Football Governance Bill [HL]

Baroness Twycross Excerpts

2nd reading
Wednesday 13th November 2024 Lords Chamber

Moved by

[Baroness Twycross]

That the Bill be now read a second time.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

My Lords, football brings joy to fans right across the country, as well as a shared sense of community. It is an essential part of the social fabric of our country. Growing up, I lived within earshot of the Manor Ground, Oxford United’s former home. My dad, who was a season ticket holder, took me and my siblings to games, including to Wembley when Oxford won the Milk Cup.

Loyalty to clubs runs through families and creates a sense of pride within communities across the generations. With apologies to noble Lords who support Bolton, I was delighted when my niece Talullah and nephew Winston got to experience the same euphoria I did as a teenager—and in May as well—when we went to see Oxford win the League One play-off final at Wembley earlier this year.

English football goes beyond family loyalty and local communities. It is a global success story and one of our greatest cultural exports. It is an industry we want to protect, for its economic value and for the fans who turn out to support every week, even when their team is down on its luck.

Despite its phenomenal success, we know that irresponsible owners, unsustainable financial models and inadequate regulation have cast a shadow over too many of our clubs. Too often, fans have had to fight to protect their club’s identity, heritage and even its very existence. In recent years, we have seen the devastating impact that losing these battles can have on communities, such as with Bury and Macclesfield Town.

Since 1992, there have been over 60 instances of professional clubs in the top four divisions going into administration, and two expert reports commissioned for DCMS have shown that the situation is not improving. In 2023 alone, clubs in the top five leagues faced pre-tax losses of over £1 billion, and net debt stood at over £4 billion. These are eye-watering figures.

Unfortunately, the football industry has not gone far enough in tackling these issues, despite many opportunities to do so. That is why we are bringing this Bill forward to establish an independent regulator, delivering on our commitment to make this country the best place in the world to be a football fan.

This is historic legislation which has been developed over several years, including by the previous Government, who recognised the need to regulate in this space. I give special thanks to Dame Tracey Crouch for chairing the independent Fan Led Review of Football Governance. It was her review that recommended an independent football regulator and laid the groundwork for the extensive policy development on this much-needed legislation.

Before I get to the details of the Bill, I thank all those who have engaged so constructively in its development, including many noble Lords from across your Lordships’ House here today. In particular, I thank the Football Supporters’ Association, the English Football League, the Premier League, the National League, the Football Association, UEFA, FIFA, the Professional Footballers’ Association and Kick It Out, as well as clubs across the football pyramid.

I turn to what the legislation does. The regulator will improve the resilience of club finances, tackle rogue owners and directors, and strengthen fan engagement. It will also set out a corporate governance code of practice and prevent clubs joining breakaway leagues.

Too many clubs are living beyond their means. Therefore, the regulator’s primary purpose will be to protect and promote the sustainability of English football. It will achieve this through a licensing system where all regulated clubs in scope will need a licence to operate as professional football clubs. That scope will be set out in regulations and is currently envisaged as the top five divisions of English men’s football.

The regulator will not be a fix for all football’s woes, nor should it be. It will have a very tightly defined scope and purpose to tackle the specific risks of significant detrimental impact on fans and communities. Legally, the regulator will not be able to act outside of this scope.

The football industry has shown itself incapable of addressing these failures. We have seen in other industries that, when done well, proportionate regulation still allows for innovation and ambition—financial services being a good example. Where clubs are already well run, regulation will be light touch to ensure sustainability without standing in the way of clubs’ ambitions. Indeed, compared to some comparator countries, this is not interventionist regulation.

To better understand the landscape of English football, the regulator will periodically undertake a “state of the game” report. This is expected to include a broad assessment of the financial health and economic issues of the industry.

Under its regime, the regulator will introduce new regulation to improve financial resilience in the game. Clubs will be required to demonstrate sound basic financial practices, have appropriate financial resources, and protect the core assets and value of the club, such as the stadium. This will reduce the risk of clubs facing financial failure and the huge knock-on impact and distress that that carries for entire communities.

This Government are committed to putting fans back at the heart of the game. As such, the Bill goes slightly further than the Bill debated in the Commons earlier this year. It will put in place a stronger minimum standard of fan engagement in decision-making on a number of key issues at all regulated clubs. The Bill also introduces important new statutory protections for key aspects of a club’s heritage, such as its name, home shirt colours and badge, because although most clubs have a strong relationship with their fans and actively engage them in decisions that affect club heritage, not all do. Fans at Cardiff City and Hull City will know this well, where they have had to battle to keep their club’s name or shirt colours.

Clubs will need to seek the regulator’s approval to sell, or relocate from, their home ground. Relocation from a club’s home ground will not be approved unless it both makes financial sense and does not compromise the heritage of the club. This will help to prevent a repeat of what we saw when Wimbledon moved from their home in south London to Milton Keynes.

Fans have also suffered the consequences of irresponsible ownership. We have seen some owners acquiring clubs without having adequate finances, or who were involved in criminality, or who had histories of financial mismanagement. The regulator will put in place stronger, statutory owners’ and directors’ tests to protect fans from the impact of irresponsible owners and decision-makers by ensuring a club’s custodians are suitable. All prospective owners and directors must pass the regulator’s tests before taking a position at, or acquiring, a club. If someone already in the system is found unsuitable, the regulator will have powers to remove them.

We have removed a clause from the previous Bill that allowed government foreign policy and trade considerations to be considered when approving takeovers. This change makes it absolutely clear that the new regulator will be independent from government.

One of the main triggers for the fan-led review was the attempted breakaway European Super League, which prompted a fierce backlash from fans. Clubs will be prevented from playing in competitions prohibited by the regulator. This will mean that fans no longer face the prospect of seeing clubs trying to join unfair, closed-shop leagues that undermine the fundamental principles of English football.

I turn now to distribution of revenue in the game. Since 2019, the leagues have failed to negotiate a new distribution deal—another stark example of the industry being unable to resolve key issues. So, while a football-led solution remains this Government’s preferred outcome, the regulator will have statutory backstop powers to intervene if necessary. The backstop mechanism is designed to incentivise an industry-led solution. However, in the absence of one, it will be robust enough to ensure an agreement is put in place to fairly distribute revenue.

Only one of the relevant football leagues can apply to trigger the backstop mechanism, if they feel that they cannot reach an agreement themselves. This does not mean, however, that the process will automatically be triggered. The regulator can decide to trigger the process based on such an application if relevant conditions are met. The regulator will then enforce a mediation period to try to encourage the leagues to come to an agreement themselves.

However, if an agreement cannot be reached, the final offer arbitration process will be triggered. This process requires both leagues to submit final proposals for a distribution agreement, and the regulator will choose the one most consistent with its objectives to promote the financial soundness and resilience of football. It can reject both proposals if they are unsuitable. This decision will be enforced via a distribution order. At every stage, this process is intended to encourage an industry-led solution, while ensuring an agreement on distributions will be reached. The Bill will also establish a corporate governance code, requiring clubs to report how they are applying the football club-specific corporate governance code published by the regulator.

As noble Lords will be aware, Labour supported the introduction of the previous version of this Bill, which was debated in the other place prior to the election. The new Bill is largely in line with the previous Bill. However, we have made key changes to ensure we deliver the best possible proportionate regulation that safeguards the future of our national game.

These changes will empower fans, keep clubs at the heart of their communities and ensure the financial sustainability that will protect clubs for future generations. As a result of the changes we have made, clubs will be explicitly required to consult with supporters on ticket prices. This, among other measures, will give fans a louder voice at their clubs on the issues that matter to them. Clubs will also be required to consult their fans prior to the regulator making a decision on relocation of a home ground.

Parachute payments will no longer be excluded from consideration as part of the backstop process. They are a significant part of football’s financial landscape, and if the regulator identifies them as a relevant factor, it will be able to consider them as part of the backstop.

Finally, the fan-led review identified that the game needs to do more to ensure it is open and welcoming to people of all backgrounds. There is therefore a clear commitment from this government to do more to improve equality, diversity and inclusion within football club governance. Clubs will be required to publish what action they are taking on equality, diversity and inclusion as part of reporting against a new football club corporate governance code, which the regulator will introduce to improve decision-making at clubs. The measures in this Bill have been carefully developed to ensure we are taking a proportionate and flexible approach to regulation that reflects the unique and special place football has in our society.

The regulator will be focused on financial sustainability as well as safeguarding the heritage of English football. But, crucially, it will also have duties to have regard to minimising its impact on important outcomes such as the competitiveness of our clubs against overseas competitors and investment into the game. This will provide a stable regulatory environment, providing the certainty required to drive future investment and growth, so that English football continues to be a global success.

If clubs have the finances to back up their plans, have suitable owners and directors, engage their fans on key issues and do not join closed-shop breakaway leagues, they should feel very little impact from the regulator. Given the ongoing issues at some clubs, we are determined to ensure the regulator is in place as quickly as possible once this legislation passes. This is why we are already putting in place a shadow regulator to do the preparatory work and lay the foundations of the regulatory regime.

The case for better regulation of our clubs is clear. This Bill will provide the much-needed reform to protect our footballing heritage. I am grateful to noble Lords for their involvement in and support for the Bill. I look forward to working across the House in the weeks ahead. I beg to move.

--- Later in debate ---

[Baroness Twycross (Lab)]

My Lords, I thank all noble Lords who have spoken today. I share the strong sentiments expressed about the importance of our football clubs and the central importance of fans, which is why we, like the previous Government, are acting in this space. I have particularly enjoyed hearing accounts of what football means to noble Lords on a personal level, and I hope that the noble Lord, Lord Markham, recovers from his recent match soon.

As the noble Lord, Lord Parkinson, outlined in his opening, football means more to fans than politics, which we all forget at our peril. Today’s debate has shown the knowledge and passion in this House for football and for improving governance in the game. It also highlights, as my noble friend Lady Taylor of Bolton articulated better than I can, why the Government have prioritised this legislation. I agree with the noble Lord, Lord Addington, that had football sorted its own house out this legislation would not be required.

I respect the right of the noble Lord, Lord Hannan, to question the need for this legislation but I do not agree with him, and I note that nor did the previous Government, which is why they also bought forward legislation—

[Lord Hannan of Kingsclere (Con)]

I opposed that too.

--- Later in debate ---

[Baroness Twycross (Lab)]

Fair enough. As I previously set out, the case for reform and for regulation is clear. Far too many of our clubs have been subject to poor ownership and financial distress, and it is ultimately the fans and communities who suffer when things go wrong. My noble friend Lord Bassam gave a useful overview of some of the issues with the financial distortion that occurs within football, as did the noble Lord, Lord Londesborough. The noble Lords, Lord Moynihan and Lord Maude, had a different view, one that in my view ignores the considerable financial risk that currently exists within the pyramid.

It is clear, with notable exceptions, that there is a degree of consensus across this House on key aspects of this legislation. It has the same motivation as the previous Government’s Bill, with very few changes. A number of noble Lords have raised the importance of preventing rogue owners, giving fans a greater voice, ensuring clubs have stable finances, and stopping another dreaded European super league—a point raised by my noble friend Lord Wood of Anfield. It is these issues that the Bill will deliver on through better regulation, ensuring the financial sustainability of our clubs, and protecting the heritage of the game. The noble Baroness, Lady Morris, gave a powerful description of what the impact can be on a community when things go wrong. Unfortunately, the Bill will not deal with VAR—which is the issue raised by the noble Lord, Lord Ranger—nor is it intended to.

While a number of noble Lords, including the noble Lord, Lord Maude, and the noble Baroness, Lady Fox, question the need for regulation, and others suggested we could have taken a different approach—including, as my noble friend Lord Grantchester said, that we could have gone further—we think this Bill is proportionate and gets the balance right. It will tackle harms where they exist, while ensuring that English football remains the fantastic product we all know it to be. I will respond to as many of the questions and points raised as I can but I am not confident I will get through them all, so where I cannot I will write to noble Lords and place a copy in the Library.

My noble friend Lord Bach raised a number of near misses, as he described them, over the past few years in relation to football and football sustainability, and expressed surprise that the industry has not had a regulator up to now. The noble Lords, Lord Parkinson, Lord Moynihan and Lord Ranger, and the noble Baroness, Lady Evans of Bowes Park, asked whether the regulator might create additional burdens on clubs. The noble Baroness, Lady Fox, questioned whether it was a statist regulation, I think, a point that was echoed by the noble Lord, Lord Hannan, while the noble Lord, Lord Goodman of Wycombe, raised concerns as well. I stress that the regulator really is genuinely designed and required to take a proportionate and flexible approach. That is made clear in the regulatory principles in Clause 8, which the regulator must have regard to in carrying out its functions. I hope that reassures those who are concerned about the regulation in this regard, although I know we will have a further debate on that in Committee.

The licensing provisions in the Bill are designed to deliver a bespoke, tailored licensing system. The requirements on each club should reflect the club’s unique circumstances, such as its size, financial health and risk profile. The noble Baroness, Lady Evans, raised the cost of the levy. That cost will be proportionate to the size of an individual club and the league it plays in. The regime is designed so that, where clubs are already well run, the regulator will not need to lay on extra requirements, so there should be minimal additional burdens.

The noble Lords, Lord Hayward and Lord Jackson, and the noble Baroness, Lady Evans, asked about the cost to clubs of the regulator. The regulator is required to take into account a club’s financial resources and the league it plays in when setting the levy. That should ensure a proportionate approach where no club is asked to pay more than what is fair and affordable, so a National League or League Two club can expect to pay just a fraction of what a Premier League club would pay. The regulator will be committed to providing value for money and only charging costs that are absolutely necessary for it to function effectively. There are numerous checks and balances in the Bill to ensure that, including the requirement to consult the industry on the levy and the tightly defined set of costs laid out in the Bill.

In relation to UEFA, the noble Lords, Lord Moynihan, Lord Jackson, Lord Taylor and Lord Markham, and others raised concerns that might be raised by UEFA. The Government have engaged extensively with relevant stakeholders, including the FA and UEFA, and this week the Minister for Sport had a productive discussion with UEFA and they committed to continuing to work together.

The noble Lords, Lord Moynihan and Lord Harlech, and the noble Baroness, Lady Brady, among others, raised concerns that the regulator could negatively impact investment. This Government are pro-business and want to see football continue to thrive. That is why we have designed a proportionate regulatory system with intervention targeted only where necessary. It is also why the regulator has a specific duty to, where possible, avoid adversely affecting investment in English football.

In response to the noble Lord, Lord Markham, and others, we want football to be successful. Within the Bill, I point noble Lords, including the noble Lord, Lord Hayward, to Clause 72 on the regulator’s general duties.

The noble Baronesses, Lady Evans and Lady Brady, and the noble Lords, Lord Maude and Lord Markham, raised concerns about regulatory involvement in financial matters relating to the backstop between clubs. We do not see the backstop as a first option, and we do not intend for the regulator to view it as such or for the leagues to view it as the first step they would take. Revenue distribution is crucial to the survival of many clubs; as a number of noble Lords referred to, it represents one-third of EFL revenue, and the noble Baroness, Lady Brady, highlighted how important that is to the game. I do not share her dystopian view of the model proposed, but I look forward to discussing that further in Committee.

If football is unable to reach an agreement on that distribution, it is important that the regulator has targeted powers to intervene as a last resort. Those backstop powers have been designed to incentivise an industry-led solution, delivering the right outcomes with the minimum regulatory involvement. However, given the importance of financial flows to the sustainability of the wider pyramid, if football cannot resolve this, the regulator will help to find a solution.

On financial distributions in relation to parachute payments, a number of noble Lords, including the noble Lords, Lord Parkinson, Lord Londesborough and Lord Maude, my noble friends Lord Grantchester and Lord Bach and the noble Baroness, Lady Brady, spoke about changes to parachute payments being included in the regulator’s remit. It is right, in the Government’s view, that the regulator has the right tools available to solve financial sustainability issues. This change does not mean that parachute payments will necessarily be amended or abolished. If the regulator does not have evidence that they are a problem, it will not act. But, if it does have evidence that they are harming wider sustainability, it will have the power to address that through this legislation. There are also safeguards in place with this change to ensure that the financial sustainability of relegated clubs is provided for.

My noble friend Lord Bassam suggested that the “state of the game” report should be published sooner. This came up in discussions with noble Lords ahead of this Second Reading debate. Under changes to the Bill, the regulator will now need to publish its first report as soon as possible and no later than 18 months after the Secretary of State has specified that competition is in scope of regulation. Of course, the regulator could publish sooner than 18 months, but we do not want it to rush this important market study, which will lay the foundations for the regulator’s regime.

My noble friend Lord Wood of Anfield asked whether the regulator would be able to ban matches being played overseas. FIFA is currently reviewing its position on overseas league matches. It has committed to looking at how this may impact supporters and players, among a number of other valuable considerations. While the industry is still considering its position on this matter and there are no current plans to move English matches abroad, we think it is right to ensure that clubs consult with their fans on any changes to match days, including moving the location, rather than imposing a blanket ban.

The right reverend Prelate the Bishop of Sheffield, my noble friends Lady Taylor, Lord Grantchester and Lord Watson and the noble Lord, Lord Taylor of Warwick, raised the importance of more fan involvement in clubs, as did others. My noble friend Lord Mann articulated clearly what fans themselves put into clubs, not just in terms of moral support but in the financial cost to the fans. We have strengthened measures to put fans and communities back at the heart of the game and to protect football heritage.

My noble friend Lord Mann asked what would happen if a club wished to be known by a new name. The Bill sets out a number of protections for club heritage assets, including the club’s name. If, as my noble friend said, the club wishes to be known as Red Bull Leeds or any other new name, the club would be required to get the approval of the FA. The regulator would be able to act as an enforcement backstop for the FA’s approval process. The Bill will look to protect this decision process and protect club heritage.

The noble Lord, Lord Hampton, and my noble friend Lord Watson asked how a fan of a club could be defined. As my noble friend Lord Shamash said, this might be an impossible task. I am sure there are as many views on this across the Chamber as they were noble Lords who spoke this evening—arguably more—and I would encourage colleagues to engage with the regulator on how this aspect of the legislation will be implemented in practice.

It is important, however, that the regulator itself is able to set out guidance on who may count as a fan and where it will vary according to club context. Providing a strict definition in legislation could risk excluding a number of the very fans that make football what it is. This Bill is intended to increase the fans’ say within the game.

The noble Baroness, Lady Grey-Thompson, asked about action on corporate governance and the noble Lord, Lord Taylor of Warwick, asked about equality, diversity and inclusion, with the noble Baroness, Lady Fox, taking a different view—one that, she will not be surprised to hear, the Government disagree with. This Government believe that equality, diversity and inclusion are an important part of good corporate governance and, as the noble Lord, Lord Taylor, said, there is an issue to address.

The requirements on clubs to report on modern slavery was raised by my noble friend Lord Mann. He asked whether action to bring players into scope of modern slavery reporting would require action by the regulator, primary legislation or secondary legislation. The requirements for which organisations should publish an annual statement on modern slavery are set out in existing guidance and legislation. As there is existing legislation on modern slavery, this Bill will not make separate provisions for it, as it is not within scope.

My noble friends Lord Bassam and Lord Mann asked about the scope of the regulator and whether it should or could include lower leagues and grass-roots football. My noble friend Lord Mann asked if extending the scope of the regulator to lower leagues would be via secondary legislation. This would indeed be the case. However, the Government’s view is that the regulator’s scope should be limited to where there are the most significant harms that the market has failed to resolve. Extending the scope further down the pyramid and into the grass roots would risk imposing disproportionate burdens on both the industry and the regulator.

The noble Lord, Lord Addington, the noble Baroness, Lady Jones, and the right reverend Prelate the Bishop of Sheffield raised issues of climate change, the climate emergency and sustainability. This will not be within the scope of the regulator because it will have a tightly defined scope, focusing on the issues causing serious harm to fans and communities and that cannot be solved through market regulation. Environmental issues are therefore not in scope.

On the topic of scope, women’s football was raised by a number of noble Lords, including my noble friends Lady Taylor, Lord Bassam and Lord Watson, and the noble Baroness, Lady Grey-Thompson. It is not currently included as part of the regulator’s remit. Clearly the women’s game has come a long way from when I was not allowed to play football at school, and this is a good thing. Karen Carney led an independent review of women’s football, which was published in July last year. We agree with its recommendation that the women’s game should be given the opportunity to grow and self-regulate, rather than moving immediately to independent statutory regulation. The regulator will be able to engage and share best practice with industry —for example, the Women’s Professional Leagues Ltd, which is responsible for the women’s game. My noble friend Lord Grantchester highlighted this and my noble friend Lord Mann asked if it was the case. If the picture changes, the Secretary of State will be able to conduct a formal review and, if appropriate, extend the scope of the regulator via secondary legislation— I will come to secondary legislation in a moment—to include women’s football.

The noble Lord, Lord Birt, raised player welfare. While this is not an issue that would come under the regulator’s remit, given its tight focus on financial sustainability, we recognise the point about the welfare of players exiting the game. They need to be better protected, particularly at a young age, as a matter of urgency. We are therefore encouraging the football leagues and the FA to work together to develop a consistent programme of support. We will continue to discuss it with them.

A number of noble Lords mentioned delegated powers, including the noble Lords, Lord Moynihan, Lord Goodman of Wycombe and Lord Jackson. They raised issues around the use of delegated powers in the Bill and I look forward to discussing these further in Committee. These powers are constrained through a combination of procedural, affirmative and legislative consultation requirement safeguards.

In determining which matters should be dealt with through delegated legislation, we have aimed to provide detail to give as much clarity to industry as possible at this stage, and to ensure that Parliament can scrutinise the detail of the regime. However, we also recognise the need for the regulator to have the flexibility to determine its own processes, which may need to adapt over time and will be subject to consultation with key stakeholders.

I have a response to the question about Wales, which I will speak to the noble Baroness, Lady Grey-Thompson, about afterwards. I welcome my noble friend Lord Triesman’s contribution and support for the Bill. His recognition that the existing football authorities have failed to tackle the major issues in the game is welcome. That is why we are bringing forward this legislation.

As we bring this debate to a close, I thank all noble Lords again for their contributions. Given the wide-ranging and thorough debate, I know I will not have responded to every point raised by every noble Lord today. I will try to ensure that other points are responded to in writing. In a lot of ways, this has helped us tease out some of the debates we will discuss further in Committee. There are points of broad consensus, even if there are differences in how positively some of the measures are viewed.

This is really important legislation, which the previous Government first introduced. I look forward to working with Peers to ensure that the Government now get the job done. I sincerely hope we do not need the refereeing skills of the noble Lord, Lord Hayward, to work through any of the issues.

A strength of this House is the rigour and scrutiny that noble Lords bring to the issues before them. As we have seen today, that is precisely what noble Lords will bring to this Bill, so that we make sure it is the best possible legislation before it goes to the other place. It is through this legislative process we can ensure that we avoid some of the unintended consequences that a number of noble Lords have warned against today. I am keen to work with all noble Lords across the House as the Bill progresses. I invite noble Lords who wish to talk about any issues related to the Bill to contact me and my officials.

Bill read a second time.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Wednesday 27th November 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank noble Lords for raising the amendments in this group. This discussion has arguably gone into extra time, although I am assured that we have not got to the point of a penalty shoot-out—although that might be one way to arrive at a conclusion, given that I no longer intend to take up the refereeing option from the noble Lord, Lord Hayward, having heard very clearly what he said.

It is clear that the enthusiasm for talking about football demonstrated at Second Reading remains strong. I am not surprised, however, given the time we have spent on this group, that my noble friend Lord Watson of Wyre Forest appears to have contributed on the next group. I will respond to his points then.

Before I get into the substance of the amendments we have discussed this afternoon, I want to make a general point that was made succinctly by my noble friend Lord Bassam: it is clear that the party opposite has very unfortunately caught an element of collective amnesia. It appears to have forgotten that it was a Conservative Party that was in government and brought forward a very similar Bill just a few months ago—a point made elegantly by my noble friend Lady Taylor. All serious parties—I include the Conservatives in that—had a commitment to introducing an independent football regulator as part of their manifesto.

Notwithstanding the length of the debate, I thank all noble Lords for their contributions. The noble Baroness, Lady Evans, made an interesting point about growth that has not been substantially covered by the notes I have. I would welcome further discussion on this point with her and am happy to meet to discuss it further.

Taking each amendment in turn, unfortunately, I have to disagree with the principle of Amendment 1 in the name of the noble Lord, Lord Parkinson, and of Amendment 4 in the name of the noble Lord, Lord Maude of Horsham. The fan-led review, led by Dame Tracey Crouch, laid bare the facts of English football today. The review is the justification for the Bill that the noble Lord, Lord Hayward, asked for, and the basis of the Bill that the noble Lord, Lord Jackson of Peterborough, asked for when he asked what problem we were trying to address. I thank the noble Lord, Lord Goodman, for highlighting Dame Tracey Crouch’s point that the game is both a success and fragile at the same time—a point reflected, in my view, in the contribution from the noble Lord, Lord Ranger.

A number of noble Lords, including my noble friends Lord Watson of Invergowrie and Lord Mann, gave other examples of where the state has intervened in football. Although, as a number of noble Lords, including the noble Lord, Lord Parkinson, said, it is undoubtedly hugely successful in many ways and has grown substantially since the formation of the Premier League in 1992, and our football is a global export that we should be proud of, the game’s financial model is broken. Too many clubs are in financial distress, fans are not being listened to, and just a few years ago top clubs attempted to break away from the Premier League to join a European super league. That move undermined the very principles of football in this country. The Bill is designed to combat these issues, identified by the previous Government.

I thank the noble Lord, Lord Moynihan, for Amendment 3 and for his contribution to this debate, not least for highlighting the cross-party support for an independent football regulator. In response to his point on hybridity, I think we will come on to this in a later group, but this is a matter for the examiners, not the Government. I am happy to discuss this and others points in the debate on the relevant group, which I believe is the eighth group. We will potentially come to that at some point in the near future.

Unfortunately, the Government do not agree with the intent of Amendment 3 to narrow the purpose of the entire Bill specifically to financial sustainability. The purpose of the Bill is sustainability, as already defined in Clause 1. I highlight to noble Lords that they will find the Government’s definition if they turn from page 1 to page 2 of the Bill. I hope this answers the query from the noble Lord, Lord Addington, about the Government’s intent in this regard. It is about a continuation of service—to continue to serve the interests of fans and contribute to the well-being of the local communities that regulated clubs serve.

I listened with interest to the contribution from the noble Baroness, Lady Brady, and all noble Lords will recognise her passion and expertise. I welcomed the passionate description from the noble Lord, Lord Goddard of Stockport, of what the Bill is about. It is about those fans and the communities. Of course, financial sustainability is an important part of this. If a club suffers financial collapse, it cannot continue to serve its fans and community. I cannot agree with the noble Lord, Lord Moynihan, that this is exactly the same as any other financial club, a point echoed by the noble Lord, Lord Addington.

However, there is more to it than this. If a club’s balance sheet remains healthy but it ups sticks, moves 60 miles away and changes its name, badge and shirt colours, that is not a continuation of service either. Clause 6 sets out the regulator’s objectives, breaking down the overarching purpose of the Bill into its component parts. That is where noble Lords will see the club financial soundness and systemic financial resilience objectives, alongside the heritage objectives. That is the right place for them, and we believe this structure appropriately conveys the regulator’s aims and priorities.

The noble Baroness, Lady Brady, asked whether all clubs in a league would have to adhere to the same rules. The regulator will be proportionate and adaptive in its approach, rather than taking a one-size-fits-all approach that requires all clubs, regardless of their level, to adhere to the same approach.

Moving to other amendments, I thank my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton for Amendments 10, 53 and 63, which raise interesting points about how much funding is required by individual clubs in the pyramid. On Amendment 10, the Government understand that the intent is to explicitly define sustainability in Clause 1 as the ability for a club to meet its financial commitments for at least the next six months.

This amendment would also effectively seek to alter the purpose of the Bill by adding to the definition of sustainability in relation to English football as a whole. As I have already stated, we believe that sustainability is already appropriately defined in Clause 1. I have no doubt that my noble friends’ intention was to define the financial soundness of a club as per the regulator’s objective in Clause 6. However, here we do not believe that it is necessarily appropriate to define general financial soundness in this way. We believe that there are circumstances in which the ability to meet financial commitments for six months may be an appropriate measure, but it is a blunt one and may not also and will not also be the case.

It will be for the regulator to set out exactly what it considers constitutes financial soundness. We think this is the right approach. However, the Explanatory Notes to Clause 6 clarify that:

“‘Financial soundness’ is a measure of a club’s expected ability to continue meeting its liabilities and debts in the future, even in the face of changing circumstances … This will involve an assessment of a wide range of factors and circumstances relating to a club’s long-term financial sustainability and resilience”.


I hope my noble friends are reassured as to the benefits of this approach.

The Government also recognise the good intent behind Amendment 53, which is to clarify that the regulator should be concerned with the financial resilience and sustainability of English football. I hope I can reassure my noble friend that, in our view, the desired intent is already achieved by the wording of the regulator’s objectives in Clause 6, and the purpose of the Bill in Clause 1.

Care was taken in the exact choice of the wording. “Financial resilience” feels appropriate in relation to the wider football system, as an established concept regarding the ability of the system to withstand shocks. “Financial soundness” feels more appropriate when referring to individual clubs, as an established concept regarding the financial health of organisations. “Sustainability” feels appropriate when referring to the overarching purpose of the Bill to ensure a continuation of service. To repeat “sustainability” in this objective could risk confusing these concepts and how they interact. I again point all noble Lords to the Explanatory Notes, which provide more detail on these various objectives and, I hope, provide some reassurance on the points raised.

Amendment 63 seeks to ensure that the financial position or soundness of regulated clubs is not diminished relative to other, non-regulated clubs. In line with its objectives, this regulator will be tasked with protecting and promoting the financial soundness of regulated clubs. Therefore, I hope my noble friends will agree that it is not necessary to place this additional requirement on it to not adversely affect financial soundness.

Amendments 4A, 7A and 62 are in the name of the noble Lord, Lord Maude of Horsham, and Amendments 2, 209, 226 and 231 are in the name of the noble Lord, Lord Hayward. In response to the surprise from the noble Lord, Lord Markham, that this is included, I understand the desire to ensure that the success of English football is protected and would like to be explicit that we believe this is achieved in the Bill already. As previously stated, the Bill is largely the same, not least in the part we have been discussing this evening so far, as that published by the previous Government, in which the noble Lord served.

As part of its secondary duties, the regulator must have regard to avoiding impacts on important outcomes in football. This extends to domestic sporting competition, the competitiveness of our clubs against international clubs, and investment into football. Actively pursuing these outcomes will remain the responsibility of the industry rather than the regulator, but the regulator will avoid unduly harming them while it strives for sustainability.

On Amendments 2, 4A and 7A specifically, if, as part of the purpose of the Bill, the regulator were required to protect the success as well as the sustainability of English football, it would not be afforded the flexibility needed to solve the clear and present issues within football currently. As someone who at Second Reading admitted to supporting Oxford United—who, sadly, lost their most recent games—I feel that success would be a hard ask of any regulator.

Similarly, my noble friend Lord Mann mentioned enjoyment. I know that most noble Lords will appreciate that sometimes that enjoyment can be quite painful as well.

[Baroness Taylor of Bolton (Lab)]

It is more like suffering.

[Baroness Twycross (Lab)]

Yes, suffering—all noble Lords will suffer for their football clubs as well, at times.

[Lord Markham (Con)]

I think the Minister did not quite understand. She was talking about success in terms of success of teams. The point about success that the noble Lord, Lord Hayward, and I were trying to make was about TV viewership, which drives the media rights value. I have not seen that anywhere else in the Bill, and I would be grateful if the Minister could say where it is addressed.

[Baroness Twycross (Lab)]

I might have been being flippant, so I apologise to the Committee. After the length of time we have been discussing this, I came up with some flippant remarks. That was not to undermine the noble Lord’s point.

Much of the success of English football has come from investment, and we do not believe the Bill will in any way deter this. Nor do we believe that the regulator will detract from the noble Lord’s point about what might be measures of success. Indeed, a stable, more certain regulatory environment is likely, in the Government’s view, to attract investors with a more long-term, prudent approach to stewarding and growing these community assets.

These amendments would require the regulator to bring into scope anything that relates to the growth of English football. This would include things such as broadcasting revenues—which the noble Lord referred to—transfer fees and sponsorship deals, alongside many other areas. Not only would this dramatically widen the scope but the regulator would be required to become actively involved in these areas, potentially causing unintentional harms when looking to advance these worthy objectives. I am sure noble Lords will agree that this is not a space we necessarily want to have the regulator interfering in.

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[Lord Hayward (Con)]

May I just seek clarification? She has covered a very wide-ranging debate as quickly and reasonably as possible, and I have no criticism of the manner in which she has done that. The key debate has been around the word “sustainability”. I think that, earlier in her reply, she said that it was defined at some point. The powers to operate are in Clause 1 and there is no definition in Clause 2. If she has given clarification at some point, I will check it in Hansard, but I am seeking clarification as to whether there is, within the Bill, “sustainability”. For that purpose, the powers identified in Clause 1 do not define it, and looking under key definitions in Clause 2, it does not appear to be there, either.

[Baroness Twycross (Lab)]

I draw the noble Lord’s attention, and other noble Lords’ attention, to the first line on page 2. Even if it does not have the word “definition”, it is quite clearly a definition. It says:

“For the purposes of this section, English football is sustainable if it … continues to serve the interests of fans of regulated clubs, and … continues to contribute to the economic or social well-being of the local communities with which regulated clubs are associated”.

[Lord Parkinson of Whitley Bay (Con)]

I am very grateful to the noble Baroness for her remarks and I agree with my noble friend Lord Hayward that she has covered a wide-ranging debate very reasonably. It was useful to get some of the thinking in the Government’s mind behind the way that Clause 1 is set out, and she was right to draw attention, as she did at the end, to the way Clause 2 tries to expand on this. As she knows, we have amendments down to look at that a bit further.

I am sorry that she repeated the points about amnesia. The reason I rose again to speak at some length before her concluding remarks was to reiterate the cross-party gestation that the Bill has had and the interest that is there. She mentioned that her notes gave her little to say on the points that my noble friend Lady Evans of Bowes Park raised about growth. After a debate of this length, there was time to get a few additional notes, so I hope she might be able to write to my noble friend and the rest of the Committee on that. But I am grateful for what she said. I will go back through the official record and look at the points that noble Lords have raised in relation to Clause 1. With that, I beg leave to withdraw my amendment.

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Just as importantly—perhaps more importantly—fans and players deserve reassurance that their clubs and our national team will continue to be able to compete on the international stage. These are the very people that the Bill has been brought forward to champion, so I hope the Minister will look favourably on these sensible and constructive amendments. I hope she will respond to the points that noble Lords from across the Committee have made and take up the invitation from her noble friend Lord Watson of Wyre Forest and seize the opportunity to give 1.5 billion fans of English football, here and around the world, the reassurance they want and a clear answer to the question that he posed. Now would be a very good time for her to answer it.

[Baroness Twycross (Lab)]

I genuinely welcome these amendments and appreciate the sincerity of the concerns noble Lords may have about the possible ramifications were the regulator to operate outside of governing body rules, including the potential ramifications for domestic teams playing in international competitions. The noble Lord, Lord Parkinson, noted that this threat might be alarming to fans. It behoves us all in your Lordships’ Committee not to spread unwarranted alarm and I hope it will be useful if I am able, in response to this debate, to reassure noble Lords—and, through the debate, fans—that we do not believe that there is any risk from the Bill as it stands to our domestic teams playing in international competitions. I reassure the noble Baroness, Lady Fox, that we definitely have the interests of fans at heart, and I say to my noble friend Lord Watson that I welcome his comments; I am not confused and nor should noble Lords be.

On Amendments 5 and 6, I assure the noble Lords, Lord Moynihan and Lord Maude of Horsham, and my noble friend Lord Watson that there is no intention that the regulator will fall foul of UEFA’s, FIFA’s or the International Olympic Committee’s rules, or that the regulator will take any action that would lead to English club or international sides being unable to play in certain competitions, such as the European Championships.

The Government have worked closely and consulted with UEFA, FIFA and, in particular, the FA throughout the development of the Bill, and will continue to work with them as it progresses through Parliament. The noble Baroness, Lady Evans, raised remarks I made at Second Reading. I can confirm that the Minister for Sport recently held a very positive and constructive meeting with UEFA, in which she reiterated that we will continue to work with it as the Bill progresses. We have listened to previous concerns and have responded by removing a clause from the previous Bill which required government foreign and trade policy to be considered when approving takeovers. In response to the noble Lord, Lord Birt, I hope I can provide assurance, in that my understanding is very clear that they have confirmed that they do not now have concerns about the Bill as it stands.

[Lord Parkinson of Whitley Bay (Con)]

Noble Lords are listening carefully to the Minister’s words, and she says it is her “understanding”. Is it the Government’s clear view that UEFA and FIFA are happy? She said also that it is not the intention of the Bill that this would take English football into areas that might cause conflict, but I think noble Lords were probing not the intention but the risk that it might do so. Perhaps she is able provide something further in writing, but noble Lords are seeking certainty and precision in her response.

[Baroness Twycross (Lab)]

There is nothing in the Bill that conflicts with English clubs or the English national side competing in international games, as the rules of the international bodies stand currently.

[Baroness Brady (Con)]

Have UEFA told the Minister that, or is that her understanding?

[Baroness Twycross (Lab)]

As I said, UEFA had a meeting with the Minister for Sport. My understanding from that meeting, at which I was not present, is that this was confirmed. It has not raised other concerns. If any noble Lord knows of other concerns that it has raised directly with them, please get in touch afterwards.

[Lord Maude of Horsham (Con)]

We are listening very carefully to this, and it is really important. I have absolutely no doubt about the honesty of the Minister’s —or the Government’s—intentions and sincerity. The concern is that stating that it is not the intention that the regulator would do anything, or that the Bill would have any effect that would conflict with these international football bodies, is not quite as reassuring as it is meant to sound. The concern has always been the unintended effects, and the fact that, for all their good intentions, she, the Government and indeed the Prime Minister cannot bind future Governments. The regulator is meant to be independent, so there is scope for activity. Unless it is explicitly excluded in the primary legislation, there will continue to be a doubt, whatever good words we hear either first or second hand. To put it beyond any doubt, it is essential that this is in the Bill.

[Baroness Twycross (Lab)]

I can only repeat that I know that the Minister for Sport is clear that she had a positive and constructive meeting with UEFA, and that we will continue to work with it. The only other point I was aiming to make on this matter, rather than repeating what I had already said, was that when the Government say that we want to keep the Bill within its current scope, this is clearly partly to avoid mission creep, with the unintended consequence that we might then stray into areas that are problematic. When we debate subsequent groups, please note that it is front and centre of our minds that we are very clear that this Government will do nothing to jeopardise the ability of English clubs or the England team to play in international competitions, whether they are European, world-level or at the Olympics. I hope that noble Lords accept that there is no intention to do anything that will jeopardise that. The advice we have had is that this will not be the case. The engagement with UEFA is essential, and it is aimed at ensuring that there are not any unintended consequences that would damage the ability of English clubs or national teams to compete in UEFA, FIFA or Olympic competitions.

This legislation does not impose undue third-party influence on the FA, and therefore does not breach FIFA or UEFA statutes, which the FA has confirmed. In any case, there is an additional safeguard already in place in the Bill, in that the regulator must have regard to its duty to avoid any effect on sporting competitiveness of regulated clubs. For the avoidance of any doubt, and to ensure that there is no possibility of any clauses that may concern these sporting bodies, we have already taken action. As previously noted during the debate, we have removed a clause from the previous Bill which allowed government foreign policy and trade considerations to be considered when approving takeovers. The regulator will be fully independent from Government and tightly focused on the financial sustainability of the game.

On Amendment 24 in the name of the noble Lord, Lord Moynihan, I say that we are extremely confident that no powers or potential actions taken by the regulator would be in breach of the rules, and thus preclude England’s national teams from competing in international competitions. We are mindful of UEFA’s governing principles around undue third-party influence, and this has shaped how we are setting up the regulator.

I am proud that this is a Labour Government Bill that we are taking through this House, as was noted, with agreement from the previous Government. This legislation will not impact the intention for our teams to play in UEFA competitions. For the reasons I have set out, I am unable to accept the noble Lords’ amendments and hope that they will not press them.

[Baroness Brady (Con)]

Just before the Minister sits down, can she confirm if she could, and would, place in the Library the letter that the Secretary of State received from UEFA, so all Peers have a chance to read it? I know the Minister stated that this was not alarming, but I think the majority of people would find it alarming.

[Baroness Twycross (Lab)]

The noble Baroness refers to my point about this not being alarming. I do not want fans to be alarmed by our discussion. It was a private letter from UEFA; there is no intention for it to be published. I assure noble Lords that this Government will not do anything to jeopardise the FA’s membership of UEFA or the participation of English teams in UEFA competitions.

[Lord Parkinson of Whitley Bay (Con)]

I am a little disappointed by the Minister’s reply to my noble friend. An important point to bear in mind is that we are not probing just the Government’s intentions, and the Minister has been very clear that it is not the Government’s intention to put in peril English clubs’ participation in international tournaments. However, the risk is that the independent regulator—ironically, as it is more independent from Government and able to do things—could take us into areas that do jeopardise that. The Government have made some changes to the Bill to try and satisfy concerns raised about its independence from Government, and we will touch on those, but I know that they are trying to help. Can she address the distinction between the Government’s intentions and actions, and what the Bill does in bringing about an independent regulator that can, through its actions, inadvertently lead to some of the jeopardy raised by noble Lords?

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[Baroness Twycross (Lab)]

As per the FA articles of association, the FA is established to promote and govern the game of association football. This Bill will not affect the FA’s ability to do that independently without undue influence, so it will not breach UEFA and FIFA statutes as they are currently drafted. The FA gave all evidence to this effect to the Committee in the other place, during the passage of the previous Bill.

[Lord Moynihan (Con)]

My Lords, I am very grateful to the Minister for what I am sure is a completely genuine and committed response to the many points that have been made. However, I hope she will understand that it worries this Committee to hear that fans might be alarmed by something, so we must not show it to them”.

[Baroness Twycross (Lab)]

That is not what I said. My point was that this conversation and this debate may be alarming, and I believe it is unduly alarming to fans, although nothing in this Bill would preclude us from international games, whether that is English clubs or the national team.

[Lord Moynihan (Con)]

I am sorry, but the Minister was very clear in her response to my noble friend that the publication of the letter might cause alarm, and that that was one of the reasons why it was not to be published. If I misunderstood, I apologise to the Minister, but I would simply say that, if there is no alarm from the letter, why not publish it? Why not place the letter in the House of Lords Library so that we can review it?

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Monday 2nd December 2024 Lords Chamber

[Lord Parkinson of Whitley Bay (Con)]

I thank the noble Lord. My noble friend Lord Hayward said that he did not much like it either, but it is helpful that my amendment has been grouped with the other amendments, which are seeking to give a bit more precision than the two short lines that are in the Bill. As I said in moving my amendment, my contention is that they do not go far enough to define what “sustainability” means in practice, which will be important for the regulator looking at it.

I am grateful to my noble friends, particularly my noble friend Lord Markham, whose Amendment 13 proposes a few tangible benchmarks through which sustainability can be measured. It suggests inserting criteria, including increasing TV viewership, increasing match attendance, improving international sporting competitiveness and increasing the overall income generated. They are all very tangible and specific. I hope that the noble Lord, Lord Watson, will prefer them and I look forward to hearing what the Minister has to say about them when she responds.

Criteria such as those would provide a far more accurate and reliable understanding of the sustainability of English football. As my noble friend Lord Markham said, we all want to make sure that we are helping to deliver that with this Bill and to give the regulator the clarity that it needs to uphold it. The Premier League’s television exports alone were worth £1.4 billion in 2019-20. If the Government are serious about growth and supporting the success of Great British success stories, the regulator must ensure that that growth trajectory goes only upwards. By basing the standards of sustainability on objective metrics, such as those that my noble friends Lord Markham and Lord Maude have tried to set out, football would surely benefit, and the regulator would have the clearer frames of reference that I think we are looking for.

As my noble friend Lord Hayward said, there is competition from a growing number of countries that are snapping at our heels. As the noble Lord, Lord Addington, reminded us, there is no divine right for football to continue to exist in the way that it does in this country. My noble friend Lord Hayward pointed out some of the sporting fixtures that have happened this weekend. I enjoyed the Qatar Grand Prix, although I thought that the 10-second penalty for Lando Norris was rather disproportionate, especially since no safety car and no virtual safety car were deployed. I mention that not to take us on to another sport but to point out the difficulties that happen when a regulator—in this case, the Fédération Internationale de l’Automobile—makes curious or contentious decisions.

Through the amendments in this group, we are seeking to give a clarity of purpose to the regulator, so that it can focus its important work on delivering the sustainability of English football in a way that matches what the Government have set out in their Explanatory Notes. For all the differences that have been expressed, I think that we are all united on that. But it is important that we give this extra precision and clarity, and I look forward to hearing what the Minister has to say.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank the noble Lords, Lord Parkinson of Whitley Bay, Lord Maude of Horsham and Lord Markham, for tabling their amendments and for the thorough discussion we have had. I look forward to the ongoing discussion on many of the points raised as we debate the Bill.

We do not think that the Bill, which is largely the same as the previous Government’s version, is flawed, as the noble Lord, Lord Jackson of Peterborough, suggested; nor do we think it leaves a lot to be desired, as the noble Lord, Lord Maude, suggested. We also do not think that it is an overreaction of the nature that the noble Lord, Lord Hayward, suggested. Indeed, we think it is what fans are looking for and what will bring sustainability to the game. I will get on to the definition of “sustainability” shortly.

Amendment 7, tabled by the noble Lord, Lord Parkinson of Whitley Bay, adds further detail to the definition of the sustainability of English football. I am pleased that he noted the definition on page 2, which does indeed define sustainability in the Bill. All the aims of the amendments are laudable. However, I assure the noble Lords concerned that the detail that has been added, in particular by Amendment 7, is largely implicit in the current definition of the sustainability of English football. So, while the noble Lord might suggest that the definition is, in his words, short and unsubstantial, I would argue that it is sufficient. The wording is that which was adopted in the noble Lord’s Government’s iteration of the Bill.

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[Lord Jackson of Peterborough (Con)]

I hear what the Minister says and I am grateful. However, she will have read the Delegated Powers and Regulatory Reform Committee report dated 22 November. We know that sustainability is not explicitly defined. We know that fans are not explicitly defined. As was said on our first day in Committee,

“the meaning of English football is deliberately left unclear on the face of the Bill … The answer will emerge only after the Bill is enacted, when the Secretary of State makes regulations to fill in the definitional gap left in the meaning of ‘specified competition’. As a result, the remit of the new regulator is presently unclear”.—[Official Report, 27/11/24; cols. 720-21.]

Does she not agree that this is why it is important to tighten up that situation—that lacuna—in the Bill, so that the regulator has a firm sense of direction in how it proceeds?

[Baroness Twycross (Lab)]

That is a matter that I am sure we will discuss at greater length when we come to a longer discussion on secondary legislation, but I am happy to talk to the noble Lord outside this Chamber at further length.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I am grateful to the Minister for her reply. There were two things that I scribbled down as she said them. The first was that the definition—the extra detail of sustainability—is implicit in the Bill. That really gets to the nub of the debate we have just had. We think leaving it implicit for the regulator causes some problems. If the wording—albeit not to the preference of the noble Lord, Lord Watson of Invergowrie—is something that the Government are happy to set out in the Explanatory Notes, why can we not make it a bit more explicit in the Bill to give the regulator more clarity? That is what the amendments in this group have sought to do, and the Bill would benefit from being made more explicit rather than left in the implicit way that the Minister set out.

The Minister also said that the regulator is being set up to deal with football’s sustainability problem, and that football has no growth problem, at least at present. Our concern is that seeking to address the former problem in the way the regulator goes about its work, particularly if it is left to do it implicitly, risks football’s continuing success in the growth category and in other ways. That is why we have given this such detailed scrutiny. However, I am grateful to her for her response, and I beg leave to withdraw my Amendment 7.

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[Lord Parkinson of Whitley Bay (Con)]

I will not prolong the discussion any further; it is important that we hear from the Minister instead. As we do so, I hope that we hear from her on the tension between the need for flexibility, which I understand, and the need for clarity so that the duties on the clubs, which are successful businesses, and on the regulator, which is a powerful new body, are also specified. We need that so that everybody, when they follow the Bill when it becomes an Act of Parliament, is clear on what they have to do, whether they are speaking to the fan group of the noble Lord, Lord Mann, or another about each of those duties.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Parkinson of Whitley Bay, Lord Markham and Lord Addington, and my noble friend Lord Watson of Invergowrie for tabling these amendments and for the thorough discussion on this group. There is an amendment in a group specifically on clubs playing overseas, which I will come back to during a later stage in the Bill’s progress. I have been told by my noble friend the Chief Whip that I should not comment on gobstoppers, as tempting as it is to do so.

I am glad that we all agree on the importance of fans to the game. The Bill also recognises that importance. As noble Lords are aware, it is based on the fan-led review, so it should have fans at its heart. I suspect that we will never get full agreement on how we should define a fan or group of fans—we have seen that in the debate on this group. However, I welcome the point made by the noble Lord, Lord Birt, that—to paraphrase—there is quite a lot of agreement on this element, so noble Lords are at risk of debating something that, when it comes down to it, many of them will agree on.

The noble Lord, Lord Parkinson of Whitley Bay, tabled an amendment that would look to add further detail to the definition of the sustainability of English football. I reassure him that both prospective and current fans would be considered in the existing requirement. As he will be aware, this is in line with the Bill introduced by the previous Government in which he served. Football would not serve the interests of fans if the game were unattractive or unwelcoming to new fans. As the Explanatory Notes to this clause clarify, continuing to serve the interests of fans

“means meeting the needs of present fans without compromising the ability of future generations of fans to enjoy and benefit from the club”.

