Tuesday 15th July 2025
(1 day, 21 hours ago)
Lords ChamberFootball Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Consideration of Bill Amendments as at 8 July 2025 - large print - (8 Jul 2025)
Baroness Twycross
That the House do agree with the Commons in their Amendment 1.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
My Lords, with the leave of the House, in moving this Motion I will also speak to Amendments 2 to 62.
I tried very hard to avoid the overuse of football metaphors or puns at the earlier stages of the Bill but, despite the Bill having left your Lordships’ House previously, I think we can say that we did think it was all over, and I sincerely hope, with your Lordships’ agreement, it almost is now.
Over the course of the passage of the Bill, we have heard concerns about the risk posed by the distributions mechanism outlined in the Bill. I thought that the original model had its merits. However, as I committed to do on Report and at Third Reading in your Lordships’ House, the Government have taken another look at the mechanism and in response have made a series of important amendments in the other place.
The Government are grateful for the careful and considered scrutiny from noble Lords across this House, which was invaluable in the development of this new model. I take this opportunity to again put on record my particular thanks to the noble Lord, Lord Birt, for his extensive and thoughtful work in providing such scrutiny. I know that he was sorry not to be able to be here in person today, but I also know that he will be well represented by his Cross-Bench colleagues. I thank the noble Lords, Lord Burns and Lord Pannick, and the noble and learned Lord, Lord Thomas of Cwmgiedd, for the expertise they have provided over the last few weeks.
The amendments we have made alter the distributions model through changes to Part 6, alongside supporting amendments to other clauses. These are primarily designed to change the mechanism from the previous binary choice mechanism to a new “staged regulator determination” model. This new model is designed to give more certainty to parties while ensuring that the backstop is designed to reach the best solution possible for all of football.
I will briefly explain how the amendments achieve this goal. First, the amendments introduce two new clauses. Clause 61 has been replaced with a completely redesigned proposal process. We have been clear that our strong preference is for the leagues to reach an independent distributions solution without the need for the backstop to be triggered.
Since the Bill was last before this House, the Government have announced David Kogan as our preferred candidate to chair the regulator. I know that David Kogan shares this view that the backstop should be triggered only as an absolute last resort, and our new proposal stage has been designed to incentivise that. If the backstop process is ever triggered, the regulator would invite the leagues to submit proposals detailing their solutions to the questions for resolution. The leagues would then submit their proposals to both the regulator and to each other. This will allow for more constructive negotiations, as the leagues will be more informed regarding each other’s position on core issues.
The leagues would also be able to submit revised proposals, ensuring both sides have the best chance possible to outline their position to the regulator, and, in turn, allowing the regulator the opportunity to request additional relevant information. This structure will ensure that the regulator is in the position to make the best possible evidence-based decision, while incentivising the leagues to make their own agreement.
We have replaced Clause 62 to introduce more flexibility for the regulator. Our new clause removes the binary choice for the regulator. Instead, it sets out how the regulator can create its own distribution order if, after all previous stages have concluded, the leagues still cannot strike a deal.
In the creation of this order, it can choose all of a league’s proposal or part of either or both proposals, or can propose unique solutions based on the evidence. The regulator would first have 60 days to create a provisional order. The regulator would share this provisional order with the leagues and invite representations, which it must consider before finalising the order. Any finalised order that it produces would have to take into account any relevant issues raised by the “state of the game” report, the evidence the regulator has gathered throughout the process, its engagement with the leagues and any proposals that they have submitted. Finally, under the new model, the regulator would be required to consult the FA before setting the questions for resolution, ensuring that the national governing body can now raise any views about the scope of the backstop process.
We are confident that the regulator, with its clear objective to promote sustainability and its duties to avoid adverse effects on growth and sporting competitiveness, would come to a balanced solution. I know that there is probably a slight variance with models that noble Lords view as ideal. However, I am confident that this new model is the right one, and I hope that noble Lords will support it as being substantially better than the original model that we debated earlier in the Bill’s passage through your Lordships’ House.
In addition to the changes to the backstop, we have also made some minor and technical changes to other parts of the Bill to aid the implementation and effectiveness of the regulatory regime and reduce the burden on the industry. I am happy to answer any questions noble Lords have on these changes. I hope that noble Lords understand and can support the changes that we have made in the other place. They have been arrived at after much careful consideration and conversation with noble Lords and the industry, and will ensure that the regulator can best deliver for fans. We believe the changes strengthen the Bill and will strengthen the regulatory model.
This Government promised in our manifesto to safeguard the future of our national game. In fact, as all noble Lords will be aware, the commitment to establish an independent football regulator was in the manifestos of all three main parties at the election a year ago. I hope that noble Lords will support this much- needed piece of legislation, which delivers on that commitment by protecting and promoting the sustainability of English football in the interests of fans and the local communities that football clubs serve. I beg to move.
Lord Burns (CB)
My Lords, I am very grateful to the Minister for introducing these amendments and for setting out the reasons behind them. On Report in March, the noble Lord, Lord Birt, introduced a series of amendments. These were aimed at addressing what he regarded as some weaknesses in the role of the independent football regulator in the distribution of funds between the various football bodies. I supported the amendments, along with the noble and learned Lord, Lord Thomas, and the noble Lord, Lord Pannick.
Unfortunately, neither the noble Lord, Lord Birt, nor the noble and learned Lord, Lord Thomas, can be here this evening, and I have been asked to respond jointly for our little group, in place of the noble Lord, Lord Birt. The noble Lord, Lord Pannick, is in his place, I am pleased to say, and I hope that we will hear from him in due course.
Throughout debate on this Bill, we have emphasised the uniqueness of this situation. Under the proposed legislation, a regulator could potentially make decisions to transfer income from one regulated body to another. Moreover, both bodies are part of the same football family and they must coexist. Many clubs could find themselves moving between the Premier League and the English Football League. We argued that the arrangements should take these factors into account, including the objective of the overall success of the football pyramid.
