the issues about hybridity until we got into the weeds of the Bill as we have in this Committee. That is the strength of the work of this House. I do not call that filibustering; I call it legislative scrutiny and, as we look at the workings of this House and the way it does that, we should do that with great pride.
I do not want to be distracted from the matter at hand by points that have been raised opposite. I want to address the amendments in this group so that we can carry out that duty. I associate myself with the amendments that my noble friends have tabled. I was speaking about my noble friend Lord Markham’s Amendment 171, and I agree with it.
Baroness Twycross (Lab)
My Lords, I thank the noble Lords, Lord Jackson of Peterborough and Lord Markham, for these amendments. Before I go through them and respond to the debate, I stress that I will make sure that all letters that have been sent to Members in the course of the Bill so far are placed in the Library as soon as possible, if that has not already taken place.
Ensuring that there are appropriate financial processes and limits in place for the regulator is extremely important, and I welcome this opportunity to discuss the matter in more detail. Amendment 50, in the name of the noble Lord, Lord Jackson of Peterborough, would entirely remove the ability of the Secretary of State to provide the regulator with financial assistance where appropriate. The Government acknowledge that the intent behind this amendment is to ensure that the regulator provides value for money for football fans, Parliament and the wider football industry. The regulator will be levy funded, and its regulatory principles include using its resources in the most efficient, expedient and economic way—this is what we expect.
The noble Lord, Lord Hayward, asked about costs to smaller clubs. It will be for the regulator to determine the methodology for the levy. However, the Bill requires it to take into consideration the financial resources of a club and the league a club plays in when determining how to distribute the levy charge across clubs. This should ensure a proportionate levy, where no club, big or small, will be asked to pay more than what is fair and affordable. I appreciate, however, that the noble Lord has not yet been satisfied by my response to this, and I look forward to discussing it with him in further detail when we meet.
Lord Hayward (Con)
I thank the noble Baroness for the offer to meet. Can I clarify that her implication is that all clubs in a division will be charged the same fee? I am not absolutely clear from what she said whether there will be a varied fee for different clubs in the same division, and this is not clear in the impact assessment either.
Baroness Twycross (Lab)
It is for each league a club plays in, but, as the noble Baroness, Lady Brady, made clear, there would be differences between the resources available to each club within a league. It is intended to make sure that each club has a proportionate levy placed on it, as well as taking into account which league a club might be playing in. So it is intended to be proportionate overall but also proportionate to the resources of an individual club.
The regulator’s budgets will be approved annually, and it will produce an annual report that will be laid before Parliament. However, on the points raised by the noble Lord, Lord Addington, exceptional and unforeseen adverse events may mean that it is necessary for the Secretary of State to provide financial assistance to the regulator. Paragraph 36 of Schedule 2 allows for this when considered appropriate. It also allows for the Secretary of State to cover any shortfall during the period between establishing the regulator and the levy being fully in effect—that was noted during the debate.
The noble Lord, Lord Jackson, asked how much the independent football regulator will cost and questioned whether the taxpayer would have to pay. To answer his question fully, I stress again that the regulator will be levy funded. However, there will be a period before clubs are licensed, and before the levy can be charged, when the Secretary of State will provide funding. These initial costs can all be recouped by the Exchequer once the regulator’s levy is up and running. We cannot know the exact cost of the regulator until the legislation has been passed and the organisational design has been finalised by the chair and the board. The noble Baroness, Lady Brady, noted that some of the additional potential purposes that noble Lords have discussed in relation to the regulator could scale up or scale down some of those costs, so it is not possible to have an exact figure at this stage.
On a power allowing the Secretary of State to cover any shortfall, there is an equivalent power for the Secretary of State to provide financial assistance to, for example, the Small Business Commissioner in the Enterprise Act 2016. Entirely removing the ability of the Secretary of State to provide this financial assistance could mean that the regulator is unable to continue to operate and fulfil its objectives, which would have significant knock-on impacts on the game.
On Amendment 171, in the name of the noble Lord, Lord Markham, it is important that clubs have appropriate non-financial resources in place. This will ensure that clubs are able to make good decisions about running the club, as well as meet relevant rules and regulations and report their finances accurately. The regulator will be able to attach discretionary licence conditions relating to non-financial resources in three areas: risk management, financial reporting and internal controls—and only in these three business-critical areas.