Amendment 9, in the name of the noble Lord, Lord Parkinson, looks to remove the specific reference to “local” communities from the definition of the sustainability of English football. One of the best things about football in this country is that it fosters community. I welcome the passionate defence of local fans made by the noble Lord, Lord Goddard of Stockport. This is something that noble Lords from across your Lordships’ House recognised and spoke passionately about at Second Reading, and we wish to protect it.

The local area surrounding clubs can often develop communities and economies dependent on the football club. It is important to recognise that not all communities are grounded in the local area. As noble Lords have mentioned, they can be online, far-reaching and even international. These communities are also important, as was highlighted by the noble Lords, Lord Goodman of Wycombe, Lord Maude of Horsham, Lord Hayward and Lord Moynihan of Chelsea.

The noble Baroness, Lady Brady, mentioned international flights. I understand that such is the Norwegian enthusiasm for football that weekend flights are scheduled to allow fans to travel to watch UK games. However, as communities become less rooted in the local area or directly related to the club itself, it would be harder for the regulator to control or even predict how its actions may influence their economic or social well-being. We do not want the regulator to be set up to fail because it cannot feasibly meet its statutory purpose. If the regulator were required to consider more detached and far-reaching communities, it might never be able to completely deliver a sustainable English football.

We should also remember that it is often the local communities that are most vulnerable and can suffer most directly from any crisis at a club. As my noble friend Lady Taylor of Bolton made clear, the locality matters. We have seen in places such as Bury and Macclesfield the hole that is left in the local community, including the economic impacts, social impacts and job losses. None the less, the regulator must of course consider the impact of its actions on the wider community of fans. That is why the Bill’s purpose, as drafted, includes English football serving the interests of fans, with no requirement that those fans are “local” to their club.

The noble Lord, Lord Parkinson of Whitley Bay, appeared to conflate how fans and communities are defined. I want to be very clear that, while Clause 1(3)(b) specifies “local communities”, Clause 1(3)(a) does not specify that it applies only to local fans. So, the noble Lord’s points on Manchester United fans in Weymouth would still be considered in this definition of “sustainability” as it pertains to fans.

On Amendment 17 in the name of the noble Lord, Lord Markham, I understand that its intention is to set in the Bill a definition of what makes someone a football fan. His amendment draws on the Explanatory Notes. I welcome the perspective of the noble Lord, Lord Finkelstein, as a member of the committee on the fan-led review. For a definition of a fan to be in primary legislation, there is a significant risk of unintended consequences that it will end up being either so loosely defined that it lacks precision or too narrow that important and passionate fans are excluded from engagement. I know that noble Lords from across the Committee would not wish to exclude any passionate fan from the engagement that the regulator intends clubs to carry out. This is because the make-up of a fan base will differ from club to club. It is this diversity that makes English football so special.

In our view, there is also likely to be the need for clubs to be able to consult different groups of fans on different issues. For example, on ticket prices, we would reasonably expect that clubs may wish to focus on consulting regular, match-going fans. However, on stadium relocations, we might expect them to consult a broader group of fans from across the community. From my engagement with Members from across your Lordships’ House, I know that there are many different views on the definition of a fan. Indeed, there are probably as many definitions as there are Members in this debate, if not many more. Therefore, although I understand the desire for more clarity, I am extremely reluctant for the Government to provide a specific definition that would be limiting.

The Government do not see themselves as the arbitrator of who counts as a football fan; instead, it is something that fans and clubs themselves will be in the best position to understand and discern. The regulator, once established, will be able to provide guidance for clubs on how to best consult fans, rather than be bound by an inflexible and potentially unhelpful definition. This will ensure that clubs have an appropriate framework in place that allows them to meet and consult fans regularly on key strategic matters and supporter interests, utilising pre-existing fan structures and other engagement mechanisms.

As Amendment 17A in the name of my noble friend Lord Watson of Invergowrie demonstrates, there are multiple ways in which others may define a “fan”, all of which would capture vastly different groups. At some clubs and on some issues, the definition as set out in the amendment may be sufficient, but for others there could be large numbers of dedicated fans, including the noble Baroness, Lady Jones of Moulsecoomb, who would not be captured if the club considered only season-ticket holders. I agree with the noble Baroness, Lady Brady, that this would be too narrow. For example, it would mean that those unable to attend matches as a season-ticket holder due to reasons of finance or health, or due just to their lack of luck in a ballot, would be excluded from the consultation. My noble friend Lord Mann noted the waiting list for season tickets. As a Labour Government who think that financial criteria should not exclude people of limited financial means, we feel strongly that the emotional commitment highlighted by the noble Lord, Lord Addington, should take precedence over any financial ones. This demonstrates the need for nuance and discretion in the definition, which clubs and the regulator are in the best position to arrive at.

On Amendment 26, the noble Lord, Lord Addington, is right that the regulator would have an important role in ensuring that clubs understand and meet the fan engagement requirements placed on them. The Government agree, and they expect that the regulator will need to produce guidance to provide more detail and information on who to engage with, and how, to meet these conditions. However, it is important to understand that, for the most part, individual clubs will be in the best position to understand the demographics of their fans, with significant variation between clubs. There is a risk that the amendment could inadvertently place a limit on fan engagement and limit clubs to meeting only those who are members of an official fan body. Many fans will not be part of a formally constituted body; that does not mean that they should not be represented. For example, if a club is seeking to move ground or make changes to home shirt colours, a wide range of fans should be consulted and not just a formally constituted body. The Government have designed the legislation to allow for a bespoke approach to fan engagement shaped by the regulator’s guidance, an approach that the previous Government also supported.

However, although many clubs will be best placed to discern who they should engage with, if it is felt that a club is misusing this to select only agreeable fans or to exclude another group, the regulator can and should intervene. As is made explicit in paragraph 272 of the Explanatory Notes, the regulator can take action in such instances and will be able to specify how any representative group of fans should be engaged or informed. As I said at the start of my response, I am delighted that there is so much support across your Lordships’ House for fans being at the heart of the Bill and the debate. It is a theme that we will no doubt return to on many occasions, and I look forward to future discussions. However, for the reasons outlined, I am unable to accept the amendments from my noble friend and the noble Lord and ask that they do not press them.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I am grateful to the noble Baroness for her response. In relation to my Amendment 8, I have been in her position of having to explain why, while agreeing with the spirit of an amendment, the Government are not minded to put it in a Bill. However, if she says that the Bill is about current and prospective fans, as my amendment seeks, why not say it in the Bill? I hope that between now and Report she might reflect a bit further on that.

Regarding my Amendment 9, the Minister said that I had conflated the issue with fans. After the slightly confusing debate that we had, it is not unreasonable that she thinks I might have done. Perhaps it was unhelpful to have grouped these amendments together and to have had one debate on them. However, I am clear that Clause 1(3)(b) relates to communities and not to fans. The question that I am asking is whether, as we work towards the sustainability of English football, we should limit our ambitions to the economic and social well-being of local communities that stand to benefit rather than our community more broadly? For the sake of clarity, I wanted to de-conflate those. I am not sure that we have quite cracked this matter but, for now, I beg leave to withdraw my amendment.

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Those two amendments seem to be the more attractive in the group, but that is the reason why I have not added my name to any of the amendments here and am not persuaded by the case that has been made.

[Baroness Twycross (Lab)]

I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton, the noble Lord, Lord Addington, and the noble Baroness, Lady Jones of Moulsecoomb, for raising the very serious issue of environmental sustainability and how it relates to the regulator. These are issues of considerable concern, not least with the shocking storms we have seen recently and the change to weather patterns over the past few years. The impact of the climate emergency on all aspects of our lives is very real.

In response to these amendments, I would like to make clear that the Government are absolutely committed to environmental sustainability. One of the Prime Minister’s five national missions is to accelerate the transition towards clean energy and ensure the UK fulfils its legal obligation to reach net-zero emissions by 2050. As a huge part of our national life, all sports, including football, have an important role to play in this transition. The Government expect authorities across this sport and across all sports to be working together to advance environmental sustainability.

A point made eloquently by the noble Lord, Lord Deben, is that we have to be able to justify the view we take now to future generations. This is true. The noble Baroness, Lady Jones of Moulsecoomb, made an interesting point on placing this requirement within the Bill. However, while I entirely support her views, we do not feel it is right to add environmental sustainability to the purpose of the Bill. As the noble Lord, Lord Goodman of Wycombe, highlighted, this Bill is acting only where industry has shown it is not capable of resolving matters itself and statutory regulation is the most effective way of tackling any market failures.

I would, however, be happy to discuss further with the noble Baroness how we can use good examples of football clubs already acting on the climate change emergency and spread best practice. What I would stress, when noble Lords are discussing something so important both nationally and internationally, is that noble Lords are still debating the very purpose of the Bill. The areas specified in the purpose of the Bill are based only on issues that English football has clearly shown itself to be unable to self-regulate and to risk clubs being lost to their fans and local communities.

By contrast, football has already demonstrated the ability to take action on the environment: for example, the Premier League’s new minimum standard of action on environmental issues across both the clubs and the league. I welcomed the examples given by the noble Baroness, Lady Brady. The noble Baroness, Lady Jones, and my noble friend Lord Bassam described some interesting measures when describing the work of Forest Green Rovers, but this is clearly only a starting point on which future initiatives must build. Football authorities must take more proactive steps to accelerate their own environmental initiatives. However, it is within the gift of leagues, clubs and other authorities across the game to do so without government intervention.

We must also be wary of scope creep and unintended consequences. The addition proposed in Amendments 11 and 15, in the names of my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton, would potentially add burden and cost to the regulator, as well as potentially limiting its ability to carry out its main objectives. Therefore, while I acknowledge the importance of this issue, as I have set out, we do not feel it is right to add environmental sustainability to the purpose of this Bill.

I look forward to further discussions on how we can best promote environmental sustainability within the game. However, for the reasons I have set out, I hope the noble Lord will withdraw his amendment.

[Lord Bassam of Brighton (Lab)]

My Lords, I think it has been of great value to have this discussion and debate on the notion of environmental sustainability in the football industry, which is a very responsible industry actually. I take heart from the examples that the noble Baroness, Lady Brady, gave of the Premier League’s initiatives and those from the noble Lord Parkinson.

It seems to me that this is an important issue for football. All the other regulators seem to have an environmental purpose as well. I have looked at the Financial Conduct Authority, Ofcom and even the Pensions Regulator, which you might think is a million miles away from being a regulator interested in sustainability. They all have environmental statements and purposes as part of their work.

I think the football business is making progress in this space. I want to see it making more progress, perhaps with a more level playing field. It seems unfair that some clubs leap ahead and leave others behind. Forest Green Rovers, although a small club and in the fifth tier of football, has led the way for some years and I think it only right that we encourage other clubs to do the same, whether that is through the regulator or by applying environmental legislation more generally.

I look forward to the invitation to have some more discussion on this point but, for now, I beg leave to withdraw the amendment.

--- Later in debate ---

[Baroness Twycross (Lab)]

I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton, the noble Lord, Lord Addington, and the noble Baroness, Lady Grey-Thompson, for raising these important issues around corporate and social responsibility and duties to facilitate training. It has been an interesting debate and I had particular sympathy for the points raised by the noble Lord, Lord Goddard of Stockport. I will, however, take their amendments in turn.

First, on Amendments 14 and 245 from the noble Lord, Lord Addington, the Government acknowledge football clubs’ central importance as community assets and their role in communities. However, this amendment would expand the scope of the regulator beyond sustainability and the Government do not believe that social responsibility is an issue where statutory intervention is necessarily justified. We believe that the regulator should be tightly focused on areas of critical need, addressing genuine market failures as exposed by the fan-led review. What is more, mandating how clubs should approach community funding could discourage their pre-existing work, crowding out some of the great initiatives already taking place.

On Amendments 90 and 247 from the noble Lord, Lord Addington, opportunities for training at amateur and community level and for women are vital. They support the next generation of English football and are crucial in getting more women into football. I speak as someone who was not allowed to play football as a girl in school, so I strongly believe in those opportunities being available. The Government are committed to supporting these opportunities. This is why we are continuing to fund the work of organisations such as Sport England and the Football Foundation and welcome work already being done by the game itself, as highlighted by the noble Baroness, Lady Brady. However, such training opportunities, and the women’s game more broadly, are not within the intended scope of the regulator.

On the regulator’s role in relation to whether it should require clubs to facilitate training for young women and girls, the regulator has a tightly defined scope: to promote financial sustainability and resilience in English football. The regulator will also be focused on the men’s game at the outset; women’s youth training is therefore beyond its core remit. However, the Government acknowledge the importance of football training to the future of football and are committed to funding organisations such as Sport England and the Football Foundation. The football industry also understands its importance, as was noted during the debate, funding numerous initiatives through the Football Foundation and the Premier League Charitable Fund. It is therefore the Government’s belief that the regulator would be an inefficient way to support women’s youth training. Further collaboration with the industry is, in our view, the most effective way to invest in England’s football future.

The noble Lord, Lord Addington, made a point about whether we should require the regulator to facilitate amateur and community training and development. That is an appealing proposal, but the regulator has a tightly defined scope in its objective—to promote financial sustainability and resilience in English football—therefore training and development in this regard is beyond its core remit. However, the Government acknowledge the importance of football training, as I have highlighted, to the future of football. In our view, collaboration with the industry and funding through the spending review is the most effective way to invest in English football’s future. I am happy to discuss both those points with noble Lords outside the Chamber before our next Committee date. As with the noble Lord’s other amendments, the amendment under discussion would expand the scope of the regulator beyond sustainability and into areas in which the Government do not believe that statutory intervention is justified.

On Amendments 151 and 165 in the name of my noble friends Lord Bassam and Lady Taylor, corporate responsibility is an important part of any business, and it is no different for football clubs. However, this addition to the mandatory licence conditions would impose more prescriptive burdens and regulations on clubs. On the content of the proposed condition, we do not feel it is right to add environmental sustainability and the societal impact around clubs to the purpose of this Bill. As I set out, the regulatory scope will focus on issues that football has clearly shown it is unable to address through self-regulation and which would pose a threat to the continued operation of football clubs.

On equality, diversity and inclusion, it is right that football clubs should be more transparent about what action they are taking on this issue. That is why we have included equality, diversity and inclusion in the corporate governance condition, which will mandate clubs to report on what action they are taking on this issue. We expect the regulator to produce guidance on the specifics of what this will entail, in consultation with the industry. We do not think it is right to put such detail on the face of the Bill.

The noble Lord, Lord Addington, and the noble Baroness, Lady Grey-Thompson, highlighted player welfare and the duty of care. The Government will discuss player welfare with the leagues, the FA and the PFA to drive action on this issue. We will continue to urge competition organisers to work together to develop a consistent programme of support which allows academy players to access an offering of independent support and advice when required. This is very important.

Many, if not most, clubs already have a positive impact on their local community, a number of examples of which have been provided. We do not believe that the regulator should be attempting to micromanage clubs in this area. However, relevant safeguards are in place in the Bill to stop a club harming the heritage and community of the club.

While I understand and strongly endorse the intention behind the noble Lord’s amendment, for the reasons I have set out I am unable to accept it. I therefore hope that the noble Lord will withdraw his amendment.

[Lord Addington (LD)]

My Lords, the noble Baroness, Lady Brady, made that the most positive rejection of an amendment I think I have ever received; I thank her for that commitment. Although I would have preferred it, as my noble friend Lord Goddard put it, to be something that “must” happen, the Premier League saying that they will do this is a pretty good second.

It would be good to arrange a discussion and to say that the outreach work beyond football could go to groups who do not normally think that football has anything to do with them. Some groups already do this, and that is the essence of running voluntary groups. It would be a very big step forward and, if the Premier League are prepared to do it, more power to their elbow.

I understand the idea of focus. I did not mention the amendments in the name of the noble Baroness, Lady Taylor, because I knew she would do a better job herself. I do not think we have quite captured in this Bill the social responsibility inherent in football’s role. We should have another look at this issue, because we may just be encouraging others to do the heavy lifting.

There is something about football. It has a nationwide pattern of facilities which can reach all these local communities. There are very few who would not be reached by football. It does not reach everywhere—some places in the countryside may not be affected by a local club’s activity—but it reaches most people, including virtually all the major population centres.

I hope that we can go away and have a little think about how to give a few more nudges to these positive responses. Having said that, and in thanking all those who took part in the debate, I beg leave to withdraw the amendment.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Monday 2nd December 2024 Lords Chamber

[Lord Parkinson of Whitley Bay (Con)]

I am grateful to the noble Lord for his intervention and for mentioning that. The point remains that it would be beneficial for us to look at that report on the way in which the FCA is doing its work to see whether it is doing what Parliament asked it to do when it was set up and to see whether we agree with the points that the all-party group, of which he is a member, made in its recent report.

As a number of noble Lords from across the House have said in our debate on this group, the amendment simply requires the regulator to have regard to the risks inherent when regulating a large industry such as football. I am grateful to my noble friends Lord Moynihan and Lord Maude of Horsham for the benefit of their considerable expertise and to my noble friend Lord Hayward for going so forensically through the impact assessment published by the Minister’s department.

My noble friend Lord Jackson’s Amendment 16 represents another guardrail for the regulator to use to focus its attention when exercising its functions. It would complement some of the other amendments that I have tabled and which we have been looking at. Such simple insertions of text into the Bill may be criticised as unnecessary, but they are important. The language that we use when establishing in law new public bodies and new regulators is of supreme importance. It creates a starting point from which that body will grow or change and be investigated by all-party groups and Select Committees. What that starting point looks like and how it is clearly defined has the potential to shape its future trajectory. We are looking at a regulator we hope will do its work very successfully for generations to come. Surely, we want that trajectory to enable future growth and innovation—future visionaries—and to remain free from mission creep and expansion into areas which we do not want to see it moving in.

The proposed model of regulation in the Bill will require the frequent submission of reports and financial plans. These will, as per the licensing conditions and as per our debate on this group, all have to be approved before a regulated club is granted a licence and are a condition for it maintaining that licence. The monitoring and collection of that information will naturally require a large number of staff to help comply with the new regulation. Added to the costs of the levy, this could have damaging effects on regulated clubs—damaging effects, as my noble friend Lord Maude of Horsham and others powerfully set out, that would be felt most keenly by those at the lower end of the pyramid.

That is also particularly evident in the provisions in the Bill that require clubs which are no longer regulated, by virtue of their relegation, to continue to comply with the duties set out. Part 5, for instance, states that some of these duties will be applicable for up to 10 years after the club has been regulated. This ratchet effect means that clubs could still be required to submit a whole host of information to the regulator, even when they have diminished resources because they have dropped below the lower limit of the regulatory ambit envisaged by the Bill. I hope that we can all see the potential for harms here and the risks of those harms growing.

I am grateful to the noble Baroness, Lady Taylor of Bolton, for drawing the Committee’s attention to her Amendment 72. We should all take a careful look at it in light of the debate that we have had. We will touch on it when we come to that group later on, but I appreciate that it is an attempt to make that sort of regulatory burden easier on clubs. When we come to it, I will ask her more on how her amendment envisages the regulator potentially paying some money to clubs. I will be interested to hear her set that out, but that is for another group.

Football is not only an extremely popular pastime but a vital part of our economy, and the financial health of clubs has to be protected, as my noble friend Lord Jackson’s Amendment 16 seeks to do. By mandating a thorough assessment of the financial implications of the new regulator’s regulatory actions, his amendment would guarantee that clubs’ sustainability would never be overlooked in the pursuit of regulation or reform.

The requirement for regular reports to be submitted to the Secretary of State and laid before Parliament would add to the Bill’s parliamentary oversight, which it currently lacks. It would enhance the transparency of the new regime that we will be bringing in through this law and allow for prompt corrective action, if needed. That is an approach which aligns perfectly with Conservative values, but one which I hope would garner support from every corner of your Lordships’ House. As my noble friend Lady Brady has reminded us, the Prime Minister has recently spoken, to my mind encouragingly, about the risks of overregulation and the need for growth. I hope that these points will resonate with the Benches opposite and with the Minister too.

My noble friend’s amendment seeks to safeguard the future of football while maintaining accountability to Parliament. I know that he would have tabled an amendment such as this if we were still in the last Parliament. If I had found myself at the Dispatch Box opposite, I would have been responding to it. I must say that I would have looked very favourably on it. I think it seeks to strike the right balance between regulation and the economic vitality and viability of football clubs. I hope the Minister will look favourably on it as well.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank the noble Lord, Lord Jackson of Peterborough, for tabling this amendment. I also particularly welcomed the personal account of the noble Lord, Lord Moynihan. I thank all those who contributed, including the noble Lord, Lord Maude of Horsham, who has considerable expertise in regulation. The description from the noble Lord, Lord Birt, of the benefits of regulation, including a strong board and what advantage that might bring, was particularly helpful.

In response to the noble Lord, Lord Goodman, we will cover the scope of specified competition in the next group, so your Lordships’ Committee will come to that shortly.

The amendment seeks to add an explicit requirement for the regulator to have “due regard” to the potential economic harms of overregulation and to report on this. It is an important point to be aired, and I welcome the opportunity to respond to the concerns the noble Lord has. I absolutely agree that overregulation is something to be avoided. It is why the regulator’s general duties and regulatory principles provide sufficient safeguards to prevent this.

The regulation ensures that the regime is proportionate. In particular, Clauses 7 and 8 emphasise the need for the regulator to act in a way that avoids, as far as reasonably possible, adverse effects on investment and competitiveness, and that it should act proportionately.

The noble Lord, Lord Jackson, asked about overregulation and was echoed by the noble Baroness, Lady Brady. The regulator’s general duties require it to have regard to how regulation might affect, among other things, financial investment in English football. Its regulatory principles clearly state the importance of advocacy and the need for the regulator to engage with stakeholders. It must act, as I said, in a proportionate manner. All these measures provide a safeguard against overregulation.

The noble Lords, Lord Hayward and Lord Maude, asked about burdens or potential costs on small clubs and the risk of disproportionate burdens. In addition to the explicit regulatory principle guiding the regulator to be proportionate, the entire system has been designed with this proportionality in mind. For example, the licence conditions placed on clubs will vary depending on their unique circumstances. Where clubs are smaller or lower-risk, the regulator’s requirements will reflect this. This means that the regulator will not impose unnecessary burdens on smaller or already well-run clubs.

[Baroness Brady (Con)]

A comment was made about there being no concern for costs outside the Premier League. However, Mark Ives, the general manager of 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. We are worried about mission creep within the Bill and the additional bureaucracy. There is a lot of duplication of work, such as the licensing system—there’s an expectation for clubs to do two lots of licensing”.


Dagenham & Redbridge chief executive officer, Steve Thompson, said:

“We are worried that the Bill will be so onerous. Some National League clubs work on two or three people and some volunteers … It does really worry me that some of our small clubs will not survive with the regulation and the reporting that is required”.


There may be a proportionate cost, with clubs in the Premier League from the top down paying proportionately but, whatever the cost, there is concern throughout the leagues.

[Baroness Twycross (Lab)]

The noble Baroness raises a particular concern. I am not suggesting by any means that people will not need time to get used to and understand the burdens or costs on smaller clubs but, as I felt I had outlined, I hope that, with enough clarity, the licence conditions—that includes the costs placed on clubs— will vary depending on their unique circumstances. I am sure we will have further opportunities to discuss that as we go forward. Hopefully we can give your Lordships’ Committee and the clubs some reassurance on that point.

[Lord Hayward (Con)]

To follow up on the Minister’s comments and the observations made by the noble Baroness, Lady Brady, given the detail that is included in the impact assessment on every other category of cost and benefit, and even though I find some of the calculations dubious, to say the least, at the next sitting of this Committee can we have a clearer indication of the likely proportionate costs which will fall on clubs at different levels in the pyramid, rather than some broad, general observation that it will be proportionate?

[Baroness Twycross (Lab)]

The noble Lord will be aware that a lot of this detail is being worked out by the shadow regulator. I can ask for that detail. I cannot give the noble Lord explicit clarity on that tonight but I will endeavour to get a clearer answer for him before the next sitting. That may, however, not include the level of detail that he requests.

To return to the amendment in question, the duties in Clause 7 are fairly novel for a statutory regulator. These bespoke duties acknowledge the specific market features that are key to the continued success of English football, such as investment and competitiveness.

[Lord Moynihan (Con)]

The Minister just referred to competitiveness. Some 14 clubs in the Premier League are multi-club ownership structures. Will the regulator be able to take into account the financial strength or otherwise of other clubs in the ownership structure of those 14 clubs? For example, with Jim Ratcliffe and INEOS at Manchester United, in providing a licence to Manchester United, will the regulator take into account the financial strength or otherwise of Nice and Lausanne—two other clubs which INEOS has an interest in—or is the regulator specifically and only to look at the English clubs? If it is the latter, is there not a risk of capital flight away from Manchester United in those circumstances if, for example, a significant bond was to be required by the regulator to be put up for Manchester United?

[Baroness Twycross]

If I correctly understood the noble Lord’s point, I do not believe that clubs should be concerned about that particular instance. We will be discussing licences and licensing conditions in a later group so, with your Lordships’ indulgence, if we could wait until then, that would be appreciated.

The amendment would also require the regulator to submit a report on its effects on the financial position of regulated clubs. I reassure the noble Lord that the Bill already includes comprehensive reporting requirements on the regulator—for example, the “state of the game” report and the regulator’s annual report to the Secretary of State, which must be laid before Parliament. These reports would of course be expected to include an assessment of the regulator’s own impact on the market. In our view, the intent of this amendment is therefore already achieved in the Bill.

The noble Lord, Lord Moynihan, asked whether we are risking jeopardising English clubs’ involvement in international competitions. As I reiterated during the last debate, the Government are confident that the Bill and the regulator will not breach the statutes of UEFA and FIFA. This Bill will constitute the business regulation of football clubs in this country; it will not constitute interference in how the FA, or any international body, governs the game. For the reasons I have laid out, I hope the noble Lord will withdraw his amendment.

[Lord Markham (Con)]

The Minister will be aware that I made quite a few points on how the only thing a regulator can really do—the only shot in its locker—is to put in more deposits, and on the impact that would have on clubs in terms of that safety net. I perfectly understand that she may not be able to answer that question now but I would welcome a follow-up in writing, and perhaps we can arrange a meeting on it.

[Baroness Twycross (Lab)]

I am happy to meet the noble Lord to discuss it further.

[Lord Jackson of Peterborough (Con)]

I thank the Minister for her answer and I thank my noble friends and others for an excellent debate on my amendment. I hesitate to single anyone out, but the contributions of my noble friends Lord Maude, Lord Moynihan and Lady Brady showed their great expertise in different aspects of football, sport and regulation over the years. I make particular reference to the granular and forensic demolition of the impact assessment by my noble friend Lord Hayward, and the issue of the impact on small clubs that was alluded to by my noble friend Lord Goodman of Wycombe.

To come back to the noble Lord, Lord Birt, I see this amendment as complementary to good governance, because it is a pretty light-touch amendment. It is really a permissive oversight power—we will come back to it, of course, on Report—with timely regulatory audit and a sense check. The Minister may need to think about whether accepting this amendment, perhaps on Report, would detract from the substance of the Bill.

Football is full of amazing stories. I want to finish with a story about my own local team, which goes to the heart of the debate on this amendment, which is the nature of entrepreneurial endeavour in football—risk and reward. Darragh MacAnthony, a property entrepreneur, bought Posh, Peterborough United, at the age of 30, the youngest owner in the league, in 2006. In August 2007, he put a note in the programme at a football match which said, “I will deliver back-to-back promotions from League Two to the Championship by 2009”. He did it, with the help of my friend Barry Fry, who, of course, noble Lords know. The point is that I have to ask, looking at the Bill and at all its onerous implications in terms of regulatory impact, would Darragh MacAnthony have put his business on the line to buy Posh, to keep Peterborough United afloat and make it flourish as it has done for the last 18 years, had the Bill been in place? I very much doubt that he would.

--- Later in debate ---

[Lord Maude of Horsham (Con)]

My Lords, I want to pick up exactly the point that my noble friend on the Front Bench has eloquently started to unpack. It is my fault, but I had not thought about this aspect of hybridity until it was developed this evening. It seems that we have two mischiefs compounding on each other here. The Government are relying on secondary legislation to do something that could just as well be in the Bill, and the committee of which my noble friend is a very distinguished member—although whether junior or senior is not for me to judge—dealt with the Government’s purported reasons for not putting any of these things in the Bill in lapidary and devastating style. They knocked each of them down with casual ease.

The one reason, of course, that the Government did not put forward to the Committee, which the Minister—all praise and honour to her—has accepted as the principal reason, was that to identify the five top tiers in the pyramid in the Bill would have risked making it hybrid. However, the reason why we have a hybrid Bill procedure is quite specific. It is because, if you have a Bill that as well as having general effect has an effect on specific private interests, those private interests are entitled to a way of making their specific concerns directly clear to Parliament.

I remember 40 years ago, as a Whip in the other place, taking through the then Channel Tunnel Bill, which was a hybrid Bill, and a very Herculean effort it was, although it was well worthwhile. It was incredibly important that the private interests—many were affected by it—had the right to make their concerns known. Here we have one technique of putting something into secondary legislation which could easily be put in the Bill, and that is something which generally, in your Lordships’ House and in the other place as well, is generally deprecated.

Even worse is when the reason for putting it in secondary legislation is to suppress the ability of private interests—in this case, really important private interests, right the way down to the National League. There are way more than 100 clubs which, according to the Government, make up English football, which is an incredibly successful and important economic interest. We know, because the Government have said it, that those multiple private interests are the intended target for this legislation. So you have a parliamentary or legislative technique, which is to be deprecated in the first place, being used to frustrate a legitimate right of private interests, which have been identified by the Government as the proposed target for this Bill. Each of those two things on its own should be deprecated, but added together they should give the Government serious pause.

I sympathise with the Minister. She probably did not ask to be put in charge of this Bill and it must have looked like it was going to be quite straightforward, because my party’s Government mistakenly came up with the idea in the first place. It must have seemed like it would be a bit of a doddle to take it through; I am sorry for her that it has not turned out like that but, in every debate we have, something else comes up.

We are not playing games. We are talking about something really serious and important, which affects a lot of people’s lives and economic livelihoods. We are seeing more issues arise; as every layer is peeled away, something else emerges that gives us serious pause. So I urge the Minister to take this back to her department and colleagues and say that it is time to look at it again.

[Baroness Twycross (Lab)]

My Lords, before I respond on this group, I would like to say that I am absolutely delighted to be taking this Bill through Parliament. If somebody had asked me even six months ago if I thought I was going to have an opportunity like this, I would have doubted them, so please do not feel sorry for me in any form. I am delighted to be taking forward this Bill. I thank the noble Lords, Lord Moynihan and Lord Parkinson of Whitley Bay, and my noble friend Lady Taylor of Bolton, for their amendments to Clause 2.

I will start with Amendment 18 in the name of the noble Lord, Lord Moynihan. It is the Government’s view that the current definition of “team” is sufficient and that the definitions in Clause 2 already work as intended. Which clubs are regulated will be determined by which competitions are specified in secondary legislation, as noble Lords have noted. If those are initially men’s competitions only, as the Government currently intend, only clubs that operate men’s teams will be regulated. Restricting the definition of “team” in statute to men’s teams would not only limit the Secretary of State’s ability to bring the women’s game into scope in the future if it were deemed necessary but send the wrong message to all those girls and young women who play football about the value we place on their contribution to the sport.

The noble Lord, Lord Moynihan, asked what would need to happen for us to see women’s football brought into scope in the future. As he referenced, the Government do not believe that the case for statutory intervention has yet been met in women’s football. It should be given the time, space and opportunity to grow and self-regulate. If in the future it becomes clear that women’s football is suffering from a sustainability problem that the industry authorities have been unable to address, the Secretary of State will be able to conduct a formal review. This will of course include consultation with all appropriate parties. Based on that review, women’s football could be brought into scope.

Amendment 19 is in the name of the noble Lord, Lord Parkinson. I understand his desire to have upfront clarity in the Bill about which competitions will initially be in scope of the regulator’s regime. However, the amendment would significantly undermine the regulator’s ability to react to changes in the structure of the football pyramid in a timely manner.

The noble Lord, Lord Markham, questioned why we do not, for example, name the Premier League when it is obvious that it would be included. Names change, and we have seen the restructuring or naming of leagues, such as in 1992, when the First Division became the Premier League, and in 2015, when the Football Conference was renamed the National League. In such a scenario, failing to amend the scope in a timely fashion could result in the legislation becoming ineffectual and the regulator being undermined.

--- Later in debate ---

[Lord Parkinson of Whitley Bay (Con)]

Before the Minister comes on to that important point, could she say a bit more about what circumstances would need to change for the National League North and the National League South to be brought into scope in the Government’s view? The noble Lord, Lord Bassam, made a powerful case about the size of many of the clubs there and the very valid point, which I meant to echo in my contribution, that those are precisely the sort of teams the Government and their predecessors were both very concerned about in the thinking that led to the Bill—the sort of teams that play such an important role in their communities, that are sometimes more precarious than those at the top of the pyramid, and that, if they went under, would leave such a hole in their communities.

[Baroness Twycross (Lab)]

I am slightly confused because the noble Lord is going from being proportionate to now appearing to want us to bring in further—

[Lord Maude of Horsham (Con)]

My noble friend just needs to know why. I hope that the Minister will forgive me for saying so, but that is not a satisfactory response. The problem here is that there seems to be no rationale other than saying it is reasonable and proportionate. On what basis? What is the basis for saying that? Why is the line drawn there? It feels completely random; you could just as easily draw it one up or one down. But if there has been a decision, and clubs up and down the country now have to prepare themselves for the likelihood that the Bill will go through and they will become regulated licensed entities, it is important to know why the line has been drawn in this place.

[Baroness Twycross (Lab)]

My Lords—

[Baroness Taylor of Bolton (Lab)]

I am very grateful to my noble friend for giving way. Was it not said at some stage during the consideration of the predecessor Bill before the election that it would be a good idea if the regulator was up and running and got some experience of the regime being introduced before considering extending it?

A few minutes ago, we heard that Members opposite thought that this would be too great a burden on smaller clubs. So perhaps it is a good idea to consider when the time is right and what experience the new regulator will have.

[Baroness Brady (Con)]

It was the smaller clubs, as well as us, that said it would be a burden to them. I read out what the National League’s general manager said about his clubs and their concerns.

[Baroness Twycross (Lab)]

I will address the issue of why the regulatory regime is currently intended to be limited to the top five tiers of football and not to include the National League North and the National League South. The issues we are concerned with arise most typically and markedly in the professional game where the financialisation of clubs is greatest. We recognise that the top five tiers is not necessarily a perfect proxy for the professional game, since some semi-professional and professional clubs can move between these leagues. However, we consider it the most appropriate and proportionate place to draw the line and the place where it would not result in some clubs in the league being subject to regulation and others not. We do not currently believe that extending the scope beyond the top five tiers would be proportionate to the burden on smaller clubs below the National League.

On Amendment 19—and apologies if I am repeating parts of my speech, because it is some time ago that I was actually on my script—in the name of the noble Lord, Lord Parkinson, I understand his desire to have upfront clarity on the face of the Bill.

Turning to Amendment 21, I thank my noble friend Lady Taylor for putting forward this amendment. As I am sure my noble friend is aware, the Secretary of State would have the ability to specify competitions that are in scope of the regulator and we believe that the top five tiers is a sensible and proportionate place to draw the line.

In relation to the points on hybridity, questions of hybridity are for the examiners, not for the Government. If the amendment is made, there will be a process to be followed that will decide whether the Bill is hybrid and needs to go through the hybrid procedures. Initial advice is that the Bill would be thought to be hybrid and I understand that, following the tabling of Amendment 19 in the name of the noble Lord, Lord Parkinson, and Amendment 21 in the name of my noble friend Lady Taylor, issues have been raised about their hybridity.

The noble Lord, Lord Goodman, asked whether we had discussed with the Delegated Powers and Regulatory Reform Committee ahead of the process. We would not discuss committee reports with clerks before they draw them up.

I know that noble Lords want to continue to work constructively on the Bill—

[Lord Goodman of Wycombe (Con)]

I think my question was, in advance of the committee considering the Bill and the Government giving their reasons to the clerks for objecting to the Bill, why did they not then raise the matter of hybridity? Is it the Government’s position that raising the matter of hybridity just is not their business? If it is their business, why did they not raise it?

[Baroness Twycross (Lab)]

It is for the examiners, not the Government, to decide whether or not there is hybridity.

[Lord Maude of Horsham (Con)]

But it is for the Government to decide whether to incorporate something in a Bill that might make it hybrid. She has clearly taken advice which concluded that putting the explicit leagues on to the face of the Bill would make it hybrid. So there was clearly a decision based on that advice to exclude the specificity from the Bill and put it into secondary legislation. I repeat my noble friend’s question: why was that reason not given to the committee?

[Baroness Twycross (Lab)]

The primary reason, as I understand it—and it was clearly the previous Government who drafted the iteration of the Bill and the stage of the Bill that we are now at in our discussions is identical to the previous Government’s Bill—was that naming the leagues would mean that, if there was any change in the names of the leagues, there would be an issue in terms of the legislation, as I have outlined previously. I am happy to write to noble Lords on this point.

[Lord Parkinson of Whitley Bay (Con)]

I am sorry; I know this is frustrating. But this is a really important issue for the Bill and I think there is some confusion. During the debate on this, the noble Baroness very helpfully nodded to give a sense to the question—

[Baroness Twycross (Lab)]

It was hybrid—

[Lord Parkinson of Whitley Bay (Con)]

Let me just ask the question and then the Minister can clarify. Did she nod to agree to the suggestion that, if we had put the names of the leagues—which I seek to do in my amendment or which the noble Baroness and the noble Lord, Lord Bassam, seek to do in their Amendment 21—on the face of the Bill, this would make it a hybrid Bill, and the reason they are not in the Bill is to stop it being a hybrid Bill? That is what I think we think she was nodding to agree to earlier.

In the speech she has just given, she dismissed my amendment on the grounds that sometimes the names of the Premier League and the EFL and the National League change and that is the reason for doing it. That is a rather different answer from refusing to put it on the face of the Bill because it would make it a hybrid Bill. If allowing those leagues, those clubs, to have access to Parliament to make the arguments about the effects on their private interests and their business is the reason that it is not on the face of the Bill, I think they and this Committee need to know that.

[Baroness Twycross (Lab)]

I apologise hugely if my nodding at one point during the noble Lord’s comments meant that other things were inferred. It has reminded me of the dangers of nodding, whether you are nodding to indicate that you understand a point, or that you agree with a point. I was nodding was because 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. I hope noble Lords will accept my writing to them to clear up any other issues that might have been raised. I know they want to work constructively on the Bill to make sure that we put in place as soon as possible an effective and proportionate regulator that safeguards the future of our national game, which was a manifesto commitment by the three main parties. I look forward to discussing these amendments further, ahead of Report.

[Baroness Taylor of Bolton (Lab)]

Will my noble friend just clarify that this section of the Bill is identical to the one that was introduced pre-election?

[Baroness Twycross (Lab)]

Yes.

[Lord Parkinson of Whitley Bay (Con)]

With respect to the noble Baroness, Lady Taylor, that point is by the by. I had not appreciated the hybridity question until my Amendment 19 was tabled and the clerks advised me about it, as I am sure she had not in relation to her Amendment 21. It raises some fundamental questions. It is unfortunate that we have come to debate them at this late hour, and I am grateful to the Minister for undertaking to write to the Committee about this; I hope she will be able to do that before our next meeting.

We need to understand this point, because it is a further instance of democracy being denied—the limiting effect it has not just on the ability of both Houses of Parliament to scrutinise legislation, but on private citizens making representations to Parliament about the direct effect on their companies, businesses, clubs and organisations. I asked the Minister about Clause 91, which seeks to deny the right to use the hybrid powers so that they can make their views known directly. If we are going to go down the route that seeks to close this off not just in the Bill—in primary legislation—but in secondary legislation too, we need clarity on this before we go much further.

[Baroness Twycross (Lab)]

As I said, I will write to noble Lords on this point, noting that I know they want to work constructively on the Bill. I have a few more points to cover, so if I could continue without interruption, I will reply to anybody in writing if we need to.

On Amendment 25 in the name of the noble Lord, Lord Parkinson, I understand that delegated decisions of such importance as the scope of regulation should be made only after proper consideration and in consultation with all key stakeholders. This is exactly what has been done over several years of development of the Bill. It was carried out by the previous Government, in which, as has been noted, the noble Lord served, although I accept that we are bringing forward this legislation, so it is the Labour Government’s Bill now.

The initial intended scope of the Bill is built on a strong evidence base and extensive consultation with the industry, including a White Paper. Therefore, the Government do not feel it is necessary to require additional consultation before the first regulations are specified in scope in secondary regulation. This would impose unnecessary burdens on the industry and the Government and risk significantly delaying the regulator being able to implement its regime.

On the question that Clause 2 stand part of the Bill, I thank the noble Lord, Lord Moynihan, for giving notice of his intention to oppose this. As is standard procedure, the Bill sets out the key definitions used in this legislation. These are required to ensure that there is legal clarity throughout the Bill and to prevent confusion when looking to practically implement this legislation.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Wednesday 4th December 2024 Lords Chamber

[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.

--- Later in debate ---

[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.

--- Later in debate ---

[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—

--- Later in debate ---

[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.

[Noble Lords]

Hear, hear!

[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.

--- Later in debate ---

Given the importance of friendly relations with our partners across the Gulf and the diplomatic power of football, does the Minister still believe that was the right approach for the leader of her party to take? And if England was playing a match in Qatar tomorrow, would she go?

[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.

This is nothing to do with what I just said, but removing it from the Bill has the unintended consequence of not giving guidance to the regulator that it has to have due regard to foreign and trade policy objectives—that is now removed from the Bill—but allowing it to focus exclusively on the significant issue of influence. I simply put the point that the regulator therefore has no protection. Given that the regulator has to deem on influence, does the Crown Prince of Saudi Arabia, who has influence as chair of the PIF, which owns Newcastle, fall within the context of the regulation that this Government are putting before the House without the clause that was previously in the Bill? The answer is yes.

[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?

[Baroness Twycross (Lab)]

No, it cannot.

[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.

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[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.

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[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.

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[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.

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[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.

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[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.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Wednesday 4th December 2024 Lords Chamber

It is important to dwell on words as small as “may” and “must” and to think about the message that this sends to the regulator on the standards that we want to see it upholding as it discharges its duties—and the standards that it is seeking to impose upon the sport at the heart of these debates. I am grateful to the noble Baroness, Lady Taylor, for giving us this opportunity and giving the Minister the chance to respond.

[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.

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[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.

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[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.

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I hope that the noble Baroness will look carefully at these amendments and see that they are seeking to do the work of this Committee, which is to go through the Bill and find ways that we might be able to improve its work, so that we can all end up with a regulator that delivers on the objectives of the Bills that both of us have had the proud privilege of helping to bring to this point.

[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.

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[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.

[Noble Lords]

It is not!

[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.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Monday 9th December 2024 Lords Chamber

[Lord Pannick (CB)]

My Lords, it is important to remember that Premier League clubs are already extensively regulated by the rules of the Premier League. The problem is that those rules are made by the 20 Premier League clubs themselves. They are also regulated, as all football is regulated, by UEFA. I gave the example a few moments ago of financial fair play. The virtue of the Government’s proposals surely is that the regulation will be by an independent person. That is what is required. The defects of all the proposed amendments in this group would be simply to confine the discretion of the independent regulator to respond to circumstances as they arise.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

My Lords, I thank the noble Lords, Lord Maude of Horsham, Lord Jackson of Peterborough and Lord Markham, for these amendments, and the noble Lord, Lord Hayward, for introducing this group. I particularly welcome the contribution of the noble Lord, Lord Pannick, which reminds us of why we are here.

Starting with Amendments 51 and 52, tabled by the noble Lord, Lord Maude of Horsham, I understand that their aim is to clarify that the regulator should only intervene where necessary and in response to substantial risks. I assure the noble Lord that this aim is already appropriately achieved by the Bill. As the noble Lord, Lord Addington, said—and apologies if I paraphrase this incorrectly—this is about ensuring a sound financial basis for football. It will be for the regulator to identify risks to a club’s financial soundness or the financial resilience of the system and to act accordingly. It would be disproportionate and unreasonable for the regulator to intervene where it did not think that the benefits of doing so would outweigh any costs imposed. The Explanatory Notes to this clause make clear that, in the advancement of its systemic financial resilience objective, the regulator

“will identify, monitor and if necessary take action to mitigate systemic risks in order to protect the aggregate financial sustainability and resilience of English football”.

However, we reject the notion that the regulator should be able to act only once risks have become so severe that they substantially threaten the system. The noble Lord, Lord Goddard of Stockport, mentioned the banking crisis; the amendment under discussion could be argued to be equivalent to a financial services regulator noticing sub-prime lending and credit default swap trading in 2007 but not being able to intervene until Lehman Brothers collapsed in 2008. Instead, the regulator should be able proactively to mitigate risks when they are identified. We believe that “protect and promote” appropriately conveys this, to ensure a future forward-looking regulator. However, I reassure your Lordships’ House that this does not mean that the regulator will be placing undue restrictions on clubs, pre-empting risks that have not yet materialised.

Turning to Amendment 57 in the name of the noble Lord, Lord Jackson of Peterborough, I am afraid that the noble Lord’s amendment is at odds with the aims and objective of the regulator. It undermines the very intention of a Bill that had the support of all three main political parties at the election less than three months ago. Indeed, the shadow Secretary of State in the other place has stated:

“I genuinely think that this is an excellent Bill”.—[Official Report, Commons, 23/5/24; col. 244.]


We are looking to set up a predominantly financial regulator. Stopping the regulator from taking any action relating to a club’s internal finances would defeat that purpose. The regulator’s statutory mandate is to deliver its objective; it will achieve these aims using only the powers given to it in statute, such as the licensing regime and the owners’ and directors’ test. The regulator would, therefore, not become involved in the club’s finances, unless it thought that the action would lead to it delivering its objectives. Its powers place clear limits on the extent to which it can require things of clubs.

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[Lord Markham (Con)]

I want to make sure I properly understood the answer to the question on the circumstances in which the Minister would say it was appropriate to take money from one club and give it to another. The Minister answered that the Bill was not seeking to do that because it was looking at the movement of money between competitions. But if you take more money from the Premier League to give to the Championship and other clubs, by definition the clubs receive less money, so that is what happens there. I am not sure that saying money is coming from the competition, not the clubs, is an answer; the money is coming from the clubs. I was not sure about the Minister’s answer. When you change the payments between the Premier League, that directly impacts the clubs and the money they receive.

[Baroness Twycross (Lab)]

My understanding is that the amendment would prevent money going from club to club. The model is around distribution between leagues or competitions, as the noble Lord suggests. There is already a situation in which the Premier League recognises that some financial redistribution is needed. I refer the noble Lord to previous discussions about why the regulator and financial redistribution of some type are required within the football pyramid.

Amendments 126 and 130 relate to the regulator being able to state in its rules any further information that is required to accompany the application for a provisional licence or the strategic business plan. The regulator will be independent, and it will be the expert. We need to give it the flexibility to implement its regime as it considers appropriate. This includes being able to request additional information in a club’s application if necessary to satisfy itself that the club will meet the test for a provisional operating licence. This will be set out up front in the rules, so clubs will always know in advance what is required of them when submitting an application or a strategic business plan. For the reasons I have set out, I am unable to accept the noble Lords’ amendments, and I hope they will not press them.

[Lord Hayward (Con)]

My Lords, I find the Minister’s answer interesting, but I will start by making a comment in relation to my noble friend—I do address him as my noble friend—Lord Addington’s remarks regarding regulation. The concerns we have on these Benches are in relation not to regulation per se but to regulatory creep and regulatory definition. The first few clauses in the Bill in one form or another either cover inadequately or do not cover the question of regulation.

My first amendments related to sustainability and the breadth of that comment. The Minister has just made her observations in relation to “targeted”, “prioritised” and “proportionate”. We are trying to establish precisely what the regulator can operate to, more clearly than we have in the Bill as it stands. It is not clear, and the net result is, as we know and as has been observed by any number of Members across this House, that we watch regulators use regulatory creep one after another after another.

The Minister used the words “proportionate” and “targeted”. Is the regulator going to have exactly the same interpretation of “proportionate” or “targeted” as the Minister? No. By definition there are no minds alike, and therefore they will be different. In this set of amendments we are trying to find out precisely how the regulator should operate. Without that clarity, the Bill gives the regulator what I regard, and I think many people on this side of the Committee particularly regard, as undue breadth of self-interpretation. The noble Lord, Lord Pannick, referred to the Premier League and the payments that are made. I agree with parts of the comments that he made, but we have here a unique operation whereby the Premier League makes payments to other clubs in other divisions and to those facing threats of relegation so that the whole system does not fail.

The noble Lord, Lord Goddard, identified the banking crisis. Under those circumstances, Governments worldwide intervened in all sorts of ways in all sorts of businesses. That is not comparable with trying to regulate a sport, and a highly successful sport as it is. What is significant and interesting is that although the Premier League passes money downwards, the Championship does not. It receives money and could easily pass money down, but fails to do so. Therefore, one is looking at a complicated position in terms of regulation and the impact it will have, in a way that has been eloquently identified in a number of contributions from the noble Baroness, Lady Brady, from her understanding, unique in this Chamber, of the operation of both the Championship and the Premier League.