We are very grateful to the Minister for the time that she has spent on this since then. Subsequently, the Government have brought forward their own amendments, which were agreed by the Commons and now come to this House today. I think I can say that as a group we support these amendments. While they are not entirely as we hoped, they address many of the concerns we had with the original Bill and go some way towards meeting the tests that are involved.
The most significant change is the fundamental re-engineering of the backstop process. This removes the Russian roulette binary mechanism, where an expert panel would have chosen between the final offers of the two parties, without the option of finding middle ground. Instead, the regulator now has the driving seat in both the negotiation and the determination process. The amendments strengthen the role of the “state of the game” report and modify the principles and criteria to explicitly refer to the regulator’s duties as well as its objectives. While it does not go as far as we hoped, it is an improvement and it means that, if the regulator is called on to decide, it will consider domestic and international competitiveness, growth and investment in the industry. I think that is a significant step forward.
We are confident that David Kogan, the preferred candidate to be chair of the IFR, will be able to make these arrangements work. He has exceptional football knowledge and expertise. Following the publication of the “state of the game” report, we hope that the regulator will set out its views about the most significant challenges that are faced by the leagues covered by this process. At the same time, we hope that the regulator will set out the criteria that it will apply in determining the appropriate funds flow down the pyramid. Overall, I am satisfied that this leaves us in a much better position than when we last discussed the Bill, and we support the amendments.
Lord Pannick (CB)
My Lords, I declare my football interests: I remain a season ticket holder at Arsenal Football Club and counsel to Manchester City Football Club in the continuing disciplinary and regulatory proceedings involving the Premier League. In respect of both those interests, I very much look forward to next season.
I am grateful to the noble Lord, Lord Burns, for setting out with such clarity why the team captained by the noble Lord, Lord Birt, of which I am proud to be a member, welcomes the Commons amendments, in particular to remove the binary mechanism which would have fettered the power of the regulator. I welcome these government amendments because they seem to further what I hope that the Minister will confirm are the three key goals of this Bill.
Baroness Taylor of Bolton (Lab)
My Lords, I will say a few words in support of what the Minister said this evening. It is right that we talk a little about the new arrangements for mediation and the backstop. The original amendment was overcomplex, but many of us were concerned about the binary nature of the choice that was to be made. For many of us, the important factor in finding a way forward was that we maintained a backstop, because we are not talking about negotiations between equal partners. That is why we needed the retention there; that is very important. I congratulate Ministers on finding a way through this which is satisfactory to everybody who expressed concerns and wanted to move forward.
I welcome what the two previous speakers said about the new independent regulator. He is intent on making this job work and moving things forward very quickly, which is exactly what football needs.
On behalf of my noble friend Lord Bassam, who cannot be here this evening, we are very impressed by and very much welcomed the engagement of the Minister in this House, my noble friend Lady Twycross. It is a model of how Ministers, Back-Benchers, civil servants and external parties can react. I am very glad to see the noble Lord, Lord Parkinson, nodding, because we have not agreed on every aspect of this Bill. That has been important.
I should declare my interest: I am looking forward to the new season, with Bolton Wanderers playing Stockport on that first Saturday—I think I am looking forward to it anyway. Bolton Wanderers went through all the problems that are very well known. I was struck, in the final stages of the debate in the other place, by how many individual MPs had to get up to say that their individual clubs had just gone through difficulties or were facing similar difficulties in the very near future; Sheffield Wednesday is the most obvious example.
The need for this Bill is well and truly proven. It is now in extremely good shape, and I congratulate those who have been involved. We should mention Tracey Crouch, who started this process with her review. I will also say that I am very pleased that three talented women Ministers have been the ones to see this through.
Lord Goddard of Stockport (LD)
My Lords, I will be reasonably brief. The noble Lord, Lord Burns, covered most of what I was going to say on the technical stuff. We sent the Bill back, and I think everybody agreed it was not perfect. Then we got this list of amendments back, and my heart sank at the thought of another 12 hours’ debate on each and every one of them. The only person whose eyes lit up was the noble Lord, Lord Pannick, who obviously gets paid by the hour by Manchester City. We are nine months into waiting for the 115 charges result; we are still playing a lot of extra time on that one, but let us park it. I am not sure who is the underdog in the game between Bolton Wanderers and Stockport County, but it will be an interesting encounter.
We went over these amendments to try to find fault with them, to pick something out, and to see whether the Government were trying to slide something through. Honestly, they have improved the Bill tremendously, and that is partly because of the slight input from the regulator designate, who has clarified the situation. We were a little bit in the dark before about what we thought the role should be and what it was morphing from and to, but just talking to David and understanding his love of what he is going to do, and hearing the passion with which he speaks about being the regulator, tells me it is in safe hands.
I had a number of chairmen, not so much from Championship but from League One and League Two clubs, emailing me, and I said that it is going to be good for the game. That is really where I have always been: at the bottom of the pyramid. The Premier League is fantastic—it will flourish and it will carry on delivering—but League One and League Two clubs, and some of those in non-league clubs, will take a deep breath now and say, “Let’s see this happen”. It will give them that certainty and hope that there will always be something there for them when times are difficult. I have known football clubs that have had to come to local authorities and beg and borrow for assistance. That is a difficult thing to do with public funds, but we did it, and the benefits for the economy, for local councils and for shopkeepers are there now for all to see. The community is all football, and if you had any doubt about that, you would look at this.
I have no complaints about Chelsea becoming the world champions, but that was the most ridiculous competition in the most ridiculous place. Any regular football fan seeing two o’clock in the morning kick-offs was the Armageddon that was said would happen to us. It has not happened because we have got our Bill through; we have got our ducks in a line, and we will be able to protect the league that we love and cherish. I wish the Bill well on its way now. We can move forward. If the noble Baroness has nothing to do, she might want to help me out with the employment Bill tomorrow if she is free, because that is another challenging Bill.
