Football Governance Bill [HL]

Debate between Baroness Fox of Buckley and Baroness Brady

Committee stage
Monday 16th December 2024 Lords Chamber

[Baroness Fox of Buckley (Non-Afl)]

I was on my last sentence, but I will now make it two sentences.

The noble Lord says that nobody is smoking now. It happens to be the evening of the Terrace Club’s Christmas bash. That is the House of Lords smokers’ group, and I can assure the noble Lord there are quite a lot of them smoking, cross-party, including from his own party. They are drinking and smoking, and every party is represented. It is in the hut round the back, by the way, in case anyone wants to pop out. There are quite a lot of people who smoke still.

Smoking advertising was taken out of sports, and a number of sports nearly collapsed—darts and snooker had a real problem. The funny thing is, guess who came in to save them? The gambling companies came in and saved those working-class, grass-roots, rank-and-file sports. Good on them, I say. The working classes were grateful at the time, and they did not all become problem gamblers as a consequence. They enjoyed the sport.

[Baroness Brady (Con)]

My Lords, these amendments seek to address gambling sponsorship in football, and include proposals to ban sponsorship entirely. This is a significant issue. I acknowledge the genuine concerns that many have, including the noble Lord, Lord Foster, about the role of gambling in sport. However, I would like to provide some context and explain why I believe that further interventions in this area are not required at this time.

The Gambling Act review has recently and comprehensively considered the role of gambling sponsorship across all sports, including football. The Government’s response reflects the extensive engagement and evidence gathered during that process. As part of this, the Premier League has already taken significant, proactive, voluntary steps to address concerns, demonstrating its commitment to act responsibly.

Most recently, the Premier League and its clubs have led the way, not just within football but across all sports, by taking the voluntary step to move away from gambling sponsorship on the front of shirts. This was a key ask made of us by the DCMS, and we agreed. This is a significant decision, and one that I do not believe any other major sports organisations have taken.

The impact of this step on clubs is, frankly, quite painful. Contrary to what the noble Baroness, Lady Fox, said, most clubs cannot afford to do it, but they have done it anyway because they have been asked to. The typical difference between gambling and non-gambling shirt sponsorships is around 40%. For some Premier League clubs, this decision will mean a reduction of around 20% of their total commercial revenues. For clubs in the bottom half of the Premier League table or those newly promoted, the financial hit will be especially pronounced in the short term, and comes on top of the £250 million hit to Premier League clubs over the Parliament, as I have already mentioned in this Committee, following the Budget’s rise in employer national insurance contributions. The pressures are acute, but the Premier League clubs took this decision, fully aware of the difficult commercial consequences, because it was the right thing to do and was aligned with what the Government asked of us.

Furthermore, the Premier League has led the way in driving forward the development of an all-sports code of conduct, published earlier this year. This sets out standards on gambling partnerships, including the critical issue of awareness and responsible gambling messages, that all clubs and sports organisations will adhere to. The code reflects the seriousness with which football in particular is addressing this issue, and provides a strengthened framework for responsible engagement with the gambling sector.

It is important to acknowledge the vital role that gambling sponsorship plays in supporting clubs across the football pyramid. For many clubs, particularly those outside the Premier League, gambling sponsorship represents a significant source of revenue. That is the reality we all need to be conscious of, especially in the context of the Bill, which focuses on financial sustainability. Noble Lords may be aware that the EFL has a much greater reliance on gambling sponsorship, including its title sponsorship deal with Sky Bet. The Premier League itself has never had a gambling sponsor. This demonstrates that the issue is not uniform across football and that heavy-handed interventions may well risk disproportionately affecting clubs lower down the pyramid.

The Premier League’s voluntary decision to phase out gambling on front-of-shirt sponsorship is just one major step, but it is proof that football is taking this issue seriously. It shows that football can lead the way on responsible change, even when it causes difficulties for clubs, without the need for heavy-handed interventions. We must properly address concerns about problem gambling and the need for responsible behaviour and stringent regulations. Football must clearly be part of the solution, as it wants to be, just as all sport needs to act responsibly. However, I argue that the Premier League in particular has already shown important leadership here, taking proactive and voluntary steps that, as far as I am aware, no comparable organisation has yet replicated.

In the light of the progress already made, I respectfully suggest that football does not require further statutory intervention in this area. We have shown—but of course we must collectively continue to show—that we can be relied upon to make progress on this vital issue.