I will continue to seek clarity, as I am sure others will, on what is intended behind the work of the regulator. That is what we are here to do, and we should do it step by step as we look at each clause and subsection. Having made those comments and noted what the Minister said, I beg leave to withdraw the amendment.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, we did not quite give the noble Lord, Lord Blunkett, the debate of under an hour that he hoped for, but I note, for the benefit of the Government Chief Whip when he comes to read the Official Report, that this group is composed entirely of Labour Back-Bench amendments. We have heard the arguments and motivations for tabling the amendments advanced by noble Lords who did so; we have tested their arguments and examined the intended and unintended consequences. That is the work of this Committee, and I am glad we have done it. We had a fruitful and useful debate with quite a lot of agreement between noble Lords about their anxieties and some of the problems that we want to solve, but also some shared anxieties about the problems that might flow from the way in which the noble Lords who tabled the amendments propose doing so.

I start on a point on which I think we all agreed and add my strong support for the amendments in the names of the noble Lords, Lord Blunkett and Lord Knight of Weymouth, and those who signed them, including the noble Baroness, Lady Grey-Thompson, about independent non-executive directors. They are sensible and constructive amendments. One reason we have been moving quite slowly in this Committee is perhaps, as is often the case, that the Government have listened to the debate and rejected all the amendments tabled so far, urging noble Lords to withdraw them and saying that they are not necessary. Amendments 54 and 157 are good amendments on which to break that trend; there was clear support for them from across the Committee, including the Cross Benches. I hope that, even if the Minister is not willing to accept the amendments as drafted, she will in this case look at how we can strengthen the oversight of the work of clubs through the work of independent non-executive directors.

I am particularly grateful to the noble Lord, Lord Burns, for his contribution and the support he gave to amendments we have previously discussed about the independence of the chief executive and the way in which they are appointed. There is some valuable stuff there for the Government to take away. It is very much linked to the broader debate we have had about diversity. If we can get the non-executive leadership of clubs right, then, as well as improving the scrutiny and accountability of the work of those clubs, we will add to their diversity—not just the diversity of the personnel sitting on the boards but the diversity of thought and the open-mindedness to make sure that the clubs are continuing the work that noble Lords have rightly pointed to. That includes making sure that they continue to be open, inclusive and growth-focused, concerned with attracting new fans to football and making sure that talented people, whoever they are and whatever their background, are able to rise as far up the football pyramid as their talents will take them. I hope the Minister will look favourably on Amendments 54 and 157.

Like other noble Lords, although I appreciate the motivations behind the other amendments in this group, particularly Amendment 156 in the name of the noble Lord, Lord Bassam of Brighton, I am worried about some of the consequences that might flow from it and the way he proposes it. That is not to disagree with what other noble Lords have said about the important issue that he raises, or to lose sight of the huge progress that has been made. I was not around in the 1960s, 1970s or 1980s, of which the noble Lord, Lord Goddard of Stockport, rightly reminded us, but the behaviour of football and football fans and clubs in those decades was often not to the credit of this nation. We should be very proud of the strides that football has made, voluntarily, through the work of its fans and the people who operate the clubs, in being a more inclusive and welcoming environment open to the talents of everybody.

I know why the noble Lord has probed this area. He wants the work that is undeniably still needed to build on that to continue. Like other noble Lords who have probed it, I worry about some of the practicalities and where his amendment, as worded, would take us. There is a material difference between monitoring the diversity of a workforce and the diversity of a fan base and season ticket holders, as I think the noble Lord would acknowledge. I would particularly be concerned about asking fans and ticket buyers to disclose quite sensitive information that they do not presently share with the football team of their choice about their religion, ethnicity, sexuality and so forth. I am not quite sure how, for season ticket holders, that work would build on things.

Amendment 249, tabled by the noble Lord, Lord Mann, gives me the opportunity to echo the thanks that my noble friend Lord Moynihan expressed to him for his work on tackling anti-Semitism, not just in football but more broadly. I was in Downing Street when he first took on the role as the Government’s independent adviser on anti-Semitism, so I have seen the work that he has done in a number of spheres to tackle prejudice in that area.

Noble Lords will undoubtedly agree that diversity and inclusion in the workplace can be of benefit not just to staff but to an organisation corporately. The noble Lord, Lord Mann, expressed that this was a probing amendment to see what the Government’s view was and to highlight some of the work that football does. He is right to do so, particularly on that last element, because clubs across the football pyramid have a number of strategies and are doing great work in this area through their own volition. Arsenal, for example, have had a diversity, equality and inclusion plan called Arsenal for Everyone since 2008. Arsenal did that by themselves; they did not require a regulator to force them to publish a plan.

Article 27 of the UEFA club licensing regulations, which detail the standards that clubs must meet before they can participate in a UEFA competition, contains social and environmental sustainability conditions. It states that:

“The licence applicant must establish and implement a social and environmental sustainability strategy in line with the UEFA Football Sustainability Strategy 2030 and relevant UEFA guidelines, for at least the areas of equality and inclusion, anti-racism, child and youth protection and welfare, football for all abilities, and environmental protection”.


That is a wide-ranging list of good causes for it to encourage people to think about. There is not exactly a lack of corporate governance requirements in this area already placed on clubs, and noble Lords have pointed to a number of highly commendable initiatives to build on our work here.

I was in your Lordships’ House on Friday when the noble Lord, Lord Mann, spoke in the archiepiscopal debate that we have in the run-up to Christmas, led by the most reverend Primate the Archbishop of York. He warned against the temptation to reach for the legislative lever in every instance to drive forward good work. This is an area where a lot of great work is already being done, to the credit of people in football. I would be wary about measures that are too restrictive or prescriptive that would cut against that.

I will not go into the details of the lively debate that my noble friend Lord Reay and others had, other than to note that these are issues which are not party political; they were raised at Second Reading by the noble Lord, Lord Triesman. My noble friend Lord Hayward’s intervention reminds us not just of his long-standing and pioneering role in championing inclusion in sport but of the fact that these are complicated matters that sport and so many parts of society are grappling with. I do not think that writing something into this Bill in the way that is envisaged would help that, but I am very grateful for the opportunity to have had a detailed debate on this. It has been useful, and I look forward to the Minister’s response.

[Baroness Twycross (Lab)]

I thank my noble friends Lord Blunkett, Lord Bassam of Brighton, Lord Knight of Weymouth, Lord Mann and Lady Taylor of Bolton for tabling these amendments. I thank the noble Baroness, Lady Grey-Thompson, for the role she has played in supporting some of the amendments. It has been useful to have the discussion. The debate is a reminder that, at times, players are often at the brunt of quite a lot of unpleasantness, not least on social media.

I am sure that noble Lords across the Committee will join others who have spoken about the dreadful accident that took place at the weekend involving Michail Antonio, and wish him a speedy and full recovery. I cannot imagine what it was like to take the phone call that the noble Baroness, Lady Brady, had to take. Our thoughts are with him and his family and colleagues.

Good corporate governance is the bedrock of any well-functioning business, and there is agreement on this across the Committee. However, the Government believe that this has been lacking at some clubs to date, and that is why it will be an important part of the regime.

I begin with Amendment 54, in the name of my noble friend Lord Blunkett. While I agree with the intention, I assure my noble friend that ensuring regulated clubs have good corporate governance is already well provided for in the Bill; for example, the mandatory licence condition requiring clubs to report against a new corporate governance code for football clubs. We do not feel it is appropriate to add this level of specificity to the regulator’s objectives. As my noble friend made clear, good governance protects fans and owners. Good corporate governance will contribute to a club’s financial soundness, which is already captured within the objectives in this clause.

Amendment 156, from my noble friend Lady Taylor of Bolton, and Amendment 249, from my noble friend Lord Mann, concern equality, diversity and inclusion. I strongly agree with the principle of these amendments that clubs should be more transparent with regards to equality, diversity and inclusion. However, I believe that Amendment 249 is not necessary. As part of the corporate governance statement mandatory licence condition, all licensed clubs will already be required to report on what action they are taking on equality, diversity and inclusion. The Bill specifically includes equality, diversity and inclusion in its definition of corporate governance. We therefore expect to see recommendations about equality, diversity and inclusion in the regulator’s corporate governance code.

On Amendment 156, as I have outlined, clubs will already be required to report on what action they are taking on EDI. My noble friend Lord Mann mentioned important examples of where clubs are already taking action. I agree with the comments made by the noble Lord, Lord Moynihan, on my noble friend’s contribution, particularly as it relates to anti-Semitism. I also agree with many of the points raised by the noble Lord, Lord Hayward, in his contribution.

Reporting on the diversity of staff and senior managers would be typical of how these types of transparency measures work. However, regarding the point on season ticket holders, we do not feel that it is the regulator’s place to act here. As a financial sustainability regulator, the regulator’s interest in equality, diversity and inclusion is that it contributes to good corporate decision-making, which in turn makes clubs more sustainable.

I agree with the noble Baroness, Lady Brady, that, beyond this, it is not for the regulator to get involved in the diversity of a club’s fan base. A club might like to take note if its fan base does not represent its local area. Some examples of clubs reaching out to communities have been mentioned by noble Lords in the course of the debate. There are already actions being taken on fan diversity by clubs, competition organisers and wider stakeholders.

In response to the points made by the noble Baroness, Lady Fox, we think that EDI reporting is a good thing. A lack of basic good corporate governance threatens the sustainability of football clubs. We have seen in the past crises at clubs that may have been avoided with some simple improvements to how the club was run. That is why the regulator will introduce a new football club corporate governance code. The regulator will work with the industry to design the code and will support clubs in applying it, in addition to encouraging best practice.

The requirement for clubs to publicly report against this code is designed to increase transparency, scrutiny and accountability. Clubs will have the flexibility to interpret the principles of the code and explain how they have applied them to suit their individual circumstances. We are clear that the regulator will not prescriptively micromanage each club’s board. That is not its role, and would cause a significant burden to the regulator itself and to clubs.

Amendment 157, in the name of my noble friend Lord Knight of Weymouth, seeks to add a further limb to a club’s corporate governance reporting by explaining how it meets the standard of the UK Corporate Governance Code in relation to the appointment of non-executive directors. I thank him for raising this issue and the noble Baroness, Lady Grey-Thompson, for illustrating why a range of skills—what she referred to as a jigsaw—helps in delivering good governance.

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As I have said, we are open to further discussion on the wording, but I hope that the noble Baroness sees what we are trying to achieve through these amendments in giving the Bill more clarity and precision, and some finer metrics by which the work of the regulator can be judged.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Markham, for Amendments 56 and 58. I look forward to reading the letter to which he referred when it is forwarded to the Committee.

On Amendment 56, while we appreciate the intent of the amendment and agree that English football should continue to be as successful as it has been, we do not believe the amendment is necessary to safeguard this. The growth of English football over the past 30 years and the financial investment in it have been widely regarded as a huge success and have turned it—as has been noted by a number of noble Lords across the Committee—into a global export. However, in pursuing such growth and investment, systemic issues have grown throughout English football which justify regulation. Some noble Lords have suggested that football’s growth is evidence that regulation is not needed, but these two things are not mutually exclusive. English football is both successful and fragile, with issues of sustainability throughout the pyramid.

We have discussed the reasons why the game needs regulating at some length, so I am not going to go through them again, but the main aim of the Bill is to address these issues to ensure financial soundness and resilience of clubs and to safeguard the heritage of English football—all things that football has shown itself unable to do. On growth and attracting investment, on the other hand, football has already shown itself to be incredibly good at both those things and does not need, in our view, a statutory regulator to promote them. Indeed, as is clear from its articles of association, “promoting” the game is one of the objectives for which the FA is established.

Noble Lords have raised concerns about breaching UEFA and FIFA’s statutes. In my view, stepping on the FA’s toes here is exactly the sort of thing that might risk that. That is why we do not believe that the regulator needs primary objectives to actively pursue growth and financial investment. However, the Bill already makes provision to safeguard these features. As part of its general duties, the regulator must have regard to the desirability of avoiding impacts on important outcomes in football—domestic sporting competition, the competitiveness of our clubs against international clubs, and investment into football—rather than a general growth objective.

The bespoke and novel duties in Clause 7 acknowledge the specific market features that have contributed to English football’s growth and will be key to its continued success. Much of the success of English football has come from investment and exciting competition, and we do not believe the Bill will in any way deter this. Indeed, a stable and more certain regulatory environment will be more likely to attract investors. These amendments would require the regulator to bring into scope anything that relates to the growth of English football. This would include things like broadcasting revenues, transfer fees, sponsorship deals and many other areas. Not only would this dramatically widen the scope but the regulator would also be required to become actively involved in these areas.

My noble friend Lord Watson of Invergowrie highlighted that these amendments would broaden the scope of the regulator. We cannot on the one hand warn against scope creep and over-intervention in a successful free market and on the other hand call for a statutory regulator to be tasked with growing the market. Regulators exist to address specific problems that the market cannot address itself. Football has a sustainability problem and not a growth one.

On Amendment 58 specifically, the additional detail in subsection (1)(a) to (c) in the noble Lord’s proposed new clause is already included in the Explanatory Notes which cover heritage. Explanatory Notes provide illustrative detail about the intention behind legislation and not drafting intended for the Bill. As the noble Lord will appreciate, the purpose of Explanatory Notes is to provide additional illustrative detail. However, this kind of detail is not appropriate for the face of the legislation, because good legislation should be clear and concise, and the current drafting is in line with that ambition.

I want also to draw noble Lords’ attention to the letter I sent to the noble Baroness, Lady Evans of Bowes Park, on this same topic of a growth duty. A copy of that letter was also placed in the House Libraries. For the reasons I have set out, I hope that the noble Lord will not press his amendments.

[Lord Markham (Con)]

I thank noble Lords for their contributions, and the Minister for replying. Before I come to address what has been said, I thank my noble friends for their contributions and especially my noble friend Lady Brady for her point that there are concerns about UEFA competitions as well that we are seeking to address in this.

Although I did not hear anyone say that these were not desirable objectives, I heard two reasons not to introduce them. First, the Minister said that we are already successful on investment and the Bill will not deter it. I am afraid that is where there is a fundamental disagreement, because the Bill introduces new aspects to this. It gives the regulator responsibility to make sure clubs are sustainable and says that the regulator can look at this through things such as the parachute payments and the solidarity payments. That fundamentally changes the investment proposition in clubs. The letter from the Brentford chair makes the point, as have others, that clubs would be much less likely to invest in new players and in resources if they did not have the safety net of parachute payments if they were to go down. That will directly affect investment in clubs via the change in the laws that we are talking about and the responsibilities of the regulator to look only at sustainability. It is the same for solidarity payments. We are changing the playing field and moving the goalposts, so we cannot expect everything to go on as normal. That will inevitably affect the investment proposition, so it will impact the amount of money we see going into the game.

That comes on to the second point that was raised about why we should not introduce these amendments: that we are somehow trying to expand the regulator’s duties, which goes counter to everything we have said so far about it being light touch. That is not what we are trying to do. We are trying to make sure that the regulator will have more than one objective when it looks at the measures it can take. If it has only one objective, about sustainability, we hope it will interpret it broadly, but I could make all clubs sustainable tomorrow by saying that all the Premier League money should be distributed. That would do it. It would give everyone loads of money, it is completely sustainable and the regulator could say, “That’s fantastic, job done”. But we know it would fundamentally harm the whole structure and the whole environment.

I do not think for one moment that a regulator would be as unwise as that, but the main point of what we are trying to do is to set out what we believe are the right objectives. As I mentioned, the Government have done that with the Bank of England and given it growth objectives alongside inflation objectives. They have done it with Ofwat and with Ofgem. They have given all of them their regulatory requirements and a growth objective. We are trying to make sure that the regulator is wise in any measures it puts in place by always having other objectives that are for the good of the game. That is not increasing its reach; it is just making sure that it has more than one objective. I hope this is something we will be able to talk about further.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, I am grateful to my noble friend Lord Markham for setting out the amendments in this group and, in his absence, my noble friend Lord Maude of Horsham. He tabled some of these amendments but, as we heard earlier today, is unable to be with us to speak to them.

This group of amendments concerns the general duties of the independent football regulator. Its role is to ensure the long-term sustainability, fairness and competitiveness of football in the UK; that is vital. The regulator is entrusted with overseeing the interests of clubs, players, fans and other key parties in the sport, so its role is invaluable. It is critical, therefore, that we lay out clearly and concisely, if we can, its duties and responsibilities.

The amendments in this group seek to provide the independent football regulator with a clear and effective framework in which to carry out its responsibilities, and to strike the right balance between governance, competition and the continued growth of the sport.

I speak in support of Amendment 61, which would introduce a duty for the new regulator to advance the growth objective. The whole Committee can agree on wanting football to flourish, expand its reach, and continue to thrive both on and off the pitch. That is the intention of Amendment 61 and the growth objective. Football’s growth, in participation and in financial sustainability, is critical for its future. The amendment before us would ensure that the regulator’s actions remain firmly aligned with advancing football’s expansion, ensuring that the sport continues to thrive and serve the interests of all involved, from grass roots to the professional game.

Amendment 59 proposes removing the phrase

“so far as reasonably practicable”

from Clause 7. This would complement Amendment 61 by strengthening the regulator’s mandate. By removing what is superfluous and ambiguous language, we would help to ensure that the regulator is not constrained by excessively cautious qualifiers. Instead, it would be given a clearer, more explicit duty to act decisively in line with its core responsibilities, including the imperative of promoting growth in the football sector. In the previous debate, we proposed additional wording that the Government did not need; here, we are seeking to help concision by striking out terms that we think are ambiguous and superfluous.

Amendment 61A, tabled by my noble friend Lord Maude of Horsham, highlights the importance of the independent regulator in working within existing competition structures where they are already operating effectively. The new regulator should not interfere unnecessarily with systems that are working well and delivering positive outcomes. Instead, it must focus on enhancing and supporting those structures, ensuring that they remain adequate and capable of meeting the needs of the game. That would prevent the duplication of regulatory functions and ensure maximum efficiency.

My noble friend Lord Maude’s Amendment 64 seeks to safeguard the integrity of football competitions by ensuring that the football regulator avoids actions that could undermine the important work and effort of competition organisers. His amendment would set a useful boundary between the regulator and the autonomy of clubs. Additionally, it would ensure that the independent football regulator does not conflict with the existing rules set by competition organisers. These protections are important for preserving the competitive spirit of football, which drives both the sporting and commercial success of the game. By ensuring that the regulator respects the frameworks that are already established, these amendments would permit football to evolve without unnecessary disruption and foster an environment where the sport can flourish at all levels.

My noble friend Lord Markham’s Amendment 67, which I have signed, seeks to ensure that the independent regulator avoids actions that could undermine competition. That competitive spirit is fundamental to football’s success, both in the excitement engendered among fans and the drive for clubs to grow and innovate. This amendment seeks to ensure that regulatory actions do not unintentionally harm what is such an essential element of the sport.

Finally, Amendment 69 seeks to strengthen the clarity and focus of the regulator’s mandate by ensuring that it operates consistently with the objectives outlined in Clause 6. Clause 7(3) states that the regulator must have regard to its regulatory principles, the “state of the game” report, the football governance statement and any guidance published. Curiously, though, it does not state that the regulator must have regard to its objectives under Clause 6. If the objectives are to mean anything, surely the Bill should try to create a duty for the regulator to have regard to those objectives in exercising its functions. I am curious as to whether that is a gap that we could close here.

The amendments in this group work together to provide the new independent football regulator with a clear, direct and effective framework for fulfilling its duties. They seek also to set out distinct boundaries and make sure that the regulator’s powers do not encroach on the competitive spirit of the clubs. I hope the Minister thinks that, in doing that, they strike the right balance between regulation and freedom. I look forward to her thoughts on this.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Markham and Lord Maude of Horsham, for tabling these amendments and the noble Lords, Lord Markham and Lord Parkinson, for speaking to the amendments in the absence of the noble Lord, Lord Maude.

I start with Amendment 59, in the name of the noble Lord, Lord Markham. The regulator’s purpose is to protect and promote the sustainability of English football. To deliver this, the legislation sets out three clear objectives: club financial soundness, systemic financial resilience and heritage. It absolutely follows that we would expect it to always act with that purpose and those objectives in mind.

This amendment would have consequences for both the regulator and the industry. The result is that the regulator could face considerably more risk of legal challenge, even if it acted reasonably and in good faith in a way that it intended to advance its objectives. If the regulator always had to prove that any action it took was directly compatible with its purpose and would advance an objective, this would introduce a considerable burden on the regulator and the cost would ultimately be paid for by industry and, potentially, indirectly by fans. We are confident that Clause 7 as drafted appropriately constrains the regulator to act in line with its purpose and objectives without introducing unnecessary, costly and restrictive procedural burdens.

I turn to Amendment 61, also in the name of the noble Lord, Lord Markham. As set out in the previous group, we appreciate the intent of amendments on this topic and agree that English football should continue to be as successful as it has been, but we do not believe that a growth objective is necessary to safeguard this. The sole aim of the Bill is to address issues that football has shown itself unable to resolve to ensure the financial soundness of clubs and the resilience of English football, and to safeguard the heritage of English football. As with the previous amendments in group 3, this amendment would dramatically widen the scope of the regulator, which is not something the Government wish to do. In order to satisfy the duty that this amendment proposes to always advance growth in every action it takes, the regulator would end up intervening on issues that affect growth, rather than effectively solving the problems it has been set up to tackle.

On Amendments 61A and 64, in the name of the noble Lord, Lord Maude of Horsham, we are confident that the Bill is already clear that competition organisers will not be unduly restricted in how they manage their competitions. The regulator has a clear regulatory principle to co-operate constructively with competition organisers and to recognise the wider footballing context, including existing competition-specific rules. Let me be clear: the regulator will not be deferring to the leagues or their rules, but it is in no one’s interests for there to be conflict. The regulator will not be standing in the way of clubs’ ambitions. Provided they do so prudently, we have always been clear that clubs will be able to invest, spend and take calculated risks. This is reflected in the legislation.

On Amendment 67, in the name of the noble Lord, Lord Markham, while I understand the desire to explicitly protect the financial interests of the leagues, this amendment is unnecessary given the existing statutory duties including in the Bill. As I mentioned, the Bill already requires the regulator to consider the competitiveness of regulated clubs, alongside any potential adverse effects on financial investment. Clearly, these things impact on the competitiveness and success of the leagues themselves. Additionally, where we consider it relevant to specific functions of the regulator, there are explicit requirements for it to consider the potential impact on the finances of the leagues. For example, as part of the backstop process, the regulator has a specific duty not to choose a proposal that would place an undue burden on the commercial interests of either league.

Finally, on Amendment 69, in the name of noble Lord, Lord Markham, I reassure the noble Lord that the desired intent is already achieved by the wording of Clause 7(1). This states that that the regulator

“must, so far as reasonably practicable”,

advance the regulator’s objectives when exercising its functions. To meet this duty to advance its objectives, the regulator would have to have regard to its objectives, so the intent of the amendment is already achieved.

For the reasons I have set out, I am not able to accept these amendments and ask that noble Lords do not press them.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, like others, I am grateful to the noble Lord, Lord Mann, for moving his Amendment 65, which probes an important area and a potentially concerning consequence. I am grateful for the example that he raised of Solihull Moors and look forward to the reassurances that I hope the Minister will give. However, even if she gives those reassurances, the noble Lord’s amendment is modest and I wonder whether there is a case—belt and braces—for us to make an amendment saying that the regulator should work in a way that does not have an adverse impact on women’s football. That feels sensible, even if the Minister does not share the concern about the specific instance that her noble friend has raised.

Like others who have spoken, we on these Benches are full of praise and excitement for the role that women’s football and women’s sport more generally play in our society. The noble Baroness, Lady Grey-Thompson, spoke powerfully about the inspiration that it is to many young women and girls, the transformative impacts that it has on their health and so much more. I am pleased that we have come such a long way from the days of old, when women were banned from playing professional football—a ban that was lifted only in 1971, but the effect of which can still be seen and has reverberated through the development of the women’s game for generations.

The FA took on the administration of women’s football only 30 years ago, in 1994, and the Women’s Super League became a fully professional league only in 2018. But, as noble Lords have pointed out, recent years have seen some striking, powerful and inspirational examples of the growth in the women’s game and, hearteningly, in the interest and appreciation that it is getting right across society. Correspondingly, there has been an enormous increase in the attention that it has garnered, with 77,000 fans attending the women’s FA Cup final last year. I know that all noble Lords fondly remember the astounding victory achieved by the Lionesses in the 2022 European Championship.

However, there is a concern, as has been expressed in this debate, that regulating women’s football now might not be the right moment in the development of the women’s game and women’s clubs. The Raising the Bar report, led by Karen Carney, stated:

“Given its stage of development, continued growth of matchday, broadcast and sponsorship revenue—with a view for the women’s game to become independently sustainable—is the right way to incentivise continued long term investment by clubs”.


Women’s football is obviously, and regrettably, not at the same stage of development as the men’s game—the men’s game had such a significant head start in terms of the professional apparatus around it—and the relative losses incurred by clubs are not in the same ballpark. Thus issues with financial stability are not comparable. There is recognition of that, although there was some surprise and, at Second Reading, a number of noble Lords from across the House rightly mentioned the women’s game as an area for us to be mindful of, so it was helpful to have had this debate.

Another issue is the level of investment that women’s football requires. As my noble friend Lady Brady pointed out, for women’s teams to come closer to the men’s game, significant financial investment will be needed. We are therefore right to question whether that is best served by and encouraged through this regulatory regime. However, I note the paradoxes that my noble friend highlighted in making that point and applying it to the women’s game, while conceding the argument in relation to the men’s game. I therefore understand why, at present, women’s football might not be included in the scope of this new regulatory regime.

However, it is useful to have had this debate and it would be useful to understand the Government’s intent here. Perhaps the Minister can explain the means by which the women’s game might be brought closer to the men’s game and how, if that happens and it falls into some of the same mistakes that we have seen in the men’s game, the women’s game might be captured by this regulatory regime. On the flipside, if the men’s regime learns from the women’s game and is able to regulate itself better, would that mean that there will be a lightening of the regulatory burden or are we past the point of no return for the men’s game? It would be interesting to hear that.

Like my noble friend Lord Moynihan, I slightly regret the wording of giving the women’s game a “chance” to regulate itself, but I am sure from looking at the Government’s accompanying notes that it is not meant pejoratively.

Amendment 72 from the noble Baroness, Lady Taylor of Bolton, sits slightly uneasily with the others because it is not just about the women’s game, but she explained why she has tabled that amendment and why she hopes to hear a bit from her noble friend the Minister. What she is seeking here is a welcome addition; it is only right that the regulator should be required to give assistance to clubs that are seeking licences. One of the themes that has been drawn out by many noble Lords in our scrutiny so far is the issue of how clubs will be able to adjust to these new licensing requirements. If the regulator does not implement this scheme in the correct manner, clubs will suffer, so it is only right that it should provide assistance to clubs to allow them effectively and efficiently to understand the new requirements that the Bill and its regulatory regime bring about. I will listen with interest to the Minister’s response to her noble friend on that and the other amendments in this group.

[Baroness Twycross (Lab)]

I thank my noble friends Lord Mann and Lady Taylor of Bolton, the noble Lord, Lord Addington, and the noble Baroness, Lady Grey-Thompson, for tabling these amendments, including on the important issue of the women’s game.

I reassure noble Lords that we are completely aligned on our commitment to women’s football. As I have said previously in your Lordships’ House, I was not allowed to play football when I was at school. I could not be more delighted that my nieces can not only play football but take for granted that they can, and that they are encouraged to do so. I am as excited at the growth in women’s football as is the noble Baroness, Lady Grey-Thompson. I asked a number of questions similar to those that noble Lords asked, so I hope that the answers I have had, which form a large part of my speaking notes tonight, will provide them the reassurance that I was provided when I asked those questions in preparation for your Lordships’ Committee.

At present, the regulator will not cover women’s football. In answer to the question from the noble Lord, Lord Moynihan, the regulator will not be concerned with women’s teams’ accounts even where they are affiliated to men’s clubs. However, it is empowered to obtain and consider information from a club’s wider corporate group. I reassure the noble Lord that clubs should not be able to circumvent requirements through creative accounting in the manner that the noble Lord described as potentially being an issue.

The regulator will be concerned only with the sustainability of the clubs which will be within the scope of its regime. Women’s football is in such an exciting place and we really do hope that it will be able to grow and succeed in a sustainable way. Indeed, the wider football ecosystem already provides financial support to the women’s game—a point made eloquently by the noble Baroness, Lady Brady.

The FA has a 2024-28 women’s and girls’ football strategy, which states that by 2028 it will

“secure significant additional funding and investment to support women’s and girls’ grassroots football and pyramid”,

among other things. In addition, as the noble Baroness, Lady Brady, said, the Premier League has provided a £20 million interest-free loan to the Women’s Professional Leagues Limited to help build strong foundations for the women’s game.

[Lord Moynihan (Con)]

Can the Minister clarify what she has just said? Is she saying that the regulator would not be able to intervene in the example given by the noble Lord, Lord Mann, in introducing his amendment?

[Baroness Twycross (Lab)]

On the example of Solihull, the response I made related specifically to the point that the noble Lord, Lord Moynihan, raised about the creative use of accounting being used to avoid things. My understanding is that it is empowered to obtain and consider information regarding the club’s wider corporate group where it has reason to do so. It might be worth me getting further clarification from officials and ensuring that a letter outlining that is placed in the Library so that all noble Lords are clear on that point.

[Lord Mann (Lab)]

That would be highly useful of the Minister, and I thank her.

[Baroness Twycross (Lab)]

The Government will continue to support the FA and Women’s Professional Leagues Ltd as the women’s game forges its own path. We completely understand the desire to see appropriate protections put in place for women’s football. As I said, I have a historical vested interest in that I was not allowed to play football at school, and none of us wants to see issues like those at Reading, where the women’s team suffers as a result of issues at the affiliated men’s club. My noble friend Lord Mann gave the example of Solihull Moors, which was also cited by the noble Lord, Lord Goddard.

At present the intention is that this will be a regulator for the men’s game, and we have already discussed the reasons for that. Asking the regulator to then consider its impact on the women’s game could constitute a widening of that scope. I am confident that this is something that the industry authorities governing the women’s game will be able to tackle through their own rules for women’s clubs with affiliated men’s teams. They deserve the time, space and opportunity to do so.

I apologise if some of the language in the Explanatory Notes came across as clunky or inappropriate. I am confident that that was not the intention of those drafting them.

The Government’s position is in line with the recommendations of Karen Carney’s independent review of domestic women’s football, which was published in July 2023. The review recommended that the women’s game should be given the opportunity to self-regulate rather than moving immediately to independent statutory regulation, and the Government support that recommendation.

On Amendment 72 in the name of my noble friend Lady Taylor of Bolton, I agree that the regulator should help clubs to comply with regulations as much as reasonably possible. It is in everyone’s interest for clubs to become compliant quickly and with as little additional burden as possible. That is why provisions for a collaborative approach are already in place. The regulatory principle in Clause 8(b) encourages the regulator to,

“so far as reasonably practicable, co-operate, and proactively and constructively engage, with … clubs”.

The regulatory principle in Clause 8(c) also encourages the regulator to be proportionate.

For the reasons I have set out, I am unable to accept the amendments in this group and I hope that my noble friends and noble Lords will not press them.

[Lord Mann (Lab)]

I look forward to receiving the letter from the Minister. I will say—and officials may be listening in—that if we had a situation where a football club had a licence and was being regulated by the regulator, and that football club then threw its women’s team off their pitch so that they could not play, the regulator would look particularly stupid and impotent, and doubtless would be suggesting that the Government and Parliament may need to amend the law. I hope this matter can be looked at to see whether there is a way in which we can get around that without giving extra powers to the regulator, so I look forward to receiving that letter and I am sure other noble Lords do as well. I beg leave to withdraw the amendment.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Monday 9th December 2024 Lords Chamber

That is all the more important with regard to the specific question raised by the amendment. My noble friend is trying to ensure that there is no undue burden on certain clubs that also have to abide by UEFA rules and licensing requirements. Without reopening the can of worms on hybridity, it does bring up that question, since there will be an unequal impact between clubs that enter teams in international competitions and those that do not. It seems, from the way the Bill is constructed, that certain private interests will face differential treatment. So I am grateful to my noble friend for bringing this before us again and I look forward to the Minister’s response.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank the noble Baroness, Lady Brady, for tabling this amendment, which gives us a further opportunity to have a discussion on international competitions. I understand that the intent of the amendment is to ensure that English clubs can continue to participate and compete successfully in international competitions. That is something we all want. As we have discussed at length previously, the Government are confident that nothing in this Bill as drafted will jeopardise the participation of our clubs in international competitions.

The noble Baroness, Lady Brady, raised a point on UEFA statutes. As I have reiterated previously, in the strongest terms, we have engaged extensively with UEFA in the development of the Bill. As has been confirmed by the FA, we are confident that the Bill as drafted will not breach any of UEFA’s statutes. The regulator will be operationally independent of this Government and any future Government, and will not exert an undue influence on the FA’s ability to govern the game. This was confirmed by the FA itself in oral evidence given to the House of Commons Public Bill Committee on 14 May this year, during the passage of the previous Bill, introduced by the last Government. Both Ministers and officials have engaged regularly with the FA, UEFA and FIFA about the Bill, and they will continue to do so as the Bill progresses and beyond.

[Baroness Evans of Bowes Park (Con)]

Obviously that is great, but the Bill has changed since then, particularly around the backstop provision. The noble Baroness on the Labour Bench was talking about before this new Bill came into effect: does that still stand? Has there been an update from the FA on that, because some of the provisions in the Bill have changed?

[Baroness Twycross (Lab)]

I understand that the FA’s position on this point has not changed.

We completely agree that, in the course of regulating, the regulator should not unduly harm the ability of regulated English clubs to compete against their rivals and to succeed in those competitions. This is why Clause 7(2)(a) already relates to avoiding effects on the sporting competitiveness of one regulated club against another. This would cover the “differential impact” to which the noble Baroness’s amendment refers.

Clause 7(2)(b) also relates to avoiding

“adverse effects on the competitiveness of regulated clubs against other clubs”.

This includes against international competitors, as the Explanatory Notes clarify. These provisions already achieve the aims of the noble Baroness’s amendment to minimise impacts on competitiveness, and in fact do so more holistically, recognising that competitiveness matters beyond just the relatively small proportion of clubs competing in, or vying for, European football.

On the points made by the noble Lord, Lord Moynihan, while I remain confident that nothing in the Bill as drafted would jeopardise the participation of English clubs in international competitions, I do understand his concerns. On UEFA and FIFA, we are speaking to the relevant authorities and will give noble Lords the reassurance on the specific points raised by the noble Lord in the coming weeks before Report.

For the reasons I have set out, I am unable to accept the noble Baroness’s amendment and hope that she will withdraw it.

[Baroness Brady (Con)]

My Lords, I thank the Minister for her response and other noble Lords for their contributions. However, I am deeply concerned about the assurances offered. While the Minister again claims that UEFA is comfortable with the Bill, the assertion is at odds with what we know. UEFA has explicitly raised objections to aspects of the Bill, including the risk of state interference breaching its rules. The correspondence exists, yet the Government refuse to publish it. If UEFA is so comfortable with the Bill, why the lack of transparency? Why not share its position openly with the House?

The Minister may be interested to know that, a couple of days ago, I spoke to Mark Bullingham, the CEO of the FA. He told me that only UEFA itself, not the FA, can confirm whether the Bill breaches its statutes, and that he believes that it will not give that confirmation because it will not want to give up its leverage. That is deeply worrying.

This amendment does not create complexity; it adds clarity. It ensures that the regulator considers the unique and unavoidable fact that Premier League clubs operate under dual compliance requirements—domestic regulation and UEFA licensing. Ignoring this reality risks leaving clubs exposed to significant conflicts with the governing bodies, which creates confusion and the instability that the Minister says the Bill seeks to avoid.

The claim that Premier League clubs are not disproportionately impacted is demonstrably incorrect. Only Premier League clubs are subject to UEFA licensing requirements, only they face the prospect of disqualification from European competitions, and only they are exposed to the dual pressures of domestic regulation and international oversight. They also fund the competition and the pyramid. This is not about prioritising one group of clubs over others; it is about recognising that their unique position requires tailored consideration.

The Premier League is not just a league; it is global powerhouse and the financial engine of our football pyramid. The risks of conflict with UEFA and FIFA are real, and they are uniquely borne by Premier League clubs. This amendment does not create division; it addresses it. It ensures that the regulator has the tools and the mandate to navigate these challenges fairly and effectively. I urge the Minister to reconsider her position as we progress towards Report and to reflect on the broader consequences of dismissing these concerns. But, for now, I beg leave to withdraw the amendment.

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With gratitude to my noble friends who brought amendments in this group, and indeed to noble Lords opposite who have done so as well, I hope the Minister will engage with this group on the reporting requirements and think, not just as the Minister presently at the Dispatch Box but as a parliamentarian, about the importance of the accountability that Parliament, as well as her right honourable friend the Secretary of State, needs.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Hayward, for moving Amendment 68 on behalf of the noble Lord, Lord Maude of Horsham, and all noble Lords for their thorough discussion of it and the other amendments in this group. The amendment, along with Amendment 89 from my noble friend Lady Taylor of Bolton, seeks to place additional reporting requirements on the regulator to increase transparency and accountability.

On Amendment 68, I understand the desire to ensure that the success of English football is protected and that the regulator monitors, evaluates and can be held accountable for its impact on the factors set out in Clause 7. However, the impact of the regulator in these areas should already be reviewed in both the “state of the game” report and the regulator’s annual report. This is true also in respect of Amendment 89. The annual report that the regulator will be required to produce and lay before Parliament at the end of each financial year will be on the exercise of its functions. The Secretary of State may also direct the regulator on what that annual report must include; they could, for example, already require the regulator to report on each of the specific aspects, including those in my noble friend’s amendment.

It is absolutely right that the regulator can be made to report on specific aspects of its performance and that these can vary from time to time, depending on the activity of the regulator and the state of the industry. We strongly expect that the regulator’s annual report would naturally include how well it had fared in advancing its objectives, but rest assured that if the regulator did not naturally report on this, the Secretary of State could direct it to.

[Lord Parkinson of Whitley Bay (Con)]

Does the Minister accept that if the Secretary of State decided that was not necessary but Parliament wanted to hear it, as the Bill is drafted, it is the Secretary of State who wins that? This is decided by the Executive and not by the legislature. Does she not think there is a role for Parliament to be a bit more assertive in what it would like to hear, rather than relying on a Secretary of State who shares its wishes and is willing to facilitate that?

[Baroness Twycross (Lab)]

I assume that if the relevant parliamentary committee felt that it was not getting the information it required, it would have quite an interesting evidence session with the regulator. It would be a very brave Secretary of State who did not include the information that Parliament wanted in an annual report of that nature or ask the regulator to do that. I can see the noble Lord shaking his head. I am not convinced that anything I could say on any of the points raised would satisfy him so, with respect, perhaps I could move on to other points.

[Lord Parkinson of Whitley Bay (Con)]

The Minister is accidentally proving my point. This is the frustration of parliamentarians when we ask questions and do not get what we want from an Executive. She is right that there is a role for Select Committees here, but I worry that the Secretary of State may not need to be that brave to avoid asking for these things. We are just keen to probe how Parliament can be a bit more precise in making sure it gets what it wants, but I will let her continue.

[Baroness Twycross (Lab)]

I suggest that noble Lords might discuss this at further length with the shadow regulator. As noble Lords will be aware, they have made themselves available and I am sure that, as the Bill progresses, they would be happy to have further conversations.

I turn to Amendment 120 from the noble Lord, Lord Markham. As I touched on earlier, the annual report is a vital mechanism for the regulator to be held to account. I therefore understand the desire to ensure that this report is comprehensive and covers the necessary detail. It will be in the power of the Secretary of State to specify any required contents, which are not, as Amendment 120 would ask for, all listed in the Bill. This is so that a much more adaptive approach can be taken, year by year, and so as to not constrain the issues that should be covered in the report.

With regard to Amendment 121, I reassure the noble Lord, Lord Parkinson of Whitley Bay, that the annual report will be laid before Parliament so that it can be scrutinised. If it is not, the regulator will be in breach of its statutory obligations; therefore, the intent of this amendment is already achieved.

Moving on to Amendment 122 from my noble friend Lord Bassam of Brighton, I thank him for raising this issue and am sympathetic to his viewpoint. Women’s football was discussed in the previous group of amendments and, as I outlined, the Government support the recommendation of the independent review of women’s football, published in July 2023. It set out that the women’s game should be given the opportunity to self-regulate, rather than moving immediately to independent statutory regulation. We appreciate, however, that this situation may change and that women’s football might need to be brought into scope down the line to safeguard its future.

As is clarified in the Explanatory Notes, the Secretary of State will already keep under ongoing review whether it is appropriate to amend the specified competitions. Clause 2(5) already requires the Secretary of State to carry out a formal assessment, including consultation, before doing this and to publish and lay its results before Parliament. The assessment can be triggered at any point so if any change in circumstance occurs, the Secretary of State is able to react. We therefore think that the principle of this amendment is already catered for and do not believe it is right for a clause with a specified timeline to be added to the Bill.

The Government recognise the intent behind Amendment 328 from the noble Lord, Lord Ranger of Northwood. It is vital that the regulator is transparent about the burden that its regulatory activities may have on clubs and competition organisers so that it can be held accountable. From the start, we have been clear that we wish to establish a regulator for football that will take a proportionate approach to regulation. We do not wish to introduce a regulator that will impose onerous and burdensome requirements on the clubs. That is why the regulator will have a statutory requirement when exercising its functions to have regard to the desirability of avoiding impacts on features such as competitiveness and investability. We expect that the impact of the regulator on the market, including on regulated clubs and the leagues, will be reviewed in both the “state of the game” report and the regulator’s annual report.

I reiterate: the Secretary of State and Parliament will be able to scrutinise these reports. We believe that this ongoing accountability is more appropriate than a one-time review by the Secretary of State six months after the Act has passed. It would not be fair or indeed helpful to evaluate the regulator’s performance or impacts after just six months of a brand new regime. For the reasons I have set out, I hope that the noble Lord will withdraw his amendment.

[Lord Hayward (Con)]

I withdraw the amendment.

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[Lord Parkinson of Whitley Bay (Con)]

I thank my noble friend and the noble Lord for rightly recalling him. It is right that he and professional footballers are getting the attention they deserve. I look forward to the noble Baroness’s response.

I have risen to speak to my amendments in this group—Amendments 74, 75, 76, 82, 84 and 85—as well as to express my support for Amendments 73 and 83 in the name of my noble friend Lord Markham and Amendments 86 and 87 in the name of my noble friend Lord Maude of Horsham.

My Amendment 74 focuses on the meaning of the word “expedient”. I know the noble Baroness, Lady Taylor, did not like it last time I mentioned a dictionary definition. The noble Lord, Lord Goddard, reached for his dictionary earlier in today’s Committee, so I hope she will not mind me doing so. I think it is important in this instance because in the Cambridge English Dictionary the word “expedient” is defined as,

“helpful or useful in a particular situation, but sometimes not morally acceptable”.

I was quite struck by that definition. I am not quite sure why a regulator, a public body, should be using its resources in a manner that is sometimes improper or immoral, and I think it is worth scrutinising the choice of that word and the message it might send to the independent regulator.

Our choice of language matters, particularly where legislation is concerned. The words in front of us in the Bill, as well as those uttered by the Minister from the Dispatch Box opposite, can be called upon in a court of law and relied upon to explain decisions and decide appropriate courses of action. The regulator will be deriving its power from this Bill and will be operating according to the principles set out in Clause 8, so it is an absolute necessity that the language in the Bill is clear and well chosen, and I do not think “expedient” meets that test.

A number of the amendments in my name and that of my noble friend Lord Markham in this group are very simple. As the noble Lord, Lord Addington, highlighted, they change “may” or “should” to “must”. I echo the points that he made, and that the noble Baroness, Lady Taylor of Bolton, made when she had an amendment making the same change earlier in the Committee. When moving that amendment, she noted that it was pretty straightforward, and I would make the same observation about our amendments today.

In seeking to make these straightforward changes, we are asking the Government why the less rigorous words “may” and “should” have been used in these instances. That is important to ascertain because of the significance of establishing the regulatory principles in the Bill. The first principle is that the regulator should use its resources in the most efficient—“expedient” as presently set out—and economic way. However, any public body that will be taking funds from the public purse, which this regulator will in its initial period, must be required to use its resources in the most efficient and economic way possible. The word “should” gives a degree of leeway here. I am sure that the clubs that will be paying the levy would not be happy with the regulator using the money they are giving it in an inefficient and uneconomical manner, so Amendment 73 attempts to tighten the phrasing here and remove that leeway.

My Amendment 75 would change the “may” to a “must” in paragraph (b). This would mean that the Bill required the regulator to co-operate and engage with the relevant parties. That amendment is complementary to my Amendment 76, which would leave out the words

“so far as reasonably practicable”.

Again, that amendment is about tightening up the wording of this provision to give the regulator strict instructions rather than looser intent.

I have put my name to Amendment 79 alongside those of the noble Baroness, Lady Taylor of Bolton, and the noble Lords, Lord Bassam of Brighton and Lord Addington, which would also amend paragraph (b). The amendment would add fans as one of the parties with which the regulator must co-operate and would therefore standardise this paragraph with other portions of the Bill.

My other amendments in this group—that is, Amendments 82, 84 and 85—would all change a “should” to a “must”. Amendment 82 would amend paragraph (d) so that the regulator must acknowledge the unique sporting context of football. That is particularly important for regulated clubs since, as the Bill rightly points out and as my noble friend Lady Brady and others have been keen to stress, football clubs operate in a very different environment from other businesses. The top clubs in the English football pyramid will have teams in both national and international competitions, so the rules and regulations they will already be required to follow must be taken into account by the new regulator.

My Amendment 84 states that the independent football regulator must hold officers of a club responsible for the actions of the club where appropriate.

Amendment 85 says that the regulator must operate transparently. Transparency, of course, has a wide range of benefits. The Institute for Government, in its report The Benefits of Transparency, argues that:

“Collating and publishing government data can also help improve the performance of government services, through the monitoring of key metrics and by increasing access to data across government”.


The Institute for Government also points to benefits relating to improved efficiencies, accountability and value for money. Given all this, surely the Bill’s language should seek to require this new regulator to operate with that sort of transparency as well.

I will not enter into the debate that we had over the rival Back-Bench Labour Amendments 80 and 81 from the noble Lords, Lord Shamash and Lord Mann—although the noble Lord, Lord Addington, in true Liberal Democrat fashion, has signed both. I am interested in the Minister’s view as to whether, between those two, she has a preference in consulting supporters, trusts or elected representatives of football club supporters’ groups. I will not reopen the question of the definition of fans, but I am interested in whether she has a preference between those two amendments.

[Baroness Twycross (Lab)]

My Lords, I thank the noble Lords, Lord Markham and Lord Parkinson of Whitley Bay, and, through them, the noble Lord, Lord Maude of Horsham, and my noble friends Lord Bassam of Brighton, Lord Watson of Invergowrie, Lady Taylor of Bolton, Lord Shamash and Lord Mann, for these amendments. This has been a wide-ranging debate.

I particularly welcome the intervention by the noble Lord, Lord Goddard, and the clarity that he provided. I have noted a number of noble Lords coming back and asking me similar questions to those that we have we had in previous groupings. I will endeavour to continue to give the same answer when required, but it was helpful for the noble Lord to point out that at times we are having a circular and repetitive discussion.

Amendments 73, 74, 75, 76, 82, 83, 84 and 85 in the name of the noble Lords, Lord Markham and Lord Parkinson, intend to reword the regulatory principles. They seem fundamentally driven by the desire to ensure that the regulator is held more strongly to the principles. However, we are confident that the current wording of the Bill, which has not changed since the previous Conservative Government laid this Bill before Parliament, is more than sufficient to ensure that the regulator operates in an appropriate way and strikes the balance between steering the regulator’s approach and not impinging on its adaptability and independence. By laying out explicitly in the Bill the principles by which the regulator should exercise its functions, we are already making a clear statement about the importance of these stated factors. However, these are intended to be principles, not duties, and the drafting reflects that.

In relation to the questions from the noble Lord, Lord Addington, on the difference between “must”, “should” and so forth, we do not agree that the regulator must be required to do these things at all times and in all cases but rather that some flexibility is important. To give an example, if the regulator were enforcing against a club, it might not be appropriate or possible for the regulator to constructively engage and co-operate with that club, as principle (b) encourages it to do. By having these principles as “should” and not “must”, that flexibility is achieved.

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[Lord Moynihan (Con)]

I appreciate that the Minister is trying to make progress and is moving through a large number of amendments. To refer back to Amendment 78, tabled by the noble Lord, Lord Watson, the Minister said that she looked forward to a further discussion at a later stage. Could she state whether she agrees with the idea that the regulator must engage with football players and their representatives? I think the mood of the Committee went a bit further than just having hopeful discussions in future, and that this was something that really should be considered to be placed in the primary legislation. Could she be a little more explicit? I know that she was sympathetic, but does she agree that that is an issue that should now be looked at in the context of the legislation?

[Baroness Twycross (Lab)]

The noble Lord might need to be content with my sympathy at this stage. I genuinely look forward to future discussions on this point.

Overall, the Government have been clear that the regulator should take a participative approach to regulation, meaning that it would co-operate constructively with the regulated industry where possible. There are some parts of the Bill—this is one of them—that directly relate to the people or organisations being regulated, rather than to stakeholders across the game more widely. The intention of the regulatory principle in question is to guide the regulator to co-operate constructively specifically with the regulated industry where possible, as this co-operative approach might not otherwise be explicit. We think that to list every possible stakeholder, or possible interpretation of fans or fan groups, that the regulator “should” ever engage with during the course of regulation, could be onerous on participants and the regulator. However, I am happy to meet my noble friends to discuss further how we can reassure fans that they will be consulted where appropriate. For supporters and their relevant representative groups it is clear that the regulator should be acting in their interests. There are several places where this is formalised through specific consultation requirements; for example, in relation to Clause 45, the prohibited competitions clause.