Baroness Brady (Con)
My Lords, I refer the House to my register of interests, in particular my position as vice-chair of West Ham United, who play in the Premier League.
One of the privileges of speaking in this House is that we can talk not only to the present moment but for the historical record. When the story of the Football Governance Bill is told, I hope it will reflect that this House asked the right questions, foresaw and understood the risks, and ultimately helped improve the legislation. I acknowledge that the Bill we return to today is better than the one we began with. That has not always been an easy journey, but Ministers have listened, for which I am very grateful, and some important safeguards have been added. For that, they really do deserve genuine credit.
We are now entering a new phase, moving from the politics of the Bill to the reality of the regulator. In doing so, I suggest that the new regulator will be judged against three simple but vital tests. First, will it protect growth? The Premier League is not just a domestic competition; it is one of the UK’s most globally admired exports, an economic powerhouse, a cultural asset, a voluntary supporter of the entire football pyramid and a £4.2 billion annual contributor to the public finances.
Future success is not inevitable. It is under pressure from a range of sources. FIFA and UEFA are expanding club competitions and business models that compete directly with the Premier League and put huge pressure on the domestic football calendar. Broadcast markets are changing very fast and in a number of competitive European leagues domestic revenues from broadcasting are falling, as we have seen in the example of Ligue 1 in France. Agent fees are rising, taking money out of the game. State-backed competitors, such as the Saudi Pro League, are changing the football economy. The EFL’s leadership appears to have chosen stasis over innovation.
In that challenging context, protecting growth must be front and centre for the regulator, not just because it is good for the Premier League but because that growth underwrites the very system that the regulator is charged with supporting. That system today includes record redistribution, rising solidarity payments, and the ongoing voluntary support for clubs up and down the pyramid. If we do not protect growth, we risk weakening the whole system. It must therefore be uppermost in everything the regulator does.
The second test is whether the regulator will truly be light-touch. This is a commitment that Ministers have repeatedly made. The proof will be in the pudding. The new independent regulator will have extraordinary powers that are unprecedented in global sport. That requires not just legal and policy constraint but cultural restraint. It must show grit, independence and judgment. It must be evidence-led and not driven by others’ grievances or agendas. Above all, it must demonstrate a proper understanding of football’s competitive dynamics, with a regulatory approach that offers clarity and certainty for clubs. Critically, that means protecting the competitive balance that is so central to the magic, appeal and value of the Premier League.
In other words, clubs in the same division must know how to comply with the financial regime and trust that they will not face opaque financial constraints that place them at an unfair disadvantage on and off the pitch. In football, a fair and level playing field is not a “nice to have”; it is a precondition for compliance. A disproportionate approach, where clubs do not know if they fall the right side of the line, or even which line rival clubs are aiming for, simply cannot work in football. It will be the fastest route to regulatory failure.
Whatever one’s views of party politics, the appointment of David Kogan as the inaugural chair is encouraging. He brings serious knowledge of the game and credibility across football. The regulator will have an early opportunity to set the tone through the approach taken in the “state of the game” review, the appointment of the board and the CEO, and the proportionality and clarity of the regulatory approach it instils in the first place.
The third test whether the backstop will truly be a backstop. This House has done important work to constrain and de-risk this power. I thank noble Lords including the noble Lords, Lord Birt, Lord Pannick and Lord Burns, and the noble and learned Lord, Lord Thomas, for their diligence, thoughtfulness and pragmatism. The legal, evidential and procedural safeguards now in place are appropriately strong. Under this model, the IFR board will need to consider incredibly carefully whether it could ever be in the best interests of English football to use this mechanism, which Dame Tracey Crouch described as “nuclear coding”. Thanks to an important government amendment, the IFR board must now exhaust all other regulatory tools before ever using the backstop. As the Sport Minister confirmed in the other place, that means using those tools and failing, not just imagining that they may not work.
However, the EFL’s current situation appears to rest solely on the promise of this lever, betting its future not on innovation but on a perceived regulatory shortcut. There is no doubt that the backstop has made the conventional, consensual approach to agreeing the distribution of Premier League revenue far harder. I can report to the House that the Premier League has very recently made a credible and generous proposal to the EFL, but this has been rejected by the EFL board. We must hope that common sense will soon return and that a new approach can develop in the best interests of the whole game.
Lord Sentamu (CB)
My Lords, I simply want to thank the Minister for her perseverance, for staying with the task until it is done, for her humour and for appearing truly human. She had quite a lot of stuff coming in her direction but she did not get distracted. For that, I thank her very much.
I am going to limit my comments to the amendments. The Minister moved the Motion on Commons Amendment 1, but I want to go up to Amendment 9 and tell the House why I think these amendments are wonderful. We all learn Americanisms, where nouns and pronouns of all kinds become verbs—which we should not really want. The word “levy” we know, but in our draft we used the word “leviable”—however you might pronounce it. We all know that you can levy but I do not know whether people in the football team will know what we called the leviable function. It is not a perfect English word, but I prefer what the Commons have done. They want us to insert “functions under this Act”. This goes through Clauses 53 and 54 and I think it is more readily understood than the word “leviable”. Sometimes it is better to use quite simple English, so that everybody can understand it. I hope that, when it comes to those nine amendments, we will not quibble but will say that they have put the English in a way that the man and woman on the Clapham omnibus can understand.
Lord Maude of Horsham (Con)
My Lords, it is a pleasure to follow the noble and right reverend Lord.
As the new football season approaches, those of us who are season ticket holders at these debates relish the prospect of further discussion on this important issue. I pay tribute to the Minister for the care she has taken with this. All of us will be conscious that she has many other responsibilities, and I know she has listened very attentively, along with her colleagues in the department, to consider genuine concerns that were raised in these debates in your Lordships’ House at earlier stages.