The term “internal controls” is explained in the Explanatory Notes. It refers to the system of policies and processes that a club has that allow it to operate in an effective, orderly and efficient manner. This includes controls to ensure complete, accurate reporting, compliance with rules and regulations, and financial management.
To confirm the assumption of the noble Lord, Lord Birt, on the matter of not duplicating with regard to audit, we would assume that existing audits would be used as part of this process.
These are all areas crucial to ensuring financial sustainability, and that is exactly why the regulator needs to be able to attach discretionary licence conditions relating to these areas to ensure that clubs do in fact have appropriate non-financial resources. It would not be appropriate to limit the regulator unnecessarily here to internal financial controls only. The regulator can attach licence conditions only if they advance one or more of its operational objectives. I reassure noble Lords that the regulator will not have free rein here; financial sustainability will still be at the heart of any licence conditions.
Finally, I thank the noble Lord, Lord Markham, for his Amendment 253. The Government completely agree that the regulator should not be able to borrow money. That is why it is already prevented from doing so in paragraph 35(2) of Schedule 2. There is no need for this restriction to be duplicated elsewhere in the Bill. Additionally, the regulator would currently use penalty receipts to fund litigation costs. The noble Lord’s amendment would prevent this. It would mean that litigation costs would have to be passed on to all clubs through the levy, as opposed—
Lord Hayward (Con)
Sorry, I was just waiting for the Minister to conclude her paragraph. Can I just ask her to clarify the intervention made by the noble Lord, Lord Mann? He said—I am paraphrasing and am happy if he corrects my phraseology—quite clearly to the Committee that figures have been given to clubs as to what they were likely to pay. Is that correct, or is the noble Baroness, Lady Brady, correct, having been present at all the meetings with the Ministers, that no figures have been given to any clubs?
Lord Mann (Lab)
Figures have been given by the Premier League to clubs and clubs have been happy to cite those figures.
Baroness Twycross (Lab)
To respond to that point, my understanding of what my noble friend Lord Mann said was that it related to the Premier League giving information to the clubs, rather than explicit information being given by the Government.
Lord Hayward (Con)
In which case, can the noble Lord, Lord Mann, provide the Committee with the details of the figures and the dates when they were provided?
Baroness Twycross (Lab)
I am not sure whether it is my responsibility as a Minister to ensure that that happens.
Baroness Twycross (Lab)
Perhaps noble Lords would allow me to continue, as it has been quite a long evening. I am getting close to the end of my response to the debate on this group.
I turn to the issue of litigation costs being passed on to all clubs through the levy, as opposed to being taken from financial penalties of non-compliant clubs. It does not seem fair or proportionate, particularly for those clubs that have complied with regulations, for the costs incurred as a result of those that have not complied to be charged to all clubs. For the reasons I have set out, I therefore hope that noble Lords will not press their amendments.
Lord Jackson of Peterborough (Con)
My Lords, just to concede the point from my noble friend Lord Hayward, he is absolutely right about the cost being accumulated and passed on to clubs. I did not make it clear that, effectively, the point I was making was that this is an open-ended financial commitment for the IFR, rather than another way of ignoring the cost on the clubs. The point I was making is that it is axiomatic that, if you have a clause that says there is unlimited cash available to a body, it will take advantage of that and there will be carte blanche.
At this late hour, I just leave your Lordships with my observation of Parkinson’s law—not my noble friend Lord Parkinson of Whitley Bay but C Northcote Parkinson. He wrote an essay in 1955 for the Economist, saying that
“work expands so as to fill the time available for its completion”—
or, in public services and government, the number of people grows regardless of the work to be done. The point I am making is that if you give an unlimited blank cheque to this body, you are encouraging mission creep and encouraging that body to move into ultra vires areas, not just regarding transitional costs but on a long-term basis in the Bill. For that reason, we need to come back to this and maybe redraft the Bill.
Incidentally, I found the Minister’s answer quite helpful and informative, for which I thank her. I know that it has been a long evening. We have had an eruption from mount Watson—the noble Lord, Lord Watson of Invergowrie—and all I would say is that it is a constitutional principle that no Parliament can be bound by its predecessor. We are in a new Parliament with a new Government and a new piece of legislation, and we are doing our job of scrutiny and oversight. With that in mind, I beg leave to withdraw the amendment.