For decisions materially impacting players, I recognise that the game is nothing without players, as I said earlier; it is absolutely right that the regulator works with them on matters that impact them. As I mentioned, the specific regulatory principle in question is intended to steer the regulator to co-operate with the regulated population. This does not include players, as they are not themselves subject to the regulator’s regime. This would be not an appropriate place to include players, or indeed any other stakeholder group. However, I understand the desire among noble Lords to ensure that important stakeholder groups are appropriately acknowledged in the Bill.

I am sure we will revisit this topic ahead of Report and in future debates. With that said, and for the reasons I have set out, I am unable to accept the amendments in this group. I hope that noble Lords and my noble friends will not press them.

[Lord Markham (Con)]

I thank the Minister. I thought we had an uncontroversial set of amendments with a great deal of consensus around the issue of players and fans. I thought that we almost had the ball in the back of the net. We had some sympathy from the Minister, who said she was looking forward to discussing this further; unfortunately, we did not quite get a yes. I hope we can firm that up as we continue to press for a goal as the Bill approaches Report. There was a large degree of consensus in the Chamber that we definitely “must” include players and fans, rather than just “should”. I hope we are able to pursue that further as the Bill progresses. With that, I beg leave to withdraw my amendment.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, I have the only amendment in this group. Amendment 88 is intended merely as a probing amendment to give us the opportunity to ask the Minister what the Government’s policies will be with regard to the other legal requirements that will be placed on the regulator. I am simply seeking some clarifications here, which I hope she can give.

The amendment states that the independent football regulator must be bound by the Freedom of Information Act 2000 and the Equality Act 2010. I note that Schedule 12 addresses these issues by inserting the name of the independent football regulator into the respective Acts of Parliament, but I am seeking clarification principally on how the Government will put in place concrete plans of action to ensure that the regulator abides by both those Acts.

I must admit that I have not read from cover to cover Sir Tony Blair’s memoir A Journey, published in 2010, but there is one passage that I have read and re-read with relish. It is brief so, mindful of the entreaties of the Government Chief Whip but noting the fans of Sir Tony on the Benches opposite, I will quote it:

“Freedom of Information. Three harmless words. I look at those words as I write them, and feel like shaking my head till it drops off my shoulders. You idiot. You naive, foolish, irresponsible nincompoop. There is really no description of stupidity, no matter how vivid, that is adequate. I quake at the imbecility of it. Once I appreciated the full enormity of the blunder, I used to say—more than a little unfairly—to any civil servant who would listen: Where was Sir Humphrey when I needed him? We had legislated in the first throes of power. How could you, knowing what you know have allowed us to do such a thing so utterly undermining of sensible government?”


I was struck by that passage. It bears returning to. There are lessons there for a Labour Government with a large majority and seeking to legislate in new ways to reflect on. But this is the law of the land and these are important Acts of Parliament. I would be grateful if the Minister could clarify what actions the Government will take to ensure that the regulator acts with the transparency required under the Freedom of Information Act, notwithstanding Sir Tony’s views on it now, and the Equality Act 2010. I beg to move.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Parkinson of Whitley Bay, for this amendment to ensure that the regulator must comply with the Freedom of Information Act and the Equality Act. This is, of course, very important. That is why, per the consequential amendments outlined in paragraphs 4 and 9 of Schedule 12, the regulator will already be subject to these Acts. As a result, this amendment would duplicate this requirement that is already in the Bill and is therefore not necessary. As the noble Lord will be aware from his time as a Minister, legislation should be clear and concise where possible. His amendment would lengthen the Bill to duplicate an existing requirement. On that basis, I hope he will feel able to withdraw it.

[Lord Parkinson of Whitley Bay (Con)]

I am grateful to the Minister. As I say, I was mindful that it is in Schedule 12, but she did not give much additional information on how the Government will seek to work with the regulator in making sure that it is adhered to. However, I appreciate that that is for the regulator. I am grateful to her for those reassurances. I have not yet had the pleasure of reading the former Prime Minister’s memoir from cover to cover so, with Christmas coming, I note that my wish list is still to be filled. I beg leave to withdraw my amendment.

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As the noble Baroness knows, her predecessors in her department commissioned a review to examine the status of digital on-demand rights and their relation to the listed regime. I do not know whether she is able to give us an update on that work from her department this evening and when it might be completed, but I hope that she will see, particularly given the support of her noble friend Lord Bassam and me, that this is an issue which unites both sides of the Committee and is worth considering in the context of this Bill, even if we did not get the opportunity to do so during the passage of the Media Act. I look forward to her reply.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord McNally and Lord Parkinson of Whitley Bay, for tabling these amendments, and the noble Lord, Lord Addington, for moving the amendment at the start of the debate on this group. Amendments 91 and 92 in the name of the noble Lord, Lord McNally, raise an important issue that I welcome the opportunity to discuss.

The Government are keen to ensure that sporting events are made available to the public as widely as possible. That is why we have the listed events regime. From the start, there have been strong voices from a number of areas that the regulator must have a tightly defined remit and must not intervene in areas where it is more appropriate for the football authorities and other bodies to take the lead. I am sure the noble Lords will agree that the bar for statutory intervention in any market should be high, a point made by the noble Lord, Lord Moynihan, although with different words. That is why we have ensured that the regulator’s remit is focused solely on tackling the specific market failures that carry a risk of significant harm to fans and communities but which we believe the industry cannot solve through self-regulation.

I sympathise with the noble Lord’s desire to see more matches free to air and understand the frustration of fans who do not always have access to watch their team. I have particular sympathy for the point made by my noble friend Lord Watson of Invergowrie about the access of young people to sport. However, we do not feel it is right to expand the regulator’s remit by including it as a body that must be consulted on which free-to-air football matches are broadcast and to have to take into account the desirability of promoting more football matches becoming listed events. This widened remit of considering broadcasting and commercial decisions would prove a distraction from the key responsibility of the regulator to ensure the financial sustainability of football clubs and would widen the scope of the Bill.

Turning to Amendment 265 in the name of the noble Lord, Lord Parkinson, I was slightly surprised that the Opposition were so keen to debate this amendment now given that it is contingent on Amendment 263, which we will come to later in Committee. Nevertheless, in the spirit of good will, I will respond.

As we face a changing media landscape, we must account for alternative forms of content and ensure the scope of the backstop is not restricted only to television broadcasting rights. This amendment intends to ensure that it is clear that a wide variety of content is in scope of the definition of “relevant revenue”. However, the existing drafting of the Bill has already been chosen carefully to ensure that we encapsulate alternative media sources. The current definition of “relevant revenue” already covers all sales or acquisitions of rights to exploit the broadcasting of football matches, which would apply to revenue produced by online content as well if that online content used footage from broadcast matches. Therefore, the concern underlying the amendment is suitably addressed by the current drafting of the Bill. For the reasons set out, I am unable to accept the noble Lords’ amendments, and I hope that they will not be pressed.

[Lord Addington (LD)]

My Lords, that was not the most positive response I have had to an amendment, but it was worth raising the idea of the listed events and certain things being culturally important. I will take away what the Minister has said and look at it, but it is about the principle that certain things are a little more important and reflect well on the actual product. It can be regarded as a little bit of advertising for those people who are taking some money.

If we cast across to other sports, I hope that people will bear in mind the experience of England Rugby. At one point, it was selling its home games, which meant that fans saw England only when they were away—that was the situation a number of years ago. There is a certain point beyond which you are cutting off people and interest, and possibly the expansion of the rest of your market. Yes, things hide behind paywalls if you have not got the money to pay for it or, as often happens in the modern broadcast world, you discover you bought the wrong bit. Having said that, I beg leave to withdraw the amendment, although I reserve my position about looking at it again.

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[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Evans of Rainow, for his amendment, which was an interesting contribution to this Committee. The noble Baroness, Lady Brady, eloquently outlined the costs to the game. The actions of some football agents are clearly a concern, with both the Government and FIFA publicly recognising it as a serious issue. The noble Lord, Lord Parkinson, gave a number of specific examples.

FIFA has recognised the need for the better international regulation of agents and proposed reforms on this to its member associations. The Government agree with the fan-led review that a global, game-wide solution, led by the industry, is preferable to statutory regulation of agents through the independent football regulator. Trying to address this issue unilaterally could simply push global talent to other markets, so a multilateral solution is preferable. If there is reform, the Government will work with the FA to ensure that any future regulation is fit for purpose. For these reasons, I hope the noble Lord will withdraw his amendment.

[Lord Evans of Rainow (Con)]

I am most grateful to the Minister for her response. I am somewhat disappointed by talk of a unilateral approach, given that FIFA is calling for other countries and authorities to work with it, but perhaps we can revisit this at a later date. I beg leave to withdraw my amendment.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, I will briefly say a few words about my Amendments 106, 108 and 109. Given the hour, I will not speak at length. As with the other amendments in this group, these concern the “state of the game” report. I am grateful to all those who brought amendments in this group and who have contributed to it.

My Amendment 106 is attempting to address a very similar point as does Amendment 105, tabled by the noble Baroness, Lady Taylor of Bolton, and the noble Lord, Lord Bassam of Brighton. Both amendments are attempting to reduce the period in which the regulator will have to publish the first “state of the game” report. As the noble Baroness noted, my amendment changes this from 18 months to six months, whereas theirs looks to change it to 12 months, but the reasoning behind both is the same. The sooner we understand the state of the game under this new framework, the better we can refine and improve the regulator’s role. I think that the sooner that happens the better, but I am not precious about the precise time.

Amendment 108 in my name requires the “state of the game” report to be published every four years to allow for a full and proper reappraisal of the issues facing football. The original draft of the Bill, when it was introduced by the previous Conversative Government, set the period for republishing the report at three years, and the current version sets it at five. With this amendment, I am trying to probe the Government as to why they have made the change that they have in this instance, and I would be grateful if the Minister could say.

With Amendment 109, again, I am trying to probe the Government’s intent. The Bill includes numerous references to consultations with fans, but it does not include any reference to engagement with fans on the draft “state of the game” report. I am curious as to the reasoning behind the drafting. If the Government believe that fans should be consulted elsewhere in the Bill, why not in this instance and with this provision?

I will not speak at length to the other amendments in this group that the noble Lord, Lord Bassam of Brighton, and the noble Baroness, Lady Taylor, have tabled, but I am grateful to them for their thoughts in doing so.

I will touch on Amendment 103, because I am conscious that the noble Baroness, Lady Jones of Moulsecoomb, is not here to mention it. Her amendment deals with the question of environmental sustainability. That falls very much into the category of the baubles on the Christmas tree that my noble friend Lord Moynihan of Chelsea would be very sceptical of. While football has a role to play in tackling climate change, the regulator must ensure that its focus remains on football governance. In the noble Baroness’s absence, I wanted to make sure that her amendment was noted, and if the Minister has anything to say on it, I am sure that she will be grateful to read it back.

Amendment 104, in the name of my noble friend Lord Markham, and to which I have added my name, attempts to expand the scope of the “state of the game” report. This requires the regulator to include an assessment of the overall financial health of football, an assessment of the current state of fan engagement and an overview of the current regulatory functions that are carried out by existing football bodies. We think that these additions are crucial. Financial health is the bedrock of football’s future, and fan engagement is its very soul. We must also respect and leverage the expertise of existing bodies, such as the FA, in ensuring that the regulator complements, rather than duplicates, their efforts.

The amendments tabled in this group reflect the wide-ranging interests and challenges facing English football. On these Benches, our priority is to ensure that the Bill creates a framework for governance that is robust, focused and effective. We must protect the integrity of the game, empower clubs to succeed and respect the fans who are its beating heart. I hope the Minister will seek to do that too in her response.

[Baroness Twycross (Lab)]

I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton and the noble Lords, Lord Parkinson of Whitley Bay, Lord Markham and Lord Addington, and the noble Baroness, Lady Brady, for tabling these amendments and for the discussion of them. I will take them in turn.

I turn first to Amendment 94 in the name of my noble friend Lady Taylor of Bolton. While I understand the intent behind this amendment, we do not consider it necessary and believe the Bill already covers this issue, and I hope that this reassures her. The positive social impact of regulated clubs in their communities features in the very definition of the sustainability of English football in Clause 1, so we fully expect that the regulator will naturally cover these areas in the “state of the game” report.

I turn to another of my noble friend Lady Taylor’s amendments in this grouping, Amendment 100. While the areas that my noble friend highlights, such as environmental sustainability and ethics, are important, they are not within the remit of the regulator and therefore will not be in scope of the “state of the game” report. In so far as the other areas are relevant to the regulator’s functions under the Bill, it already has the power to report on, for instance, a club’s general financial sustainability.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Monday 16th December 2024 Lords Chamber

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I will speak to my Amendment 111, which is part of this group, and pick up some of the points that my noble friends have raised in the debate.

My Amendment 111 states that the Secretary of State should not be permitted to revise a football governance statement simply because there has been a “significant change” in government policy on football. The reasoning for this comes from much the same place as my noble friend Lady Brady’s Amendment 110: both try to prevent the possibility of frequent changes in the Government’s policies for the regulator. If the Secretary of State took up every opportunity that the Bill allows to alter the governance statement—it could be every three years, after every general election and after every change in government policy—we could see this governance statement being altered rather frequently, every few years, with effects on the stability of football.

How would clubs have the certainty they need to plan their investment? As my noble friend Lady Brady said, football clubs plan their infrastructure and stadium developments over periods of 10 to 15 years or more. The talent pipeline, which is needed to develop the players of the future, requires much more than five years of careful thought and investment. To do all this and deliver the sustainability of English football, clubs need to know what the policies of the regulator will be over the long term. They need to know what the regulator will require of them.

My noble friend Lord Hayward reflected on a broader point in his remarks. The Government have been at pains to stress the importance of the independence of this regulator. I do not doubt their intention, but how will that independence be maintained when there could be regular and changing political statements setting out the policies to which the regulator will have to adhere? We need some assurances that these governance statements will not interfere with the operational independence of the regulator. To do that, it seems much more sensible that the Secretary of State should not be able to revise these statements on a whim or because the department’s Secretaries of State are changing with the regularity that we have seen in recent years.

I hope the Minister will address the points that have been raised and look favourably on these amendments. I look forward to her reassurances.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank the noble Baroness, Lady Brady, and the noble Lord, Lord Parkinson of Whitley Bay, for their amendments. Clause 11 permits the Secretary of State to publish a statement on government policy related to football governance. The statement is non-binding, but the regulator will be required to have regard to it when exercising its functions.

On Amendment 110, in the name of the noble Baroness, Lady Brady, we believe that, given the fast-paced nature of football and the changing regulatory landscape, every three years is a suitable time to pass before the Secretary of State can amend this statement. This decision was reached following consultation with other regulators.

There is no duty on the Secretary of State to amend or publish a statement every three years, unless there is reason to. I understand the noble Baroness has concerns that this could present an opportunity to exert political influence on the regulator and thus a risk to the regulator’s independence. Although this is a standard provision for most economic regulators, I recognise the intent behind the amendments, to reduce the risk of interference.

The noble Lords, Lord Parkinson and Lord Hayward, raised concerns that this clause might limit independence. The football governance statement cannot be used to direct the regulator’s day-to-day operations, so it will not impinge on the operational independence of the regulator. The Bill has been brought forward as a result of the policy of this and the previous Government. As the noble Lord, Lord Pannick, made clear, the regulator’s statutory scope and powers would remain unchanged and it would be under no obligation to act in accordance with any statement. We want to ensure that the regulator remains free of any undue political interference; this drafting, as with the previous Government’s version of the Bill, achieves that.

The noble Baroness, Lady Brady, and the noble Lord, Lord Maude of Horsham, raised concerns around UEFA’s position in relation to this clause. As I have reiterated previously, we have engaged extensively with both the FA and UEFA in the development of the Bill. As has been confirmed by the FA, we are confident that the Bill as drafted will not breach any UEFA statutes. The regulator will be operationally independent of the Government and will not exert an undue influence on the FA’s ability to govern the game. This was confirmed by the FA itself in oral evidence given to the House of Commons Public Bill Committee on 14 May during the passage of the previous Bill introduced by the last Government.

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[Lord Moynihan (Con)]

My Lords, I will speak to my Amendment 119A in this group. Noble Lords will recall that, on many occasions, I have been active on the appointments made by the DCMS, in particular when it came to the consumer protection Bill in your Lordships’ House and the non-declaration of the CEO of Seatwave, which was an online European ticketing marketplace that was then to be sold to Ticketmaster. The announcement of the individual concerned to the DCMS board made no mention of that, and nor was there any declaration in the House, despite the fact that Seatwave was subject to very significant criticisms about ticket touting and the impact on consumers.

I took an interest over the weekend to look in more detail at some of the appointments that have been made, to satisfy myself and the Committee that they were wholly independent of government. Could the Minister provide the Committee, in due course, with a comprehensive answer on the process that has been followed to date for each and every appointment to the senior levels of the shadow football regulator, including when and how the legal requirements for Civil Service recruitment have been implemented, namely that selections must be based on merit and on fair and open competition? Departments and agencies can develop their own recruitment approaches, but how has the governance code on public appointments been followed, including integrity, merit, openness, diversity and assurance? Who has been on the appointment boards and how many appointments have been made from outside DCMS officials?

What would help the Committee to understand the question of the degree of true independence of the proposed football regulator is to know how many of the Bill team and the paid advisers to the DCMS are going on from government to join the shadow regulator and, in due course, the full regulator. Are the shadow regulator contracts in any way tied to appointments to jobs with the full regulator? If so, how many and whose?

My probing amendment does not question in any sense the integrity or competence of the candidates concerned. But I went on LinkedIn this weekend and had the opportunity to read, as a result of a connection on LinkedIn, that one of the most senior appointments made was based, in part no doubt, on the outstanding work that was done by that individual on football governance while doing their PhD. I will give one quote from that—and, again, it is not in any way impugning the integrity or professionalism or the outstanding nature of this somewhat long PhD. With this quote, I was a bit concerned about whether the independence of the appointments was truly up to the standard we would wish to see:

“Granting an authority the power to legally regulate the football industry, compelling all English football clubs to comply with the established economic framework or risk being unable to use their football facilities, thereby prohibiting the club from playing in any football competition, either domestic or international, would transfer economic power back from the clubs and leagues to the regulatory authority, reversing the process initiated by the creation of the EPL in 1992”.


That is a fairly major statement that counterbalances the Premier League’s autonomy and would question the true independence of the proposed independent regulator.

I have not had the opportunity to read the whole thesis. I look forward to doing so, and to reading any other public documentation through LinkedIn. I think it is incredibly important that, if we are going to have an independent football regulator, that regulator has to be truly independent. All the appointments need to be made on merit, bringing in the very best people in regulation from across the country, and indeed possibly from abroad, to fulfil those important responsibilities and posts. I would be grateful if the Minister could give us the confidence that that is exactly what is being pursued.

[Baroness Twycross (Lab)]

I thank the noble Baroness, Lady Brady, and the noble Lords, Lord Moynihan and Lord Parkinson of Whitley Bay, for putting forward these amendments.

On Amendments 112, 113, 114, 115 and 117, in the name of the noble Baroness, Lady Brady, we clearly agree that producing guidance will be a really important part of the regulator’s work. It will help to clarify the practicalities of the legislation and ensure that clubs’ owners and competition organisers know what is expected of them and what to expect from the regulator. However, while I recognise the intent of the approach proposed, I disagree to some extent with the approach to guidance that the noble Baroness, Lady Brady, has suggested we take. Amendments 112, 113, 115 and 117 would require the regulator to produce guidance on all aspects of its functions. This is likely to be a disproportionate and needlessly burdensome requirement that would likely end up being more unhelpful than helpful.

There is little benefit in issuing guidance on issues that are self-explanatory or that do not have a direct impact on the industry. I will endeavour to find some examples of that type of guidance to meet some of the queries from noble Lords—for example, on every one of the regulator’s operational or administrative functions, excessive guidance would make it harder and more burdensome for clubs to understand and comply with the system, not easier, and National League clubs would potentially struggle to sift through reams of guidance to get to what was relevant to them. We expect that the regulator will publish guidance on all relevant parts of its regime, as appropriate. It is in everyone’s interests to maximise the industry’s understanding and compliance.

On Amendment 114, in the name of the noble Baroness, Lady Brady, the regulator is already required to publish guidance on how it will use discretionary licence conditions, including the outcomes it seeks to achieve. We believe that this requirement is sufficient, and it will be for the regulator to determine what that guidance should look like and how best to aid the industry without unduly burdening it.

I turn to Amendments 116 and 118, in the name of the noble Lord, Lord Parkinson. Amendment 116 would require the regulator to prepare and issue a code of practice for all competition organisers and licensed clubs. We do not believe that a code of practice for all clubs would allow for a proportionate, tailored approach to regulation, where what is required of a club should vary depending on the club’s specific circumstances. The regulator’s current approach of bespoke regulation will address the unique challenges and risks faced by clubs better than a list of one-size-fits-all recommended measures, and its guidance, as per Clause 12, should already help clubs to understand what is required of them and to comply.

On the points raised by the noble Baronesses, Lady Brady and Lady Evans of Bowes Park, on Amendment 118, the regulator is already required to consult such persons it considers appropriate when publishing guidance. We strongly expect that this will include the FA, competition organisers and regulated clubs, since those persons will all be directly relevant to and affected by that guidance. However, we have not taken the approach in this Bill of listing every person the regulator should consult for every piece of guidance issued. To do so would, in our view, be counter to the operationally independent and agile regulator that we are trying to establish.

There may be times when different levels of consultation are necessary, or with different stakeholders. The regulator is best placed to draw the line between comprehensive consultation and needless bureaucracy, and to ensure that the correct groups are consulted on a case-by-case basis. On the specific consultation requirements in the Bill, including on guidance, the regulator has a regulatory principle that it should co-operate and proactively and constructively engage with clubs, owners, officers and competition organisers. I hope that that gives the noble Baroness, Lady Brady, some confidence around the collaborative points she raised. This amendment would require the regulator to consult on minor revisions to guidance, needlessly creating an administrative burden for the regulator and those consulted.

Finally, Amendment 119, in the name of the noble Lord, Lord Parkinson, and Amendment 119A, in the name of the noble Lord, Lord Moynihan, relate to the Secretary of State guidance in Clause 13. Amendment 119 seeks to extend the period that the Secretary of State cannot amend guidance on the regulator’s functions from three to five years. While the regulator must have regard to the Secretary of State’s guidance, as an operationally independent body it will not be obliged to follow it. The industry and fans alike have been clear that they do not want to see excessive ongoing government involvement in football. That is why the Secretary of State may not revise this guidance any more frequently than every three years. The Secretary of State must consult both the regulator and anyone else they consider appropriate before publishing or revising any guidance, and must lay the guidance before Parliament. While I appreciate the concerns of undue influence, extending this to five years, when there may be an issue that needs clarificatory guidance before then, would be sub-optimal.

On Amendment 119A, I agree that the regulator should be independent and free from government influence. I do not have the level of detail that the noble Lord, Lord Moynihan, requested. However, I am confident that appointments will be made on merit. I will write to him with additional detail following the debate. Secretary of State guidance on this point would be unnecessary. The employees of the regulator will already be independent from the Government, like other regulators in the country. Independence has been at the heart of the regulator’s design, with it having sole discretion over its operational decisions. The aims of this amendment are therefore already achieved by the Bill’s current drafting.

I have noted the points from across the Committee on the amendments in this group and I am happy to discuss these further ahead of Report. However, for the reasons I have set out, I hope the noble Lords will not press their amendments.

[Lord Addington (LD)]

I take it that we have a consensus that there should be some way to find out what the regulation is and the reactions to it. Will the Minister give us an assurance that it will be published somewhere we can find it? That is the real point.

[Baroness Twycross (Lab)]

Perhaps the noble Lord could clarify whether he means once the regulator is up and running. I assume so. It would be very unusual for that to not be the case, but I will confirm that and get back to him, I hope, in the course of the evening.

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[Baroness Twycross (Lab)]

My Lords, before I respond to the points that have been raised, I want to respond to the point raised by the noble Lord, Lord Addington, in the previous group, in relation to the regulator’s guidance. I can confirm that the regulator’s guidance will be published. Clause 12(5) of the Bill states:

“The IFR must publish any guidance”.


I also want to clarify a point raised by the noble Lord, Lord Hayward, because I am concerned that if I let it lie then, at a later date, somebody may suggest that it was accepted. It was that only seven clubs had been met with. I stress to your Lordships’ House that this Bill is the culmination of almost five years’ work which started in 2019. Officials have had extensive regular engagement with key stakeholders, including with the clubs which will be subject to the regulation. All clubs have had a number of formal opportunities to share their views, particularly as part of the fan-led review and the football governance White Paper. Over this five-year period, DCMS has had hundreds of meetings with clubs, leagues, fan groups and other stakeholders. No club that has requested a meeting has not had one. I hope that clarifies that point.

[Lord Hayward (Con)]

While I understand the Minister citing a series of meetings that have taken place over a number of years, we are now talking about a Bill which has been introduced by this Government with changes from the previous Bill. Some of those changes have already been debated, and some have not. Surely, it behoves the Secretary of State and any Minister within a Government to have slightly more than a half-hour conversation with seven members of the Premier League when we know that they are going to be the most affected clubs in terms of cost burdens.

[Baroness Twycross (Lab)]

The noble Lord and I may need to agree to disagree on the level and extent of the consultation. The culmination of consultations between officials and the various meetings that have taken place constitute very sound consultation. I was concerned that it might appear to your Lordships and to people externally that only seven clubs had been met during the whole course of the design of a new regulator, which I think all noble Lords would agree would be highly unusual and undesirable. I may return to that point; noble Lords may raise it again in Committee. I look forward to further discussion of what constitutes consultation.

I thank the noble Lord, Lord Markham, for his Amendment 124, which creates a mechanism for the regulator to delegate its function to the competition organisers. I understand that some noble Lords believe that the regulator should act as an overseeing body, only acting through the leagues and only stepping in once the leagues have failed to address a problem or, in some instances, not wishing the regulator to exist at all. Without wanting to disappoint noble Lords, including the noble Lords, Lord Maude of Horsham and Lord Hayward, the noble Baroness, Lady Brady, and others who support this amendment, I am afraid that the model of regulation is not one that we are proposing and nor is it the model that the previous Government proposed. Notwithstanding the points that have been raised repeatedly, this is now this Government’s Bill and we are very proud to bring it before your Lordships.

The fan-led review laid bare the issues with industry self-regulation, and this is an amendment where it is important for your Lordships’ Committee to reflect on the fact that football has had ample opportunity to get this right. We are legislating only because the leagues do not have the incentives and governance structures to address these problems adequately.

I agree with the point made by the noble Lord, Lord Goddard of Stockport, that this amendment could be argued to represent a bear trap. I also agree with a number of points raised by the noble Lord, Lord Pannick, and the noble and right reverend Lord, Lord Sentamu. As has been demonstrated, compliance with current competition organiser rules has not proved an effective way of ensuring sustainability of the game. That is precisely why a new bespoke regulator is required, with the powers, incentives and agility to act where competition organisers are unable to.

However, I want to reassure the noble Lord that the regulatory system is already designed in such a way that the regulator should not need to intervene if the required standards are already being met. If clubs are meeting their threshold requirements naturally—for example, through their compliance with the industry’s existing rules—then the regulator will not need to apply discretionary licence conditions. There is also the more formal

“Commitments in lieu of … discretionary licence conditions”


mechanism, where leagues will be given an opportunity to address specific identified financial problems so that the regulator does not need to attach a licence condition.

Beyond this, however, we do not believe that the regulator should delegate functions to the leagues—there would be a significant issue of accountability. In a case where a function was delegated and serious failings happened, accountability would then be hard to ascertain. We also do not think that a power for the Secretary of State to direct the regulator would be appropriate. Not only could that constitute undue political influence on the regulator but it would also open the door to continuous lobbying by competition organisers for regulation to be delegated to them. What is more, the amendment would allow the Secretary of State to give this direction and for regulation to be delegated back to the industry without any prior parliamentary scrutiny.

On the points raised by the noble Baroness, Lady Brady, about the FA’s willingness to take on delegated functions, my department continues to have discussions with all stakeholders, including the FA, on a range of issues. It is encouraging that there is willingness in the industry to tackle the problems of financial sustainability. However, as the fan-led review clearly showed, the industry has not proved able to take forward the reforms needed at this time due to the governance and constitutional arrangements in place, as well as lacking the expertise required to deliver the regime we have been discussing. An independent body free of industry influence is needed; now is not the time to delegate functions. However, as with all aspects of the Bill, the Government will keep under review the effectiveness of the regime to deliver regulation. For these reasons, I am unable to accept the amendment, and I hope the noble Lord will withdraw it.

[Lord Parkinson of Whitley Bay (Con)]

I thank the noble Baroness. Is she saying therefore that we are, in essence, past the point of no return in relation to some of the competition organisers? I take what she says about the discretionary licence conditions that are available to the regulator that give it a bit of leeway with those that get their house in order, but if football were to get its act together, does she not foresee a circumstance in which some of the functions that are going to be given to the new regulator could be given to organisers, whether at the direction of Secretary of State, or by the choice of the regulator?

[Baroness Twycross (Lab)]

I agree that statutory regulation should exist only where it is necessary. In our view, the regulatory system is already designed to be proportionate so that intervention can automatically scale up and down as needed. Clubs that are already well run and are lower risk should not face additional requirements. We want standards in the industry to improve, and if this were to happen and the market was derisked, I would expect the regulator to be less involved and less noticeable. I want also to stress that the regulator will not stop the leagues imposing their own competition rules so long as they do not conflict with the regulator’s regime. However, this is not an amendment which we feel would serve the sector well, and that was why I asked the noble Lord to withdraw it.

[Lord Markham (Con)]

I thank noble Lords; it has been a genuine exchange of views. I am also glad that it gave an opportunity for the noble Lord, Lord Hayward, to make a positive point about Spurs over the weekend—and that there was a positive point available to be made about Spurs.

I genuinely appreciate the constructive challenge that we have had in this debate. I feel that there has been a bit of a misunderstanding, however. When we say that we are asking for delegation, as in contracting out the function, it is not abdication, because the independent regulator will always be ultimately responsible for that decision. It always has the final say. It is just trying to adopt the policy, which I think many of us believe in, in terms of devolution or subsidiarity—call it what you want—but it is another form of trying to make sure that the power is as close to the coalface as possible, at the same time always giving the opportunity for the regulator ultimately to make the decision. As my noble friend Lady Brady said, this point was absolutely envisaged in the White Paper. The FA and UEFA welcome it, and I must admit that I cannot see why we would not want those who are closest to it to have responsibility first.

Again, I want to clear up that I am not talking about the clubs; they are different from the competition organisers. The clubs and the Premier League, for instance, have very different views, as we have seen recently on financial fair play. The amendment is about giving those regulatory bodies—such as the FA, the Premier League and the EFL—an opportunity, where they are best placed to do it, to make those decisions themselves. If the regulator does not agree with that, ultimately it always has the final say.

I hope we will be able to return to this, because I hope it would demonstrate the collaborative approach that all noble Lords and the Government are trying to bring. I know that it is what we have all said many a time in this debate as well. At this stage, I beg leave to withdraw the amendment.

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[Lord Markham (Con)]

I thank the noble Lord. Of course, we want to have the flexibility to react to such situations. This issue comes up in various other contexts, such as government statements. There are lots of points where the Secretary of State can vary the approach. The question is: how do we get the checks and balances right? However, I think there is basic agreement on this issue, and I would like to hear the Minister’s views.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Markham, Lord Parkinson of Whitley Bay and Lord Moynihan, and my noble friends Lady Taylor of Bolton, Lord Wood of Anfield and Lord Mann for tabling the amendments in this group. I also thank all noble Lords for their contributions. I will take each of the amendments in turn before responding to the noble Lords, Lord Markham and Lord Parkinson, and their opposition to the entire licensing regime standing part of the Bill. I will endeavour to get the noble Lord, Lord Pannick, a response to his question in the near future; I do not have the detail he requested today.

Amendment 128, from my noble friend Lady Taylor of Bolton, and Amendment 129A from the noble Lord, Lord Moynihan, relate to owners. The first seeks to make identifying an owner’s source of funds a prerequisite for a provisional licence. I absolutely agree that it is crucial that the regulator has oversight of an owner’s funding, so it knows how a club expects to fund its activity and the source of this funding. I hope my noble friend will be reassured that this is why a club is already required to provide such detail as part of its application for a provisional operating licence.

When a club submits its application for a provisional operating licence, this must include a strategic business plan. Among other things, this must contain detail about the club’s operating costs, how these costs are to be funded and, crucially, the source of such funding. This will enable the regulator to scrutinise the source of the funds. On the point made by the noble Baroness, Lady Grey-Thompson, importantly, a club must set out how much it plans to spend and how it will fund that cost. Furthermore, if the regulator has concerns at any time—even before it has received its provisional operating licence—about the source of an owner’s wealth, it can test that owner. Should it find that an owner’s source of wealth is connected to illicit finance, that owner will be found unsuitable.

I also agree that it is important that the industry has certainty as to what the regulator will consider “significant influence” by owners. Of course, what is meant by “significant influence and control” would need to have been set out in guidance before clubs and the regulator can consider who meets this definition. That is why I can assure noble Lords that the Secretary of State’s guidance will be produced in good time, in order to give this clarity.

Noble Lords should note that the provisions in Clause 3 and Schedule 1 that define “owner” come into force on the day the Bill becomes an Act. That means that the obligation on the Secretary of State to produce this guidance comes into force on that day, whereas the licensing provisions and other provisions which rely on the definition of “owner” will be commenced later, by regulations.

I turn to Amendment 132, from my noble friend Lord Mann. Although the risk of clubs going into administration will be greatly reduced, it may still happen. The regulator revoking a licence would be the ultimate punishment and would be used only in the most extreme of circumstances. I assure my noble friend that the regime is designed to avoid the situation his amendment aims to provide for, and that ensuring that a club has a plan for adverse shocks is at the heart of the regulator’s financial regulation regime. This might include a plan to keep the club going if, for example, an owner can no longer continue to fund it. We have spoken to many football clubs while developing the Bill, and know that the well-run clubs already do this.

Turning to Amendments 167A and 168A to 168C, from the noble Lord, Lord Moynihan, I understand his intention that the regulator should identify a clear risk before acting. The amendments are not necessary to achieve the aim in relation to his points on discretionary licence conditions, as was explained to the Premier League when it suggested these exact amendments prior to introduction. The regulator can attach discretionary licence conditions only if the conditions contribute to a club meeting the threshold requirements, or if the conditions advance systemic financial resilience.

The regulator is bound by its general duties, meaning that it must have regard to its regulatory principles and must act reasonably and proportionately. In effect, that means that the regulator can attach a discretionary licence condition only to address a risk it has identified. I assure the noble Lord that the regulator cannot take any action that is meaningless or does not advance its objectives. If a club feels the regulator is doing that, it can appeal any action through the appeals regime.

Ultimately, these four amendments all seek to raise the threshold for intervention and limit when and how the regulator can act. For every discretionary condition, the regulator would have to demonstrate that there was no possible alternative to achieve the aim than to impose that specific condition. This would be an unacceptably high bar, fettering when the regulator can act. In practice, we think the risk of legal challenge could lead to an excessively risk-averse regulator, afraid to act swiftly or at all.

I thank my noble friend Lord Wood for Amendments 168 and 169 and for his genuinely constructive approach to scrutinising the Bill, which I very much appreciate. I note that the noble Baroness, Lady Brady, also expressed concern on the points he raised. My noble friend has met with officials and me regarding these amendments and I hope that those meetings were useful. We believe these amendments would severely limit the regulator’s flexibility to meet its objectives and ensure clubs reach their threshold requirements. The regulator should not take its lead from the competition organisers. Of most concern is the blurred accountability that this approach would introduce. The fan-led review laid bare the significant issues with self-regulation, and that is why we are introducing an independent regulator.

That said, the system is designed so that the regulator should not need to intervene if the required standards are being met. If clubs meet their threshold requirements naturally—for example, through their compliance with the industry’s own existing rules—the regulator should not need to apply discretionary licence conditions. The model in this legislation is the right one, with clear accountability, and where discretionary licence conditions are not applied in a one-size-fits-all way but reflect each club’s specific circumstances.

My noble friend Lord Bassam raised the basic requirement for clubs to have a sustainable business plan. I agree with him that that is important. That basic requirement, as well as the requirement for clubs to engage with their fans and ensure that their owners and officers are suitable custodians, are light-touch, appropriate measures that should already have been in place.

On Amendment 169A, from the noble Lord, Lord Moynihan, the regulator is already required to publish guidance about how it will use discretionary licence conditions, including the outcomes it seeks to achieve. That will give upfront clarity to clubs and competition organisers. However, the Government do not believe that the level of detail in the noble Lord’s amendment is appropriate for the Bill. He and I would agree that we are not in-depth experts on football finances—had I looked ahead in my speech, I perhaps would not have said that, and I apologise. I am not an in-depth expert on football finances, the inner workings of football clubs or how football clubs operate; I will allow the noble Lord to make his own conclusions on the extent to which he is. The regulator will employ experts in this sector who will have far more knowledge of these areas than we do. They will also have a stronger evidence base on which to base their actions, informed by things such as the “state of the game” study and consultation with the industry itself. That is why we have required the regulator to publish guidance on discretionary licence conditions and why we think it should be left to do this independently. We do not want to unintentionally hamstring the regulator with overly prescriptive requirements for the guidance it must produce.

In response to the point made by the noble Lord, Lord Moynihan, if the regulator agrees with him that it should include detail on financial shocks, liquidity and debt management, it will include this.

I turn next to Amendment 173, from the noble Lord, Lord Markham. The Bill outlines the specific types of discretionary licence conditions that the regulator may attach to a club’s licence to address its financial or non-financial resources or to improve systemic financial resilience. It is possible that, as the industry evolves, these types of conditions might not remain adequate to address the new or different financial risks faced by clubs, and there might be more effective ways to address them. That is why it is crucial that there is a mechanism in the Bill to enable the types of conditions available to the regulator to be updated. This amendment would deny the regulator this flexibility and potentially make the regime unable to adapt to changing economic circumstances. It is vital that the regulator has appropriate the tools to regulate football effectively, both now and in the future.

I reassure the noble Lord, Lord Markham, that the Bill does not give the regulator or the Secretary of State free rein to make changes. The Secretary of State can amend the types of discretionary licence conditions that can be attached only if requested in writing to do so by the regulator—a point highlighted by the noble Lord, Lord Pannick. The regulator would have to provide clear reasons and consult stakeholders ahead of making a request.

[Lord Jackson of Peterborough (Con)]

On that specific point, in Clause 22(8), the language is quite permissive and wide-ranging regarding who the IFR considers it appropriate to consult in respect of wide-ranging powers, particularly those to add or remove an item from primary legislation. Can the Minister confirm that the guidance that the Government will publish will tidy that up and make it tighter on who the IFR has to consult before it would write to the Minister seeking to vary the licence conditions?

[Baroness Twycross (Lab)]

We discussed in one of the previous groups why the legislation does not currently have specific people that have to be consulted every time. I commit to write to the noble Lord to clarify the specific point he raises. The regulator would have to provide clear reasons and consult stakeholders ahead of making such a request. The Bill has not stated every single person the regulator would have to consult every single time, but there are principles at play around how the consultation would need to take place.

[Lord Jackson of Peterborough (Con)]

I thank the Minister but she will agree that the guidance could, for instance, include groupings of particular types of people who would be key stakeholders and would need to be consulted, because this would obviously be quite a wide-ranging intervention by the IFR.

[Baroness Twycross (Lab)]

I will write to the noble Lord on that point. I hope it will give noble Lords some reassurance that Parliament would also be able to scrutinise any change, as regulations would need to be made by the affirmative procedure.

We do not believe that Amendments 174A and 174B, in the name of the noble Lord, Lord Moynihan, would be helpful to the regulator, as we explained to the Premier League prior to introduction. The addition of a minimum six-week period would mean a total minimum of eight weeks once you include the minimum period for making representations or giving a commitment in lieu. That would mean an eight-week delay, during which the regulator would not be able to impose a financial condition, which might mean that the regulator would have no choice but to sit idly by while the issue identified at the club gets worse. That would be contrary to the regulator’s objectives and principles and is therefore not considered acceptable by the Government. Slow action has been a common feature of industry self-regulation. We will not allow it to become a feature of the independent regulator’s regime.

The regulator already has a regulatory principle to proactively and constructively engage with the regulated industry, including competition organisers. This means that regulatory intervention at one of their clubs should never come as a shock to a competition organiser. Once the regulator has given notice of its intention to attach a financial discretionary licence condition, the competition organiser will have a minimum of 14 days to propose a commitment in lieu. To be clear, this is a minimum; the regulator may well decide to specify a longer period, but, equally, if the situation was sufficiently serious and urgent, the regulator should not be prevented from acting without delay. The minimum period of 14 days therefore strikes the right balance.

Amendment 174B only adds further burden and confusion to the process of applying financial discretionary licence conditions. The regulator is required to follow the procedure set out in Clause 23, except in very limited circumstances. This includes urgent circumstances where the regulator considers that the issues are so significant and urgent that the condition needs to be imposed immediately. Under those circumstances, burdening the regulator with a requirement to go through the process of commitments in lieu when it has already acted under urgency and has its own regulation in place is not acceptable. This would also leave clubs in an ongoing state of uncertainty, where an existing financial licence condition might be replaced with a different competition organiser requirement. This would be unnecessarily complicated, confusing and burdensome.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, I have added my name to the amendments in this group, and I certainly agree with what the noble Lord, Lord Pannick, has suggested in relation to Amendment 125. We are grateful to him. The noble Lord, Lord Addington, is right that we are seeking to make sure that we get the right balance with this group of amendments. We are keen to close the unfortunate gap that the Bill currently poses, which is that, if it passes without amendment, nobody will know what rules the regulator might yet specify or the period in which it might specify them. We need a bit more clarity for those preparing to be regulated and wanting to do so in this way would be useful. With gratitude to the noble Lords who have done the work of the Committee and suggested ways in which to improve on this ahead of Report, I look forward to hearing what the Minister thinks.

[Baroness Twycross (Lab)]

My Lords, I thank the noble Lord, Lord Markham, for tabling these amendments, and the noble Lords, Lord Pannick, Lord Addington and Lord Parkinson of Whitley Bay, for what has been a short but constructive debate. If the noble Lord, Lord Pannick, was, as was suggested by the noble Lord, Lord Addington, making changes on the hoof, I hope that he will accept that I am not going come up with a response on the hoof, but I will endeavour to look into the points that he raised and will get back to the whole Committee subsequently.

Starting with Amendment 125, I understand the desire for quick implementation, and the desire to make sure that clubs are given clarity on what is required of them as soon as possible. However, we believe that the regulator should not have an arbitrary deadline imposed on it to make rules relating to the application of provisional operating licences. The regulator should be able to conduct an effective consultation with clubs regarding the rules around this clause, and that should not be rushed. The regulator is already encouraged to be expedient, including in its regulatory principles, though I note that in a previous debate the noble Lord, Lord Parkinson of Whitley Bay, raised some concerns around the definition of “expedient”, which we are still looking into. Beyond this principle of being time-efficient, the regulator should not be subject to arbitrary, tight deadlines that would serve only to limit its operational flexibility.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, like the noble Baroness, Lady Taylor of Bolton, I always balk when I see a group described as miscellaneous, or even worse in this case, “misc”. On the failure to give new names to the groups that have been degrouped, it is always helpful to have a go at giving us a theme. But I am grateful to the noble Lords who have covered a wide range of very important issues in this group.

I wanted to say a few words about my noble friend Lord Markham’s Amendment 332, to which I have added my name. A number of noble Lords raised in previous debates the concerning example of the delegated power for the Secretary of State to decide what and when a season is. I am glad we have had opportunity to discuss that on its own. This delegated power seems to be egregious. I am not quite clear why the Secretary of State should have a say on what constitutes a football season. I am not even sure why this delegated power is necessary—apart from granting the Secretary of State more powers over the game, there does not seem to be any particular advantage to her in granting herself this rather curious power. I would be interested to hear the Minister’s response. I wonder whether UEFA has a view on this measure. Would it not regard the Secretary of State being able to intervene in the definition of a season as political interference? If the Government have had discussions with UEFA on this point, I would be grateful to know.

I do not think the noble Lord, Lord Mann, actually got round to speaking to his Amendment 153 in this group, which relates to modern slavery—such are the pitfalls of a miscellany—but I wanted to highlight that one and congratulate him on bringing it forward. I am sure all noble Lords would agree that everyone has a duty to prevent this abhorrent crime. I was very proud to work at the Home Office when my noble friend Lady May of Maidenhead brought through the Modern Slavery Act 2015, which has made large headway into cracking down on this abhorrent behaviour. Since then, both the Premier League and the English Football League have released an annual anti-slavery and human trafficking statement, as have all the participating clubs. As the Minister knows, I am wary of increasing the scope of the regulator, but I would be interested in hearing how she thinks this new regulatory regime will operate within the law that we already have to tackle modern slavery and what she thinks of the amendment from the noble Lord, Lord Mann.

I am grateful to the noble Lord, Lord Pannick, for his comments on football agents. Whether they are more or less popular than lawyers, I will leave to others to decide—and indeed whether the existing regulation that is brought about by UEFA and others he mentions is, in this case, sufficient and not a requirement for further regulation, as we see in some of the other behaviours in football. I leave all these, and the miscellaneous other issues that noble Lords have raised, to the Minister to respond to.

[Baroness Twycross (Lab)]

I thank noble Lords across the Committee for the thorough debate on this group. If the group is called misc or miscellaneous, that does not diminish the significance of the concerns raised.

I will take each amendment in turn. First, I thank my noble friend Lord Mann for his Amendment 129. While it is right that the regulator should have all relevant details of the club’s finances when assessing it for an operating licence, we do not believe this detail is required to be provided in the Bill. The personnel statement should detail any key individuals working specifically at the club in question and should not include external individuals. However, any relevant financial arrangements can be included within the strategic business plan, or the financial plan, if the regulator deems this necessary.

My noble friend Lord Mann and the noble Lords, Lord Goddard of Stockport and Lord Evans of Rainow, raised concerns about agents and their fees. A different perspective—it is always helpful to get a rounded perspective—was raised by the noble Lord, Lord Pannick. In response to the broader point regarding agents, as was noted, FIFA has recognised the need for the better international regulation of agents and has proposed reforms. FIFA’s member associations, such as the FA, will retain the ability to introduce stricter requirements on agents than those stipulated in FIFA’s regulations. The DCMS will work closely with the FA to ensure that any national regulations for agents are fit for purpose. The Government are working with the FA and FIFA to track the implementation of these regulatory reforms, which are due to begin next year.

Amendments 150 and 164, in the names of my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton respectively, concern assets of community value. Home grounds are often the most important assets that a club owns. That is why the Bill has prioritised key protections to prevent them being sold, used as collateral or relocated without the necessary considerations. “Asset of community value” status is another mechanism that a number of clubs and supporters’ groups have obtained for their home grounds.

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[Lord Bassam of Brighton (Lab)]

My Lords, if I may ask the Minister to give way very briefly, I raised the issue of the abolition of FA Cup replays in the context of consultation. Had that been in the future, would there have been an obligation on the FA to consult which the regulator could have enforced? The shape of that competition is very germane and important to football fans across England and Wales, and it seems to me that it is a significant issue that ought at least to be part of the regulator’s consideration.

[Baroness Twycross (Lab)]

My noble friend raises an interesting point. The issue of the FA Cup replays would rightly be outside the scope of this regulator. The sporting calendar and the rules of specific competitions are matters for the football authorities to manage in consultation with the appropriate stakeholders. I am not sure whether that reassures my noble friend, but we can maybe have a longer discussion about it at another point.

On Amendment 242A from the noble Lord, Lord Moynihan—apologies if I am going over paragraphs that I have already covered—the intention behind this amendment is to make sure that clubs are not overburdened with requirements to notify the regulator of every event that ever happens. We do not want this either, nor is it in the regulator’s interest to receive a flood of unnecessary information. As the clause sets out, the notification requirement relates to material changes in circumstances. It will be up to the regulator to set out what it considers to be material in guidance, which we expect it will produce on this. The regulator will already have burdens in mind when setting its guidance and enforcing this duty on clubs, given public law principles and its regulatory principles. We want the regulator to receive the information and updates it needs to regulate effectively. By raising the bar for when clubs are required to notify the regulator of changes, the proposed amendment risks doing just that.

Amendment 248, from my noble friend Lord Mann, would introduce a new requirement for regulated clubs to register with the regulator all player contracts, transfer fees and other fees annually for the previous 12 months. I reassure my noble friend that, where this information is relevant for the regulator to understand a club’s finances, it can already obtain it. All clubs will be required to submit financial plans which detail, among other things, their revenues and expenses. These plans should capture details about player contracts and transactions where this information is relevant to the regulator understanding a club’s finances. Furthermore, the regulator has extensive information-gathering powers. Should it need greater oversight of the detail set out in this amendment, the regulator can already request this information, and it would not have to wait 12 months to get it. Therefore, I am confident that the Bill already delivers the intent of the amendment.

I am also grateful to the noble Baroness, Lady Grey-Thompson, and the noble Lord, Lord Moynihan, for Amendments 248A and 258A respectively, which focus on ticket prices. I understand that the noble Baroness intends to address the recent rise in clubs removing concession pricing on tickets and other such changes that have left some fans priced out of match attendance, and she highlighted concerns raised by fans from Reading. Fans are justifiably concerned, and I am exceptionally sympathetic to that. I am equally grateful for the attention by the noble Lord, Lord Moynihan, to ticketing and the issue of resale. These are huge issues that matter to fans, which is exactly why the Government have made it explicit that clubs must consult their fans on ticket pricing as part of their fan engagement. This also includes engagement on other operational issues, which is intended to capture many of the issues the noble Lord has made in his amendment. It is also important to note that any unauthorised resale of tickets for designated football matches is already addressed in the Criminal Justice and Public Order Act 1994. Many clubs take this exceptionally seriously and work with police and relevant authorities on it. However, the regulator should not be seen as a vehicle to fix all of football’s woes, especially those that are well within the gifts of clubs, leagues and the FA to address. On the noble Baroness’s amendment in particular, it would also not be appropriate for the Government to dictate prices or concession categories, and there is limited precedent for such an interventionist approach on commercial decisions.