This is a better Bill than it was. I think the fact that, as the Minister said, a commitment to such a Bill appeared in the manifestos of the three major parties is a dire warning of the dangers of consensus, because there are many of us for whom this Bill is definitely in the not proven category. The case for having it is not proven, in that what it is intended to rectify is not obviously a proven defect. The current system has not been perfect, for sure, in allowing wealth created at the top end to cascade down through the pyramid, but it has been pretty effective at doing that.
Sometimes, in these debates, it has been assumed that the bottom of pyramid is the bottom of the EFL and, of course, that is not the case. It is significant that the leadership of the National League, several tiers below the EFL, has been very sceptical about the need for regulation. I speak with a particular interest as Horsham Football Club has just won promotion to National League South. My interests in football are in the Premier League, where I admit that my—our—football club did well in Europe, but not quite so well in the domestic competition. But in the National League, the clubs are much closer to the grass roots—in many cases they are the grass roots—and they are much closer than even League Two in the EFL. There is a scepticism there about whether improving the mechanism —creating a wholly new mechanism for cascading wealth down through the pyramid—is really necessary at all.
We have to remind ourselves, as my noble friend Lady Brady has done, that the Premier League is the most successful sporting league of any kind anywhere in the world. There are competitive winds: side winds and head winds. There is state-sponsored money being put into creating alternatives. Competition is healthy, but we should not assume that the golden goose that the noble Lord, Lord Burns, referred to will continue to lay golden eggs for ever. It is incredibly precious, as various noble Lords have commented. This is a sport that is much more than just a sport or a competition; it is a passion that attracts enormous depths of loyalty. The Premier League attracts a deep commitment, not just from British citizens but from fans right across the world. We should be very chary indeed of taking steps that jeopardise that.
So, while this definitely a better Bill and there are clear improvements to the backstop arrangements which reduce the risk of permanent damage being created, I hope the chair designate of the new regulator—about whom I hear nothing but good things—will bear in mind the need for the regulatory hand to be used with great lightness of touch. There is something very precious here. It looks like it is solid and indestructible, but that success—what the Premier League earns every year, from which the whole of the pyramid of football benefits—is a right and that wealth has to be earned. It has to be earned every week of every month of every football season that there is. So I urge the Government to bear in mind the need to tread lightly on this success, and for the new regulator to bear very much in mind the concerns that have been raised on many occasions in this House. I am grateful to the Minister and her colleagues for listening to some of them and responding, but the concerns remain.
Lord Faulkner of Worcester (Lab)
My Lords, I have two football interests I should declare: one is historical and the other current. The historical one is that I served as vice-chair of the Football Task Force 25 years ago and in one of the four reports that we produced, the case for a football regulator was argued very carefully. We thought we had won the argument, but we were not able to persuade the Government of the day—not a Conservative Government, but a new Labour one—of the merits of football regulation.
The fact that we now have all-party support for a football regulator is an indication of how far that debate has progressed. I would like to add my congratulations, first, to my noble friend Lady Twycross for the brilliant way she steered the Bill through this House, where it suffered no defeats whatever in any Divisions; and to the Ministers in the House of Commons who, with support and willingness to listen, were able to change the Bill and, I readily accept, improve it.
This takes me to my current interest. I am vice-president of the National Football League, to which the noble Lord, Lord Maude, just referred. Its scepticism was there in the beginning but as far as I understand it, that has now gone, and it is satisfied with the form of regulator in the Bill and looking forward to playing its part. As he said, it is a very important part of the football family and the element closest to fans at local level.
There are two groups of people I want particularly to refer to, and I will be very brief. One is the Football Supporters’ Association, without whose support this Bill would never have come to light. It was, as noble Lords will recall, the product of the fan-based review and the interests of fans have been very strongly taken into account and represented in the outcome. It deserves a great deal of congratulation for the part it played in the debate. The second group are the supporters of Wimbledon Football Club—the club I was proud to support in the 1970s and the 1980s—who found that their club was being taken away from them and moved to another part of the country against the wishes of the fans, the local community and everybody concerned with it. That was the sort of dictatorial decision which will be impossible as a result of this Bill going through, as it will prevent the removal of a club to a new location against the wishes of its supporters. Wimbledon supporters’ ability to start a new club—which has been extraordinarily successful and, indeed, was promoted from the Second Division of the Football League to the First Division at the end of last season—is a testament to their resilience and skill in making the case.
Above all, I congratulate the Minister in this House and the Ministers in the other place on producing a Bill that even the Premier League is now willing to accept and work with, and that is very commendable.
Lord Moynihan (Con)
My Lords, while I agree with the noble Lord, Lord Goddard, on many aspects of sports policy, I have to say that, in character, I am afraid I disagree with him again on what he opened up with this evening. It would be remiss of this House not to seriously congratulate Chelsea on winning the FIFA World Club Cup. To put three goals in the back of PSG’s net in the first half of a final—an often impenetrable net this season—was remarkable. Indeed, I would go so far as to say that it is one of the great football occasions in memory. I congratulate my noble friend Lord Moynihan of Chelsea, an avid supporter of that club, on the extraordinary and magnificent performance of Chelsea only a few days ago. It matched the success of England’s cricketers in the Third Test.
Lord Goddard of Stockport (LD)
My Lords, just for clarity, I am staying this week in the Chelsea Football Club hotel, and it is a fantastic set-up and a fantastic ground.
Lord Moynihan (Con)
I am glad the noble Lord added that because otherwise, I would have kicked his name off the register, if I had been him.
The key amendments before us this evening are undoubtedly improvements, and I thank all the noble Lords who worked so hard, not least the noble Lords, Lord Birt and Pannick, to bring those amendments to us this evening and worked so hard with the Government to gain those improvements. But, as my noble friend Lady Brady, has said, for many of us they do little more than remove some broken eggshell from the omelette, which many in the other place joined with us in describing as unpalatable to both the fans and professional football clubs.