Football Governance Bill [HL]

Debate between Baroness Fox of Buckley and Baroness Brady

Committee stage
Wednesday 4th December 2024 Lords Chamber

[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.

Football Governance Bill [HL]

Debate between Baroness Fox of Buckley and Baroness Brady

Committee stage
Monday 2nd December 2024 Lords Chamber

[Baroness Brady (Con)]

My Lords, I rise to speak against this set of amendments, which would add corporate responsibility requirements to the Bill. Before I do so, I want to say how much I respect and understand where the noble Lord, Lord Addington, is coming from. As a shareholder in the Premier League, I commit to him that we will meet with him to think about ways in which we can work together to deliver some of the aims that he spoke so passionately about, because we are all in agreement that they are important.

I want to make sure there is no misunderstanding in this House of the extraordinary social impact that football clubs already have in their communities and what drives this activity. Let me share some perspective on what football clubs already deliver. The Premier League provides over £500 million annually to support lower league clubs, fund youth development and invest in community facilities. We support every single football league club to provide its own community programmes, too. This is not a peripheral activity; it represents the most comprehensive community investment of any business sector in Britain. I cannot think of any other sector that voluntarily shares such a huge proportion—over 16%—of its central revenues in such a way.

The Premier League Charitable Fund’s £110 million three-year budget supports half a million people annually through targeted community programmes. Significantly, 45% of this activity takes place in our country’s most deprived communities. This April, the Premier League announced additional funding of £33 million per season from 2025-26 to further enhance this work.

The scale of impact that this work has is remarkable. Through the Football Foundation, Premier League funding has enabled over 70,000 grants to improve grass-roots facilities, supporting nearly 70,000 community teams last season alone. The Premier League Primary Stars programme reaches 84% of primary schools across England and Wales; that is 19,000 schools and over 18 million student interactions since 2017.

These are not isolated initiatives. More than 100 club-connected charities work daily in their communities. Programmes such as Premier League Kicks create opportunities for young people at risk of anti-social behaviour. Premier League Inspires develops personal skills and positive attitudes in young people aged 11 to 25. This work touches every aspect of community development.

Football has naturally evolved its social contribution without regulatory compulsion or diktats. What other business sector can demonstrate this level of sustained community investment? What other industry has built social responsibility so fundamentally into its operating model? Premier League clubs—indeed, all football clubs—understand their role as community institutions and deliver accordingly.

The Bill’s purpose is to address specific issues around what I think the Government mean by financial sustainability and governance. Adding layers of corporate responsibility requirements would not only duplicate existing good work but risk distracting the regulator from its core purpose. We have seen in other sectors how regulatory mission creep can undermine effectiveness. We must not let that happen here again.

Football clubs are not just businesses that happen to do some good work in their communities. They are the beating heart of those communities, woven into their very fabric across generations. When a child steps on to a Premier League-funded pitch in a deprived area, when a struggling student finds inspiration through Premier League Inspires, and when a disabled young person discovers the joy of playing football through a club foundation, these moments represent something profound about football’s role in our society.

Premier League clubs understand their power and their responsibility deeply. They live it every day through their actions, their investment and their commitment to their communities. I do not believe any regulation could ever mandate or compel this level of social impact; it comes from an authentic and deeply felt understanding of football’s unique place in our national life.

Let us keep the regulator focused on its vital purpose and trust instead in football’s consistent commitment to social good: not because rules demand it but because it is already so fundamental to what makes English football so special.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, that eloquent and passionate explanation of football at the heart of community sums up for me the tension when we are talking about this Bill. Football exists as a positive force in society and in communities. We do not want to kick the life out of it by turning it into a box-ticking exercise that imagines the only way football clubs will help a community is if they have a regulator breathing down their neck, saying, “You must be corporately socially responsible”. Noble Lords must not make me repeat that.

I had concerns in general when I read the details of all these amendments. For example, Amendment 165 calls for environmental sustainability requirements and increasing diversity and inclusion requirements. I will not repeat the points that I made earlier and will make more fully when I speak to my Amendment 155, opposing the imposed duties of EDI and so on. I want to look at one aspect of discrimination that I think is hidden. It is focused on in Amendment 247, which says that regulated clubs

“must facilitate football training for young women and girls”,

and Amendment 90, which says that the independent football regulator

“must include facilitation for both sexes and separate development pathways”.