[Lord Moynihan (Con)]

Before the Minister leaves that amendment, could she very kindly advise the Committee whether the Government intend to meet their expected deadline of a consultation exercise on the abuse of the secondary ticketing market by the end of this year?

[Baroness Twycross (Lab)]

If I may, I will clarify that in writing after this session to ensure I give the right response. I am not trying to avoid it; I will ensure I give the Committee a response.

Amendment 332 is from the noble Lord, Lord Markham, and the noble Lord, Lord Parkinson of Whitley Bay, also spoke to it. I appreciate that noble Lords may not welcome the use of delegated powers to amend the definition of “football season” in the Bill. However, to future-proof the Bill against any changes to the footballing calendar, we feel that the Secretary of State needs this power.

It is unlikely, but possible, that a specified competition might be organised in a unique way in the future, for which the current definition may not be suitable. For example, I am sure that noble Lords remember the impact of the 2022 World Cup on the domestic calendar. It is not beyond the realms of possibility that similar changes may occur in the future that impact the efficacy of this definition.

[Lord Moynihan (Con)]

I am now trying to be helpful, especially in the presence of the noble Lord, Lord Pannick, who will be able to opine on this suggestion. The reason why the Secretary of State has this power, as set out on page 46 of the memorandum to the Delegated Powers and Regulatory Reform Committee, is that a specific competition may be played over two calendar years. That is the current definition. If it were not to be played over two calendar years, we would not be able to proceed with the definition of “football season” set out in the Bill.

We have been looking for simplicity here. Instead of Clause 92(1) defining a “football season” as

“beginning with the day in a particular year on which the first match of any specified competition is played, and … ending with the day in the following year on which the final match of any specified competition is played”,

a simpler way would simply be to delete “in a particular year” and “in the following year”. Then we would all understand that we begin on the day on which the first match is played and end on the day on which the final match is played. We thus would not need secondary legislation through a draft affirmative resolution for the Secretary of State to come back to both Houses of Parliament, as this simple amendment could clarify it all and remove the Secretary of State from this onerous task.

[Baroness Twycross (Lab)]

I am not sure that the Secretary of State would find it onerous, because it is not intended to be used very often. However, the noble Lord makes an interesting point and I appreciate that he made it in the spirit of being helpful.

This is not a power for the Secretary of State to dictate to the industry what a season is; it is the opposite. The power as currently defined in the Bill will ensure that the definition can flex to changes in the industry. It will also be subject to the affirmative parliamentary procedure, so I hope noble Lords will rest assured that the House will be able to scrutinise any changes. I am happy to continue to discuss that further with noble Lords after Committee.

[Lord Parkinson of Whitley Bay (Con)]

I think it would be helpful if the Minister took this away, discussed it and maybe checked whether a solution like the helpful one my noble friend Lord Moynihan suggested might be possible. That would remove one of the delegated powers that the Delegated Powers Committee has raised concerns about.

I was struck by the answer the Minister gave to the intervention from the noble Lord, Lord Bassam, reassuring him about various matters of gameplay that are not within the scope of this regulator. The timing of the season seems to sit closer to things that she reassured him are not the job of the new independent football regulator to look at than to delegated powers for the Secretary of State. I hope she will take this away and continue discussions ahead of Report, because that feels like a very straightforward and sensible suggestion.

[Baroness Twycross (Lab)]

I was getting to the point where I was offering to take it away, so I think we are in violent danger of agreeing. On the question of the House being able to scrutinise any changes, I think we will return to this issue later, before Report.

Amendment 259 is from my noble friend Lady Taylor of Bolton. I understand that concerns have been raised about the ways in which rules are made in the industry today, including in recent legal cases. However, the Government’s view is that the amendment as drafted is not appropriate. The scenarios listed in Clause 55(6) could well be time sensitive and urgent. They may require immediate action from both competition organisers and the regulator. It would not be right to burden the competition organiser with a requirement to consult every member club for the purpose of informing the regulator of changes to the regime on an issue that may not affect them all. We would, of course, expect competition organisers to be carrying out appropriate consultation on their own rules. However, we are wary of the regulator mandating and prescribing how the leagues develop their rules.

I will finish on the two government amendments, Amendments 320 and 330. They both correct erroneous cross-references and make no change to the content of the Bill.

For the reasons I have set out, I hope that the noble Lord will withdraw his amendment.

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[Lord Markham (Con)]

My Lords, I hope this will be a nice, quick and simple group ahead of dinner break business. Clause 17 refers to awarding or refusing a provisional licence. I think we all agree that, if a provisional licence were not agreed, it would have serious consequences for a club, which would not be able to carry on playing or start a season, for example. That would have serious consequences on the fans, as well. All this amendment seeks is to give clubs sufficient time to respond. Generally, in serious situations, 14 days is not enough time to respond fully, so the suggestion is to give clubs a month in these circumstances. I beg to move.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Markham and Lord Parkinson of Whitley Bay, for their amendments. Apart from Amendment 148, which I will turn to shortly, they all seek to extend to a month the minimum period for clubs, individuals and competition organisers to make representations to the regulator on a number of issues—far longer than the 14 days that the Bill sets out.

The 14 days set out in the Bill for representations is the minimum to ensure that the individual concerned has a fair amount of time to prepare and present any representations to the regulator, though it is not an absolute. The regulator may choose to specify a longer period if it thinks it is appropriate. However, the 14-day minimum also means the regulator can respond quickly to urgent issues without an extended delay if necessary. We do not think it is appropriate to introduce unnecessary delays into the regulator’s regime that would slow down decision-making and leave clubs in an extended period of uncertainty. A 14-day period for representations is not uncommon among other regulators such as the FCA and CMA.

Turning to Amendment 148 specifically, I understand that the intention of the noble Lord, Lord Markham, is to ensure that, if the regulator is looking to revoke a club’s provisional licence, the club will have an opportunity to make representations. I reassure the noble Lord that this is already captured by Clause 18(4), which says that, if the regulator considers that a club has not met the full licence test, it needs to give the club notice. This must include

“inviting the club to make representations about the proposed action”,

be that to extend the provisional licence period or to revoke the provisional licence. To be clear, the regulator would look to revoke a provisional licence only if the club had persistently and without excuse failed to take reasonable steps to meet the requirements for a full licence. This is a high bar. Therefore, the club will have had sufficient opportunities to take remedial action even before the opportunity to make representations under Clause 18(4). The club will also be able to appeal a decision to revoke a provisional licence if it believes the regulator has acted unfairly. This is yet another way in which the regulator can be held to account and decisions can be scrutinised.

I will close with the question that Clause 18 stand part of the Bill. I understand that the rationale of the noble Lord, Lord Parkinson, in tabling the clause stand part notice is the same as that which we already discussed in relation to the earlier group on licensing. I am happy to provide further detail on Clause 18 in writing if the noble Lord wishes it, but, as I set out earlier, we do not believe there is a credible risk that clubs will refuse en masse to participate in the regime. Clubs at all levels of the game have welcomed this regime.

[Lord Markham (Con)]

I thank the Minister for her response. The main thing is not only having a sensible conversation but making sure that the regulator is aware that, where there are circumstances in which more than 14 days are required, it demonstrates that flexibility. I beg leave to withdraw the amendment.

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[Lord Parkinson of Whitley Bay (Con)]

I think that is an informal one from fans of other north London clubs. But clearly the names of clubs do matter, and we would be interested in whether the Government agree with that.

Given the time, I will address the other amendments in this group as a whole. They attempt to require clubs to consult a whole host of different supporters’ organisations, community trusts and fan groups. I share the concerns raised by my noble friend Lord Jackson of Peterborough that, if clubs are required to consult numerous different groups—chosen through various methods and representing countless, and often competing, interests—it will be difficult for clubs to know to whom they are to listen. What opinions will they have to take on board and whose interests will win out? There is also a concern about whether this could lead to divisions forming among supporters’ groups of differing views, as they seek to influence the activities of a club in a manner that they would like.

I am concerned by what the noble Lord, Lord Mann, said about football clubs picking the people who sit on their fan groups. That sounds like having a House of Parliament entirely dominated by the Executive—but that is for another Bill. The concern about this one is the old adage that too many cooks spoil the broth; that is, if we tried to have too many people vying to influence the views of a club, it would be difficult to differentiate the differing sounds and, perversely, fans’ voices would be drowned out in that cacophony. So a simpler approach might be required for fan engagement.

Trying to have a better answer to the question of who fans are, as we have said previously, runs to the heart of all this. But I agree with what my noble friend Lord Maude said: clubs are well advised to take on board the views of fans. They listen to them because they are the lifeblood of the clubs, and they make their views known pretty volubly.

[Baroness Twycross (Lab)]

I thank noble Lords for their continued engagement on these important provisions of the Bill. I appreciate that I am one of the very few things standing between noble Lords and the dinner break, but I want to give a proper response and, I hope, the reassurance that my noble friend Lord Bassam of Brighton is looking for. We must not forget that, at the heart of all of this, it is the fans who matter the most. Football is nothing without them, and the fan engagement threshold requirement has been designed to reflect this. As the noble Baroness, Lady Brady, said, fans are the lifeblood of the game.

My noble friend Lord Bassam’s Amendment 138 seeks to make it explicit that clubs must have the appropriate structures in place to engage effectively with fans. I hope noble Lords can take comfort that this is already implicit in the Bill. The Bill already asks for all clubs, in order to meet their fan engagement threshold requirement, to have adequate and effective means to consult and take the views of fans into account. It would therefore not be possible for a club to meet this bar without also having the appropriate structures and processes for effective engagement with its fans.

On my noble friend Lord Watson of Invergowrie’s Amendment 138A, it is important to avoid fan engagement becoming a box-ticking exercise for clubs. The intent is to ensure that dialogue can be constructive for both parties. This is why the threshold requirement requires a club to consult fans on the relevant matters. Consultation goes beyond just a meeting, which might lead fans to have only a passive role at their clubs. Instead, we expect clubs to seek input from fans on issues, with that input directly feeding into the decision-making or a club’s understanding of an issue.

I do, however, reassure my noble friend that the expectations on clubs will be proportionate to club resources and the demographics of the fan base. I hope that other noble Lords, including the noble Baroness, Lady Brady, also feel reassured by that point. This will not be the same as the statutory consultation, and we expect that the regulator will provide more detail about what consultation should look like in practice. This will allow for a bespoke approach to be taken across clubs.

My noble friend Lord Watson raised points around making fan engagement more explicit. The intention of the regulatory principle is not to list every possible stakeholder the regulator should ever engage with during the course of regulation, however important that stakeholder might be. That could be a slippery slope to an enormous list that risks—

[Lord Watson of Invergowrie (Lab)]

I understand my noble friend’s point about every stakeholder, but can she name a stakeholder more important than the fans?

[Baroness Twycross (Lab)]

My noble friend is quite clear, as are we, that the fans are central—I made that point earlier. However, making an explicit list for every single type of consultation that the regulator should have could mean that an unintended consequence would be that we missed off important stakeholders. The intention of the principle within the legislation is to encode a participative approach into the regulator’s regime. We believe that the regulator will be more effective if those being regulated participate constructively; that is to say, they are brought in and are pulling in the same direction. It is already clear from the very purpose of the Bill and its origin that the regulator will be regulating in the interest of fans and communities. As part of this, it should of course engage with them and representative groups, as appropriate.

On Amendments 160 and 163, from my noble friend Lady Taylor of Bolton, I reassure her that, where there are concerns that a club is not meeting the fan engagement standards, the regulator is empowered to gather information and look further into the situation. As it is a licensing condition, a breach of these requirements will qualify as a relevant infringement; if deemed necessary, the regulator can take enforcement action. The regulator will have the ability to receive evidence from fans when considering whether a club is meeting its licence condition or any other concerns in the regulator’s remit, but it will not adjudicate all consultations.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Monday 16th December 2024 Lords Chamber

[Lord Addington (LD)]

My Lords, I totally agree with my noble friend on this one—both noble friends, actually. I am afraid that if you want to see a country where gambling advertising and gambling problems are linked, you just have to look at Kenya—especially at the young. There is a chronic problem there, and it is doing enormous damage. Football has enormous reach and enormous power; it will reach out to you, and it reaches out to the most impressionable. I hope that the Government take some action here, showing a way forward that at least reduces the harm.

I know that the noble Baroness, Lady Brady, means well with her point about the front of the jersey, but it is a team game. People run up and down; the back is still there.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank the noble Lord, Lord Foster, for these amendments. As Gambling Minister, I acknowledge the importance of monitoring the impacts of gambling sponsorship in football. Slightly bizarrely, I think this is the first opportunity I have had to discuss gambling in your Lordships’ House. I am confident, from working through the measures in the White Paper, that it will not be the last, but I acknowledge the noble Lord’s long record of campaigning on the issue of gambling harm.

I also thank the noble Baroness, Lady Bennett of Manor Castle, and join others across your Lordships’ House in wishing the noble Baroness, Lady Jones of Moulsecoomb, a speedy and good recovery. We look forward to the noble Baroness working with us while the noble Baroness, Lady Jones, is recovering from her operation.

Starting with Amendment 255, the Government do not believe the regulator should have a role in commercial matters such as sponsorship. This is outside the scope of the regulator and commercial decisions are, rightly, decisions for clubs. Further, what constitutes the promotion of gambling could be interpreted extremely widely, with significant consequences for clubs and the sport more widely. This might mean players not being able to take part in competitions that have gambling sponsors.

All major football bodies have published their joint gambling sponsorship code of conduct, which sets minimum standards for socially responsible gambling sponsorships within football. The Government will closely monitor the implementation of the codes of conduct to ensure they have a meaningful impact. I note the points made by the noble Lord, Lord Foster, about children and young people. I am happy to liaise with him and other noble Lords on this further as the codes of conduct are implemented.

On Amendment 143, I agree that where gambling advertising and sponsorship appear, it must be in a socially responsible way. Both the noble Lord, Lord Foster, and the noble Baroness, Lady Brady, mentioned that the Premier League has already made a decision to ban front-of-shirt sponsorship by gambling firms by the end of next season. That is welcome. The noble Lord, Lord Foster, referred to around 40 clubs that have already taken action on gambling sponsorship. As I set out in my speech at the GambleAware conference on 4 December, I really want to see the gambling industry further raise standards to ensure that levels of gambling advertising do not exacerbate harm.

I apologise to the noble Lord if my response to his question was not clear. We are trying to address volume across different companies, where even if one company has only a small amount, the collective volume can become quite significant. That is a specific issue we have asked the gambling industry to look at. Where there is volume across the piece, individually it might not be excessive but together it might represent a significant amount of gambling advertising beyond what is deemed acceptable. This work will be monitored closely.

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[Baroness Fox of Buckley (Non-Afl)]

My Lords, very briefly, I am so glad that these amendments were tabled, because it gives us a chance to reflect. The statement that to determine what is right and wrong between different countries and cultures is very complicated so it is easier to say that it has no place in the game seems fair enough to me. Politics is complicated. We find it complicated in this place, even though we are the legislators and the politicians. Once you start introducing it into football, you can get into a real mess.

I am also not sure about a few things, so I want to share some confusion. One difficulty is that, for example, we heard from the noble Lord, Lord Hayward, last week that he does not consider the rainbow armband to be political, but I think that it is highly ideological and political. Last month, the FA dedicated a 35-minute video to the Rainbow Laces campaign, showcasing an activist-heavy panel that included its women’s talent and senior game EDI consultant coach developer. That title gives the game away before we go anywhere.

Guess what? That particular individual used to work for Stonewall before being brought into football. I hope that we in this House understand that Stonewall is at least a highly contentious political organisation which is now at the heart of defining what is considered to be inclusive football. The problem with this profusion of rainbows on laces, pitch flags, ball plinths and all the rest of this branding is that any objection on the basis of politics leads to an accusation of being insensitive to lesbian and gay people or being homophobic. Indeed, it is the very opposite. I think that trans ideology is discriminatory against lesbians and gays because it does not understand same-sex attraction. If noble Lords are lost and are thinking, “Oh God, what is she going on about?”, that is fine. It is a political matter and nothing to do with football. I worry when football managers and teams get embroiled in this.

I was unsure about this amendment. I am usually the kind of populist democrat who says, “Vote on everything; go and have a vote”, but I did wonder when the noble Lord said, “See what the fans say—don’t put out a statement unless they agree with you”. Maybe it is because I am from a Celtic family—although some of them support Spurs. I hope that noble Lords can get their heads around this. Celtic’s fan base has gone completely bonkers on the Israel-Gaza question. It is like a Hamas support group on tour. The irony is that their sloganeering in support, as they would see it, of the Green Brigade and all the rest of it—their support for Gaza resistance—has put them completely at odds with Celtic’s owners and the board, although the Celtic Trust, the shareholders’ group, agrees with them. It has split the club. But everyone should keep out of this. Let them sloganise away, but do not get involved one way or another. Make the political point.

However, I cheered when Crystal Palace put out an official statement after the 7 October pogrom. I thought it was great that at last somebody had come out and condemned the murders and hostage-taking. We have seen what has happened to Israeli teams, which have been subjected to anti-Semitic attacks, one of which almost brought down a Government on the continent. We know what is going on. I am interested that football is getting involved in this. I have already commended those Spurs fans who have started a grass-roots campaign in support of Emily Damari, the last remaining British hostage. I want Spurs fans to chant this young woman’s name at the ground. Her uncle Rob is a Crystal Palace fan. As he pointed out, they may not have the grass-roots campaign, but at least Palace put out a statement.

I am into all this. I genuinely do not want to say that we should sanitise football clubs of all political discussion. It is impossible. It is not going to happen. I do not want the Government interfering in it or a regulator being involved. I do not want people being in a situation where they fail, or refuse, to acknowledge that they are putting forward, for example, EDI policies. These are politics in disguise, although they will not admit it. Politics is complicated. Let us keep it out of football. The fans will be political just because they are stroppy like that.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Jackson of Peterborough and Lord Parkinson of Whitley Bay, for tabling these amendments, and all noble Lords who have contributed to the debate. These amendments seek to add a requirement for a club to consult fans on any political statements or stances.

Amendment 244 in the name of the noble Lord, Lord Jackson of Peterborough, would additionally mandate fan approval of any political statement or political activity made by the club, its players or any other staff. This includes fan approval in relation to the issuing or wearing of items of clothing with political connotations. As the noble Baroness, Lady Fox of Buckley, outlined, what we view as political is disputed. It is not the place of a statutory regulator tasked with sustaining the stability of the game to limit or add approval processes for political speech or action or, indeed, to determine what is defined as political in the first place.

On Amendment 145, tabled by the noble Lord, Lord Parkinson, clubs may wish to consult their fans in this regard as part of their regular fan engagement. However, this is not something that the regulator will require of clubs. The Bill is intended to ensure that fans have a voice in key decisions regarding their club, but we need to make sure that this is proportionate. That is why we have not listed every possible issue that clubs should engage with their fans on in minute detail.

As has been mentioned, it is notable that many sporting personalities have used the attention that sports receive to campaign on issues that concern them. The noble Lord, Lord Moynihan, highlighted Marcus Rashford as an example. To be clear, we do not want to inhibit free speech. Instead, as is the case now, fans are equally able to use their own freedom of expression to protest political statements or actions made by their club. As well as potentially constraining freedom of speech, these amendments would not improve the regulator’s ability to deliver its objectives. I therefore ask the noble Lord to withdraw his amendment.

[Lord Parkinson of Whitley Bay (Con)]

I am grateful to the Minister and to all noble Lords who have spoken on this group for their considered thoughts. Like the Minister, we do not want to inhibit free speech. The difficulty is in questions of an acceptable political gesture or article of clothing conflicting with the free speech of those who take a differing view. That is where it is important for clubs to be mindful of the wide range of views that are out there and to have an earnest conversation with their fans and with society more broadly.

The noble Lord, Lord Addington, is right to mention the poppy. Sadly, it is already an article contested by some—we have crossed the Rubicon that he warned us to be wary of. The noble Baroness, Lady Fox, alluded to the sectarianism that there has been for a long time in certain football clubs. This is not a new matter but one which is growing and where there are new, more complicated areas of contention. I agree with the sentiment that a number of noble Lords expressed that it is important to get politics out of football.

I hope that the Minister will reflect further on this ahead of Report. I am grateful to noble Lords for their thoughts and beg leave to withdraw my amendment.

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[Lord Addington (LD)]

I will take that advice.

I put my name to Amendment 237, because I thought that it was about an identification symbol. That is what heraldry is all about, except that we do not use it any more to define who is going to belt who over the head in the middle of a medieval battlefield. All I can say after listening to the speech on this amendment is that I have learned much, but I am not sure when it will be useful.

[Baroness Twycross (Lab)]

My Lords, I am very grateful to the noble Lord, Lord Parkinson of Whitley Bay, for these amendments, which address changes to club heritage assets and what should be safeguarded by the regulator. I if may say so, this debate could be used as the definition of a lordly debate.

The Government understand that the amendments in the name of the noble Lord seek to avoid a misuse of any heraldic terms. I am grateful for the historic background that he gave in what was one of the Committee’s more unusual contributions, but one from which we all learned a great deal.

This specific clause is intended to work in tandem with the FA heritage protections, with the regulator acting as an enforcement backstop to the FA’s rules. The FA’s heritage protections use the term “crest”, and therefore this amendment would risk the regulator being out of step with the rest of the industry. However, I stress to the noble Lord that officials have liaised with the College of Arms on this. We are keen to ensure that the Bill does not incorrectly signal that the regulator would ever override the separate process of the College of Arms. We have engaged and will continue to engage with the College of Arms to ensure that it is content. This may be something that we return to upon further discussions with the college and the FA. I acknowledge the intent of these amendments but, for the reasons that I have outlined, ask the noble Lord, Lord Parkinson, to withdraw his amendment.

[Lord Parkinson of Whitley Bay (Con)]

I am very grateful to the Minister for the way that she has engaged with this and her promise to look at it further. She is right that this is a very House of Lords issue, but I was alerted to it by comments on social media from those who watch your Lordships’ proceedings, so it is both an ancient and a very modern issue, and one about which people feel very strongly.

I am glad that the Minister has begun dialogue with the College of Arms. Just because others are getting it wrong, it does not mean that we should get it wrong in legislation. For the reasons that I have set out, I think that we can nudge towards the present legal position in the Bill. I am grateful to the Minister for that and will certainly take her up on the offer to discuss this further between now and Report.

In my research I was pleased to learn that a football first appeared in heraldry as far back as 1604, when the Clarenceux King of Arms at that time granted arms and a crest to Sir William Jordan, who was briefly a Member of Parliament for Westbury. Noble Lords may be as surprised as I was to learn that a football appears in the 17th century grant given to him. His crest is

“A football or encircled by a scroll inscribed PERCUSSA RESURGO”—

“Struck, I bounce back”. That message of resilience is perhaps one to cheer us on as we consider these amendments in Committee. I beg leave to withdraw my amendment.

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[Lord Addington (LD)]

My Lords, all I can say about this is that I may not have disagreed with every single word that the noble Baroness, Lady Fox, said, but I certainly disagreed with her tone.

[Baroness Twycross (Lab)]

My Lords, reflecting the point from the noble Lord, Lord Addington, I am afraid that the noble Baroness, Lady Fox of Buckley, and I fundamentally disagree on this area of the Bill, but I am glad of the opportunity for your Lordships’ House to debate this issue and thank her for the amendment, as it allows me to clarify why the Government have added this provision.

The Government believe that equality, diversity and inclusion are key elements of good corporate governance. This is not about moral panic, as described by the noble Lord, Lord Moynihan of Chelsea, or virtue signalling, as described by the noble Lord, Lord Jackson of Peterborough. I appreciate that the noble Lord, Lord Moynihan of Chelsea, will have a different view on the research from the likes of McKinsey, but it has shown that diversity on boards and in organisations promotes better governance, decision-making and transparency—arguably, the noble Lord’s point about its growth as a company might demonstrate that it could have a point. All this, in terms of better governance, decision-making and transparency, contributes to improved financial sustainability. The noble Baroness, Lady Brady, highlighted the value of considering EDI within the corporate space.

This relationship between diversity and better corporate performance is recognised also by the Financial Reporting Council and the Association of Chartered Certified Accountants. The industry is already taking action in this space, and I welcome the expertise of the noble Baroness, Lady Brady, in this area and her example of PLEDIS, but for a regulator that will be introducing a corporate governance code and requiring clubs to report against it, it is only right that such a code also covers EDI. The regulator will look to co-operate with other stakeholders, draw on the expertise of the sector and add to industry initiatives. I am sure that they will want to engage with the noble Baroness, Lady Brady, on this point as well.

As with fan engagement, this will be a statutory baseline, so clubs that already champion equality, diversity and inclusion will not have any additional burden placed on them other than having to periodically report on these things. Under the corporate governance code, clubs will simply be required to explain how they are applying the code and what action they are taking on equality, diversity and inclusion. That is not onerous, but it is a very helpful transparency measure. This transparency will only be a good thing, and I am afraid that if noble Lords disagree with that, we are simply of very different minds on this issue.

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[Lord Jackson of Peterborough (Con)]

Before the Minister sits down, may I ask, given that this is a specific difference from the previous Bill, what specific football-related research was commissioned by the Government that led them to believe that it was imperative to add this provision to the new Bill? If that question is too difficult to answer now, perhaps the Minister will write to me.

[Baroness Twycross (Lab)]

My Lords, it is getting late and I have just dropped all my notes. This is not actually about football per se; it is about good governance. The regulator will be concerned with sustainability. As a sustainability regulator, its interest in equality, diversity and inclusion is that it contributes to good corporate decision-making, which, in turn, makes clubs more sustainable. This is why the regulator will encourage good EDI in clubs by requiring them to report on what action they are taking to improve EDI. That transparency will only be a good thing. I therefore hope that the noble Baroness will withdraw her amendment for the reasons I have given.

[Lord Moynihan of Chelsea (Con)]

Before the Minister sits down, may I offer to send her the academic study headed, “Study linking ethnic diversity with performance by McKinsey questioned by academics”? I am very happy to send her this. It completely rebutted the McKinsey finding that she quoted. It would be very useful were she to understand that that has been rebutted, so that she might not be quite so keen on the ideas she wishes to espouse, and we could come together on that point.

[Baroness Twycross (Lab)]

The noble Lord is very welcome to send this to me, but I am afraid that, as somebody who used to work in governance myself, I am quite committed to the concept that good governance should also include good EDI.

[Lord Moynihan of Chelsea (Con)]

Why?

[Baroness Twycross (Lab)]

For the reasons that I have outlined in my speech.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I thank all those who joined in with this short debate. To the noble Lords, Lord Jackson and Lord Moynihan, and to the noble Baroness, Lady Brady, I emphasise that, despite what anybody says, they are not my friends, even though they call me their friend. I do not mean that in any rude sense. I know that the noble Lord, Lord Addington, has decided that he has taken against my tone. I do not know what I have done wrong there. I did not think I had a tone: I just made a speech. I just want to clarify that they are not my friends, but they spoke brilliantly well and interestingly on this issue.

It is very important to draw the Government’s and the Minister’s attention to new evidence that has emerged. I know the Minister did not mean to say this, but it is not advisable to say, “I have worked in this, and I am committed to this view”, given that circumstances are changing and new evidence is emerging all the time. It would be better to be open-minded. I made the point about the Post Office, and it is a good example. The Post Office won those awards for EDI and good governance at the same time as the Post Office scandal.

I definitely do not want to micromanage freedom of speech—and I do not think that the Government have any intentions of doing that through this part of the Bill—but to say that this is not the appropriate time to raise trans inclusion is not true. The truth of the matter is that it is through EDI policies that the issue of trans has become so controversial for women in women’s football. I have not raised this just because I am trying to shoehorn it in; that is the basis on which it happens.

Before I formally withdraw because of the time, I finish by saying that I absolutely do not think that football clubs should sit back, do nothing and not care about the fact that they are inaccessible to anybody or should put up any barriers to anyone getting involved in football. Most football clubs are at the heart of their community, and they do not need to fulfil all these schemes to involve a wide range of people. Every small football club I know is going way beyond anything that any EDI pen-pusher could imagine to involve the socially excluded from the local area. They are the heart and soul of local areas. My concern is that they will end up spending too much time writing reports and not doing that. That is my concern about EDI: it is an industry, so it is not helping to include anyone or create any diversity and so on. It has become a politicised, dangerous threat. I beg leave to withdraw the amendment.

--- Later in debate ---

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Markham, Lord Moynihan and Lord Parkinson of Whitley Bay, for tabling these amendments. I will take them in turn.

On Amendment 170, in the name of the noble Lord, Lord Markham, I understand that the intention behind the amendment is to allow the regulator to block a club from accepting funding that it reasonably suspects to be harmful to the interests of the United Kingdom. I agree that it is important to protect clubs from harm; that is what the Bill as a whole seeks to do. The intention of having this power, as set out in the Bill, is to protect English football from illicit finance and keep it out of the game. Illicit finance is inherently unsustainable.

However, I caution the noble Lord as to the implications of a football regulator discerning what is harmful to the interests of the United Kingdom and then blocking such funding. This is not something that a regulator can determine. They can make evidenced-based decisions on facts in a clearly defined framework. It also must be noted that there are protections in the Bill that go beyond protecting against serious criminal conduct to protect against wider harm. For example, the owners’ and directors’ test will look at the fitness of a club’s owners and officers, including any criminal history and investigations and whether the individual has been prevented from entering the UK. This seeks to protect English clubs from unsuitable owners or officers making decisions that may endanger their club. This, in conjunction with the power to restrict funds suspected to be connected to serious criminal conduct, will help to ensure that clubs are protected from harm.

I turn to Amendments 194, 196 and 197 in the name of the noble Lord, Lord Parkinson. On Amendment 194, I reassure the noble Lord that the intent of his amendment is already achieved within the current drafting. When assessing an owner’s or officer’s fitness, the regulator must have regard to any criminal convictions and proceedings, including those included in Schedule 1 to the Serious Crime Act 2007. Membership of a proscribed organisation is an offence under the Terrorism Act 2000, and that offence is included in paragraph 2A of Schedule 1 to the Serious Crime Act. Consequently, the current provisions in the Bill deliver the intent of this amendment. I hope that he is reassured by that.

On Amendment 196, I agree that it is vital that the regulator has access to information when assessing the suitability of owners and officers. The regulator may need to work closely with other organisations and stakeholders when exercising its wider functions. That is why the Bill establishes information-sharing arrangements with a range of organisations including the National Crime Agency and the Serious Fraud Office and why it adequately empowers the regulator to gather information, including from other organisations, to assess suitability. However, to require the regulator, as the amendment would, to always consult multiple organisations, even when this is not necessary to its ability to make an assessment, would be disproportionate. It would lead to slow decision-making, impacting on growth and investment. It would be a wholly unnecessary burden on clubs. As part of the fitness test, officers will be assessed on their competence, specifically their qualifications, experience and training.

Amendment 197 would give the regulator discretion as to whether to consider these matters when assessing competence. General public law obligations would still require the regulator to act consistently and fairly when testing officers. However, this amendment would give officers less certainty about what they will be tested on.

Finally, on the amendment from the noble Lord, Lord Moynihan, the whole point of the owners’ and directors’ test, which has been carefully designed, is to ensure that club custodians are suitable for assessing an owner’s fitness—this is absolutely crucial. It is right that any owner passes the tests set out in the Bill, so it would not be fair, appropriate or responsible to exempt certain types of owners from testing, but that is precisely what this amendment seeks to do. This amendment intends that owners with diplomatic status or who are Heads of State, Government Ministers or high-ranking officials of foreign Governments would not be tested. I do not need to tell noble Lords about some of the people this could exempt from testing. That means that the regulator could not consider any personal finances or criminal history, no matter how egregious. Instead, it would have to ignore these matters, so the regulator could be letting unsuitable owners in. This could be incredibly risky for the club, and any incumbent owner captured by this amendment could also never be tested, even if concerning information subsequently came to light.

Suitability should be based purely on an impartial assessment of the criteria set out in the Bill. This will ensure that the test can be applied consistently, remain fair, transparent and robust, and focus on whether an individual is suitable to own a football club. For the reasons I have set out, I would therefore be grateful if the noble Lord would withdraw his amendment.

[Lord Parkinson of Whitley Bay (Con)]

As the Minister spoke, I wondered whether the staff and relevant board members of the regulator will have the requisite security vetting to be able to consider some of the matters that they might need to in this area. One reason I was keen that they engaged the appropriate authorities was to make sure that things which are, by nature, highly classified and sensitive can be provided to them so that they can give advice. If the Minister is not accepting my amendment to open the channels of dialogue there, is she able to say anything, now or later in writing, about the vetting that staff and others at the regulator would receive?

I am conscious that immediately before we came into this Committee, the Minister’s noble friend the Lord Privy Seal moved the Motion to appoint members to the Intelligence and Security Committee. We make sure, rightly, that people who are suitably qualified are able to look into this area of our laws. I wonder whether she can just say a little, now or later, about the vetting and assistance that staff will have?

[Baroness Twycross (Lab)]

I could talk at great length about this, but instead, I reassure noble Lords that I can confirm that staff will be able to engage with all relevant authorities on such issues.

[Lord Parkinson of Whitley Bay (Con)]

I appreciate that it is late. If the noble Baroness could put some of what she might have said in a letter, that would be useful. It is unfortunate that we are reaching what is a rather serious subject at what I know is a late hour with very few people left in Committee, but it would be helpful to hear a bit more about this as we ponder the issue further ahead of Report.

[Baroness Twycross (Lab)]

I would like to make it explicit that they will have the relevant clearance to deal with this issue.

[Lord Parkinson of Whitley Bay (Con)]

I am grateful to the noble Baroness for that. If there is more she is able to say, I am sure that other noble Lords who are not able to be here and who take an interest in these matters would appreciate that.

The noble Baroness said that the regulator is not really equipped to decide what is harmful to our national interest. That is why, in our version of the Bill, we had the provision on taking into account UK trade and foreign policy. I know the reasons why the Government have taken that out of the Bill—because of the concerns UEFA and others raised about political independence—but I worry that, in doing so, we might lose something about our national interest which is quite important. That is why I was seeking to reinsert that criterion into the consideration. We might come back to that issue once she is able to say anything more that she wishes to, and once other noble Lords who are interested can join the discussion on this point.

Given the hour, and with gratitude to the noble Baroness for all her answers today, I beg leave to withdraw my amendment.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Wednesday 18th December 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank the noble Lords, Lord Markham, Lord Moynihan and Lord Hayward, for tabling these amendments, and the noble Lords, Lord Markham and Lord Parkinson of Whitley Bay, for giving notice of their intention to oppose the question that Clause 22 stand part of the Bill. Like other noble Lords, I wish the noble Lord, Lord Hayward, a swift recovery and hope to see him back for the next day of consideration by this Committee.

I will start with Amendment 172 in the name of the noble Lord, Lord Markham. It is vital that the regulator has the appropriate tools to address systemic financial risks that might arise. Indeed, in recent years clubs have faced a number of systemic risks, such as during the Covid-19 pandemic, when many clubs faced financial difficulties, some of which are still felt by clubs today.

The ability to restrict clubs’ overall expenditure may be the most appropriate and effective tool in certain circumstances. The noble Lord, Lord Markham, asked about limiting expenditure, which is already used within football. Some leagues already have rules limiting expenditure on wages and limits on permissive losses. I reassure him that the regulator is further constrained when taking action here. First, we have made it absolutely clear that the regulator has the ability only to restrict overall expenditure. It cannot place restrictions around specific transactions or types of transactions, to micromanage spending in that way.

Furthermore, the regulatory principles enshrined in the Bill in Clause 8 include the principle that the regulator should act proportionately. We would expect this to be reflected in any discretionary licence condition that the regulator sets. Restricting overall expenditure might be the most proportionate and least interventionist or burdensome response to these risks. Without this tool, it might have to apply a different response that may be more restrictive or less effective.

I turn to Amendment 173A in the name of the noble Lord, Lord Moynihan, to which the noble Lords, Lord Pannick and Lord Addington, also spoke. While we appreciate the intent, we are confident that clubs and competition organisers would already be captured under the current wording in the Bill, of persons the regulator “considers appropriate”. As I have outlined in previous debates, the Government do not believe it is necessary or appropriate to put an exhaustive list of stakeholders in the Bill. I appreciate that the noble Lord, Lord Moynihan, has a different view, but we feel that the regulator will be best placed to determine which persons are appropriate to consult depending on the decision in question. However, I look forward to further discussions with him on this point.

The regulator is required to consult anyone it considers appropriate. Failing to do so would be a breach of its statutory obligations and could result in legal challenge—

[Lord Moynihan (Con)]

I was not for a minute suggesting that there should be an exhaustive list that should be consulted; I was simply highlighting three very specific groups of people who should be consulted, which I think the Minister agrees with. There should be no doubt in the minds of the Committee that if you simply list clubs and competition organisers and then say “such other persons as the regulator considers appropriate”, you capture everything she has just said and make it very clear that the regulator will approach and consult clubs and competition organisers—which is the whole purpose behind this clause and surely one that has her full support. Why not simply clarify it in a very simple additional nine words?

[Baroness Twycross (Lab)]

I hear what the noble Lord says and look forward to further discussions with him on that point, but we feel that the regulator will be best placed to determine which persons are appropriate to consult.

[Lord Pannick (CB)]

I am sorry to keep on at the Minister about this, but can she really think of any circumstances in which it would be appropriate for the regulator not to consult the competition organisers and the clubs in this context? If the answer to that is “Of course not”, let us put it in the Bill and make it clear.

[Baroness Twycross (Lab)]

I recognise the strength of feeling on this point and look forward to discussing this further as we proceed through the Bill’s progress in this House.

Amendment 173B is in the name of the noble Lord, Lord Hayward, and the noble Baroness, Lady Evans of Bowes Park, spoke to it in his absence. Its intention is to place procedural requirements around the regulator’s use of capital buffers as part of a liquidity requirement. First, I reassure noble Lords that the model of financial regulation is about making clubs more financially resilient.

The noble Lord, Lord Markham, raised an issue that has been discussed previously in this Committee, where owners tragically die and the issues this can cause clubs, which is that clubs will have to submit detailed financial plans, including contingency plans. This could include what the club would do in the event of a financial shock such as the sudden loss of an owner.

If the regulator has concerns about the level of financial risk exhibited in a range of scenarios, it can place discretionary licence conditions on clubs in limited areas. That does not necessarily mean that owners will have to put funding in up front. If the regulator does reach for liquidity requirements, there are already safeguards. Indeed, the amendment seeks to require the regulator to have regard to a number of considerations, but in each case the Bill already requires this.

When assessing whether to attach the discretionary licence conditions needed to meet the appropriate financial resources threshold condition, the regulator will already be fully informed of the club’s financial position because clubs have to submit a financial plan, which would already include detail of any existing liquidity buffers. Consideration of proportionality and existing financial rules is covered by the regulatory principles in Clause 8(c) and (d). Again, consideration of the impact on competitiveness and investment is covered by the regulator’s duties in Clause 7(2). Therefore, this is all already accounted for.

--- Later in debate ---

[Baroness Twycross (Lab)]

I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton, as well as the noble Lords, Lord McNally and Lord Scriven, and the noble Baroness, Lady Grey-Thompson, for the amendments in this group. It has been a really thoughtful discussion around issues of note.

I particularly welcomed the opportunity to hear from a number of noble Lords who have not spoken previously on the Bill but who have contributed their expertise, including the noble and learned Baroness, Lady Butler-Sloss, and the noble Lord, Lord Scriven. Their expertise led to a thoughtful debate. A number of noble Lords had interesting alternative perspectives as well. That included the perspective of the noble Lord, Lord Pannick. It is right that we discuss these significant issues as we discuss what the role of the regulator should be.

On Amendments 178, 185 and 193, it is absolutely right that clubs have suitable owners. That is why the new statutory owners’ and directors’ test is a key focus of the regulatory regime. A core part of this is the fitness test, which these amendments seek to expand. The individual ownership fitness test criteria are based on precedents specifically relevant to whether somebody is suitable to be an owner of a football club.

I would like to reassure my noble friend that much of what the amendments seek to achieve is already delivered within the current drafting. If an individual has had legal—whether civil or criminal—regulatory or disciplinary action of any kind brought against them, and that action has a bearing on their honesty or integrity, the regular must take that into account. This could then be used to find them unsuitable under the tests in this legislation.

The noble and learned Baroness, Lady Butler-Sloss, spoke specifically on modern slavery in relation to current legislation. I welcome the comments from the noble Lord, Lord Pannick, around keeping the regulator focused on issues that it can deal with effectively. Offences under the Modern Slavery Act are included in Schedule 1 to the Serious Crime Act, so the regulator will have to consider them in particular when determining whether an owner meets the fitness criteria.

If there are concerns about what is covered in the Modern Slavery Act, there are more appropriate places to discuss this, perhaps outside the Committee. I would be very happy to talk to noble Lords and the noble and learned Baroness outside the Committee to give them some reassurance on the points they have raised.

Any human rights violations that have given rise to legal, regulatory or disciplinary action against the owner in any forum can be considered, and so are egregious actions committed outside the UK that would have been criminal if carried out here. I assure noble Lords that these are things the regulator would—

[Lord Scriven (LD)]

There is a specific issue with the Gulf states. If people are potentially put to death for being gay in a state, would that debar a state entity or an individual in that Government from owning an English club? It is a clear question.

[Baroness Twycross (Lab)]

I am going to come on to state ownership later in my speech, if the noble Lord would be happy to wait.

[Lord Scriven (LD)]

No, I would like an answer to this specific question, because the Minister gave a specific commitment with regard to what is in the Bill. I put a specific question based on what could happen, and on the laws of the land of a Gulf state. I wish to know: if that takes place, would someone who is related to that state through a state entity not be able to own a Premier League club in this country?

[Baroness Twycross (Lab)]

I would be grateful if the noble Lord allowed me to take away that specific example. I will write to him and to the Committee and place a letter in the Library, so that they have a detailed response on that point.

These are all issues that the regulator will take very seriously. Where the amendments before us today go further than existing drafting, this introduces elements that we do not believe are necessarily relevant to an owner’s suitability. They would require the regulator to make a subjective and potentially speculative judgment on whether the individual has engaged in any activity that would risk bringing the game into disrepute. Where a potential dispute relates to things like criminal history, the regulator will already have to consider these things. But “disrepute” is a vague term; could it arise through an owner’s conduct in their personal life, or their political views? In the Government’s view, it would put the regulator in quite a difficult position, making a value judgment on what constitutes disrepute, which would undermine the principle of a reasoned, evidence-based test.

Turning to Amendment 199 in the name of the noble Baroness, Lady Grey-Thompson, the test is supported by the regulator’s information-gathering powers to ensure its determination is evidence-based. These powers will help the regulator tackle unco-operative individuals or organisations that do not provide the information. However, let me be clear: if the regulator does not have enough evidence to make its determination, the individual will be found unsuitable.

I understand the noble Baroness’s concerns about restrictions on an owner’s funds. I want to reassure her that the test requires an owner to submit financial plans and demonstrate sufficient financial resources to run the club. As part of this, we expect that the regulator will consider things such as the liquidity of those resources and their availability to actually be used to fund the club. The regulator will also need to be satisfied that the owner does not have wealth connected to illicit finance. To do this, it can conduct enhanced due diligence on the owner’s source of wealth. This would identify any links to criminality, corruption and money-laundering. We believe, therefore, that the intent of the noble Baroness’s amendment is delivered in the current drafting of the Bill. I hope she takes reassurance from this, but I am happy to meet her to discuss this if my explanation has not satisfied her.

I turn to amendment 200 from my noble friend Lord Bassam of Brighton, which the noble Lord, Lord Moynihan, also spoke to. This Government are not making a judgment on different forms of ownership. We recognise that good ownership can take many forms, and it is investment from responsible owners that has been a driving factor in the success of English football. Banning any one particular kind of ownership would not, in our view, be in keeping with the flexible and proportionate approach to regulation we are proposing. I believe that this approach has broad support across the Committee. Prospective owners with state backing will be assessed against the same set of criteria as any other prospective owner, on a case-by-case basis. I hope that answers the question about Newcastle from the noble Lord, Lord Parkinson.

[Lord Moynihan (Con)]

I apologise for intervening on the Minister’s speech, but I did ask a very specific question, which I think she has answered but I would be grateful if she could make it clear to the Committee. Through the higher degree of influence test, which we have debated and understand, and which is unique to this regulatory framework, will the Crown Prince of Saudi Arabia be subject to an ownership test—yes or no?

[Baroness Twycross (Lab)]

Any owner, with state backing or otherwise, will be assessed against the same set of criteria as any other prospective owner, on a case-by-case basis.

[Lord Moynihan (Con)]

So the answer is yes.

[Baroness Twycross (Lab)]

Yes. Prospective owners with state backing will be assessed against the same set of criteria and, by requiring new owners to undergo the regulator’s test, we better mitigate against harm to clubs by preventing unsuitable custodians ever becoming owners. Giving the regulator the power to test incumbent owners where there are concerns about their suitability ensures that any unsuitable owners can be removed.

The noble Lord, Lord Scriven, raised a comparison with the legal position on media organisations. Although football clubs up and down the country are vital community assets, they are not the cornerstone of our democracy that free media is. Investment from responsible owners has been a driving factor in the success of English football, which is why we are putting in place a stable regulatory environment that will continue to attract investors with a long-term prudent approach to growing football clubs as important community assets. What is important, in our view, is that owners are suitable, and the approach to testing owners set out in the Bill ensures just that.

This has been a hugely useful debate and, although I will have to come back on a number of points, I hope my response has provided some reassurance. But, for the reasons I have given, I would be grateful if my noble friends and other noble Lords would not press their amendments.

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[Baroness Taylor of Bolton (Lab)]

My Lords, I just want to say a word about Amendment 207. It talks about a club that is not a regulated club but bears a very similar resemblance to one that is in things such as the name, the shirt colours and things of that type—almost an imitation of another club in order to get some support, finance or whatever. It may seem that this is highly unlikely, but I have a nightmare scenario where the super leagues that are being proposed do not take off, and therefore people try to create an artificial super league by, for example, having a team called “Manchester Blues” or “Liverpool Reds” getting into competitions with clubs abroad as an imitation of the super league that has been proposed and rejected. I want some assurance that should that nightmare scenario come about, there is some provision for being strict about what can and cannot happen.

[Baroness Twycross (Lab)]

My Lords, before I speak to this group, I want to be clear about who the regulator will test and clarify an earlier point I made. I will ensure that all noble Lords who participated in the second group have their attention drawn to this clarification and apologise if I caused any confusion.

Schedule 1 to the Bill sets out details on who meets the definition of an owner. The Secretary of State will also set out guidance on one of the criteria for ownership, “significant influence or control”. An incumbent individual simply meeting the definition, including if they exert significant influence or control, does not mean that the regulator is required or obliged to test them. It may test an incumbent owner if there are grounds for concern about their suitability. The criteria for suitability are clearly set out in the Bill. This applies to any type of owner, be it a state owner or otherwise.

The key point I must stress—it goes for Newcastle United or any other club, although as someone who lived for a number of years in Newcastle I am particularly keen to reassure Geordies—is that the regulator will be operationally independent of government. It is not for the Government to prejudge the regulator’s assessment of who meets the definition of owner, whether there is concern about a particular owner or the outcome if the regulator tests a particular owner.

Finally, I want to reassure your Lordships’ Committee that this Government are unashamedly pro-investment, which will drive our growth mission. We want good, long-term investors into the UK, and foreign investment is key to this. I hope that noble Lords find this clarification helpful.

[Lord Moynihan (Con)]

I thank the Minister for that. I think it is self-evident from her comments that once you remove the foreign and trade policy objective and put in place the significant influence test, you have a massive problem in the Bill. That massive problem is that it is self-evident, as has been discussed many times during the proceedings, that the Crown Prince—as chair of and in control of the PIF, with significant influence over it—would automatically come within the scope of significant influence as defined so far in debate on a number of occasions. I have no problem with that, and I do not think that the noble Baroness, Lady Taylor, has any problem with that. If that is the case, so be it, and let us be honest about it. If it is not the case, “significant influence” is meaningless, and we should come back to it on Report and simply delete “significant influence”, which, incidentally, goes far further than any other regulator in Europe.

We have control tests that are applied by UEFA, by the Premier League and across football. We do not have this significant influence test, and that is what is causing the problem. You remove the foreign and trade policy objectives and apply a significant influence test. The Minister was very clear in response to me on Monday that the Crown Prince would be absolutely full and central in any clear interpretation of that test. For the first time, she has put the definition of significant influence into the long grass as she said that it would come back in secondary legislation, that the Government do not actually know what it means and that she cannot give an answer to that in Committee or when we return on Report. But it is critical, because it comes to the very hub of political influence: what is the status of the Crown Prince? What is the status of Abu Dhabi? What would be the status of the Qataris if they wanted to buy a club in the Premier League, or indeed in any other league? My recommendation is that, given the uncertainty in the response that the Minister has just given and the absolute clarity on Monday evening and earlier this afternoon on the yes/no answer, we leave it for the time being and return on Report and analyse this in depth.

[Baroness Twycross (Lab)]

I felt I was clear, but I accept that the noble Lord has a different view. I look forward to ongoing discussions with him before and on Report. My comments related to a previous group, so I apologise to noble Lords who were not there to hear the context of my comments.