One constant theme throughout my consideration of the Bill’s details has been the layering of regulation that exists within football and the dangers of adding an additional regulator to what is already quite a complex and competitive structure of football regulation. In respect of Clause 61, can the Minister say whether the changes have been approved by UEFA and FIFA, and whether they now see no conflict with the position that they stated very clearly only a matter of months ago?
Lord Grantchester (Lab)
My Lords, I congratulate my noble friend the Minister and commend the excellent work of her officials in her department’s Bill team on the amendments returned from the Commons that clarify and tidy provisions in the Bill. I congratulate them especially on where the Bill has been strengthened; this version is much improved from the previous Government’s drafting. I declare an interest from my past experiences, involvement, responsibilities and connections with Everton Football Club.
While transparency has been improved by these amendments, I am grateful that the exaggerated perils claimed from the Opposition Benches have continued to be resisted. These proposals will bring a more amicable resolution of the backstop. I am confident that the Bill will prove effective in including parachute payments within the remit of the regulator, as, without their inclusion, the regulator’s ability to view the financial stability and resilience of the whole football pyramid would be substantially impaired.
These amendments will reduce the risk and uncertainty in the backstop mechanism. A light touch does not signify a lack of application in maintaining vigilance across the pyramid, especially down through the leagues, where the predominance of more maverick owners has tended to congregate. However, there are other features that must be mentioned. That the regulator is fully independent of government should reassure all fans, especially now that the regulator is no longer required to consider government policies on trade and international markets. Fans will expect a rigid level playing field between clubs to be scrupulously maintained and will be encouraged that fan representatives will be democratically endorsed independently from their clubs. Meaningful engagement of fans will ensure that the heritage provisions of the Bill will not be undermined.
I too welcome the appointment of David Kogan as the first football regulator. Although he is yet to take up his post officially, it is imperative that the work begins and that swift progress is made on the state of the game report—the next milestone in this legislation’s effectiveness. May I tempt my noble friend the Minister to confirm that David Kogan has already been able to identify his team and is already drawing up proposals to begin the necessary processes to start immediately on Royal Assent?
Lord Moynihan of Chelsea (Con)
My Lords, despite the very kind words of my noble friend the senior Lord Moynihan, and indeed of the noble Lord, Lord Goddard, I understand that we have to be careful in declaring our interests. I declare myself a season ticket holder of the Club World Cup champions of the world, whose games I have been attending since 1958—a time when many noble Lords were not even alive.
As we enter what we might call the final minutes of extra time on this Bill, it would certainly be churlish of me not to repeat the words of my noble friend Lord Maude about the Minister’s very careful and kind attention throughout this Bill, and the improvements that have been made as this Bill has come back from the Commons. But somebody must stand up and say that there is an opinion that can be heard in this House that a regulator is a really bad idea for this sector.
In saying that, I accept that it was our side, scoring, as you might say, an own goal, who started all of this. I hope that, if ever we come to power again, we have leaders who do not say, “There go the people, I must follow them”, but who think rather longer-term, not about how football fans respond to artfully constructed opinion polls but how football fans will react to the depredations of this regulator, however well-intended and good—and everybody on all sides has applauded the selection of the regulator—that will make this sector worse, and possibly very bad.
Why do we have this regulator? Because, as the noble Baroness, Lady Taylor, mentioned, Bolton football club took some risks, went bust and got relegated. Is Bolton football club no longer? Has it now vanished? Oh, no, it is still around. For those who are not massively enamoured of or conversant with the world of business—it appears that most of the Cabinet is comprised of those who have never been involved in business—it may come as a surprise to know that this is how business works. You take risks and sometimes you go bust, then you get re-formed, as Bolton football club did, and you carry on, with the same fans and the same ground. They are in a lower division but can fight back and get re-elected to higher divisions.
Baroness Taylor of Bolton (Lab)
Time is late, so I do not want to go through the whole history of Bolton Wanderers, but the noble Lord’s facts are not quite correct. What we are concentrating on here is that all clubs should have a better business approach to football and not just rely on wealthy local individuals or people who come along and buy up a club. We need a fit and proper persons test. That is the kind of progress we will be making. We need to make sure that, all through the pyramid, there is a better business approach to football. That is what the new regulator will help create.
Lord Moynihan of Chelsea (Con)
I thank the noble Baroness. It is a pity we are discussing football and not chess, where maybe the clock would have been stopped to give me the time I would need in view of that lengthy interruption. The noble Baroness has made my point. In life, one takes risks. The fact that we have in this country the best football in the world is because enormous risks were taken in setting up the Premier League, and it has been enormously successful.
The noble Baroness was basically saying, “We know best and, to impose our view of how it should be—the non-commercial view—we will have a regulator. By the way, when we have the regulator, we will impose all sorts of little baubles on the Christmas tree”, as we discussed earlier in these debates. One example was EDI. She was basically saying, “We will impose EDI on all football clubs. Just as that pernicious doctrine is fading away, we’re going to impose it”. The Labour Party—God bless—won an election and has the right to impose these Bills. I am merely warning about what will happen.
I wrote to the Minister, who very kindly responded at length. The Labour Government often pray in aid the McKinsey studies on how EDI is a jolly good thing and leads to better organisations. I wrote to her pointing out that the McKinsey work has been completely discredited. She kindly wrote back to me saying, “Yes, I agree that the McKinsey work has been discredited, but many other studies have not been discredited and show that EDI is a jolly good thing”. So I called one of the most senior people at McKinsey and said, “Your studies have all been discredited, haven’t they?”. He said yes. I said, “Well, people are saying that there are many other studies that support the EDI idea”. He said, “There aren’t any. We’ve looked for them. They aren’t there”. The Minister did not give me examples—she may have examples, but she did not give me any in the letter—of anything but the utterly discredited McKinsey idea of EDI. That is just one example of the kind of baubles that have been put on this Christmas tree and that will make things worse in our industry.