I will now move on to my remarks on this group, which—

[Lord Moynihan (Con)]

I shall just say this, as it is so central to our proceedings this evening. Just for the record, on Monday evening the Minister said:

“Finally, on the amendment from the noble Lord, Lord Moynihan, the whole point of the owners’ and directors’ test, which has been carefully designed, is to ensure that club custodians are suitable for assessing an owner’s fitness—this is absolutely crucial. It is right that any owner passes the tests set out in the Bill, so it would not be fair, appropriate or responsible to exempt certain types of owners from testing … This amendment intends that owners with diplomatic status or who are Heads of State, Government Ministers or high-ranking officials of foreign Governments would not be tested”.


That was in response to my probing amendment. She went on:

“I do not need to tell noble Lords about some of the people this could exempt from testing. That means that the regulator could not consider any personal finances or criminal history, no matter how egregious. Instead, it would have to ignore these matters, so the regulator could be letting unsuitable owners in”.—[Official Report, 16/12/24; col. 140.]


In other words, all those people I have just mentioned are subject to the tests set out in the Bill, and that would include anybody who was chair of a sovereign wealth fund that had invested in football in this country. That is what we will return to on Report. I do not think it is appropriate to lengthen the discussion this evening, as it has been well aired, but it is fundamental to removing that clause from the legislation in terms of opening up a can of worms now for the Government in identifying exactly what the suitable ownership test means.

[Baroness Twycross (Lab)]

Like other noble Lords, I want to move on, but I shall repeat two sentences that I referred to earlier. Simply because an incumbent individual meets the definition, including if they exert significant influence or control, does not mean that the regulator is required to test them. It may test an incumbent owner if there are grounds for concern about their suitability. Now I think we should move on. I do not feel that is a can of worms, but I appreciate that the noble Lord has an alternative view.

Moving to the group under discussion, I thank the noble Lord, Lord Parkinson of Whitley Bay, and my noble friend Lady Taylor of Bolton for speaking to the amendments. On Amendment 206, in the name of the noble Lord, Lord Parkinson, the aim of the clause, as he knows, is to stop the possibility of clubs leaving to join a closed-shop breakaway competition, as several clubs attempted with the European Super League in 2021. While I appreciate the aim of the noble Lord’s amendment, the clause has been carefully drafted to ensure that there is no possibility of circumvention. That is why the duty also captures formerly regulated clubs, so an owner cannot remove a club from the specified competitions in favour of joining a new break- away competition.

It is unlikely that clubs in the sixth tier of English football or beyond will attempt to join a prohibited competition, so we do not think the risk that the amendment aims to cater for is a material one. What is more, if these clubs sought to join a competition that had been prohibited by the regulator, that would undermine the heritage and history of the club and should also be condemned—so it is no bad thing that the duty would capture them as well.

On Amendment 207, in the name of my noble friend Lord Bassam of Brighton, which my noble friend Lady Taylor spoke to, I acknowledge the intent to protect the clause from any risk of circumvention. However, we do not believe it is necessary to extend the scope of the clause to the new clubs or entities that are created to take on the identity and players of a formerly regulated club in order to participate in prohibited competitions. We believe this is a remote risk. Even if a club could convince its players to do this, convince its fan base to follow them and work through the legalities, the FA’s existing requirements around the registration of clubs and players would offer sufficient protection. For the reasons I have set out, I hope noble Lords will not press their amendments.

[Lord Parkinson of Whitley Bay (Con)]

I am grateful to the Minister for her answers to the amendments in this group and for the clarification she gave on the comments on a previous group. I take what she says about breakaway clubs, but the point is for how long the provisions will still apply to clubs that drop out below the bottom level of this regulation through relegation, and why it lasts for so long. She has spoken before, rightly, about making sure that this is a proportionate regime. If you are a club that has been relegated to such a low tier and are unlikely to come back in, it feels like a very long time to have to continue to comply. That is the point that I was probing there. I might take that away and think about it further. If she has anything further to add on reflection, I would be very happy to receive that in a letter or pick it up in the discussions that we will have between now and Report—but that was part of the thinking there.

The noble Lord, Lord Addington, is right: the suggestion of another or an intermediate regulator would not be popular in all parts of this Committee, so I will let that issue rest.

My noble friend Lord Moynihan’s suggestion on the question of influence and foreign ownership is one that is perhaps better for us to talk about in our discussions between Committee and Report. I cannot be the only Geordie who is a bit confused and concerned about the implications for Newcastle United and I look forward to speaking to the Minister about that. But, for now, I beg leave to withdraw the amendment.

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[Lord Watson of Invergowrie (Lab)]

Some 72 miles and a few chains, I am sure.

Even a club such as Bristol Rovers, who were obliged to move to Bath, which is only about 15 miles away, had to play there for 10 years until their new stadium was built—and even then, I think they ended up sharing with a rugby club.

Amendments 227 and 233 are really “the AFC Wimbledon amendments”, because they refer to that club in which I have an interest, which I have stated on a number of occasions in consideration of this Bill. On the figure of five miles, it may not surprise noble Lords to know that, when Wimbledon FC were obliged to move because their ground had been sold from underneath them, they went to Crystal Palace, which is about six and a half miles away. It still was not convenient for a lot of the fans.

It has been said that, when Wimbledon moved to Crystal Palace, the crowds increased. Factually, that is correct—and I see the noble Lord, Lord Moynihan, nodding—but they increased because there was a far greater ability for visiting fans to go to Crystal Palace. It was not at all unusual for Wimbledon FC to play home games where their own fans were very much in the minority. So that was not a benefit—okay, in financial terms for the club it was, but it is not a system that anybody would advocate.

My final point is to reinforce Amendment 234, about taking reasonable steps to ensure that the club’s fans do not consider arrangements for any change to be unsatisfactory. That should be a very basic consideration. I think it is in the Bill, but it is helpful to have that stated quite clearly and I hope that my noble friend will take that on board and, if she is not able to accept it today, which I would not expect, that we might come back to this to get something more solid on Report.

[Baroness Twycross (Lab)]

I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton and the noble Lord, Lord Parkinson of Whitley Bay, for tabling these amendments regarding home grounds. The noble Lords, Lord Harlech and Lord Goddard, gave powerful examples of why home grounds matter and what they mean to fans, as did my noble friend Lord Watson of Invergowrie, particularly in relation to relocation. As somebody who grew up within hearing distance of Oxford United’s Manor Ground, I can empathise with the feelings of fans when grounds move —although inevitably they do sometimes, and often successfully.

I will talk first to Amendments 219 to 223, 227 to 230 and 233 and 234 in the names of my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton. Starting with Amendments 219 to 222 and Amendment 230, home grounds are clearly often the most important asset of a club and that is why this legislation has carved out specific protections to safeguard against risky financial decisions or sales of the ground. This does not mean that other assets such as training grounds or office space are not also important to the club, but there is a specific consideration necessary for the home ground. I reassure my noble friends that there are protections in the Bill to safeguard against owners stripping a club of its assets or making reckless mortgage decisions against clubs. They include the enhanced owners’ and directors’ test, which will look to ensure that owners are prepared to be appropriate custodians of their club and its assets.

The regulator will also have oversight of the financial plans and balance sheets of the regulated clubs, ensuring that the club is not putting itself in a risky position unnecessarily. We would expect that this would include what assets remain in the club’s ownership and any plans to dispose of them. If it were to become evident that an owner was looking to asset strip the club or deliberately worsen its financial position, the licensing regime gives the regulator power to place licensing conditions on the club. The regulator could also take enforcement action if those conditions are breached or if the financial plan that the club has submitted has not been followed.

I turn to Amendment 227. I will not repeat the same points made previously as they are both similar to other amendments in this group. However, on the second sub-paragraph proposed by this amendment, with changes to the ownership or use of the home ground as collateral, the potential adverse outcomes are entirely financial. They do not impact the heritage of the club, nor would they necessarily relate to a relocation. If there is reasonable prospect of a change leading to relocation, Clause 48 sets out the parameters for any home ground relocation. The regulator would need to be satisfied that the move does not undermine the financial sustainability of the club or significantly harm the heritage of the club. This means that the regulator will be able to look at things such as location.

However, the Government have deliberately not set a fixed distance or considerations. This is to further allow for a bespoke approach to be taken at all clubs to make sure that the impact of a relocation can be mitigated if one is deemed necessary. Amendment 223 seeks to expand the scope of the duty to gain the regulator’s approval to include all substantial changes to specify properties or the club’s home ground. Given the addition of the specified properties, this amendment could include any significant changes to property, such as a hotel owned by the club. This is a significant expansion of scope and could be onerous and resource intensive on the regulator. In such a case as a hotel, the amendment could feasibly lead to a full consultation and approval process for substantial changes such as building an extension. This would not be an appropriate or efficient use of the regulator’s time or resources.

Instead, such substantial changes to either the home ground or other assets can be addressed via other areas in the Bill. For example, we expect all clubs to consult and have regard to the views of fans on the specified relevant matters. This includes home grounds and business priorities, among other issues. We would also expect any substantial changes to the home ground or other assets to be captured by the club’s financial plans. The regulator will therefore be able to have oversight and react to any concerns.

--- Later in debate ---

[Lord Harlech (Con)]

My Lords, I rise in support of the amendment from the noble Lord, Lord Wood of Anfield. If all football fans were surveyed—more than the 20,000 to 30,000 that responded to Dame Tracey Crouch’s report—this would be one of the issues they cared about most. I hope the noble Lord, Lord Mann, will not mind me putting words in his mouth, but if he were here, I think he would say in his Yorkshire tones, “Home should mean home.” The Government must do everything they can to ensure that.

[Baroness Twycross (Lab)]

I thank my noble friend Lord Wood of Anfield for tabling Amendment 235. Clause 48 has been designed to prevent clubs unilaterally moving their home ground with no regard for the vital role it plays in the club’s history and identity, as well as its financial position. In essence, it is intended to capture instances such as Wimbledon’s move to Milton Keynes and is a really important protection in the legislation. The Government believe that this protection must remain in the Bill to enable the regulator to deliver its key objectives and ensure that home grounds have the appropriate safeguards in place. This amendment, however, seeks to address a slightly different but related issue of competition organisers relocating matches elsewhere. Many of the current instances of this are, for example, play-off matches at Wembley, which have become a key part of English football heritage in and of themselves.

However, I am aware that my noble friend wants this amendment to address situations in which a match could be moved outside England and Wales. Noble Lords will be aware that FIFA is currently reviewing its position on overseas league matches. I do recognise the point the noble Lord, Lord Harlech, made—although I would not presume to paraphrase my noble friend Lord Mann—and how significant this would be for supporters. FIFA has committed to looking at how it might impact supporters, as well as players and a number of other valuable considerations. While the industry is still considering its position on this matter, and many clubs have spoken against the proposals, we do not think the regulator should have a specific power to directly address this. However, the regulator will ensure that clubs consult fans on any changes to match days, including moving the location. The Government will remain in conversation with the relevant governing bodies on this developing issue.

I am happy to continue conversations with noble Lords who have a specific interest in this issue before we get to Report. But for the reasons I have laid out, I must ask my noble friend to withdraw his amendment.

[Lord Wood of Anfield (Lab)]

I thank the Minister for that reply. I also thank her—I did not before—and her officials for the generous way she has spared time not just for me but for lots of other Members of this House over the last few weeks. It is really appreciated.

I understand what the Minister says, and I also understand that FIFA is currently revising its proposals. We have spent a lot of time worrying about provoking FIFA, and I understand why there is sensitivity there. The requirement to consult fans on moving matches assumes that there is already a scheduled match that needs to be moved. My amendment is about two problems that there are in fact technical ways around. So, that issue is still a live one. There will be more discussion about this, and I know the Minister is going to be as generous with her time as she has been already, so with that in mind—

--- Later in debate ---

[Baroness Blake of Leeds (Lab)]

We have interventions on interventions here and we should move on.

[Baroness Twycross (Lab)]

My Lords, before we have any further interventions, I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton, as well as the noble Lord, Lord Parkinson of Whitley Bay, for their amendments. I also thank the noble Lord, Lord Maude of Horsham, for his contribution on this group, which sparked a lively debate, and for giving notice of his intention to oppose the Question that Clause 53 stand part of the Bill. It is useful to remember why we are here, but my comments will focus on the amendments in this group. It is imperative that the regulator can raise the funds necessary to deliver its regulatory functions, so I thank my noble friends and the noble Lords who have raised this important issue.

Turning first to Amendments 250 and 254 in the name of my noble friend Lord Bassam, I want to reassure him that the existing drafting in Clause 53(3) is comprehensive, in the Government’s view, and provides the necessary mechanism for raising these funds. Clause 53(3) also acts as an important constraint on what the regulator can charge clubs for. We believe that the amendment would risk bypassing this safeguard. We also want to be clear that, under the existing drafting, any such central fund could not be used as a form of lifeboat fund to prop up clubs in distress. It is the Government’s opinion that a zero-failure regulator, as implied, would create moral hazard and encourage the very risk-taking that the regulator is trying to address.

On Amendment 252 in the name of my noble friend Lady Taylor of Bolton, the Government acknowledge the importance of any charges on clubs being transparent and proportionate, and offering value for money. These values should be at the heart of any public body. This must be achieved while maintaining the regulator’s operational independence and flexibility, which is why it would not be appropriate to prescribe an exact methodology in legislation for charging the levy. Doing so would remove the regulator’s ability to explore other, possibly more effective and proportionate, methods of charging. The Bill already requires the regulator to have regard to clubs’ financial resources and position in the pyramid. I am confident that this will be sufficient to ensure that the levy is fair and proportionate. I hope this will give my noble friends reassurance that these costs will not be burdensome to clubs.

Amendment 256 in the name of the noble Lord, Lord Parkinson of Whitley Bay, would require the regulator to consult with the Chancellor of the Exchequer specifically, as opposed to the Treasury, when making, amending or replacing levy rules. Consulting with the Treasury on levy rules is standard practice for a regulator, and this approach has been agreed with the department. The Chancellor, as head of the Treasury, will have full oversight of the Treasury’s response to the consultation. The Chancellor is accountable for the decisions of the Treasury and any consultation with the Treasury is likely to have the approval of the Chancellor. Therefore, the Government’s view is that the existing requirement to consult with the Treasury is sufficient to ensure value for money.

Finally, on whether Clause 53 should stand part of the Bill, this clause will allow the regulator to charge a levy to licensed clubs that covers the regulator’s running costs. This follows the precedent of other regulators such as the FCA, the CMA and Ofcom.

[Baroness Brady (Con)]

I thank the Minister for allowing an intervention. Has there been any further development on the cost of the regulator? I know that we have asked the question on numerous occasions, but we have not had a reply. It would be very good for clubs to know what the Government expect the regulator to cost. The Minister mentioned the FCA; that costs £762 million a year. I hope it will not be that much.

[Baroness Twycross (Lab)]

I was going to come on to that. I anticipated that if the noble Lord, Lord Hayward, was here, he would ask me that question. If I can carry on through my speech, with the noble Baroness’s permission, I will address that later in my remarks.

We think it only fair that industry should cover the cost, as opposed to taxpayers. Football is a wealthy industry, and the cost of regulation would represent just a tiny fraction of its annual revenue of over £6 billion. However, this legislation puts robust checks and balances on the regulator. It will be limited to raising funds to meet a set of tightly defined costs that are necessary for regulatory activity only. The regulator will not have a blank cheque; it will be subject to numerous safeguards, including annual auditing by the National Audit Office, and its annual accounts will be laid before Parliament. This will provide the necessary transparency and scrutiny to deliver value for money.

Clause 53 also requires the regulator to have regard to a club’s individual financial position and the league it plays in when setting the levy charges that a club must pay. This should ensure a proportionate approach where no club, big or small, is asked to pay more than what is fair and affordable. As noble Lords are aware, the regulator will be the one that decides on the methodology and, ultimately, the cost of the levy.

I understand, however, that there is a clear desire, as expressed by the noble Baroness, Lady Brady, the noble Lord, Lord Hayward, and other Members of your Lordships’ Committee, to have a much better understanding of how the costs may be borne at different levels of the game. I will endeavour to provide more clarity on this issue. Therefore, after further discussions with the shadow regulator, I will write to noble Lords to provide further clarity on costs ahead of Report. I will also place a copy of this letter in the Libraries of both Houses and would be happy to meet noble Lords or take any questions.

This is a complex issue and we cannot fetter the discretion of the regulator. The letter, when it comes, cannot therefore be considered a definite estimation of costs. It will merely be illustrative, in an attempt to be helpful to this Committee and provide your Lordships’ House—and the clubs that will be regulated—with some clarity and reassurance before we get to Report.

For the reasons I have set out, I am unable to accept the amendments in this group. I therefore hope that noble Lords will not press them.

[Lord Bassam of Brighton (Lab)]

My Lords, I am more than happy to withdraw my amendment and grateful to the Minister for the assurances that she has given about the levy. I just say to colleagues on the Opposition Benches: it is worth reminding ourselves that we are talking about the regulation of only 116 different football entities. This is a small regulator, at the end of the day, so we should not be overly worried about its eventual costs. I think the costs will be, in relative terms, small—nothing at all by comparison with the FCA. Some of the clubs regulated, such as Gateshead, employ only three staff. If you are an Ebbsfleet staffer, you are one of just six, whereas Arsenal employs more than 500 full-time backroom staff. That is why we need to be certain that the levy raised is proportionate to the size of the club. Proportionality should be at the core of the regulator’s consideration when setting its levy. Having said that, I beg leave to withdraw the amendment.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Wednesday 18th December 2024 Lords Chamber

[Lord Markham (Con)]

My Lords, I rise to move Amendment 251 in my name and to speak to Amendments 257 and 258 from my noble friend Lord Parkinson.

Amendment 251 seeks to place a limit on the rate of interest the regulator may charge on any unpaid levies. I think all noble Lords have agreed that we want to keep the regulator fees and cost burden on clubs as low as possible, so having a reasonable rate of interest seems helpful. The proposal is that we take the formula the Government currently use for tuition fees, and which is proposed for the tobacco levy, which is the RPI rate plus 2%. I am not absolutely wedded to that figure, but we believe there should be a figure we can all agree on.

Amendment 257 from my noble friend Lord Parkinson would remove the provision whereby the regulator does not have to consult on changing the levy if it considers the change to be minor. We understand the intent behind that provision, but all sorts of discussions could then be got into about what is minor and what is not, so it is probably easier just to establish that it be properly consulted on if there is a change.

Amendment 258 is pretty straightforward. It seeks to establish that if the regulator plans to change the levy rules, it gives six months’ notice before the chargeable period begins. We have said a number of times that we want clubs to improve their financial budgeting and planning, and this would help them to do that. With those simple changes, I beg to move.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I thank the noble Lords, Lord Markham and Lord Parkinson of Whitley Bay, for their amendments concerning the levy. On Amendment 251 from the noble Lord, Lord Markham, setting the rate of interest charged on non-payment of the levy is an operational decision for the regulator, which needs the flexibility to charge interest at a rate that deters non-payment. A rate that is too low could increase the incentive for non-payment and jeopardise the regulator’s ability to carry out its functions. The level of interest charged would be subject to the same consultation requirements as the levy itself. This will ensure a firm but fair level of interest.

Amendment 257, in the name of the noble Lord, Lord Parkinson of Whitley Bay, would require the regulator to consult every regulated club and others such as the Secretary of State and the Treasury on minor changes to the levy rules. These would be immaterial amendments or replacements to levy rules, such as correcting mistakes. Going out to gather the views of all clubs feels like it would be a disproportionate burden on clubs and on the regulator. For material changes, the Bill already requires the regulator to consult as appropriate. No club, especially those in the National League, wants the administrative burden of unnecessary consultation.

Finally, on Amendment 258 in the name of the noble Lord, Lord Markham, requiring the regulator to publish its levy charge six months before the chargeable period would create an operational challenge. The regulator would have to estimate a levy charge having only half a year’s costs to base it on. This could lead to inaccurate levy charges, which could see the regulator underfunded or clubs needlessly burdened. The current requirement of charges being publicised as soon as reasonably practicable strikes the right balance, we feel, between adequate notice for clubs and operational flexibility for the regulator to ensure an accurate and appropriate levy charge.

I therefore hope that the noble Lord will withdraw his amendment.

--- Later in debate ---

[Lord Goodman of Wycombe (Con)]

My Lords, it is relatively late in the evening and we have debated a lot of clauses and amendments, but I agree with my noble friend Lord Maude that this debate is at the heart of the Bill, at least as far as the Premier League, the Football League and the clubs themselves are concerned, I suspect. What will really get them going in relation to the Bill is not, for better or worse, net zero, diversity or any of those things but the money; it is what happens to the money and the success or failure of their clubs.

When the Minister responds, she will make the best case she can for what is in the Bill—for the backstop—and I understand that. However, when we finish Committee and go on to Report, and when eventually the Bill passes, the debate will not be over; it is just beginning. Once the Bill is passed, as I assume it will be, my noble friend Lady Brady will continue to make her case broadly for the present arrangements and the noble Lord, Lord Bassam, will be back to make his case for what my noble friend Lord Markham called the front-stop, while the Government will defend the backstop—and so the debate will go on.

One of the lobby groups that has an interest in the Bill said of it that the debate is over. I found that a remarkable statement, given that this House presumably has a duty to scrutinise legislation and the Bill has not even been down to the other place yet. My point at this stage is that the debate is not over. It will not be over in Committee, on Report or after Third Reading; it will just be beginning. I ask noble Lords to bear this in mind when we come back, later in Committee, to consider clauses that seek to review the Bill as a whole.

[Baroness Twycross (Lab)]

I thank my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton for their amendments on this important topic. I thank my noble friend for outlining why distributions are so important to the football pyramid. I will aim to take the amendments in a sensible order, with logical grouping where possible. In appreciating comments on the size of the group, I note that there is a logic to this, as outlined by my noble friend, and I say to the noble Lord, Lord Markham, that I do not think we have skimped on debate during Committee—though I agree with the noble Lord, Lord Goodman, both that the hour is getting late and that it does not feel like the debate has finished or will finish any time soon.

I acknowledge the probing intent of the amendments and it is really helpful to have this debate. I know that subsequent groups will go into this a bit more as well. I agree with the noble Lord, Lord Addington, that it is important that we do our absolute best to work through the issues that noble Lords have raised and to get the regulator right, which was the point that he made.

I reassure my noble friends that we agree on the importance of regulatory intervention on distributions— I appreciate that not all noble Lords have exactly the same view of this. Amendments 260, 269, 270, 293, 295 and 288 would broaden the powers that the regulator has to intervene by allowing it to trigger the back- stop process. I understand the intention behind the amendments, but we must maintain the backstop process as a last resort, to be triggered by the leagues only if they cannot come to an agreement themselves.

[Baroness Evans of Bowes Park (Con)]

The noble Baroness keeps saying that, and I understand that it is what we hoped was going to happen, but I do not think that anyone in this Committee believes that it will be a last resort. From the briefings that all noble Lords—including, I am sure, the Minister—have had from all sides, we know that the backstop is likely to be triggered very early on by the regulator. I really hope the Minister can move from what we hoped might be the position to where I think we are, whether we like it or not, and look at these processes on the basis of what is likely to happen. This could be one of the first things that the regulator has to deal with.

We have heard concerns about the nature of the conversations and the way that those might set up leagues against one another. I know that the Minister would hope that it was a last resort, as I think we all did, but I urge her to accept that if we are being genuinely honest—and other noble Lords may have heard differently from the various leagues we have all been speaking to—it seems to be a view that this is likely to happen. It would be much more helpful for our discussions if we could stop saying, “It’s a last resort”, and accept that it is very likely to happen quicker than we all wanted.

[Baroness Twycross (Lab)]

I appreciate that the noble Baroness, Lady Evans, may take a different view and I completely understand people’s concerns that it will be a front-stop—as a spoiler alert, and with apologies to my noble friend, I am not going to accept these amendments; we will come to that in a moment. However, we genuinely think that the model we have established is very similar, apart from the possible inclusion of the parachute payment—for want of a better word; it is not the phrase used in the Bill, but that escapes me for a moment—should the “state of the game” report suggest to the regulator that it needs to allow that to be taken into account.

My view is that the model we have presented should incentivise the leagues and the parties to come to an agreement themselves, and that opportunity to do so does not go away once the regulator is established. That is the design of the model and an essential part of it, as it was in the previous iteration of the Bill, so this is absolutely intended as a backstop process. We can go on to debate that in later groups as well as in this group. I am happy to do that and to meet people individually to go through why we think this will be a backstop and not a front-stop whereby the minute the regulator sets off in motion, everybody will claim that they want to have the backstop triggered.

However, there are things that the regulator will need to take into account if somebody asks for the backstop process to be triggered. It is not the necessarily the case that the regulator would have to accept that that process was set in motion. The whole model is designed around the principle of trying to get people to come to an agreement themselves. It is really important to ensure—

[Baroness Brady (Con)]

I thank the Minister for giving way. If she was right, we would have a deal in place by now. This has been the model for two years, so it is definitely a barrier to conversations. There is a view that whatever the Premier League agrees with the Football League, that, in effect, becomes its insurance policy. It then triggers the backstop and goes straight to the regulator, knowing that it will never get less than it has been offered and could get more. We will be in a perpetually revolving door of triggering mechanisms that will never give any club any certainty of its income, which will be very dangerous and very bad for football.

[Baroness Twycross (Lab)]

It is important for us to go through how the regulator’s backstop powers and power of last resort would work. I appreciate that the noble Baroness is entirely right that an agreement has not come into place, and that might be—or might not be—because of people waiting to see what form the regulator takes and the exact iteration of the wide range of views we have heard tonight and on previous occasions.

If, under the Government’s intended model for the backstop, the relevant leagues cannot reach an agreement, they can apply to trigger the backstop—the noble Baroness is quite right on that. If certain high thresholds are met, of which the regulator must be satisfied, the backstop can be triggered, but let me go through what would happen first: the relevant leagues would enter a period of mediation and, if there was still no agreement, they would move to a final proposal stage.

[Baroness Brady (Con)]

I thank the Minister for allowing me to intervene. Rick Parry went before the Select Committee and said he would trigger the backstop in any event—even if he got more money from the Premier League in the meantime—because there is no risk to the EFL in the backstop.

[Baroness Twycross (Lab)]

I am not going to comment on what people did or did not say in that committee meeting at this point. The backstop would be applied only if certain high thresholds were met. The regulator will be an independent regulator and it will have strict measures to meet—high thresholds which it must be satisfied of if the backstop is to be triggered. If there is still no agreement, the parties will move to a final proposal stage and, at that point, the regulator would convene an independent expert panel and invite final proposals from both relevant leagues with accompanying analysis, and the independent expert panel would choose the most appropriate proposal. This model incentivises both parties to compromise, as unreasonable proposals would not be chosen.

The whole model, which is almost identical in every detail to how the previous Government were planning to do this, is intended—

[Baroness Evans of Bowes Park (Con)]

The Minister keeps coming back to the previous model. I think most of us here thought the previous model was nuts, and we still think it is nuts. We never discussed this in the House, so to keep saying that is quite insulting to quite a lot of us who always thought this was a bad idea. We are trying to engage with the Minister now about why we think it is a bad idea, and we would really like her to talk about the detail rather than keep saying, “Well, it was your Government”. Honestly, I would never have voted for this beforehand and, in my ex-position, that would have probably been quite a bad thing, but I am sorry, I would not have done so. I would like the Minister to focus on what we are talking about rather than keep using those issues to deflect from getting into the detail.

[Baroness Twycross (Lab)]

I am not sure how many times I have said that this evening, but it is really not very many. I am trying to establish that this model has been worked on and discussed for some time. I appreciate that noble Lords in this House did not get the opportunity to discuss it under the previous Government. It is a model that has been worked through, with examples from different organisations. It encourages compromise and tries to get people to reach a deal that everybody can work through and which meets the criteria of the regulator.

[Lord Moynihan (Con)]

A model which creates tension does not get it right. We have already heard from Rick Parry that he would trigger it immediately. This is a model that does not work. We are trying to say to the Minister that Committee is an opportunity to take it away and rethink it. It really does not stack up to be a successful model for the future of English football.

I would really appreciate it if the Minister could take that away, think about it and come back to us with her reflections on everything she has heard this evening, from many people who are very knowledgeable about the future of English football and, indeed, its existence. I have real concerns that what is being proposed would be deeply damaging not only to English football but to the investment future of the game in England. Surely, she should take that into account.

[Baroness Twycross (Lab)]

Simply because one individual says that they would want to trigger it does not mean that the regulator would view the condition as being met.

[Lord Maude of Horsham (Con)]

With respect to the Minister, it was not just a random individual; it was a really significant player in the whole scheme of what we are talking about here.

[Baroness Twycross (Lab)]

I appreciate the noble Lord’s point, but if the EFL triggers the backstop or makes a proposal in bad faith, it could end up worse off if the Premier League’s proposal is more reasonable, so this does not encourage the EFL or Premier League to be confrontation or divisive. I am sure we will come back to this at a later stage, probably this evening, but definitely when we come back in the new year on Report.

I am really happy to sit down with noble Lords and talk this through, but I will continue to use my speaking notes for some time and then, I hope, give some reassurance that we are considering this carefully. I am always happy to meet with noble Lords, as is the team that has been working on this. As noble Lords are aware, a number of the officials working on this have been doing so right the way through from the fan-led review, so this is a really good example of the consistency of advice both to this Government and the previous Government, notwithstanding the fact that not everybody here liked the Bill’s previous iteration.

To return to my speaking notes—although I am fairly sure I have got slightly out of order now—we think that this approach encourages future collaboration. We might need to agree to disagree on that point and come back to that debate.

[Baroness Brady (Con)]

The Minister says that she believes that the mechanism will deliver collaboration. For my benefit, please could she name a single example of a binding final offer process working in UK regulatory terms, and its use in the UK to deliver the outcomes she is talking about?

[Baroness Twycross (Lab)]

The Competition and Markets Authority has used it.

The process proposed by this group of amendments, excluding Amendment 260, would allow the regulator to intervene at its discretion and would require it to take into account the potential use of any revenue distributed. It is the Government’s view that this is regulatory overreach and a fundamental change to the intent of the process as drafted.

The other amendments from my noble friends Lord Bassam and Lady Taylor seek to change the structure of the backstop process from a two-party mediation and final proposal/order process to one that could apply to any number of relevant parties. I understand the overall intent of these amendments and have chosen to address them as a group to ensure that that intent is understood comprehensively, and that the Government’s position is in turn communicated coherently.

To clarify, the Premier League, the English Football League and the National League can all apply to trigger the backstop process. Any of the specified competition organisers can submit an application to trigger the process, and simultaneous instances of the backstop process could be triggered to cover the relationships between each of the leagues. The process is inherently designed as a two-party process. Fundamentally, distribution agreements are agreed between two individual leagues and the process is designed to facilitate these agreements. As the final offer process is set up and designed between two parties to facilitate a decision between two proposals on the basis of relevant principles, it would not be effective for the regulator to engage in this process with more than two parties. This is also, in part, why it would not be appropriate for the regulator to make a third offer. Without the incentive of the two-proposal process, parties are likely to stay at polarised positions, rather than find areas for compromise. However, when the two proposals submitted are the only choices, the pragmatic decision is to submit the most reasonable proposal possible. This is the incentive we wish to create.

I now turn to Amendments 292, 296 and 314, tabled by my noble friends Lord Bassam and Lady Taylor of Bolton. While there is a slight difference between “special” and “compelling”, we are satisfied that the bar is set sufficiently high with the use of “special”, which is the more usual terminology in these sorts of provisions. There is likely to be no tangible difference in outcomes, and therefore these amendments would be minor, insignificant changes to the wording of the Bill. As such, the Government believe the current drafting is sufficient. This is also the case for Amendment 264. While we understand the intent behind this amendment, we are content that the current drafting in the Bill sufficiently captures all revenue relevant for consideration during the backstop process. The proposed drafting change would not capture any revenue sources not already captured by the existing wording.

I turn now to Amendments 261, 262, 276 and 315. Amendment 276 seeks to significantly broaden one of the conditions by which the backstop process could be triggered. Condition 2 is specifically designed to be triggered by a material reduction in relevant revenue, as this poses a significant threat to the financial sustainability of the pyramid. Amendment 315 would, if the distribution process was ended due to incomplete or inconsistent proposals, require the regulator to issue a distribution order based on its expert panel’s own proposal, rather than ending the process. This would prevent the regulator ending the final proposal stage without an order, even if both leagues have chosen not to submit proposals.

These amendments, and the others referenced, would increase the likelihood of an enforced rather than an agreed solution. The Government’s preference is for an industry-led solution. It is our view that the regulator should have a role in facilitating the final proposal process only where no agreement can be reached on distribution, and that the process should be the least interventionist it can be while remaining effective. This approach encourages future collaboration and prevents the leagues relying too heavily on the regulator in the future.

I turn now to Amendments 284 and 286. While I agree that the state of the game report is a usual source of information to be considered as part of the distribution agreement process, it is our position that these amendments are unnecessarily prescriptive. As it stands, the Bill does not make specific reference to the report being included as a potential question for consideration. However, the existing drafting does not in any way exclude consideration of the state of the game report, and the regulator must have regard to it as part of its general duties. I would expect the state of the game report to be considered by both the leagues applying to trigger the backstop process, and the regulator, given its relevance. However, to include this expectation beyond what is already set out in primary legislation would be inflexible.

Turning to Amendment 267, while the Government understand the broader intention to involve fans in as many areas of the Bill as possible, it would not be appropriate for the regulator to be mandated to consult a group which is neither directly financially involved nor a governing body. This is not to say that fans should not make their views known to the regulator, and there will be many instances, such as in the state of the game consultation, where we expect the regulator to be able to consider a number of perspectives. This includes the views of fans on the financial situation in English football. Furthermore, the proposed drafting requiring consultation with representatives of regulated clubs is duplicative, given that the Bill as drafted already requires the consultation of the leagues.

Finally, Amendment 319 seeks to remove the provision that explicitly outlines that leagues can come to an alternative agreement at any time in the backstop process. The ability of leagues to come to an agreement independently has been protected in the legislation itself intentionally, to highlight that an industry-led solution is both preferred and encouraged. We believe this explicit protection will encourage the leagues to reconsider at every step of the process whether regulatory intervention is necessary, ideally bringing them closer to an independent agreement that works for all of football.

I hope that my responses have reassured my noble friends and other noble Lords that the Government’s approach is appropriate and provides the necessary protections, and that my noble friends will not press their amendments.

[Lord Bassam of Brighton (Lab)]

My Lords, the noble Lord, Lord Markham, rumbled me early on in his comments when he worked out that these were probing amendments; that is what they were intended to be. The group is disparate—I did not author it; it was what we were handed. It has been useful because it has enabled me to hear from the Minister how she sees the regulatory arrangements working as far as distribution is concerned, and the extent of the regulator’s flexibility.

I did not make this observation in my opening remarks but I think—the Minister covered this point—that the “state of the game” report will be critical when the regulator gets to grips with the distribution. The distribution of the revenues will be most important, because that is designed to make the game sustainable, to make sure that clubs do not go into administration, that we do not have clubs paying more than they actually earn in revenues, and so that clubs do not get to the point where they cannot properly trade. That is the most important thing for me.

Although I appreciate that my amendments would appear to some to be a bit of regulatory overkill, I think the point was made that we need to make sure that the regulator can do its job properly. The Premier League should not be at all threatened by the powers that the regulator has. Given the amount of money there is in the game and the continuing success of the Premier League—and, for that matter, the Championship —the regulator should be able to get our national game to the point where it is much more financially in balance and there are not the big gaps and distortions in revenue distribution throughout the pyramid.

I thank the Minister for what she said. Obviously, I shall study it very carefully. I think it unlikely that I shall return to these issues on Report, but obviously I will look at it very carefully before we come to that point. I beg leave to withdraw the amendment.

--- Later in debate ---

[Baroness Evans of Bowes Park (Con)]

I support Amendment 263 and declare an interest as a supporter of Norwich City, who, over a number of seasons, endured the pain of relegation and then the joy of promotion on a regular basis. So, unlike my noble friend Lord Maude, I am well aware of the benefits of parachute payments, although unfortunately not for a few seasons now.

As we have heard, parachute payments are a critical foundation for the competitiveness of the Premier League. They help clubs manage the financial impact relegation from the Premier League can cause and give a degree of stability at a time of significant challenge to allow them to adjust to their new financial and footballing reality. That is true of all clubs. Well-run clubs like Norwich City could not have survived, even with the benevolent owners they had, without the benefit of a parachute payment. A parachute payment does not, however, in any way ensure that clubs continually go up to the Premier League, as, unfortunately, the last few seasons for Norwich City have shown.

I am sure a number of noble Lords will have seen the letter from Cliff Crown, chairman of Brentford FC, who said:

“For Brentford FC the parachute payment model provided an essential safety net, enabling us to invest in the team and infrastructure when we secured promotion. This support was pivotal in ensuring we could compete effectively and establish ourselves in the Premier League.”.


Like other noble Lords, I am concerned that the Bill as it stands may inadvertently incentivise bottom-half Premier League clubs and Championship clubs seeking promotion to significantly curb their investment over time, given the greater risk relegation would undoubtedly present. As my noble friend Lady Brady said, relegation would become a real financial cliff edge that would see clubs lose enormous amounts of revenue overnight, while having to continue to cover the costs predicated on their involvement in the Premier League. If that were to happen, the competitiveness of the Premier League would be severely weakened, and I believe the Championship would be significantly weakened too, undermining the very attributes that attract the revenues that sustain the game.

I urge the Minister to look again at this issue and to carefully consider the concerns raised in our discussions today. In particular, if she has not already done so, I urge her to talk to the clubs whose first-hand experience of the stabilising effects of parachute payments surely must be central to any discussion of this issue. I really hope that their experience will not be dismissed out of hand.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Markham, for this amendment and all noble Lords who have taken part with a degree of passion that shows their commitment to the game and to the legislative scrutiny process.

First, I acknowledge that all noble Lords—I include myself in this—agree that parachute payments are a significant part of football’s financial landscape. I reassure noble Lords that the Government recognise that they play an important role in supporting the survival of relegated clubs. I agree with the noble Baroness, Lady Brady, that they can provide a lifeline. However, the regulator needs to be able to consider all relevant revenue sources as part of the backstop process to get an accurate picture of the proposal’s impact on financial sustainability. That is why parachute payments have not been excluded in this Bill’s definition of relevant revenue.

We believe that allowing the regulator to make a more informed decision, rather than restricting what it can consider, will only help to achieve the best possible outcome for the future of the game. Notably, parachute payments will be reviewed as part of the process only if the regulator deems them a relevant consideration. The current drafting does not require that parachute payments be considered; it allows them to be so only if they are deemed relevant by the regulator. So, if it agrees with the point made by the noble Lord, Lord Markham, based on the state of the game report, it will act accordingly. What that means in practice—

[Baroness Evans of Bowes Park (Con)]

The Minister talks about the state of the game report, which I completely agree is going to be extremely important, but the fact of the matter is that the backstop could be triggered before the state of the game report is published. From what I remember, it is quite a long time before it needs to be published. It could be that both leagues—the EFL and the Premier League, or whoever—will trigger the backstop before that, so parachute payments will be included. Unfortunately, the state of the game report may have no impact whatever on an initial decision by the regulator. The timescales simply do not work. I am not expecting a particular answer today, as the Minister can well say that she is not in charge of the regulator, but it is important to note that the timing of these things does not necessarily tie up, so unfortunately, reassurances like that are not really reassurances.

[Baroness Twycross (Lab)]

Clearly, it does not need to wait for the state of the game report to decide whether they are relevant. The approach we have adopted in the Bill means in practice that if the regulator has clear evidence, whether from a different source or from the state of the game report, that parachute payments are causing sustainability issues to the wider pyramid, it will now be able to address them. In our view, this was a potentially serious gap in the legislation that we feel has now been rectified. I stress “potential”.

[Baroness Brady (Con)]

What the Minister said would be fine if the regulator was making a balanced determination, but because the Government have created a binary process whereby one proposal can be accepted, it could choose to abolish them. The Government have created that risk, and it is an intolerable risk.

[Baroness Twycross (Lab)]

We went through in quite a lot of detail how the backstop mechanism would be triggered. I know we have more to come, as the noble Lord, Lord Maude, said, but in my view, it is not unreasonable for the regulator to be able to consider them. However, the regulator does not need to consider them.

On the point raised by the noble Baroness, Lady Brady —clubs and planning, and how they can deal with their financial future if parachute payments could change as part of the backstop process—while the Government understand the desire to ensure that regulated clubs have as much time to adjust to change as possible, we acknowledge that significant time has already passed without a financial distribution agreement. Ensuring a timely and satisfactory agreement is in the interests of football and the wider public. The backstop process is a built-in transition period specifying that parachute payments cannot be reduced within one year of the distribution order coming into effect.

We understand concerns around the future of clubs that may already have factored parachute payments into their forward-looking financial planning before a potential order that could lower payments had been issued. We would expect the leagues to maintain effective communication with clubs throughout the backstop process, which, alongside the built-in transitory provision, will mean that clubs should have ample time to adjust if parachute payments are deemed in scope. There will not be any sudden reduction in payments without warning. I feel that that should provide some reassurance to noble Lords and to the clubs.

On the definition of relevant revenue, football is a fast-paced industry, so it would be erroneous to assume that the definition of relevant revenue might not need to change. If broadcast revenue ceases to be the primary source of revenue stream in the game, the definition would need to be amended to ensure the process remained a viable regulatory intervention. Furthermore, there are already significant safeguards in place to ensure that this power is not used incorrectly. For example, consultation with the regulator, the Football Association and specified competition organisations is required before the power can be utilised.

With noble Lords’ indulgence, I want to say a bit about the consultation process. On a number of occasions it has been stated in your Lordships’ House that there has been insufficient consultation. Particularly in response to a point raised by the noble Baroness, Lady Brady, I want to put on the record that this Football Governance Bill is the culmination of years of work, including a huge amount of consultation. During that time, there has been extensive regular engagement with key stakeholders, including clubs that will be subject to the regulation. All clubs have been provided with a number of formal opportunities to share their views, particularly as part of the fan-led review and the formal consultation process on the football governance White Paper, where all 116 clubs in the top five leagues at the time were invited to give their views on the proposals. Over that period, DCMS Ministers and officials have had many hundreds of meetings with clubs, leagues, fan groups and other stakeholders from across football, and we continue to engage with the industry now, so this number is constantly growing.

Clubs have had five years to write to or meet DCMS to make their position known. No club that has requested a meeting has not had one. Indeed, some Premier League clubs were recently invited to meet officials and turned down the invitation, which I stress is their right. We have met and continue to meet a range of clubs, at all levels of the football pyramid, that will be subject to regulation.

The leagues have a role to play here. We would expect them to support their clubs in their understanding of the development of the regime and in their engagement with the Government, as well as to keep their clubs updated on any engagement that the leagues have had with the Government. Indeed, this is what has been explicitly asked of us at times by some of the leagues. Richard Masters, the CEO of the Premier League, Rick Parry, chair of the EFL, and Kevin Miles, CEO of the Football Supporters’ Association, have all praised the Government’s constructive approach to engagement with the clubs and the leagues.

This is not the end of the process or of the consultation. There are still lots of opportunities for clubs to have their say as the legislation passes through Parliament and work continues to establish the regulator. Even once the regulator is established, its approach will be advocacy first, aiming to work constructively with clubs on an ongoing basis to resolve issues wherever it can.

I have asked for an answer to the noble Baroness’s question about the response to the letter, and I will have to revert to her after the debate. Given the lateness of the evening, I have not been able to get a response on that.

[Baroness Brady (Con)]

Is that the letter I sent on 2 December about UEFA or the letter that the seven clubs sent to the Secretary of State to which she is going to reply? Maybe the Minister can tell me that afterwards.

It is a statement of fact that the Secretary of State has met only seven clubs for half an hour. I am not talking about other officials. I have to say that there was zero consultation on including parachute payments in the Bill. There may have been other meetings, but between the two Bills that was a significant change that has caused lots of difficult conversations within the leagues.

The Minister said that there was no deal in place. There is a deal; it has been in place between the Premier League and the EFL since 2018, and it has a three-year notice period—just so she knows.

[Baroness Twycross (Lab)]

I will have to get back to the noble Baroness on the letter she said was sent by the Premier League following that meeting. Officials have not been able to get in touch with the correspondence team given the lateness of the evening, but we will endeavour to chase that up tomorrow.

I am aware that there is a deal in place. One of the issues raised during the debate this evening has been the inability to reach a new deal. I hope that, at some point soon, the various parties will come to an agreement without us having to trigger the backstop. My main point was that simply referring to one meeting maybe gave the wrong impression of the extent of the consultation. I have spoken to officials who themselves have had more than 100 meetings with the Premier League. To me, that sounds like ongoing dialogue rather than consultation. However, we may need to pick that up outside this Committee.

[Lord Jackson of Peterborough (Con)]

In the spirit of trying to be helpful, and given that Clause 56 is a Henry VIII clause, would the Minister look favourably, potentially on Report, at bringing forward a government amendment which tightens up the wording of Clause 56(2)? Very strong feelings have been enunciated today by my noble friends around parachute payments. It is incumbent on the Minister to acknowledge that and perhaps come back on Report with government amendments that reflect that.

[Baroness Twycross (Lab)]

The noble Lord may not be surprised to know that I am not going to commit to doing that. We believe that the model in the Bill is the correct one. I am happy to meet the noble Lord and others to discuss this before Report, However, on the basis of the arguments I have made this evening, I urge the noble Lord, Lord Markham, to withdraw his amendment.

[Lord Markham (Con)]

I thank all noble Lords for their contributions. We can all agree that everyone spoke with passion on this point. We are passionate because we know it really matters.

I am grateful to the Minister for her acknowledgement of the importance of parachute payments. They really are critical. I echo the point made by my noble friend Lady Brady that, since parachute payments were brought into this, my understanding is that there has been only a 30-minute meeting with the clubs, where this was barely brought up. I urge the Minister to consult more with the clubs.

[Baroness Twycross (Lab)]

I asked officials to draw up the words that I said on consultation because, night after night, group after group, it has been said to me that there has been insufficient consultation on the Bill. I went back and asked whether I could stand up and say that there has been sufficient consultation on the Bill. What consultation happened? When has it happened? How has it happened? Who has it been with? I am confident there has been a huge amount of consultation on the Bill and I will continue to state that when I am asked. I will follow up things that people feel have not been followed up, but any club that wanted to have a meeting has had one, and some have said they did not want one. I will sit down and allow the noble Lord to finish, but I am not going to accept that there has not been sufficient consultation.

[Baroness Brady (Con)]

I am sorry to intervene, but I want to say again that on the specific issue of parachute payments there was no consultation with either the Premier League officials or the Premier League clubs that attended that meeting before this went into the Bill. I am not saying that there was not consultation on other areas, but this is a significant change to the Bill that had zero consultation with the Premier League or Premier League officials.

[Lord Markham (Con)]

It may be that it should be a matter of fact and we can find out one way or the other. The question is: how much consultation has happened specifically on the parachute payments? Obviously, they have been a recent introduction. My understanding from my noble friend is that there was just that 30-minute meeting, at which this was barely raised. I would be grateful if the Minister could ask her officials directly.

[Baroness Twycross (Lab)]

I will intervene again, and I thank the noble Lord for giving way. Labour tabled an amendment on this in opposition, so I am surprised that there seems to be so much surprise that the Government have now put this in the legislation. I accept that perhaps it was not noted at the time.

[Baroness Evans of Bowes Park (Con)]

The Minister will also know that Labour tabled a lot of amendments, many of which we are also now pushing, but are told they are not going to be considered. So, yes, but equally perhaps the Minister might like to look through all the amendments tabled by her colleagues in the Labour Party in the other House and see whether she is now prepared to accept them all.

--- Later in debate ---

[Baroness Brady (Con)]

My Lords, I rise to speak to Amendments 271, 307 and 316 in this group. My noble friend Lord Maude is right: the Premier League’s distribution outside our ecosystem is the highest amount of money of any other sporting competition in the world, and no regulator has forced the Premier League to do that.

My amendments seek to embed principles into the backstop mechanism. My aim in doing so is to ensure that it operates in a way that is proportionate, legally defensible and fit for purpose. At the heart of the amendments lies a simple but critical idea: any intervention by the IFR on this issue must be guided by clear, fair and transparent principles.

The backstop mechanism in its current form lacks sufficient criteria to direct the IFR in exercising its powers. It dictates that the IFR must choose the proposal that is “more consistent” with its principles. But what are those principles? The first is to “advance the IFR’s objectives”, and we have already discussed at great length how nebulous those objectives are. The second is not to place any “undue burden” on the parties’ commercial interests. The third is to ensure that relegated clubs have a one-year transition for any changes to parachute payments. That is it. There is no other guidance for the regulator in making this enormous and binary choice. This is quite incredible, and it creates huge risks, not only for the clubs and the leagues but, more importantly, for the very integrity of the regulatory process itself.

Let me begin with a fundamental principle of protecting property and contractual rights. It is vital to understand that the revenues subject to redistribution under the backstop are not collective funds but revenues generated solely by the Premier League and the Premier League clubs. So the backstop is not a neutral act; it is interference in the property rights of Premier League clubs only.

Under Article 1 of Protocol 1 in the Human Rights Act—A1P1—any interference with those rights must therefore be justified on clear and compelling public policy grounds, and adhere to principles of proportionality and necessity. There are concerns that this crude mechanism, with so few transparent criteria, is legally challengeable under A1P1, even more so now as a result of parachute payments being included, and that is not a good thing; it is in everybody’s interests for this backstop to be legally defensible. But without robust principles to guide the IFR’s decision-making, any determination risks being challenged, leaving the IFR open to judicial review and the entire system mired in uncertainty and delay.