It is indeed late, as noble Baroness said, and I will try to wrap up. We do not know best; the market knows best. The market has produced one of the most extraordinarily successful industries that we have in this country. We are going to try to take the market away and impose on it all sorts of rules. I am here just to put down a marker—
Lord Pannick (CB)
I point out to the noble Lord, who lauds the market, that an important part of the impetus for the Bill was that a number of Premier League clubs were going to exercise market forces to break away and destroy the Premier League.
Lord Moynihan of Chelsea (Con)
The noble Lord, Lord Pannick, is absolutely correct—and what happened? Within a few days, all that went away. They had a look and it went away. As I mentioned, I wrote an article on the very day the idea came out, as did many other people, saying that it would not work. The clubs involved looked at that and said, “Yes, this is true. It’s not going to work”.
The noble Lord talked about Wimbledon. We are now saying, in the Bill, that clubs cannot move and there can be no dynamism. Yet I quoted a study in the debate last night that said that, when we restrict, clamp down and prevent things happening, that is when societies disintegrate. We cannot expect to have success if we say, “We know best and we’re going to stop this, that and the other, and impose this, that and the other”. I am just putting a warning down: one of these days, somebody will be in a position to say that this was an extraordinarily bad idea.
Lord Addington (LD)
My Lords, I will say a couple of words to wrap up from these Benches. When we did the Bill, my first comment was, “I am not of your tribe when it comes to being a football fan”. I encourage everybody to watch a decent sport on Saturday morning, when the Lions have their first Test, but we have got that out of the way now. The thing about this is that football clearly touches people’s lives because it is their local team. What the Bill does is get better management and better structures in there. It means that somebody is overseeing them.
It may be that the market will ultimately do something or run away, or we will all end up playing ice hockey on artificial pitches or something when people get fed up with it. Who knows? But at the moment, football speaks to many communities, and the fact that we will have these clubs, which are a part of the fabric of their local society and its interaction together, surviving better, or at least standing a chance of so doing, is something for which we should actually be very grateful.
In the end, the argument about these amendments is probably over how we divide up the loot. Let us face it, we did this because bits of football were fighting with each other about money; that is where we got to at the end. The Cross Benches came up with a solution that was, I felt, a little too elegant—that congratulation is really what I felt the whole time—as opposed to a rather brutal solution by the Government. We went brutal. But we have something here that looks like it will work and have general agreement.
Lord Markham (Con)
I too start by declaring my interest as a Chelsea season ticket holder, and while I will not speak too long about Chelsea’s Club World Cup success, I will note that three of the four big European and world tournaments were won by English clubs—I can even say that half of them were won by Chelsea. We can see that we currently have a very successful game. Also, four of the starting 11 were English players and one, Cole Palmer, was the player of the tournament and even had President Trump celebrating alongside him. If only we could teach him to do the Palmer rub, we would really be there.
So we start off in a good position, and I have to add my thanks to the Minister. I think she took some political risk in bringing back amendments to the Lords when everything had obviously passed here already, and opening this up to possible further challenges and ping-pongs. She did that because she thought it would make this a better Bill, and I support everything she was trying to do and the intentions behind that, because I think it has made it a better Bill. While I agree with both my noble friends, the two Lords Moynihan, that there are dangers in the introduction of a regulator, and with my noble friends Lady Brady and Lord Maude that we need to ensure that it is a light-touch regulator, this is an improvement—but there are dangers still out there. I think we all remember the long conversations we had about the risk of UEFA, and we need only to look at the last few days, with the demotion of Crystal Palace, to see that we have to be sure that we are not doing anything here that falls foul of UEFA.
The Minister was at pains to confirm that UEFA was on board with the last version of the Bill. What we see now is, of course, quite a different version in terms of the backstop. It is a better version, particularly with the removal of what we all thought was a fairly crazy pendulum mechanism. However, it allowed the Government to say at the time, keeping to one of the UEFA golden rules or red lines, that a decision has to be a football decision. In the past, it can be said of the pendulum that it was either an FAPL or an English Football League solution. Now that the regulator is able to negotiate to find its own solution, which is very sensible measure that I support, UEFA could argue that we are now imposing a potential government solution. It is the right approach to take, but has the Minister sought similar assurances from UEFA that this new backstop does not fall foul of some of its red lines, and that it is as comfortable with this new version as it was with the old version?
That said, this is a better version, and I thank the fab four Cross-Benchers for bringing together this solution. I am sorry that both the noble Lord, Lord Birt, and the noble and learned Lord, Lord Thomas, are not in their usual places to take their laps of honour. It is a sensible amendment which tries to lead to a negotiated outcome with compromise, rather than the arbitrary pendulum mechanism.
At the same time, it is very sensible—and I know David Kogan was very involved in this—that the regulated board are now responsible for the decision, with the removal of the expert panel, and they are willing to be accountable for that decision. I have known David Kogan for some 15 years and, like others, I truly believe that we have a real expert with deep knowledge of the game and sports rights; he is a valuable addition. As so many of these issues are judgment calls, I feel much better knowing that we have David Kogan’s judgment. We all have to accept that the appointment process was perhaps a bit unfortunate. Can the Minister say where we are with the investigation, and when can we expect an outcome? Obviously, we would all like to get him on board as quickly as possible.
I conclude by thanking the ministerial team, the Bill team and all noble Lords for their work during what has been a long, thoughtful, informative and good process, which has ultimately improved the Bill. I look forward to hearing the Minister’s reply.
Baroness Twycross (Lab)
I thank all noble Lords for a constructive and good-natured debate on the amendments made in the other place and for their very kind comments, not least from the noble Lord, Lord Markham, recognising why I took the risk to bring the Bill back, which was to ensure that we get a better Bill. I am very grateful to the noble Lords, Lord Burns and Lord Pannick, and noble Lords from across your Lordships’ House, including the noble Lord, Lord Goddard, and the noble Baroness, Lady Brady, for their support for changing the backstop mechanism. I am grateful too for the support for, and confidence across your Lordships’ House in, the Government’s preferred candidate.
The noble Lord, Lord Pannick, is right that we need to see the regulator as taking a light-touch approach, and I am grateful to all those involved in helping us get this over the line in a much more match-fit state than it left us. I note the concerns of the noble Lords, Lord Maude of Horsham, Lord Moynihan and Lord Moynihan of Chelsea, and the noble Baroness, Lady Brady. I will send a transcript of the debate to the chair designate, although I am confident that he is following the debate and is already aware of the need—and their call—to tread lightly.
The noble Lord, Lord Burns, asked how we would incorporate evidence from the “state of the game” report. Under the amended model, it would be explicit that the regulator must use the “state of the game” as the basis for its decision. The regulator must explain in its notice how its solution addresses the evidence from the “state of the game” report. Leagues must also submit supporting evidence alongside their proposals, which the regulator must take into account. The regulator can request additional evidence as well as gathering its own information to ensure it has a wide evidence base for making a decision. This is a more evidence-based and data-driven process than before. We are also proposing an extension of the final proposal stage to allow for more time for the regulator to come to a considered solution based on evidence.
The noble Lords, Lord Moynihan and Lord Markham, asked whether UEFA is content with the Bill as it stands. As noble Lords will know and as I have stated previously, UEFA has written to confirm that it is content with the Bill and the FA has confirmed it. Its issues were with the previous Government’s version of the Bill and requiring the regulator to have regard to the Government’s foreign policy, something we have removed and something your Lordships’ House clearly debated at some length.
Past examples of Italy and Spain legislating in relation to football broadcasting without facing repercussions from UEFA should offer reassurance. Italy in 2008 and Spain in 2015 legislated setting out how TV rights are to be sold and how the revenues are to be distributed. Neither association has faced consequences from UEFA. I will return to exactly where we are with the process a bit later.
Lord Moynihan (Con)
I do not want to prolong this at all except to just place on the record that both the examples the Minister has given us are totally different and in fact reflected the model that the Premier League had in place, which was effectively a non-legislative agreement. Just for the record, we need to be clear that the very short legislation introduced in both those countries did not bear any resemblance whatever to the substantive Bill before us.
Baroness Twycross (Lab)
Appreciating the noble Lord’s point, I can confirm that UEFA is content with the Bill as it stands.
I am going to return to the question from the noble Lord, Lord Markham, on where exactly we are with the chair’s appointment. The lines I have in my pack do not entirely reflect his question, so I will try to answer it rather than just use the line in the pack.
In closing, I thank several noble Lords who have been involved throughout the passage of the Bill. In particular, I thank my noble friend Lord Bassam of Brighton, who was not able to be here today, and my noble friends Lady Taylor of Bolton, Lord Faulkner of Worcester and Lord Grantchester. I also thank a number of Labour Back-Benchers who have been really restrained at various points in what has been a very long process, by rationing their contributions to try to get the Bill to move forward. As noble Lords are aware, most noble Lords—probably with the exception of the noble Lord, Lord Addington—are absolutely passionate about the game, so to not contribute as much as they wanted was quite painful for a number of them.
I particularly thank my noble friend Lady Blake of Leeds for the excellent job she has done in supporting me, which continues now, and officials whose patience has been outstanding, and I was pleased that this was noted by noble Lords from across your Lordships’ House. They have worked with me, the Minister for Sport, the Secretary of State, stakeholders and many noble Lords to redesign the backstop over the past few months.
I also thank the noble Lords on the Opposition Front Bench, the noble Lords, Lord Parkinson of Whitley Bay and Lord Markham. It is always a pleasure to face them across the Dispatch Box—occasionally, I might have wished it was slightly less late into the night. I particularly thank noble Lords on the Liberal Democrat Front Bench, the noble Lords, Lord Addington and Lord Goddard of Stockport, not least for their good humour and constructive approach to raising and resolving their concerns, and the noble Lord, Lord Addington, who took the time in his contribution today to focus on the fact that this is about how football speaks to local communities—that is at the heart of why the Government have pursued this.
I am particularly grateful to the noble Lords on the Cross Benches, particularly the A-team of the noble Lords, Lord Birt, Lord Pannick and Lord Burns, and the noble and learned Lord, Lord Thomas of Cwmgiedd. They raised issues that made us pause to consider. I was sorry we were not able to bring back amendments before we got to Third Reading, and I hope noble Lords understand why this was. We are keen now to make sure that the football regulator can get on with the job.
Baroness Twycross
That the House do agree with the Commons in their Amendments 2 to 62.
“(za) set out details of the question or questions for resolution mentioned in section 57(1) to which it is intended the application will relate,”
“(za) set out details of the question or questions for resolution mentioned in section 57(1) to which the application relates,”
“(4A) Where the IFR is minded that the resolution process should be triggered, the IFR must consult the Football Association on the question or questions for resolution in relation to which it is minded to trigger the process.”
“(zi) the question or questions for resolution in relation to which the IFR is triggering the resolution process,”
“(iia) how the IFR has taken account of any representations, copies of which accompanied the application under section 57 by virtue of section 58(5)(d), in setting out that question or those questions, and”
“(5A) Where any of the questions for resolution set out in the notice differ from those to which the application made under section 57 relates, the notice must set out the extent of, and reasons for, those differences.”
“Proposal stage
(1) This section applies where mediation under section 60 comes to an end by virtue of the occurrence of an event within section 60(6)(b), (c) or (d).
(2) As soon as reasonably practicable after the occurrence of the event, the IFR must give notice to the two specified competition organisers.