A1P1 case law also emphasises the principle that less intrusive measures must be considered before more significant interventions are imposed, so this is also enshrined in my proposed amendment. The backstop mechanism, as drafted, establishes a binary process that compels the IFR to choose between two competing proposals, but it provides no framework for the IFR to tend towards the least intrusive option, particularly in relation to respecting the Premier League’s property rights as the sole funder of financial redistribution. That is a very dangerous oversight.

Without explicit guidance to the IFR that it should tend towards the least intrusive measure, particularly in its treatment of Premier League revenues, there is a real risk that the backstop could lead to legal overreach. Including this principle in the Bill would provide the IFR with a clear steer, reflect the unique role of the Premier League as the funder of any distribution order and ensure that the mechanism operated in a way that respected property rights.

The principle of good faith is another cornerstone of these amendments. The binary nature of the backstop mechanism incentivises brinkmanship rather than genuine negotiation. These amendments seek to create a framework that rewards constructive engagement and discourages posturing. Without this principle, the backstop risks becoming a tool for division rather than collaboration.

Another critical safeguard in the amendments is the requirement that any backstop decision must not force clubs into breaching their own league’s or UEFA’s existing financial rules and covenants, including profit and sustainability rules or the IFR’s own licence. A sudden and drastic redistribution could reduce Premier League clubs’ revenues, which in turn could destabilise their own business plans, which in turn leads them to breach the profitability and sustainability rules in their own leagues. That would lead to fines, sanctions or even points deductions for Premier League clubs. It would be a remarkable irony if a mechanism intended to promote sustainability instead penalised clubs for failing to meet their own financial obligations.

Finally, let me address the amendment tabled by my noble friend Lord Maude, which would ensure that the backstop could not be used as a first resort. The IFR must first regulate clubs in the EFL to ensure that they are financially responsible and not conveniently reach for the Premier League’s revenues before it has even sought to impose those controls. If the IFR cannot deliver sustainability through its own regulatory tools, what confidence can we have in its ability to manage a redistributive mechanism fairly or effectively? My noble friend’s amendment rightly prioritises the use of all other tools before triggering the backstop.

These amendments would provide the IFR with the steers that it will desperately need to navigate one of the most consequential issues in football. Without these amendments, or something very similar, the backstop risks sinking into a legal and political quagmire. We should all be aligned in preventing that outcome, so I hope the Minister will listen carefully and sympathetically to these arguments.

[Baroness Twycross (Lab)]

I thank the noble Baroness, Lady Brady, and the noble Lord, Lord Maude of Horsham, for these amendments, and the noble Lord, Lord Parkinson of Whitley Bay, for giving notice of his intention to oppose that Clauses 56 to 60 stand part of the Bill.

I will start with Amendments 271 and 316, from the noble Baroness, Lady Brady. I thank her for clearly stating some of her core concerns about the backstop process through these amendments and hope to reassure her that the existing drafting of the Bill already addresses her concerns without the need for this additional clause. First, I will cover her concern regarding the explanation of suitable alternative regulatory solutions when I address subsequent amendments. On her other concerns, current drafting of the Bill already requires the regulator to trigger the process only if its ability to advance its objectives would be threatened if it did not. Final proposals are already required to advance the regulator’s objective of ensuring financial sustainability and resilience. They also have to ensure that they do not place an undue burden on the commercial interests of either league. We have been mindful of property rights when designing the backstop, which is why the process can be triggered only in specific circumstances and why, even when the high threshold for triggering the process is met, commercial interests must still be considered. We consider this to be a suitably high bar to ensure that the regulator takes adequate consideration of regulated clubs’ property rights and commercial interests.

I understand that the noble Baroness is especially concerned about the issuing of a distribution order that may force clubs into non-compliance with the league’s own internal rules. We would expect the regulator’s decisions to be internally consistent in terms of advancing its objectives, so we cannot see a scenario where the regulator would issue a distribution order that required a club to become non-compliant with its licence conditions. However, there may need to be some adaptation by regulated clubs and competition organisers to renew the regulatory landscape.

If a distribution order issued to ensure the financial sustainability of football put a club at risk of breaching a league’s rules, we would expect competition organisers to work with the club in question and the regulator to understand the decision and its impact. Just as we may expect adaptation by clubs transitioning from unregulated to regulated, we may also expect to see the adaptation of competition organisers.

The amendment implies a scenario where a distribution order results in clubs becoming non-compliant with existing financial regulations. The regulator is already required, as part of its decision on whether to trigger the process, to consider whether the lack of arrangement has arisen as a result of bad faith. Therefore, we are confident that the existing drafting of the backstop proposal process is sufficient to ensure that the regulator already considers the factors outlined in this amendment.

I turn to Amendment 307. While I understand the desire to ensure the proposals chosen at the final proposal stage of the backstop process meet the objectives of the regulator, I believe that the existing drafting already suitably addresses this concern. Final proposals are already required to advance the financial sustainability and resilience of the football pyramid, under existing Clause 62(2)(a). I do not think that the proposed change in wording would lead to significant altered proposals or subsequent distribution orders; therefore, I do not consider that the change is necessary.

I turn to Amendment 288A, from the noble Lord, Lord Maude of Horsham. I understand the desire to ensure that the backstop process is triggered only as a last resort, as this is how the process has been designed and is intended to be used. However, one of the existing conditions that must be met for the regulator to trigger the process in response to an application is that its ability to deliver at least one of its objectives would be jeopardised if the backstop was not triggered. We would expect that, as part of the assessment under this condition, the regulator would review whether existing financial regulations and other regulatory tools could be utilised to better effect instead.

While in service of the same goal, the wording of this amendment is unnecessarily restrictive, requiring the regulator to exhaust all possible other regulatory approaches, and it adds a regulatory burden by requiring the consideration of an expansive array of approaches without prioritisation. This forces the regulator to spend additional time and resources considering options unlikely to resolve the conflict in question. We believe that the current wording already allows the regulator to make its own considered assessment of relevant options before triggering the process.

I now turn to the clause stand part debates and will respond to the noble Lord, Lord Markham. Part 6, of which Clause 56 is the first clause, relates to financial distributions and the backstop mechanism in its totality. I understand the desire on both sides to apply appropriate scrutiny to a part of the Bill that could significantly impact the future financial landscape of football. I hope that, throughout the debate on the backstop process on this and future Committee days, I will be able to demonstrate that the approach taken in Part 6 is the most proportionate and effective approach possible.

These backstop powers have been introduced to help ensure that an agreement can be reached between the leagues in regard to the distribution of revenues from the selling of TV broadcast rights. An agreement of this nature is vital to ensure the future financial sustainability of the football pyramid. The process has been designed to incentivise reasonableness, encourage industry solutions and tackle any bargaining imbalance between leagues. The design of the process is a final offer mechanism, a process that has been shown to incentivise negotiation. It achieves this by removing the ability of the negotiating parties to rely on the third party, in this case the regulator, to design a solution for them. We do not want football to become reliant on the regulator to decide its agreements.

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[Lord Moynihan (Con)]

I have listened very carefully to the debate and to what the Minister has said. I understand that UEFA asked the Government to carefully reconsider the backstop mechanism, since when it has become much wider in scope and more likely to lead to the most extreme outcomes. I wonder whether she has discussed it with UEFA. Can the Minister update the Committee on the outcome of those discussions?

[Baroness Twycross (Lab)]

I have had no direct meetings with UEFA, but the Minister for Sport in the other place has. I cannot confirm what was said in the meeting, but I will endeavour to establish whether this was part of the discussion. What did or did not happen at that meeting has not been part of my conversations with people, but I will endeavour to find out. I suspect I will not get an answer to the noble Lord tonight.

[Lord Moynihan (Con)]

Will the Minister kindly write to the Committee? This is very important indeed. The backstop has been introduced into the Bill and UEFA has expressed very serious concerns about it. Unless this can be resolved, it could threaten the existence of English clubs playing in UEFA competitions. I hope that this has been high on the agenda of discussions between UEFA and the Government. Having listened carefully to what the Minister has said, all I ask is that she write to the Committee, or early in January inform the Committee, on how UEFA has responded to this significant expansion of the effect of the backstop, which it was originally very concerned about.

[Baroness Twycross (Lab)]

To be clear, I do not speak for UEFA. It is an international organisation that is able to speak for itself. I am not aware that UEFA raised issues about the backstop specifically in the meeting with the Minister for Sport, but I will endeavour to find out. I understand from the expression of the noble Lord, Lord Moynihan, that he may have more information about UEFA’s concerns than I do. However, without expecting this to be an ongoing dialogue, I will endeavour to establish the information that he requested.

[Lord Moynihan (Con)]

I asked whether it was raised in the letter from UEFA, which sadly the Committee cannot because it is private correspondence, but it is right at the heart of this legislation. If it was raised in the letter, or in subsequent correspondence, would my friend the Minister kindly confirm that to the Committee? It would help us in our deliberations moving forward.

[Baroness Twycross (Lab)]

UEFA raised no concerns about the backstop in its most recent meetings with DCMS and the Minister for Sport, including those held since the Bill has been introduced. I hope that reassures the noble Lord on this point. As I say, I do not speak, will not speak and cannot speak for UEFA; I speak for the Government.

Ultimately, the clause is about creating transparency, which sets the tone for the rest of the backstop process. Clause 59 introduces high statutory thresholds that must be met in order for the backstop to be triggered. In particular, it sets out that the regulator must have reasonable grounds to suspect that its ability to advance at least one of its objectives would be jeopardised if the backstop was not triggered. As stated, an implicit part of this consideration would include an assessment of whether other regulatory tools could be utilised to better effect instead.

The regulator can consider what the distributed revenues will be used for and, if the basis for the backstop application is that there is no distribution agreement in place, whether this has arisen as a result of bad faith. This helps to incentivise the leagues to try to reach an agreement in good faith before turning to the regulator, and ensures that the backstop is used only where absolutely necessary. The regulator must make its decision within 28 days, although it can extend this by a further 28 days if absolutely necessary. Once the regulator has made its decision, it must notify the relevant leagues of its decision to ensure transparency throughout the process.

As we have made clear, the Government’s strong preference is for a football-led solution to issues around financial distributions. As such, the mediation stage outlined in Clause 60 grants the relevant leagues an opportunity to reach an agreement before the regulator delivers a solution as part of the final proposal stage. The mediation stage has been designed to facilitate meaningful negotiation and compromise between the parties. To this end, it encourages the leagues to appoint a mediator they both agree on, but ensures that the regulator will appoint somebody with the appropriate skills and experience if they cannot. The leagues can end the mediation process for multiple reasons, most notably if an alternative agreement is reached. However, the mediator can also end the process if it is not producing meaningful good-faith negotiations or if it reaches the 28-day deadline.

I thank noble Lords for their amendments and the well-natured debate on this important part of the Bill. I hope my reasons have reassured noble Lords and that they will not press their amendments. I ask that these clauses stand part of the Bill.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, I rise to speak to Amendments 280 and 281, which my noble friend Lady Brady has set out admirably. She established the case for her amendments very well and raised a number of points that I hope the Minister will answer.

These amendments work in tandem to allow competition organisers to contract out of the backstop. Under this amendment, leagues would be able to agree a period for which a distribution agreement would last. Of course, they may not reach such a deal. In that case, the applicable period would be five years—the period that is currently the default in the Bill. Allowing leagues to have a greater flexibility to negotiate the length of time for which an agreement has to be in place before it can be renegotiated would establish better principles in the backstop. Surely, we should not preclude leagues from acting cordially, if they are able to, and agreeing a period for distributions. I fear that the Bill, as the Government have presented it, might discourage constructive working relationships where they may arise.

I am conscious that this is the last opportunity I will have to intervene on this final group before the Christmas Recess and I want to thank noble Lords across the Committee for the hard work they have put in. I know that noble friends on my side of the House are missing Christmas parties and wedding anniversaries this evening, and noble Lords across the House have been doing similar. Everyone is here because they care very deeply about the future of football—even if, like football fans, they disagree volubly on some of the details.

In particular I thank the Minister, who has responded to pretty much every group. Today was the first day that she did not, and even then she had only a brief time off the pitch. She has taken many interventions, she has been generous with her time outside the Chamber as well and she has written us a number of letters. I know we have asked her a few more questions and she will be writing to us further, but, in the meantime, I wish her and all noble Lords across the Committee a very merry Christmas and express my thanks to everyone for their work in scrutinising the Bill.

[Baroness Twycross (Lab)]

I thank the noble Baroness, Lady Brady, for her amendments and for her introduction to what was, thankfully, at this time of the night, with apologies, a very short debate—so far.

These amendments are intended to allow leagues to reach an agreement to extend the time that must pass before the backstop can be triggered. While I entirely understand the desire for negotiations to be a league-led process, the timeframe outlined in the Bill has been chosen to ensure that the regulator can intervene in cases where an agreement has not been reached for a significant period. We believe that it is the correct amount of time to get a good view of how potential agreements have affected sustainability, while ensuring that a new agreement is reached in a timely manner. Crucially, many noble Lords have talked about certainty in the regime. We consider that five years provides enough certainty to all parties.

Finally, we have concerns that allowing industry to come to a different timeframe could lead to an element of coercion towards much longer agreements, nulling the presence of the power. The Government’s view is that the five-year timeframe is critical to the effective functioning of the backstop as a regulatory intervention.

For the reasons I have set out, I am unable to accept the amendments and hope that the noble Baroness will withdraw Amendment 280. But, first, I also wish all noble Lords a very happy Recess. I genuinely look forward to continuing the debate in the new year and thank the noble Lord, Lord Parkinson, for his kind words.

[Baroness Brady (Con)]

My Lords, I thank the Minister for her response and for engaging with the points raised in this debate. However, it will not surprise her that I remain completely unconvinced.

This decision does not deliver certainty: quite the opposite. It enshrines short-term thinking and locks football in a perpetual cycle of instability, with both sides forever negotiating under the shadow of the backstop. As I said, it is a recipe not for certainty but for fractiousness and mistrust.

The Minister also referenced the nature of football’s landscape as the reason to limit agreements, but I am not sure that can be right. I urge her to think again. This new backstop is the Government’s gamble that the Premier League has achieved escape velocity and can absorb anything that even its own Government can throw at it. However, the Premier League is not a cow to be milked. It is a national treasure to be protected. English football deserves much better. I am sure that we will be discussing this issue again on Report, but, for now, I beg leave to withdraw my amendment.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Committee stage
Wednesday 15th January 2025 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

My Lords, I thank noble Lords who are here for this debate, especially those who have missed football matches to take part in a game for the greater good of football—that is something we all agree on, whether or not we agree with the exact form of the regulator or whether we have amendments on which noble Lords may have a different view from me and the Government.

Before I address the amendments in this group, I would like to make a brief clarification regarding a comment that I made in Committee on 18 December. It pertains to an issue that comes up in the next group, but I felt it important to clarify it at this point of the debate. In response to a question from the noble Baroness, Lady Brady, regarding whether there was a similar final offer mechanism in use in the UK and how it has delivered the outcomes that this model intends to achieve, I said that the Competition and Markets Authority had used a final offer mechanism. While the CMA does have a similar final offer mechanism, it was incorrect for me to say the process had been used, as the Digital Markets, Competition and Consumers Act only received Royal Assent on 24 May 2024, so the new regime has only just come into effect and has not yet been used by the CMA to come to a determination. We are clear, however, as the previous Government were clear, that this is an evidence-based model developed in tandem with leading economists, which has successfully achieved intended outcomes in other jurisdictions. I hope that through this evening’s debate I can reassure noble Lords that this is also the correct model for use in this case. As I mentioned, the model is discussed in considerable depth in the next group.

I note the question from the noble Lord, Lord Hayward, and I will seek clarity before the end of the debate. If I do not get it, I will come back to him on that particular point. Like him, I noted the request from the Chancellor on that point.

Moving on to the specific group that we have just debated, I thank the noble Lord, Lord Birt, for his amendments and insightful contributions. I also welcome his broad support for the principle underpinning the Bill around the independent football regulator. His knowledge and expertise are hugely beneficial in supporting the House to scrutinise this legislation. It was also helpful to have a reminder of the movement and the fluidity within and between leagues. That is an important point for your Lordships’ House to note and remember. The noble Lord, Lord Birt, has played an important part in the development of football broadcasting in this country and, as we have heard today, has a number of really valuable thoughts around this issue. That is also apparent in the thorough scrutiny that the noble Lord’s amendments provide on the design of the backstop process. It is important for us to examine why the Government believe that the backstop process remains the model that we should rely on when we come to setting the independent football regulator to work.

To reflect on the concerns of the noble Lords, Lord Birt and Lord Markham, and the noble Baroness, Lady Evans of Bowes Park, among others, I first restate that the intent behind this mechanism is not to create a heavy-handed regulatory intervention. There is a mediation process built in and we agree with the noble Lord, Lord Pannick, that this is an important step. To respond to the noble Lord’s specific concerns, the intent is to provide a last-resort process, only to be triggered if the leagues cannot come to an agreement themselves. It is genuinely intended to be a backstop. It cannot take place until mediation has concluded.

A number of noble Lords questioned why government intervention in this space is even necessary. A clear distribution agreement is in the interest of both the public and of football. Indeed, the Premier League recognises that financial redistribution is needed to ensure the vibrancy and sustainability of the football pyramid. As the noble Baroness, Lady Brady, has outlined on a number of occasions during Committee, that is why it already voluntarily distributes its revenues to lower leagues.

The EFL and the National League are important talent pipelines to the Premier League. Similarly, the Premier League is an important financial supporter of various programmes across the lower leagues. The football pyramid is a mutually beneficial structure, but only when a suitable distribution agreement or order is in place. The mechanism would not be necessary if the industry were able to come to a new agreement. I want to reassure noble Lords that, should the leagues choose to come to an independent agreement without the backstop, the regulator will not need to get involved and will not do so. One of the leagues has to apply to trigger the regulator’s process. It has to meet a high threshold, so leagues cannot unilaterally trigger it. This is not regulatory overreach into corporate agreements. If a voluntary corporate agreement is made between the leagues, then there is no role for the regulator. It is an alternative route by which a suitable deal and distribution scheme can be put in place, should the leagues require it. We recognise the value of preserving the competitiveness of English football. This process is designed to ensure its long-term financial sustainability and not to force a regulator-designed agreement on an industry.

Taking the points made by the noble Lord, Lord Birt, sequentially, I want first to address Amendments 295A and 297A. We acknowledge and respect the amendments’ intent to ensure that the mediator has the appropriate legal expertise to mediate successfully a complex financial and legal agreement alongside preventing potential conflicts of interest. I am not going to repeat the points made by the noble Lord, Lord Pannick. I agree with the sentiment expressed by the noble Lord, Lord Birt, that the mediator should be a relevantly qualified individual. However, we think that adding these specific requirements would disqualify potentially qualified and appropriate candidates and limit both the leagues and the regulator in their selection of potential mediators. As drafted, these principles for hiring may be too prescriptive and could lead to an inability to appoint a mediator if no suitable candidate were found who met all the conditions.

Amendment 297B seeks to add a formal arbitration mechanism to the backstop by providing another forum for negotiation before a final decision is made by the regulator. I must reiterate the point that the leagues have not been able to agree a new deal under an existing agreement since 2019. The addition of another negotiation step after the mediation stage would require not only the hiring of another formally qualified arbitrator but the introduction of a new set of statutory timelines. These new timelines, by which various crucial decisions must be made, would make the backstop process functionally unusable from a timing and resources perspective. It is also unclear what formal arbitration would be likely to achieve after a mandated and guided mediation process. The leagues can already come to an alternative agreement at any stage in the backstop process. This ability is explicitly protected in the Bill, so this added arbitration step would add complexity and would potentially—or even likely—delay the process.

On Amendments 297C and 297D, the introduction of a determination process would fundamentally override the final offer stage of the existing process, representing a significant shift in government policy towards a different type of arbitration process and moving away from the final offer mechanism. The process outlined in the amendment would offer the arbitrator greatly increased discretion regarding the design of the final proposals, requiring them only to consider evidence presented by the parties rather than to accept the design of one of their proposals. While we are sympathetic to the desire for the regulator to be required formally to consider expert analysis, systemic implications and the practicality of the proposals, allowing a third party to propose their own form of determination would remove entirely the incentive which the original process is designed to create. With a third-party decision-maker introduced to the process, it is likely that competition organisers would simply dig in to an inherently adversarial position rather than move closer to a middle ground and allow the third party—the arbitrator—to decide for them. It is our view that this amendment would increase reliance on the regulator and move us further from an industry-led solution.

Amendment 297E seeks to ask the regulator to provide more detailed information about the implementation of their decisions. This would include outlining transitional arrangements and compliance requirements, alongside outlining when orders can take effect. Again, I am sympathetic to the sentiments expressed by the noble Lord, as minimising adverse unintended impacts on business should be a top priority for the regulator when implementing a decision. The Bill requires distribution orders to include a summary of the questions for resolution, a copy of the final order, information detailing the reasons for those decisions and information on potential consequences of non-compliance. We would also expect the regulator to stay in constant communication with the leagues throughout the implementation process.

Amendment 297F would add to the ability of the leagues to appeal decisions made as part of the backstop process to the Competition Appeal Tribunal. Regulatory decisions made as part of the backstop process are already considered “reviewable decisions” open to appeal under the existing appeals process outlined in Part 9 of the Bill. Functionally, therefore, this amendment only makes more explicit a process that could already be triggered under existing clauses.

Finally, I turn to Amendment 297G, which would require the regulator to publish guidance on their decision-making and implementation processes and for them to keep this guidance under review for potential update in future. While we are not opposed in principle to the idea of regulatory guidance and the backstop, there is already provision in the Bill for guidance to be prepared by the regulator at their discretion and in consultation with such persons as they consider appropriate. In addition, the amendment would lock the appointment of a mediator behind the publishing of the guidance. In practical terms, this would significantly affect the timeliness of the process and open a window of opportunity for the process to be stalled by the leagues via extended consultation. We are keen for the leagues’ views on the process to be heard and taken into account by the regulator, but we are also conscious that football has already gone quite long enough without a suitable new arrangement. To reiterate, a timely, satisfactory agreement is in the public interest, as it is vital to the continued sustainability of the game. I repeat that I am always happy to engage with any noble Lords and other stakeholders on this point and to go through how the process might work, as I have already done with the Bill team. For the reasons I have outlined, I must reject the amendments from the noble Lord in this instance and ask him not to press them.

[Lord Birt (CB)]

I am genuinely grateful to the Minister for her long, detailed and considered response. It gives me hope as I hope it gives hope to other noble Lords across the Committee. In going into the detail, the Minster registered how complex these issues are. This must be capable of being improved. Some of the doubts that exist on all sides of the Committee should be further considered to be sure that all these considerations are truly reflected at the next stage of the Bill when we come back to this matter, as we definitely will.

I am also very grateful for the broad support for this approach from right across the Committee, including from the noble Baroness, Lady Evans of Bowes Park, and the noble Lord, Lord Markham. I did not divine the 40% figure myself—as noble Lords know, there are a lot of data scientists operating in football. I am sure that it is highly arguable, but, intuitively, it rings true for me, not least because the Premier League has far greater resources than any other league, so it would be surprising if that did not result in it having by far the highest proportion of the world’s best players. If there is one key performance measure here about the appeal of British football, it is that we have the best players in the world playing in it. That is something we cannot forget. We cannot afford to reduce that percentage, whatever it is.

I am particularly grateful to the noble Lord, Lord Moynihan, who has made many excellent contributions to the Bill. Above all, I am very pleased that the noble Lord, Lord Addington, retains an open mind about the possibility of improving this important part of the Bill. I ask the noble Baroness, Lady Taylor of Bolton, and the noble Lord, Lord Bassam, to please read the amendment as written, because it is designed to avoid the very situation that they stood up to complain about. It is designed to bring mediation, collaboration and consideration, and, at the end of the day, binding arbitration. It has everybody in the room. It has not worked these last couple of years because the right people have not been in the room in the right circumstances. I want a resolution in the interest of the whole of football and I firmly believe that the approach set out in my amendment is far more likely to deliver it than the potentially divisive process in the Bill as it stands.

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[Baroness Evans of Bowes Park (Con)]

My Lords, I have added my name to Amendments 302 and 304.

As I said in previous debates on the backstop, I have real concerns about the resolution process, and in particular the binding final offer arbitration model included. The Minister has repeatedly claimed, and said again today, that these powers are to be used only as a last resort, but we have heard from noble Lords across the House that this does not feel like the situation in which we find ourselves today. As has been identified by other noble Lords, the approach being legislated for in the Bill is unduly adversarial and pits two sides against one another rather than encouraging comprise and dialogue. As we have heard, the very existence of the proposed mechanism set out seems to have played a role in the breakdown of the latest round of financial negotiations, which is concerning and does not bode well for the future.

The Government would be unwise to dismiss and ignore this chilling effect, as the current backstop proposal threatens to undermine and damage relations across the football pyramid. The model just does not make sense. In any deal negotiation, if both sides are disappointed at the outcome reached, it is more likely that it has been fair and balances the two sides’ competing proposals. Yet, as we have heard, under the process set out in the Bill, rather than consider each proposal and determine the best approach—which may very well be a compromise between the two—the expert panel formed by the regulator must instead choose one of the proposals.

Amendment 304 gives the expert panel set up by the regulator to oversee the process the ability to combine elements of the proposals

“where it considers that this will result in an order which is most consistent with the principles in subsection (2)”.

This is a far more sensible approach. It does not mean that the regulator or its expert panel would be forcing a proposal on the two leagues involved. Rather, they can play a constructive role in facilitation and mediation to help achieve an outcome that both parties can agree with.

I really hope that the Minister will use the time between the end of Committee and the beginning of Report to discuss further some of the ideas that have been brought forward in this and, as I said in the previous debate, consult with the leagues and individual clubs again. A number of them have expressed concerns publicly about the process. I hope that she will think about tabling amendments that will be supported across the House at our next stage.

[Baroness Twycross (Lab)]

My Lords, I thank noble Lords for their at times passionate discussion on this group of amendments. I agree with the noble Lord, Lord Goddard, that it has been a good debate. All noble Lords who have taken part clearly believe in getting the best governance for our national game, which should be at the heart of discussions.

Let me be clear that the Government’s preference is for an industry-led solution. While we acknowledge that there is an existing agreement in place, if a new updated agreement cannot be reached, an industry-designed proposal, facilitated by the regulator, is the next best option. The model adopted by this Government for a backstop was in the previous Government’s Bill.

One of the dividing lines in your Lordships’ House is clearly on the rights and wrongs of parachute payments and their inclusion or otherwise in the scope of the regulator. This was referred to by, among others, the noble Baroness, Lady Brady, the noble Lord, Lord Markham, and my noble friends Lord Watson of Invergowrie and Lord Bassam of Brighton. I hope that we can all agree, not least because of the debate on this, that parachute payments are a significant part of football’s financial landscape. They clearly play an important role in supporting the survival of relegated clubs and the Government are clear on that.

However, the regulator needs to be able to consider all relevant revenue sources as part of the backstop process, to arrive at an accurate picture of any proposal’s impact on financial sustainability and the potential for distortion of the parachute payments. This is not to say that they must be included. It is to allow the regulator to include them if, having gone through the process with, for example, the “state of the game” report, it has arrived at the view that they should be included in the process.

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[Lord Markham (Con)]

I am sure that we can get the absolute reference from the statto—the noble Lord, Lord Birt, will probably calculate it and tell us by the end of the debate. I think the figure is about 9%, but we can check that.

The point I was trying to make is that Tony Bloom, the chair of Brighton, and Paul Barber, its CEO, whom I have spoken to during this process, would say that parachute payments were a very important part of their business planning in giving them the confidence to invest, which allowed Brighton to stay up and thrive in the Premier League. There is a very good argument for them being there.

As much as I would like the regulator not to get involved in redistribution payments, I accept that it is likely that those powers will be granted. If we really narrow it down, the debate on this group and the previous one is all about the negotiation mechanism. That is where I appreciate so much the work that the noble Lord, Lord Birt, has done on this, because it is not a political point. I do not think anyone in the outside world would get into the intricacies of and care more broadly about the negotiation mechanisms that we are talking about, but what we are talking about is, as the Minister said, a theory behind binary choices and what will happen in terms of gaming. It is an untried theory that has not been done anywhere else, and it has been put forward. I thought the Minister said that it had not been done by the commission.

[Baroness Twycross (Lab)]

It has not been used by the Competition and Markets Authority yet, even though the previous Government gave it the powers to do so. It has been used successfully in other jurisdictions —for example, in Australia and Canada. I have other examples that may be in my speaking notes later in the evening, but I am happy to share them.

[Lord Markham (Con)]

That would be very helpful, because the main point here, and what I hope we can achieve between now and Report, is that we know that there is a small group of economists at the DCMS who have put together this mechanism. There are noble Lords here who have been involved in media sports rights deals and these sorts of negotiations who can add real value to this. There is a real opportunity between now and Report to engage with those officials to really get into those negotiation mechanisms, because this is what we have narrowed it down to and that is what this debate has been useful for. I hope we can use that time productively.

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[Lord Markham (Con)]

I will be brief because my noble friend Lady Brady made the points extremely well and we have debated parachute payments quite a bit already this evening. The only thing I would say is that they give clubs in the Premiership the incentive or the confidence to invest and in my understanding every European league now has some variation on that, because it is seen as a system that works. It is fundamental to the competitiveness of the Premier League. It underlies its whole audience appeal and broadcasters all round the world will make media sports rights payments to see such an exciting and competitive game.

It is known that we would prefer that parachute payments were not included but, if they are going to be included, the proposal to make a three-year safety net as opposed to a one-year safety net is very sensible. In the conversations that the Minister helpfully set up with her officials, I could tell that it was something they understood and were quite well disposed towards. The fact, as my noble friend Lady Brady, said, that contracts for players are for three years shows the importance of having that. So I hope that this is a sensible amendment that the Minister can speak to.

[Baroness Twycross (Lab)]

I committed earlier this evening to come back to the noble Lord, Lord Hayward, on whether the shadow regulator would join the Chancellor’s meeting with regulators tomorrow. My understanding is that the Chancellor’s invite has gone only to regulators who are currently operational. Therefore, the shadow football regulator has not been invited to the specific meeting to which the noble Lord referred. I would add, however, that I have heard many good points made on growth during the Committee stage of the Bill and look forward to returning to further discussions around that point on Report.

In relation to the group under discussion, I thank the noble Baroness, Lady Brady, for bringing her concerns regarding the future financial sustainability of relegated clubs to my attention with this amendment. I note the clarity from the noble Lord, Lord Markham, in relation to the Opposition opposing parachute payments being included in the Bill. As I made clear in my response to the previous group, the Government agree—and I hope this gives the noble Baroness some reassurance—that parachute payments play an important role in supporting the survival of relegated clubs. This point was also made by my noble friend Lord Bassam of Brighton, even though he had a different perspective from the noble Baroness, Lady Brady.

I highlight first that in the Government’s view it is not inevitable that the backstop would address parachute payments. They will be addressed only if they have been identified as a relevant question for resolution, which will happen only if they are proven to have a substantial impact on the sustainability of the pyramid.

The noble Lord, Lord Addington, asked some pertinent questions, not least relating to the survival of clubs. If parachute payments are deemed relevant for consideration, the Bill currently specifies that they cannot be reduced within a year of the distribution order coming into effect. This point was made by the noble Baroness, Lady Brady. This amendment would extend this period to three years, triggered at the beginning, rather than the end, of a season.

While I genuinely understand the core concern behind this amendment, we must balance the desire to ensure that relegated clubs have as much time to adjust to changes as possible with the need to ensure a new, timely, satisfactory agreement. We would expect the leagues to maintain effective communication with clubs throughout the backstop process which, alongside the existing year-long transitionary period, will mean that clubs have ample time to adjust if parachute payments are deemed in scope. There will be no sudden reduction in payments without warning.

Before I finish, I again urge the leagues to come to an agreement on a new package of financial support under their own steam, which is in the long-term interests of the game. However, for the reasons I have set out, I regret that I cannot accept these amendments and hope the noble Baroness will not press them.

[Baroness Brady (Con)]

My Lords, I am grateful for the contributions made by noble Lords on this group. To the noble Lord, Lord Addington, I say that, in my experience, if you cut some of the ropes on a parachute it certainly does not provide for soft landing; it results in a crash. That is what I think I am trying to help avoid here.

I thank the Minister for her response and I am sorry that we do not yet seem to agree. I want to emphasise again that, while the Government seem to believe they have prevented parachutes from being abolished under this legislation, they have literally created a Bill that allows the regulator to choose between only two proposals. One of the proposals is going to come from the organisation that called parachute payments “an evil that needs to be eradicated”. The Bill specifically enables the kind of system that the Minister says the Government do not want to see, and that really is an intolerable risk to the Premier League clubs, newly promoted clubs and relegated clubs.

It may be helpful to stand back and remind the House that this Bill principally seeks to address financial sustainability across the game. Yet, the removal or severe restriction of parachute payments would undermine that very goal. Around 50% of football administrations follow a relegation event. Take away parachutes or alter them without proper transition periods and that number will, sadly, undoubtedly rise. For the Premier League clubs at the lower end of the table, a one-year transition period will fundamentally alter all their risk calculus. These clubs invest heavily in players, infrastructure and youth development, knowing that the current system provides some financial security in the event of relegation. Remove that security and I call tell you that the calculation changes. Risk taking diminishes, investment shrinks and competitiveness suffers. That is exactly the same for newly promoted clubs. It is impossible to invest in your squad if you do not have that safety net, if it is not successful for you.

I continue to believe that these amendments are a necessary safeguard. Of course, much greater changes to the backstop are required, but a transition is a vital element to examine. These amendments would provide the time and clarity needed for clubs to adapt responsibly, protect the legitimate expectations of all shareholders and preserve the stability of the football ecosystem.

I urge the Government to give these measures further consideration, please, as part of a fundamental reconsideration of the backstop, just as UEFA has explicitly called for, to ensure that this Bill really can achieve its intended purpose of promoting sustainability across the game. I will withdraw this amendment today, but I say respectfully to the Minister that I really hope that she reflects carefully on my amendments.

--- Later in debate ---

Moved by

[Baroness Twycross]

320: Clause 64, page 53, line 34, leave out “62(7)(b)” and insert “62(8)(b)”
Member's explanatory statement
This amendment corrects an erroneous cross-reference.

--- Later in debate ---

[Lord Markham (Con)]

My Lords, Clause 84 details the provisions that may be brought before the Competition Appeal Tribunal. However, as drafted the Bill does not include any decisions made under Clauses 62 or 63 for appeals that may be heard before the tribunal. Given the implications of these two clauses, relating as they do to the distribution of revenue, it is wholly inadequate that the determinations made under them are not subject to an external appeals process. Therefore, my Amendment 323, and the amendments in this group tabled by my noble friend Lady Brady, ensure that any decisions made by the committee of the expert panel relating to distribution orders are reviewable under Clause 84.

I do not dispute that the Bill already provides for distribution orders under Clause 62, and for reviewable decisions under Clause 81. The latter clause states that reviewable decisions are any decisions listed in the table in Schedule 10, and Schedule 10 does include decisions made under Clause 62. However, this relates only to internal reviews. Schedule 10 also states that any internal review of distribution orders is to be carried out by a different committee of the expert panel. Therefore, although the composition of the deciding and reviewing committees must be different, the review will still be carried out by the same body.

Therefore, the Bill currently gives competition organisers the right to appeal only to a component of the regulator. This cannot be right. The imposition of a distribution order under Clause 62 is surely the measure that most affects competition; requiring one league to distribute its money to another league will impact its competition ability. Surely, then, any distribution decision should be reviewable by the Competition Appeal Tribunal.

[Baroness Twycross (Lab)]

I thank the noble Baroness, Lady Brady, and the noble Lord, Lord Markham, for tabling these amendments. I recognise that the intent of the amendments in this group is to ensure that decisions related to the distribution backstop are appealable and subject to a merit standard of appeal, rather than being based on judicial review principles. I understand that this comes from a belief that a merit standard of appeal is necessarily preferable because it would allow the Competition Appeal Tribunal to opine on the merits of the case, rather than just on whether the correct procedure was followed, and thereby arguably offers better protections for affected parties. In this instance, I do not believe that this is the right process.

In truth, it means that a tribunal, which most likely has less technical expertise and background knowledge of the specific issues surrounding financial distribution in football than the regulator, will be able to substitute its own decision for that of the regulator’s. For example, if the regulator were to choose one of the two proposals as part of the backstop process, and make an order imposing that distribution arrangement, the Competition Appeal Tribunal could overrule this and choose the other proposal. Indeed, if we consider how this would most likely play out, the aggrieved competition organiser whose proposal is not selected would be very likely to lodge an appeal regardless.

These amendments would be tantamount to making the Competition Appeal Tribunal the ultimate deciding authority on the financial distribution arrangement in football. This would, in effect, mean cutting out the middleman and having the courts decide how much money should flow down the football pyramid. It is unclear to me why noble Lords, or indeed anyone, would think a court making this decision a better option, rather than the expert panel of the independent football regulator, or why this would necessarily lead to a more robust, more favourable or fairer outcome. It is simply the case that there are certain decisions better suited to certain standards of review.

We have engaged with legal experts and senior members of tribunals while developing the Bill. They agreed that the courts are not necessarily well placed to substitute the decisions of expert regulators on matters of technical regulatory judgment, and that a judicial review standard of appeal would be more appropriate for those types of decisions. This is also a common approach taken across other regulators. For example, the majority of decisions made by Ofcom are subject to appeal on judicial review standards.

By contrast, some of the possible enforcement decisions that the regulator can take under the Bill represent highly punitive actions. For these highly punitive, less technical and less market-specific enforcement decisions, a merits appeal is more appropriate. For example, we are of the view that courts are far better placed to opine on whether the severity of a punishment is appropriate to the infringement than on whether a certain distribution of revenue is better for the financial sustainability of English football. Ultimately, an appeals process should provide the appropriate opportunity to challenge whether a regulator is acting fairly and within its statutory remit. It should also be a focused and efficient process that does not excessively delay the final resolution of decisions or hinder the regulator in achieving its objectives.

While providing effective assurance of the regulator’s decision-making process and judgment, the appeals system should not unduly undermine the expert independent regulator. The Bill effectively balances these different considerations, including through the standard of appeal. The amendments tabled by the noble Baroness, Lady Brady, would also make every decision under Clauses 62 and 63 reviewable, subject to the statutory route of appeal to the Competition Appeal Tribunal. This includes minor and operational decisions such as the giving of notice or extending the period to submit proposals. For the same reasons I have already outlined—balancing fairness, efficiency and appropriate deference to the regulator—we do not believe this is necessary and it is not the approach we have taken in the Bill.

Amendment 326 would be contrary to Amendments 322, 324 and 325. The Competition Appeal Tribunal could not simultaneously review a decision on judicial review principles and on the merits. On Amendments 333, 334 and 335, as I have set out, we disagree with the intention to make every decision under Clauses 62 and 63 a reviewable decision on the merits. However, if that were the intention, additions to the consequential amendments of other Acts, or the Competition Appeal Tribunal rules, certainly would not be the way to do it. For these reasons, I cannot accept the amendments and I hope that noble Lords will not press them.

[Baroness Brady (Con)]

My Lords, I am grateful for the Minister’s response, although I confess that I remain far from reassured. The logic of the Government’s position appears to be that procedural correctness matters more than getting the right answer for English football. Consider what we are being asked to accept: a regulator with new, unprecedented powers to reshape our national game, yet its decisions can be challenged only if its ticks the wrong procedural boxes.

The Premier League drives investment throughout the pyramid. It enables clubs such as Brighton, Brentford and Nottingham Forest to climb through the lower leagues without parachutes and compete at the highest level because of the security they provide. It funds grass-roots facilities in every corner of Britain. It projects British soft power globally in a way that no other cultural export can match. Yet under this Bill a single regulatory decision could fundamentally alter the mechanisms that make all that possible.

The Minister suggests that a judicial review provides adequate protection, but what comfort is that to a relegated club facing financial ruin because a regulator chose to abolish parachute payments? What protection does it offer less well-established Premier League clubs forced to abandon investment because the regulator selected a proposal that makes relegation catastrophic?

--- Later in debate ---

We have visited this issue already, so I will not dwell on it any longer. I hope that this amendment gives the Minister the ability to rethink her arguments from earlier in Committee.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Moynihan, for opening the debate on this group and moving the amendment in the name of the noble Lord, Lord Maude of Horsham; and the noble Lord, Lord Markham, for speaking to the amendment in the name of the noble Lord, Lord Parkinson of Whitley Bay, which he signed. I have to say that, at points during the debate, I wished that I was in the Caribbean, but I will endeavour to respond.

The Government recognise the intent behind Amendment 327, in the name of the noble Lord, Lord Maude. I thank the noble Lord, Lord Pannick, for cutting to the chase on what has been a longer debate on two amendments than I anticipated. They raise reasonable concerns that need to be addressed, but we have debated these concerns at some length previously. However, the exchange on what light-touch regulation might mean was useful.

It is vital that the regulator be transparent about the burden that its regulatory activities may have on clubs, so that it can be held accountable. From the start, we have been very clear that we wish to establish a regulator for football that will take a proportionate approach across all its regulatory activities. My noble friend Lady Taylor spoke about proportionate regulation. I thank her for highlighting the research that she shared with me earlier this week. She made many points better than I could.

We do not wish to bring into being a regulator that will impose unnecessary, onerous and burdensome requirements on clubs, and neither did the previous Government. That is in no one’s interest. Noble Lords have spoken of concerns about smaller clubs in particular. I am concerned that this debate may lead to some of those clubs being unduly alarmed. If clubs have raised concerns with noble Lords, please encourage them to contact the department, where we are very happy to discuss in more detail any concerns that they may have.

The noble Lord, Lord Addington, asked how the Government see scrutiny playing out in practice. We already expect that the impact of the regulator on the market, including on regulated clubs and the leagues, will be reviewed in the regulator’s “state of the game” report and its annual report. The Secretary of State and Parliament will be able to scrutinise these reports. This ongoing accountability is more appropriate than a one-time review by the Secretary of State, six months after the Act is passed, not least because, as was highlighted during the debate, six months would be an unfairly short window in which to appraise the impacts of a brand new, novel regulatory regime.

The noble Lord, Lord Moynihan, made a number of points and cited the impact assessment. The costs in the impact assessment have been estimated using evidence gathered through industry engagement and from existing regulators, ONS datasets and other sources of information. The impact assessment has been prepared in the same way as all government assessments, in line with principles in the Green Book. It received a green rating from the Regulatory Policy Committee.

Ultimately, the costs in the impact assessment are indicative. It will be for the regulator to finalise its operating budget, which will be subject to scrutiny from Parliament and government to ensure it represents value for money. The estimated costs have been informed by approaches taken by similar regulators and reflect the complexity of the activities required to oversee a new legislative and regulatory regime.

The noble Lord, Lord Hayward, cited a headcount of 250 staff for the regulator, which is not one that we recognise. Indeed, it is well above the level that we would expect. I will have to pick that up with the noble Lord afterwards to establish how that figure was arrived at.

[Lord Hayward (Con)]

It was the indicative figure given by the previous Secretary of State under our Government.

[Baroness Twycross (Lab)]

That is a helpful clarification. The figure remains one that I do not recognise. I will go away and cross-reference with officials why I have now been told that it is not one that we recognise and is above the level we expect. I know I have committed to come back to noble Lords with a number of costs, and we can clarify that at the same point before Report.

I understand that Amendment 329 in the name of the noble Lord, Lord Parkinson, is a natural consequence of the noble Lord’s Amendment 19 in relation to the specified competitions, and it certainly would have made more sense to debate it then. Nevertheless, as we discussed at length previously, we understand the desire to have upfront clarity in the Bill as to which competitions will initially be in scope of the regulator’s regime.

However, as I explained during our previous debates on this issue, the Government believe the approach taken to defining the scope of the regime in the Bill is the right one. It delivers the effect intended, closing any loopholes that would allow avoidance of the regime, while also allowing for agility to respond to any potential changes in the structure of the football pyramid.

On the merits of Amendment 329, we completely agree that the Secretary of State’s power to define the competitions in scope and to amend this scope in the future should be subject to the affirmative parliamentary procedure. This will ensure that Parliament can scrutinise this important decision properly. That is why the Bill as currently drafted achieves this already in Clause 91(3)(a)(i). However, as we cannot accept the noble Lord’s Amendment 19, which was withdrawn, we cannot accept this consequential Amendment 329 either.

For the reasons I have set out, I hope the noble Lords will not press the amendments.

[Lord Moynihan (Con)]

I am very grateful to noble Lords who have participated in this debate. I think it has been one of the best debates we have had in Committee. I particularly highlight the contribution made by the noble Lord, Lord Birt, which is very relevant to the amendment. There is a huge difference in costs between light-touch regulation that is effective and appropriate and what he has identified in the 125 pages of this overcomplex and bureaucratic legislation —let alone the secondary legislation that will flow from it. If it becomes overcomplex and bureaucratic, it becomes expensive.

To get that balance right, which was an important point made by the noble Baroness, Lady Taylor, we need regulation. But football is regulated. The FA is the core regulator of both professional and amateur football in England. It has been absolutely absent from this debate. It has said nothing, to the detriment of its reputation as the national governing body of football in England. It is very sad that it has had nothing to say and no opinion. It is there to protect the autonomy of football and really should have come to the table and provided us with its thoughts. Indeed, I know that some noble Lords have written to the FA to ask it for a briefing on the Bill, and the FA’s response has been that it does not have a view on the Bill. We have no briefing. That is exceptionally sad.

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Moved by

[Baroness Twycross]

330: Clause 91, page 74, line 1, leave out “56(2)(a)(ii)” and insert “56(2)(b)”
Member’s explanatory statement
This amendment corrects an erroneous cross-reference.

--- Later in debate ---

[Lord Markham (Con)]

There we go—the biggest cheer of the night.

As this is the last debate of what has been an extensive process, I echo some earlier comments by thanking the Minister for all her time and involvement over all these days in Committee. I thank all noble Lords for what has been an extensive number of days’ debate. I hope that we may have one new convert as a fan, but maybe not. The debate has been so extensive over those days—as mentioned, there have been 380 amendments—and there is such extensive expertise around the Chamber. So many key points have been raised and there is an understanding that the consequences of getting this wrong are pretty extreme.

There seems to be consensus, as mentioned by the noble Lord, Lord Pannick, that there needs to be some sort of review and some mechanism for that. I must admit that I do not think that is the “state of the game” report, because that is written by the regulator. It is extremely unlikely that the regulator would say in that report, “In all of this, the regulator is pretty rubbish and should be reviewed”. That is probably an unlikely outcome from the “state of the game” report. This post-legislative review needs to be conducted by someone who is not at the regulator, because otherwise it would be marking its own homework.

I thank my noble friend Lord Goodman for raising this. A sunset is one very good way of looking at it, but we have had other suggestions as well. I ask the Minister to spend the time between now and Report thinking about how we are to get some sort of post-legislative review, to make sure that we get this all right. Lastly, I also ask the Minister to spend the time that we have to reflect on all the views expressed over the many hours and days of debate on this. I look forward to discussing her thoughts on them when we have the meeting in February.

[Baroness Twycross (Lab)]

I am grateful to all noble Lords for staying the course to debate this group. I am not going to use any footballing metaphors, because I think we have exhausted them during the Committee and clearly this is the final group. I want to stress that I am really happy to continue to meet noble Lords before Report to make sure that we can talk through concerns that they have raised ahead of the next stage in the progress of the legislation through your Lordships’ House.

I thank the noble Lord, Lord Goodman of Wycombe, for tabling these amendments, which have allowed a debate about what kind of scrutiny we might need for a new regulator of this type. I am also grateful to the noble Lord, Lord Norton of Louth, for waiting so late to contribute, particularly given his complete lack of interest in football. There is a real value in hearing from people who are interested in regulation and what makes good legislation when we look at something where there is a risk that noble Lords—or anyone looking at the legislation—might approach it from the perspective of themselves as a fan, rather than what we need to have, which is good legislation, a good regulator and effective regulation.

I am also grateful to my noble friend Lady Taylor of Bolton for her contribution. Her expertise has been recognised by other noble Lords as well. I am keen to reflect on these contributions and the points raised by the noble Lords, Lord Pannick and Lord Addington, ahead of Report. I will take the points about scrutiny and accountability away for further consideration. I will go through a number of points—unfortunately, I am going to keep noble Lords a little longer—but I want to reflect properly on the points that have been raised.

Going back to the amendments tabled by the noble Lord, Lord Goodman, unfortunately, while we completely agree that the efficacy of the regulator should be monitored and evaluated—and I am happy to discuss this point further with the noble Lord—I cannot stress enough how strongly we disagree with the use of a sunset clause in this context. I agree with my noble friend Lady Taylor that these amendments would create a perverse incentive for the regulated industry to deliberately act in bad faith from the outset in the hope that the regulator fails to achieve its objectives and is therefore scrapped. We do not want, through the design of the legislation, to encourage or risk encouraging any non-compliance or vexatious behaviour by clubs and competition organisers who might be setting out with the intention of frustrating the regulator. We want to create the right conditions so that clubs act in a sustainable way, and we feel that the approach adopted is the right one.

On the other points raised by the noble Lord, Lord Goodman, surely, we want a regime that creates incentives for clubs to comply and improve sustainability. Under the amendment, the panel would make the decision, but there would still be an incentive for industry to show that the regime is not working. I also had concerns about the noble Lord saying that this would not be a problem because the Secretary of State would appoint the panel. If the Secretary of State can appoint a panel, knowing that it is not going to act against what the Secretary of State might have already decided, that is not a good panel. Therefore, with respect, I cannot agree with the noble Lord’s comments.