(3) A notice under subsection (2) must—
(a) set out the question or questions for resolution,
(b) specify the qualifying football season or seasons to which that question relates or those questions relate,
(c) set out any findings in the IFR’s most recent state of the game report that the IFR considers relevant to that question or those questions,
(d) invite each of the two specified competition organisers to submit to the IFR and to each other a proposal as to how that question or those questions should be resolved,
(e) require any proposal to be accompanied by supporting evidence (including evidence as to how the proposal addresses the findings set out under paragraph (c)),
(f) specify the day on or before which proposals are to be submitted.
(4) A question for resolution may be set out in a notice under subsection (2) only if it is the question, or one of the questions, for resolution remaining unresolved when the mediation mentioned in subsection (1) came to an end.
(5) Where a notice under subsection (2) sets out a question for resolution that relates to relegation revenue (within the meaning given by section (Distribution orders)(9)), the notice must require the specified competition organisers to explain in a proposal how the proposal will promote the financial sustainability of clubs which operate teams relegated from a competition organised by the specified competition organiser distributing the relegation revenue.
(6) Subsection (7) applies if, on or before the day specified by virtue of subsection (3)(f), a specified competition organiser submits to the IFR a proposal which the IFR considers is not a qualifying proposal.
(7) The IFR may give both specified competition organisers a notice specifying a later day (falling not more than seven days after the end of the day specified by virtue of subsection (3)(f)) on or before which proposals are to be submitted.
(8) As soon as reasonably practicable after—
(a) the initial proposal deadline, or
(b) (if earlier) the day on which the IFR considers that both specified competition organisers have submitted qualifying proposals,
the IFR must give a notice under subsection (9) to the two specified competition organisers.
(9) A notice under this subsection must—
(a) state which of the two specified competition organisers (if any) has submitted a qualifying proposal before the initial proposal deadline,
(b) invite each such specified competition organiser to—
(i) confirm their proposal, or
(ii) make any permitted modifications to their proposal,
and submit the confirmed or modified proposal to the IFR and the other specified competition organiser, and
(c) specify the day on or before which the confirmed or modified proposal is to be submitted.
(10) The IFR may specify in a notice under subsection (2) or (9) the form and manner in which proposals and supporting evidence must be submitted.
(11) In this section—
(a) “the initial proposal deadline” means—
(i) the day referred to in subsection (3)(f), or
(ii) where the IFR gives a notice under subsection (7), the day specified in the notice;
(b) a “qualifying proposal” means a proposal which—
(i) explains how the question or questions for resolution should be resolved, and
(ii) complies with the requirements imposed by virtue of subsection (3)(e) and (5) (if applicable);
(c) a modification to a proposal is “permitted” unless it results in the proposal no longer being a qualifying proposal.”
“Distribution orders
(1) This section applies where the IFR has given a notice under section (Proposal stage)(9).
(2) Before the end of the period of 60 days beginning with the day on which the notice under section (Proposal stage)(9) was given, the IFR must give the two specified competition organisers a notice of the distribution order it proposes to make.
(3) The IFR may extend the period in subsection (2) by up to a further 14 days if it considers it appropriate to do so.
(4) A notice under subsection (2) must—
(a) give reasons for the proposed distribution order,
(b) explain how the proposed order applies the principles mentioned in subsection (8),
(c) explain how the proposed order addresses the findings set out under section (Proposal stage)(3)(c),
(d) invite each of the two specified competition organisers to make representations about the proposed distribution order,
(e) specify the period within which such representations may be made, and
(f) specify the means by which they may be made,
and the IFR must have regard to any representations which are duly made.
(5) The period specified under subsection (4)(d) must be a period of not less than 14 days beginning with the day on which the notice is given.
(6) As soon as reasonably practicable after the end of the period specified under subsection (4)(d), the IFR must make an order requiring relevant revenue to be distributed in a way that the IFR considers appropriate for the purpose of resolving the question or questions for resolution set out under section (Proposal stage)(3)(a) (a “distribution order”).
(7) In making a distribution order the IFR must—
(a) apply the principles mentioned in subsection (8), and
(b) have regard to any proposal submitted under section (Proposal stage)(9)(b). See also section 7 (in particular the IFR’s general duty to exercise its functions in a way that advances one or more of its objectives and to have regard to various matters).
(8) The principles referred to in subsection (7)(a) are that—
(a) the distribution order should not place an undue burden on the commercial interests of either specified competition organiser, and
(b) the distribution order should not result in a lower amount of relegation revenue being distributed to a club during the relevant period than would have been distributed to the club during that period had the order not been made.
(9) For the purposes of subsection (8)—
“relegation revenue” means revenue distributed by a specified competition organiser to a club in consequence of a team operated by the club being relegated from a specified competition organised by the specified competition organiser;
“relevant period”, in relation to a distribution order, means the period of one year beginning with the final day of the first football season in respect of which relegation revenue would be distributed in pursuance of the order.
(10) A distribution order—
(a) must impose on the specified competition organisers such obligations as the IFR considers appropriate for the purpose of securing compliance with the requirements set out in the order, and
(b) may, where a distribution agreement is in force between the specified competition organisers in relation to the same qualifying football season or seasons to which the order relates, provide for that agreement to have effect subject to provision contained in the order.
(11) At the same time as making a distribution order, the IFR must give the two specified competition organisers a notice—
(a) including a copy of the order,
(b) giving reasons for the order,
(c) explaining how the order applies the principles mentioned in subsection (8),
(d) explaining how the order addresses the findings set out under section (Proposal stage)(3)(c), and
(e) including information about the possible consequences under Part 8 of not complying with the order.
(12) The IFR must, as soon as reasonably practicable after making a distribution order, publish the order or a summary of the order.”
(a) a provision of this Act which requires the IFR to consult another person;
(b) the provision made by section 10(5)(a) and (b).”
“(da) the function of deciding whether the resolution process should be triggered under section 59;
(db) the function of making a distribution order under section (Distribution orders);”