Giving the regulator a deadline of five years would also create the incentive for it to become more interventionist. Knowing it will be judged on whether it was meeting its objectives within a fixed period, the regulator could feel compelled to pursue more severe short-term solutions; this would be an undesirable unintended consequence. In addition to introducing these perverse incentives on both sides, a sunset clause would create inherent uncertainty in the market, as default expiry of the legislation in five years’ time, unless regulations are made to the contrary, would leave the industry and investors unclear on what basis they should plan for the future. We do not want to leave the Government or Parliament open to persistent lobbying to trigger the sunset clause.

The noble Lord, Lord Goodman, raised the important issue of accountability. This is already built in through the “state of the game” report and the annual report. However, I do recognise the point made by the noble Lord, Lord Markham, that these are produced by the regulator, albeit that the “state of the game” report will be based on data from the industry. While I understand the noble Lord’s concerns, the Government believe that the current measures already ensure sufficient scrutiny of the regulator and that it can be held to account if necessary—for example, through the DCMS’s role as sponsor and the requirement for an annual report to be laid before Parliament.

Parliament’s Select Committees can also conduct inquiries into any aspect of the work of the regulator once it is established and take evidence on such matters. The Government believe, given the aforementioned risks associated with the sunset clause, that it would not be an effective way to ensure accountability. For the reasons I have set out, I hope the noble Lord will withdraw his amendment.

[Lord Goodman of Wycombe (Con)]

My Lords, I am very grateful to all those who have spoken in this appropriately sober debate, especially to my noble—and non-footballing—friend Lord Norton for coming in and sharing his expertise with us. I suppose it is scarcely surprising that those noble Lords who are sceptical of state regulation favour the sunset clause, and those who are supportive of it are not. The Minister did not fully answer the argument I put to her. I find it hard to see why a panel appointed by her, which could be trusted to be fair-minded rather than biased one way or the other, would deliberately frustrate the regulator if that panel of experts thought the regulator was right. But these are matters to which we may be able to return on Report.

In the interim, I will simply make two points. First, it is very encouraging to see that there is agreement throughout the Committee that there needs to be more effective post-legislative scrutiny. This point was made briefly but very forcefully by the noble Lord, Lord Pannick. My challenge to the noble Baroness, Lady Taylor, is this: if noble Lords do not like the sunset clause as a means of post-legislative scrutiny, let us come up with something else specific, rather than simply issue the general wish that things can somehow be made better.

Finally, a noble Lord said, “Fans want this”. Once again, I say that something like 33 million people watch football. Some of them will be unaware that this is coming down the tracks. I predict that many fans will find themselves in the position of the noble Lord, Lord Birt. I suspect that he has sat through more of this Committee than I have—and I have sat through a great deal of it—very quietly assessing what is going on. He is pro the principle of independent regulation, as licensed by the state, whereas I and many of my noble friends are either sceptical or opposed. But he has recognised, as we have dug more deeply into the weeds of this matter, that it is problematic.

I am sure we will return to these problems on Report. In the meantime, I beg leave to withdraw my amendment.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Report stage
Tuesday 11th March 2025 Lords Chamber

[Lord Sentamu (CB)]

My Lords, at the end of the day, the purpose of this first amendment is simply to increase financial sustainability and to require the Secretary of State to do a number of things. The Bill as it stands clearly and simply states the purpose, review and key priorities:

“The purpose of this Act is to protect and promote the sustainability of English football”.


I for one would be content not to put in finance and many other things, because that opens a big can of worms. The Bill then spells out clearly in Clause 2 how to achieve that particular purpose. This amendment would truncate a big piece of work that has been done.

So I still support the idea that the purpose of this Act is to protect, promote and sustain English football. That is a wonderful way of doing it. The amendment would reduce it to financial sustainability and the Secretary of State having powers to do this, that and the other. This particular Bill is really about the independent regulator; do not suddenly introduce the Secretary of State in the purposes. So I would not like to support or go with this amendment, because it is not as careful and clear as the purpose we have at the moment.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

My Lords, I thank the noble Lord, Lord Parkinson, for tabling his amendments, and for his kind words and his engagement on this Bill. I extend those thanks to all noble Lords from across your Lordships’ House for their engagement, and for the time and input that I have benefited from over the last few weeks and months.

I will start with Amendment 2. I reassure the noble Lord that, although the Bill does not specify the requirement to consider both prospective and current fans, this is implicit within the existing requirement. Football would not serve the interests of fans if the game were unattractive or unwelcoming to new fans. The regulator is also inherently future minded, with the requirement to focus on sustainability and the long-term protection of the club and its heritage assets. Future fans are therefore already required to be in the regulator’s mind when it makes its decisions. This is also reflected in the Bill’s Explanatory Notes.

--- Later in debate ---

[Lord Markham (Con)]

From this side, I would like to join the recognition from all noble Lords about the social value that clubs bring. I need only to look at my six year-old, who is barely ever not wearing his Cole Palmer shirt, to know that it is much bigger than just an economic interest. Clubs fully understand that, and I think that point was made very well by all noble Lords—the particular examples from my noble friend Lady Brady were very well made.

Clubs realise that they are the leaders in their field, and I think we have all seen countless examples of them doing it again and again. In terms of getting the balance right, though, we shall talk later—the noble Lord, Lord Pannick, made the point as well—about wanting to make sure the regulator is light touch. I think the Government get that right in their Amendment 32—again, I think we all agree on the intentions—but the amendment from the noble Lord, Lord Addington, may go slightly to the other side of the fence. However, I think we have a united gathering, for want of a better word, around the Government’s amendment. From our side, we very much welcome that, and welcome the continued work of the clubs on the social front as well.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Addington, for raising this issue on Report and giving us the opportunity to discuss it further. I also thank him for his very kind words and, not least, for his persuasive arguments over the past few weeks. I am grateful to him and to the noble Lord, Lord Goddard, for their time on many occasions. I am also grateful to noble Lords from across the House, irrespective of whether they agree with the government position, although I feel that there was a general consensus.

I think that what we are all agreed on across your Lordships’ House, including the Government, is that clubs play a vital role in their local communities. It is a key part of what makes football our national game as well as our local anchor. However, as I previously stated in Committee, we believe that the noble Lord’s amendments would expand the scope of the regulator too far and are potentially overprescriptive, as the noble Lord, Lord Pannick, expressed much more elegantly than I can.

The regulator should be focused on areas of critical need, addressing genuine market failures rather than regulating on issues that the industry can solve. There are many different ways a club can make a difference and serve its local community. We have heard some fabulous examples throughout the Bill’s passage through your Lordships’ House, including a number we have heard today, such as that of West Ham during the pandemic, mentioned by the noble Baroness, Lady Brady, and my noble friend Lady Taylor of Bolton mentioned the charity work of her team, Bolton Wanderers.

This is why we are confident that government Amendment 32 strikes the right balance. We want to encourage clubs to continue their great work in their local communities without restricting the manner or form in which they achieve it. For example, clubs could match their community outreach initiatives to the size and resources of their clubs and to the specific communities’ needs and issues, which may vary. This could include the bespoke training for charities and community groups envisaged by the noble Lord, Lord Addington. Like him, we agree that the regulator can shine a light on this vital work carried out by clubs up and down the country and therefore encourage more outreach. That is why we have brought forward the government amendment, which would require clubs to report on the actions they are carrying out.

Government Amendment 32 would mean that the regulator includes clubs’ community contributions in its corporate governance code and adds criteria for what constitutes corporate governance for football clubs. I welcome support for the government amendment from my noble friends Lord Bassam and Lady Taylor, and the noble Lord, Lord Addington, who have co-sponsored the amendment. This is very much in the spirit of co-operation and discussion that we have had over the past few weeks. It will be explicit in the Bill that a club’s contribution to the economic and social well-being of its local community is part of its corporate governance. That will ensure that clubs outline how they contribute to their local communities in their corporate governance statement.

In answer to the noble Baroness, Lady Fox of Buckley, we do not think this is heavy-handed or overregulation; this is, as the noble Lord, Lord Maude of Horsham, said, what good clubs already do. If they were not contributing to their local community, they would, however, be expected to explain the reason for that in their statement. Their report would be published online to allow for public scrutiny so they can be held accountable for their actions or inaction. We believe this will encourage transparency and, as with the approach to corporate governance more widely, this will in turn encourage greater action in this space.

Above all, this approach will allow flexibility for each club to comply in accordance with their resources and size and in a way suited to their own community’s needs. Additionally, when the regulator publishes its corporate governance report on clubs, best practice can be shared with the industry. The approach will also ensure that we do not step on the toes of the likes of the FA, which already spearheads good social and community initiatives across football.

I hope that I have reassured the noble Lord that we are taking appropriate action to ensure that this important issue is captured without giving without rise to scope creep. For these reasons, I urge the noble Lord to withdraw his amendment, and I commend government Amendment 32.

[Lord Addington (LD)]

Well, my Lords, there were hints of normal service being resumed at the end of that. It just goes to show that we have to look at what we are actually trying to achieve here. If good clubs do it anyway, why should they be hamstrung by doing it when bad ones do not? That is something I would say: a bit of basic fair play. Also, the idea of light-touch has been spoken about very much in this debate—it is one of the mantras—but I just received information from the EFL saying that it is worried about this, because what does “light-touch” mean? Does it mean doing virtually nothing? The noble Baroness shakes her head, but we will possibly drag that out during the course of the Bill. I have heard Lords debates in which “light-touch” was described as being asleep at the wheel and only paying attention when there is a disaster.

I would hope that the careful use of regulation, encouraging people to do the things they should, is something we do not shy away from. The good ones do it—bravo—but let us make the rest join in. I hope that we can take this principle forward in this Bill and other pieces of legislation. Just because somebody is good does not mean to say that everybody will be. I do not know how many pieces of legislation have that principle running through the middle of them like a stick of rock. I beg leave to withdraw my amendment and look forward to supporting the government amendment when it is moved.

--- Later in debate ---

[Lord Parkinson of Whitley Bay (Con)]

I was always in the habit of complying with the Freedom of Information Act and, in this instance, my advice to the noble Baroness would be to give us as much as she can about UEFA’s concerns. It is very clearly a matter of concern here in your Lordships’ House. I hope the matter can be settled. Maybe the noble Baroness can say a bit more about the correspondence that she has had with UEFA but, if not, I hope that my noble friend Lord Moynihan will continue to pursue this important issue.

[Baroness Twycross (Lab)]

My Lords, I had been slightly unnerved by the tone of the debate up to this group. I now feel myself in much more comfortable territory—under attack and revisiting the issue of international competitions.

I understand the intent of the amendments from the noble Lord, Lord Moynihan, to put beyond any doubt that the Bill and the regulator will not breach UEFA or FIFA statutes. I would like to thank him for his time, both in writing and in meeting myself and officials. However, I would like once again to reassure your Lordships’ House that these amendments are not necessary. At the very least, they are trying to solve a problem that does not exist; at worst, they attempt to create an issue that does not exist.

I would be a brave and foolish Minister if I proposed legislation that risked us being banned from international competitions. UEFA has again confirmed in writing with the Secretary of State, just last month—and, as the noble Lord, Lord Goddard of Stockport, and other noble Lords, including my noble friends Lady Taylor and Lord Bassam highlighted, the FA confirmed directly to noble Lords, including the noble Lord, Lord Moynihan, just yesterday—that the Bill, as drafted, does not breach UEFA statutes.

The regulator will be operationally independent of the Government and will not exert an undue influence on the FA’s ability to govern the game. The extent of its statutory powers and duties will simply not allow it to do so. I know that there have been requests to see the letter that UEFA has sent to the Government that was leaked to the media last year. I wrote to UEFA, following the conclusion of Committee, asking whether they would be content for me to release the letter, but they replied that they would rather that communications be kept private. It is important that I respect this request to ensure that the Government can continue to have honest and constructive conversations with our stakeholders.

I turn to the issue of the FOI. This is—

[Lord Pannick (CB)]

I would be grateful if the Minister could throw any light on what a freedom of information request should state.

[Baroness Twycross (Lab)]

As if I planned this seamlessly, I was just coming on to the FoI request. In my view—this is not what I got from the Box note—this is a lesson on how to get an FoI request rejected, unless rejection was actually the intent. I hope the Benches opposite will bear with me as I explain. The FoI request referred to by the noble Lords, Lord Moynihan and Lord Parkinson, was an extremely broad request for all correspondence ever to the department from UEFA. In the response, the requester was advised to narrow his request to a particular timeframe for the department to be able to respond. In my humble view, that sounds perfectly reasonable. I understand that such a letter has not yet been sent in, but, clearly, the responder may choose to accept the advice from officials.

Turning to the specifics of the amendments themselves, much as I do not want to see the noble Lord, Lord Pannick, lose the opportunity for future litigation, I am afraid that, rather than protecting English football, his amendments would have serious unintended consequences. The amendments would see a regulator established by an Act of Parliament in this country take a position of deference to a private international organisation. That would not only undermine the sovereignty of Parliament but leave English football in a very weak position.

The noble Baroness, Lady Brady, raised concerns, both today and on the fourth day in Committee, that the Bill compounds the problem of UEFA’s and FIFA’s ongoing leverage over Premier League clubs, creating a regulatory environment that could become fundamentally unstable. While I do not accept that that is currently the case for the Bill, amending current drafting, to fix in statute that the regulator must fall in line with whatever rules those organisations set, would surely create such an issue. The result of these amendments would be a concerning loss of autonomy and independence for the regulator and, in turn, for English football as a whole. For those reasons, I ask the noble Lord, Lord Moynihan, to withdraw his amendment.

[Lord Moynihan (Con)]

My Lords, I am very grateful to noble Lords for their contribution to this debate. I will attempt to respond to the comments that have been made.

I attended the meeting yesterday, and I was very attentive to what was said. The first question was about UEFA, and the first thing said in response by Joanna Manning-Cooper, who represented the FA at the meeting, was that UEFA has been

“happy since the start of the journey”.

I wrote that down; that was precisely what she said. I have to say to noble Lords that the correspondence that was sent in September last year to the Secretary of State reflected five pages of unhappiness about the potential of this legislation as far as UEFA was concerned. It is inconceivable, to any noble Lord who has read that letter, that that could possibly be seen as UEFA’s happiness since the start of the journey.

I make that point because I would never have started with the strength that I have had on this subject in Committee, and today, unless I had read the letter. I was sent two different copies of the same letter from two different sources; it has been widely distributed. Everything that I said in my opening remarks reflected the content of that letter and the very real concerns that UEFA had.

I am surprised that the Government have not published that letter, and I believe that they should have done so, because it is simply not true to say that UEFA has been happy since the start of the journey. It is also disingenuous to say that the request that was made was so wide as to have taken a great deal of time, when everybody knows precisely what correspondence was requested. The Written Question placed by James Wild was: please provide an electronic copy of correspondence from UEFA

“on the proposal to introduce a football regulator”.

That is specific; it is not wide in its remit. Everybody knows which letter we are talking about. It is disingenuous to say that it would take three and a half days for a civil servant to go through all the letters that UEFA has sent on the subject of the introduction of a football regulator, when this Bill has been only a year in the making, including the time that the Conservative Party spent on it. As I said, I would not have taken the view that I had—including when listening to the meeting yesterday—if I had not also registered very significant surprise at the comment that the Bill will take no powers away from the Football Association.

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[Lord Pannick (CB)]

My Lords, the defect of imprecision is unfortunate, but it can be cured by secondary legislation, which is far preferable to the serious risk that the Bill would be hybrid.

[Baroness Twycross (Lab)]

I thank noble Lords for their contributions to the group. It is an issue that we have discussed at length throughout the Bill’s passage through this House. I for one thank noble Lords who suggested that it would be helpful if we could progress the legislation so that we get the regulator in place.

On Amendments 6 and 82 from the noble Lord, Lord Moynihan, I understand his desire to have upfront clarity in the Bill as to which competitions will initially be in scope of the regulator’s regime. However, again, the noble Lord may be trying to solve a problem that potentially does not exist. There is no doubt as to which competitions are in scope of the regulator’s regime at this point, and which will not be. By delegating this to secondary legislation, we are following the precedent established by other similar sport-related legislation. Without wanting to seem ungracious, this includes the Safety of Sports Grounds Act 1975 and the Football Spectators Act 1989, the latter of which the noble Lord, Lord Moynihan, will be very familiar with, as he was the Bill Minister in the other place during its passage.

The approach that the Government are taking is both reasonable and the result of extensive, evidence-based consultation with all key stakeholders in the industry. The delegated power ensures that the competitions in scope can be amended in a timely manner and ensures that the scope of the regime remains relevant. It future- proofs for future innovations and protects against circumvention by ensuring that clubs and competition organisers cannot simply reconstitute, rename or establish new domestic competitions to avoid the regulator’s regime.

The Government’s intended scope for the regulator is well known; it has been a subject of policy development process over many years, both by this Government and the previous Government, which has involved extensive consultation with the clubs and leagues that will be in scope. Any changes to the scope in future would be based on clear evidence and proper consultation as part of a published Secretary of State assessment. The requirement to consult before future uses of the power is set out on in the Bill. Any changes would be subject to the appropriate parliamentary scrutiny under the affirmative procedure.

On Amendment 85 from the noble Lord, Lord Parkinson, this is a standard provision in many Bills, including the Media Bill, which I note he was the Minister for. To future-proof this legislation, regulations have to be able to be made in a timely way; getting bogged down in lengthy parliamentary proceedings could undermine the Government’s ability to keep the regulatory framework up to date and ensure that it remains effective. This is of no benefit to anyone, including the industry. This comes back to the perceived issue of hybridity that has been mentioned by a number of noble Lords today.

As I set out in Committee and in our memorandum, the policy intent being the top five tiers of men’s English football has never been in doubt. Throughout the development of the policy over the past three years, there have been countless opportunities for all affected and interested parties to make representations on this scope. This amendment would serve no purpose other than to delay the implementation and effect of the regulator. It would be set up, incurring a cost, but unable to act while crucial regulations establishing its scope were bogged down in years of process.

I have set out very clear reasons for the approach taken on defining the scope of the regime and will not take up your Lordships’ time further relitigating this issue. For those reasons, I urge the noble Lord to withdraw his amendment.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, I thank my noble friend Lord Moynihan for the forensic way he set out the case for his Amendment 7. The example with which he illustrated it—one he has used throughout the passage of this Bill—is certainly one that captured my attention, coming from Whitley Bay. It is causing some concern across Tyneside and among Newcastle United’s many fans across the world. I would be failing in my Geordie duty if I did not take this opportunity to wish the team the best of luck for the Carabao Cup this weekend.

I understand that the Minister cannot speak for a regulator that is to be independent and that does not yet exist, but I hope she will be able to say a bit about the implications of the Bill, such as the one that my noble friend Lord Moynihan set out. It clearly has some very serious consequences, not just for Newcastle in the example he has given but potentially for other teams in the future. I look forward to hearing what she says.

I want to say a little about my two amendments in this group, Amendments 46 and 47. As we said in Committee, among the many changes the Government have made to the Bill, compared with the Bill that the previous Government brought forward in the previous Parliament, was one we understand the case for. In the earlier version of the Bill, there was a provision stating that the regulator must have regard to the Government’s foreign and trade policy when making determinations for the owners’ test. This is an example of a concern that UEFA raised. That has been reported publicly, and the Government were very clear when they made the change to the Bill now before us that it was in response to concerns by UEFA that this undermined the independence of the regulator and that if it was to have regard to the Government’s foreign or trade policy, it would be too close to the Government’s view, in the eyes of UEFA.

I can understand the rationale for making that change, but in Committee I expressed some concerns about the unintended consequences of that and the potential loopholes. I gave the example that if there were to be two potential foreign owners of a club, one from a friendly nation and one from a nation with which this country does not enjoy friendly relations—we can all think of some examples that would spring readily to mind in the troubled world we face today—we would all be clear on which way we would like to see the independent regulator come down, even if the Government are not able to direct it, or if it is not able to have regard to the Government’s foreign policy.

My Amendment 46 would insert a provision highlighting

“whether the individual is reasonably believed to be, or have been, involved in terrorism related activity”.

I am sure that noble Lords would not want such a person to be an owner or director of one of our prominent football teams.

Amendment 47 sets out a number of agencies—the National Crime Agency, the Security Service, the Serious Fraud Office and others—that the new regulator may consult in carrying out its test. I have watered down my amendment from Committee to say “may consult”, not “must consult”, in the hope that this will find some greater support from the Government. I understand the reasons for the change that they have made to the Bill, but I do hope that the noble Baroness will be able to look at these ways in which we might be able to tighten up the potential for a loophole, so that we can avoid seeing the sorts of people that none of us want to see taking control of English football clubs.

[Baroness Twycross (Lab)]

My Lords, I thank the noble Lords, Lord Parkinson, Lord Moynihan and Lord Fuller, for tabling their amendments, as it provides me with the opportunity to restate the Government’s position on these points and provide some clarification. I join the noble Lord, Lord Parkinson, in wishing Newcastle good luck in their forthcoming match. We can agree on some things in your Lordships’ House.

I start with Amendments 7 and 28, in the name of the noble Lord, Lord Moynihan. Before I go into a bit more detail, I would like to clarify whether incumbent owners or officers could be tested. Indeed, they can be tested. The regulator can test incumbent owners or officers where it has grounds for concern about their fitness or, for owners only, the source of their wealth—but, I repeat, only where there are grounds for concern. It is vital that we have a strong definition of an ultimate owner in order to give transparency to fans and hold owners to account. The Government are intent on providing the regulator with the tools to identify the ultimate owner as accurately as possible.

On the point from the noble Lord, Lord Moynihan, point on precedent, this is why the Bill’s drafting takes its lead from the precedent of other Acts using “influence or control”, including the Companies Act’s “persons with significant control” regime, and the economic crime Act’s “beneficial owners” regime. We are confident that we have the correct definition to achieve the Bill’s aim. It 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. In fact, without this definition, ultimate owners could circumvent regulation. It is fundamental that clubs have suitable custodians in order to secure the future of clubs and, most importantly, to protect the game that fans hold so dear. For these reasons, I hope that the noble Lord can understand the importance of the definition.

I turn now to Amendment 28. As I outlined in Committee, I agree that it is important that the industry has certainty as to what the regulator will consider significant influence by owners. That is why the Secretary of State’s guidance will be produced in good time in order to give this clarity. I want to make it clear that the Bill’s provisions that define “owner” in Clause 3 and Schedule 1 come into force on the day the Bill becomes an Act. That means that the obligation for the Secretary of State to produce this guidance comes into force on that day.

We have taken on board the valuable points the noble Lord raised in Committee. After looking at this again in detail, we stand by our position that the intent of this amendment is met without needing to change the Bill. We do agree that, before guidance is produced, clubs should not be expected to identify those who meet the definition of an owner by exercising significant influence or control. I would therefore like to provide greater reassurance that the scenario the noble Lord is concerned about should not be an issue. I can commit that the Secretary of State’s guidance will be produced before clubs are required to identify their owners who meet the definition of having significant influence or control to the regulator.

In response to the point from the noble Lord, Lord Pannick, on why we have not defined “significant influence and control” on the face of the Bill and are putting it in guidance instead, this approach is based on precedent. As I mentioned, the Companies Act also sets out the definition of “significant influence or control” in guidance rather than legislation. The Secretary of State’s guidance will give clarity to owners about who meets the definition.

Turning now to Amendments 42, 43, 44 and 45 in the name of the noble Lord, Lord Fuller, I think it was a bit cheeky and that one should take a slight exception to the notion that Delia Smith is just a cook. I would argue that she is, through her professional career, arguably also a highly successful businesswoman. Leaving that point aside, however, the requirement to notify is there for a reason. Keeping unsuitable owners and officers out is a core part of the regulator’s regime. We want the regulator to block these individuals from entering the system, and not to have difficult, costly battles to remove them after the fact. So it needs to know who a club’s respective new owners and officers are before they buy or join the club. Put simply, the regulator needs to be able to gather the information that it needs to test them and work with them and the club to ensure that they submit a proper application in good time. It will help the regulator prepare to act quickly when it receives the application.

Clause 27 plays another important function. If a person has, for whatever reason, become an owner or officer of a club without the regulator first having found them suitable, they still have to notify the regulator as soon as possible after the event. Without this provision, there could be untested, unsuitable individuals in the system that the regulator was unaware of.

I move now to Amendment 46, in the name of the noble Lords, Lord Parkinson and Lord Markham. We agree that it would not be right for money related to terrorism to find its way into our clubs. The Bill, as already drafted, already stops that through its provisions on serious criminal conduct. Serious criminal conduct includes offences listed in Section 41 of the Counter-Terrorism Act 2008. That is an extensive list of terrorism-related offences, ranging, to name a few, from membership of a banned organisation to encouraging terrorism to offences related to funding terrorism. Serious criminal conduct, including these terrorism offences, is considered under the ODT “source of wealth” and “honesty and integrity” tests. The club licensing regime lets the regulator block funding that is connected to serious criminal conduct. That is why we are confident that the Bill appropriately and thoroughly deals with terrorism-related activities.

Finally, I turn to Amendment 47, also in the name of the noble Lords, Lord Parkinson and Lord Markham. I am pleased to have another opportunity to highlight the information-sharing agreements that the regulator can and will use to its advantage. I absolutely agree that the regulator may need to work closely with other organisations and stakeholders when exercising its wider functions. I am grateful to the noble Lord for the discussions we have had on this point.

The Bill establishes a gateway for the regulator to share information with a range of organisations, including HMRC, the National Crime Agency and the Serious Fraud Office. It also creates a specific gateway for HMRC to share information with the regulator and empowers the Secretary of State to create other such gateways by regulations, as needed. The regulator may already consult whoever it needs to in order to make robust decisions. The regulator will seek information and expertise from relevant organisations to help it to stay live to both national and international concerns. The shadow regulator is already building a strong relationship with the NCA and law enforcement to ensure that the regulator is in a strong position to gather and receive the information it needs. We are confident that the Bill adequately empowers the regulator to gather such information. For the reasons I have set out, I would be grateful if the noble Lord could withdraw his amendment.

[Lord Moynihan (Con)]

I turn first to the noble Lord, Lord Goddard, and his comment that by accepting this amendment, we would be watering down the regulation. On the contrary, if you look at the regulatory requirements of FIFA and UEFA, the FA, the Premier League or any of the other national governing bodies in football in Europe—which I have done—it is not a matter of watering down. This makes a much more intrusive additional layer of regulation which does not exist in any of the other countries. I simply put it to the noble Lord that there must be a reason for that. There is a good reason why, to the detailed regulation which exists in FIFA, UEFA, the FA and the Premier League, it is unnecessary to add this additional layer.

My noble friend Lord Parkinson on the Front Bench mentioned the exchange that took place over the clause having regard to foreign and trade policy objectives of the Government. It was a classic example of when UEFA said “Jump” and the British Government’s position was “How high?” I fear that if you take the FA out of the equation, which has happened now, we will see far more work for lawyers in the future than the noble Lord, Lord Pannick, anticipates. His point, however, on this amendment was perceptive and accurate. If the legislation is not changed this evening, it is incumbent on the Secretary of State at a future opportunity to make it absolutely clear in his consideration, which he will undertake, to make sure that there is clarity on that.

As far the Companies Act is concerned, I simply say to the House that there is no requirement whatever for the Secretary of State to take it into consideration when opining on this subject. If there is, it should be written into the Bill. Once again, as I have mentioned before, there are 31 different areas where we are going to wait to hear the detail of the competitions, the clubs and exactly what “influence” means—this is all for the future. This is in many respects a shell Bill, but using “influence” over has the impact that I have mentioned in the example of Newcastle, and I am very concerned about it.

I ask the Minister to write to me if she would, because I appreciate that she will not have had time to respond to the concerns that have been expressed with regard to the owners of Newcastle, not just with regard to the club, but to the response to this Bill when enacted in their investment in the Newcastle area, over and beyond their financing of the club. As I understand it, those rumours that are circulating are well grounded, but the Minister will no doubt be able to tell me. This is meant to be a growth Bill: all regulators are meant to grow the businesses that they regulate, but I fear that this will have exactly the opposite effect, and I think Newcastle may be on the receiving end of that. If we do not change the Bill to remove the “influence” over as a key criterion of control, we will have made an error, and for that reason I wish to test the opinion of the House.

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[Lord Goddard of Stockport (LD)]

Okay.

[Baroness Twycross (Lab)]

I thank noble Lords for their amendments. On Amendment 8, in the name of the noble Lord, Lord Maude, I understand the desire for the scrutiny of the appointment of the regulator’s chair and I am grateful for the thoughtful speech he made outlining the reasons behind the amendment. Getting the chair right, both now and in the future, will be pivotal for the success of the new regulator. I will not go into names or press speculation. I understand that progress is being made on the appointment. I am not involved in that, so I will not comment further.

The chair, as the public leader of the regulator, must be a competent and strong individual, free from any vested interests. I assure noble Lords from across the House that the existing public appointments process is robust, run in accordance with the Governance Code on Public Appointments, and one that Parliament can and should have faith in.

As per Cabinet Office guidance, parliamentary Select Committees can already carry out pre-appointment scrutiny hearings and offer their views to the Secretary of State. The chair of the regulator is subject to that scrutiny. The Secretary of State will, of course, weigh any committee’s views carefully, as the Cabinet Office guidance already sets out; this will be the case for the future.

However, the Governance Code on Public Appointments sets out that Ministers have the ultimate responsibility for appointment decisions for which they are accountable to Parliament. It is not common for Parliament to hold a statutory right of veto over such public appointments and we cannot see a reason to set that precedent with this regulator. In response to my noble friend Lord Bassam of Brighton, our view is that this amendment would represent a veto.

Amendment 10, in the name of the noble Lord, Lord Parkinson of Whitley Bay, seeks to place a cap on the number of members of the regulator’s expert panel. The regulator’s independent expert panel will play a vital role in making various important decisions across the regulator’s regime, when and where it is appropriate. It is essential that the panel has a range of relevant expertise and experience to reflect the diversity and complexity of decisions that may come before it.

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 fetter the effectiveness of the expert panel by introducing a cap on the maximum number of members of the panel as this amendment seeks to do, however sensible that level may appear to noble Lords. The regulator needs the flexibility to react in the event of high workload for the panel. The regulator will be required to deliver value for money and has a regulatory principle underpinning this. We do not believe that the CEO would appoint and maintain an unnecessarily bloated panel.

Finally, I turn to government Amendments 9 and 11. In Committee, my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton, among others, emphasised the real importance of protecting the regulator from conflicts of interest. The Government are in complete agreement that the independence of the regulator must be protected, including against vested interests. Although the Bill already makes provision for managing such conflicts of interest, we have tabled government amendments to strengthen these protections even further and beyond any doubt.

The amendments require the regulator to establish and maintain a system whereby the members of the regulator’s board and its expert panel must declare their relevant interests, and a record of these interests must be kept and maintained. This will ensure that all board and expert panel members declare relevant interests from the outset of their appointment and on an ongoing basis. This is good practice not only for transparency but to help the regulator manage any conflicts and to insulate its decisions from potential vested or competing interests.

I hope that those reasons have reassured your Lordships’ House and that noble Lords will not press their amendments. I will move government Amendments 9 and 11 in due course.

[Lord Maude of Horsham (Con)]

My Lords, I am grateful to noble Lords for their contributions to this important debate. On the comments made at the outset by the noble Lord, Lord Bassam, I am open-minded about whether the Bill should contain what is effectively a veto or whether it should accord with the more usual practice. As I said, if the Minister were to give an undertaking that she would come back with an amendment framed in those terms at Third Reading, I would be willing not to press this amendment to a Division, but I have not heard that commitment from her, which is a disappointment.

We heard from the noble Lord, Lord Rooker, who is obviously scarred by his personal experience. I simply remind him that hard cases make bad law, and his sounds like a particularly hard case, for which he has my sympathy.

The noble Lord, Lord Addington, seemed to be recommending—arguing, really—that there should be no pre-appointment scrutiny at all, let alone whether it should be in the Bill. Therefore, he is presumably urging the Minister to withdraw the commitment she has made that there should be pre-appointment scrutiny. On the substantive point he made in arguing that scrutiny would turn the regulator into a political football, the reverse is actually the case. It is important that the regulator should be genuinely independent, and my experience of observing these scrutiny procedures is that Select Committees are particularly concerned to test the capability of the nominee to exercise genuine, robust independence. Rather than turning the nominee into someone who is overly influenced by the scrutiny, it is to test whether they are capable of withstanding it. That is the consideration.

I am grateful for all contributions, but in the absence of the quite modest commitment I have requested the Minister to make, I want to test the opinion of the House on Amendment 8.

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Moved by

[Baroness Twycross]

9: Schedule 2, page 85, line 37, at end insert—
“Declaration and registration of interests of members of the Board
6A (1) The IFR must establish and maintain a system for the declaration and registration of relevant interests of members of the Board.(2) In this paragraph “relevant interest”, in relation to a member of the Board, means a financial or other interest that may be relevant to the IFR’s exercise of its functions under this Act.”Member’s explanatory statement
This amendment requires the IFR to establish and maintain a system for the declaration and registration of relevant interests of members of the Board.

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Moved by

[Baroness Twycross]

11: Schedule 2, page 91, line 3, at end insert—
“Declaration and registration of interests of members of the Expert Panel
23A (1) The IFR must establish and maintain a system for the declaration and registration of relevant interests of members of the Expert Panel.(2) In this paragraph “relevant interest”, in relation to a member of the Expert Panel, means a financial or other interest that may be relevant to the IFR’s exercise of its functions under this Act.”Member’s explanatory statement
This amendment requires the IFR to establish and maintain a system for the declaration and registration of relevant interests of members of the Expert Panel.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, I thank the Minister for the two government amendments in this group. They reflect amendments I tabled in Committee. The first reduces the frequency with which the Secretary of State may revise the football governance statements, bringing it more in line with the parliamentary cycle rather than every three years. The second removes the Secretary of State’s power to amend the definition of the football season. This always seemed a disproportionate power. Why a Cabinet Minister ought to define a football season is a point that has bemused many football fans. I am grateful to the noble Baroness for Amendments 24 and 87, which she has brought forward on those points.

Like other noble Lords, I applaud my noble friend Lord Ranger of Northwood for his passionate speech in favour of his Amendment 27, which seeks to require the regulator’s annual report to include a review of the impact of its activities on ticket prices. The important argument here is not that the regulator should dictate ticket prices to clubs. I recognise the point that the noble Lord, Lord Hogan-Howe, made about how clubs often try the patience of their fans, but it is a commercial decision for clubs to take. There is a distinct possibility that the activities of the new regulator may force clubs to increase ticket prices further.

This is different from the point that the noble Lord, Lord Bassam of Brighton, made in pointing to the duty already in the Bill. The regulator will charge a levy to clubs. It will bring in higher compliance and legal costs, and many clubs will have to hire extra staff to comply with the new legal duties. That is all acknowledged in the Government’s impact assessment. When we couple that with the Government’s job tax, the increase in the minimum wage and the impending duties in the Employment Rights Bill, we can see that football clubs will be facing significant cost pressures over the coming years.

Inevitably, the only solution for many clubs—here I am thinking not predominantly about Premier League or Championship clubs but about clubs in League Two and the National League, which are the smaller and less well-off clubs—will be to hike ticket prices to offset these new and increased costs. It is clear that we need this assessment of the impact of the regulator’s actions on ticket prices. If Parliament is to give its assent and create this regulator, I think it owes it to fans to make sure that the impact of that cost is properly accounted for.

The noble Baroness, Lady Fox, my noble friend Lord Ranger and others have reflected on the fact that fans have very high expectations of this Bill and this regulator. They hope that the Bill, including the provisions in Schedule 4, will allow them to benefit from lower ticket prices, but I fear that the reverse is likely to be the case—higher costs leading to higher ticket prices for fans. I hope that my noble friend Lord Ranger will pursue his point on behalf of football fans across the country.

I am pleased that my noble friend Lady Brady has retabled her very sensible amendments to ensure that the regulator publishes guidance, not just to its functions under Clauses 21 to 25 but to its functions under the whole Bill. The regulator needs to translate the somewhat abstract powers and duties set out in the Bill into a more detailed and cohesive explanation of the rules it will be producing to support clubs in understanding precisely what will be expected of them. If it does that clearly, that may go some way to mitigating the costs that the new regulatory regime will impose on them. My noble friend’s Amendment 25 is a very simple one, but its impact would be helpful to all clubs facing these new regulations.

To the noble Baroness, Lady Jones of Moulsecoomb, the right reverend Prelate the Bishop of Sheffield and my noble friend Lord Gascoigne, I must regretfully say that I cannot support them on the amendment they have spoken passionately about. As I set out in Committee, we worry about the propensity for mission creep here. They have very wisely chosen to put their initiative behind Amendment 13, which is the more modest of the two and reflects an Act of Parliament that has already been passed with duties under it. While we cannot support the noble Baroness’s Amendment 13, neither will we oppose it if she presses it to a vote.

With renewed thanks to the Minister for the government amendments in this group, I look forward to her response.

[Baroness Twycross (Lab)]

I am not sure I have many original thoughts either, although I will try to address the points raised during the debate, starting with Amendments 12 and 13 in the name of the noble Baroness, Lady Jones of Moulsecoomb. I thank her for these amendments.

I am really comfortable with her absolute determination—as is her right—to raise environmental issues in every single way at every point of our deliberations in your Lordships’ House. The noble Baroness is right that we need to limit our impact. I note that she has support from the noble Lords, Lord Hogan-Howe and Lord Gascoigne, demonstrating her incredible ability to forge unlikely—some might say unholy—alliances with very noble aims. I apologise to the right reverend Prelate; I am not referring to him in that sweeping statement.

The Government are absolutely committed to environmental sustainability. One of the Prime Minister’s five national missions is to accelerate the transition towards clean energy and ensure that the UK fulfils its legal obligation to reach net-zero emissions by 2050. I agree with the noble Baroness, Lady Jones, and other speakers, including the right reverend Prelate the Bishop of Sheffield, that as a huge part of our national psyche, all sports, including football, have an important role to play in this transition.

The Government expect authorities across the sport to be working together to advance environmental sustainability. However, we do not feel it is right to add environmental sustainability to the regulator’s objectives or general duties. The bar for statutory intervention in any market should be very high. That is why the regulator’s focus should be on the problems that football has clearly shown itself to be unable to properly address through self-regulation.

By contrast, football has demonstrated the ability to take action on the environment. You only have to look at Forest Green Rovers as a brilliant example of a club taking action on environmental issues lower down the pyramid. At the highest level, the Premier League’s new sustainability pledge, involving a new minimum standard of action on environmental issues across both the clubs and the league, is another good example. This is only a starting point upon which future initiatives must build. Football authorities must take more proactive steps to accelerate their environmental initiatives. However, it is within the gift of the leagues, clubs and other authorities across the game to do so without government intervention.

This Amendment would also constitute scope creep, as highlighted by the noble Baroness, Lady Fox—something that I know noble Lords all agree we should be wary of, not least with the additional burdens it would impose on the regulator and the industry. Therefore, I hope the noble Baroness will not press these amendments.

Amendment 25 in the name of the noble Baroness, Lady Brady, seeks to bind the regulator to produce guidance on every aspect of its functions. In our view, this is disproportionate and would be a significant burden on the regulator. We are not aware of a precedent for any regulator being required to publish guidance about every single aspect of its functions. In many cases, it would be unnecessary and not relevant to clubs or competition organisers. This would involve engagement and consultation with clubs, adding significant burdens to them. The regulator will, where necessary, produce guidance in consultation with relevant stake- holders, in line with its duties and principles. I therefore hope the noble Baroness will feel sufficiently reassured to not move her amendment.

On Amendment 27 in the name of the noble Lord, Lord Ranger of Northwood, regarding ticket prices, the annual report is clearly a vital mechanism for the regulator to be held to account. I understand the desire to ensure that this report is comprehensive and covers necessary detail. It was really helpful to have his explanation of the intent of his amendment. I recognise how important ticket prices are to fans and recognise the noble Lord’s determination to raise this important issue on behalf of fans.

Ticket pricing is ultimately a matter for clubs. That is exactly why this Government have made it explicit in the Bill that clubs must consult their fans on ticket pricing as part of their fan engagement. This is the way to ensure that fans can have their voices heard on such an impactful issue; the annual report is not the most effective place to achieve this. The regulator may well choose to look at ticket pricing as part of the “state of the game” report. However, as it is a commercial decision, the regulator will not intervene, aside from ensuring that clubs consult their fans.

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Moved by

[Baroness Twycross]

14: Clause 7, page 5, line 26, leave out “financial investment in” and insert “the financial growth of, or financial investment in,”
Member’s explanatory statement
This amendment requires the IFR to have regard to the desirability of exercising its functions in a way that avoids any adverse effects on the financial growth of English football.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Report stage
Tuesday 11th March 2025 Lords Chamber

[Lord Markham (Con)]

This amendment is trying to avoid that and do it the other way around. Our trade agreements are in place already and well-known. We are asking the football regulator to do many things, but I would not expect it to know, because of the large levels of foreign ownership, how its decisions might disproportionately affect some segments versus other segments and how that could trip over some of the World Trade Organization agreements or other such bodies. That is what we are trying to protect against. Hopefully, it is not even relevant, but again it is trying to ensure that we do not sleepwalk into something that is thoroughly unintended. This is a simple precautionary amendment to avoid such unintended consequences.

So, as I say, we must all recognise that our existing trade agreements are not just beneficial but vital for our future growth. The Government have repeatedly said, quite rightly, that growth is their number one mission. All we are trying to do with this amendment is make sure that we do not inadvertently trip up on one of those and the regulator has one of those unintended consequences, because clearly none of us wants to see that happen.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Moynihan, for his amendments. There is much on which we agree, but, unfortunately, I cannot agree that these amendments in this group are required. Good investment, which comes in many forms, has helped make English football the global success it is today, and this Government are absolutely committed to continuing that. Of course, this regulator will not discriminate against foreign investors or act unfairly against anyone else—nothing in this Bill allows it to do so. This amendment is not needed to prevent that. Not only is it unnecessary but, as noble Lords will appreciate, it would be highly unusual to bring a broad range of treaty obligations directly into our domestic law in such a sweeping way.

This Government take our international obligations very seriously and the Bill complies with our treaty commitments. But, if foreign investors have concerns about the regulator’s decisions, there are mechanisms within our treaties to allow them to raise these concerns at the international level and, if necessary, to bring disputes. That is the appropriate forum, not our domestic courts. Let me be clear once more: we are confident that the Bill complies with our international obligations. Nothing in it requires or even allows the regulator to make discriminatory or unfair decisions.

Finally, I was slightly surprised to see the last part of this amendment tabled by the noble Lord, Lord Moynihan. We have carefully ensured the regulator’s independence from government and ensured that UEFA is content with the Bill as drafted, so I was not clear why the noble Lord wants to require the regulator to consult the Treasury and DBT on a wide range of occasions and risk undermining the regulator’s independence. This would be concerning, especially given how much time the noble Lord has spent discussing UEFA and FIFA throughout the passage of the Bill through your Lordships’ House, and I am sure the risk would be highly concerning for many others in this House. That is why I urge the noble Lord to withdraw his amendment.

[Lord Moynihan (Con)]

I am grateful to my noble friend from the Front Bench and the Minister for their contributions, and for the intervention, although I regret that I was not in a position to answer it, because I had already attempted to set the scene before the House managed to resume in full.

My amendment was not about UEFA. The purpose of the amendments this evening was about explicit statutory acknowledgement to reinforce clarity, reduce the legal uncertainties and prevent inadvertent breaches, demonstrating transparency, foresight and collaboration between the relevant government departments. It was to simplify what I anticipate will be, potentially, a legal minefield and to make sure that, if we did that in the legislation, we would avoid many of the issues that were going to, potentially, follow as a result of this legislation.

In parentheses, one of the problems that will follow comes from the intervention from the noble Lord: namely, UEFA is now out of this loop. UEFA is only a stepping stone: the running of football in the United Kingdom is through its member, the FA, and the FA, as we have debated and concluded within the House this evening, has no role within the financial regulation of football in this country. That is the first time that has happened anywhere in Europe. In Spain, it is fully at the heart of the financial regulation of that country, and indeed was party to working with government in order to follow a model that the Premier League has instituted here in the United Kingdom.

It is a dangerous path to move away from the autonomy of world sport. I will not go into this again, but I am trying to do a service to the noble Lord who has intervened this evening, because I know he has been an assiduous attender in Committee. It is a dangerous path: if you legislate to run sport and have financial management of sport and you ignore in practice the role of the governing body, which is the FA, you set up potential legal complexities that would otherwise not arise. That is why I have put forward these proposals: simply to give additional protection to those legal challenges that could arise as a result of this legislation and to move the amendments before the House.

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Moved by

[Baroness Twycross]

17: Clause 8, page 6, line 6, leave out sub-paragraphs (i) to (iii) and insert—
“(i) persons on whom it may impose requirements or restrictions, namely clubs, owners, senior managers and other officers of clubs, and competition organisers, and(ii) other persons who may be affected by its decisions, including players and fans;”Member’s explanatory statement
This amendment amends the regulatory principle in clause 8(b) so that the IFR should co-operate, and proactively and constructively engage, with persons who may be affected by its decisions.

[Baroness Twycross (Lab)]

This group contains a number of government amendments to the regulatory principles. I am grateful to noble Lords from across your Lordships’ House for the engagement we have had over the past few weeks both in Committee and in meetings. It has been helpful.

First, on Amendment 17, we all know that football without fans is nothing. It has always been the intention that the regulator would engage with fans and any others impacted by the regulator’s decisions, where they are relevant. It is vital to the Government that the essential value of players and fans to English football is demonstrated both in the legislation and the regulator’s engagement. I thank my noble friends Lady O’Grady and Lord Watson of Invergowrie for their engagement in ensuring that that value is reflected in the legislation, as well as my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton, and the noble Lord, Lord Addington, for their support for this amendment. This amendment will clarify that intent and make it explicit in the Bill. It will both reflect the essential nature of players and fans to English football and ensure that the regulator is directed to engage with both groups.

Turning to Amendments 18 and 19 concerning light- touch regulation, I thank the noble Lord, Lord Pannick, for tabling his amendment and for his extensive discussion of this issue with me and officials. We agree wholeheartedly that light-touch regulation should be the aim of the regulator. It should have a bias—against unnecessary intervention, against excessive burdens on the industry, towards co-operation and engagement before intervention, and towards proportionate interventions that deliver real benefits. That is why I have tabled Amendment 18 to clarify the intention that the regulatory regime should be light-touch.

We carefully considered the best way to deliver this aim, including whether to use the term “light-touch” in the Bill. We believe the regulatory principles should be as clear and specific as possible. Each time the regulator acts, it should be clear whether it has met the Bill’s requirements; that is, whether it has had regard to the principles. That is why our new principle in Amendment 18 centres around a test of necessity and whether the same outcome could be achieved in a less burdensome way. These, like the existing Clause 8(c) test of proportionality, reflect concepts that are well understood in public law and will give clubs, leagues and the regulator appropriate legal certainty.

“Light-touch”, by contrast, is not typical legislative drafting. That could make it difficult for both regulator and regulated to be 100% certain of their legal positions. As debates in Committee made clear, one person’s “light-touch” regulation is another’s “overreach”. Allowing a margin of discretion is a less novel concept, but we none the less have concerns about its legal certainty.

In our view, the wording “necessity”, “consideration of alternatives” and “proportionality” are clear tests that will let both regulator and regulated act with confidence. That is what our regulatory principles and government Amendment 18 deliver. I can assure the House that the principles in Clause 8, including our Amendment 18, enshrine a light-touch approach in law.

Finally, on government Amendment 20, this minor drafting change seeks to clarify the regulator’s responsibility under this regulatory principle. Although it will not materially change the effect of the principle, an obligation for a public body to have “regard to” is well precedented and understood by the industry.

For the reasons I have set out, I hope that the noble Lord, Lord Pannick, will not move his amendment. I beg to move government Amendment 17.

[Lord Watson of Invergowrie (Lab)]

My Lords, I would like to say a few words on Amendment 17 just moved by my noble friend the Minister. I tabled an amendment in Committee to try to ensure that the players appeared in the Bill, as originally they did not.

I very much welcome the fact that my noble friend has listened to the representations, not just by me and my noble friend Lady O’Grady but by the Professional Footballers’ Association and others, who have made the very reasonable case that, with the insertion of a reference to players as a group in this section, the regulator is expected to,

“so far as reasonably practicable, co-operate, and proactively and constructively engage”

with players. In effect, they become statutory consultees of the IFR, which is only appropriate because there is of course no football without the players. I very much welcome the wording that the Minister has come forward with; it meets my concerns and those of others.

The other part of this is the fans. I also put forward an amendment in Committee proposing that the fans should be defined in some way. I have had discussions with my noble friend the Minister. It was always going to be difficult. I assume that it will soon become the job of the regulator to define what a fan is. I still hold to the belief that you need to have some address for a fan if you are going to consult them. That is why I proposed in Committee that season ticket holders should be the best way of deciding who the fans are for consultation purposes, but I accept that it has not been possible to reach any kind of consensus on that.

I welcome the wording in this amendment. Again, I commend my noble friend and the Government on listening to representations and coming up with wording as a result.

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[Baroness Twycross (Lab)]

My Lords, this group and the discussion we have had reflect the value of the style of debate that we have in your Lordships’ House. I welcome the opportunity for us to work with noble Lords from across the House to refine the Bill. We thought the Bill was good when the previous Government had it; we thought our version was very slightly better; and we have the possibility of sending an even better version to be considered in the other place.

In starting my response to the comments made during this short debate, and with appropriate and due impartiality, I am very happy to pass on my best wishes to Liverpool FC—I will not comment on the score. Whichever team anyone supports, I think all noble Lords can agree that without players we would have no game. On that basis alone, it is right that they are included. I thank the noble Lords and my noble friends who have signed the Government’s amendment on that, and who took time to talk us through where it should sit within the Bill.

A lot of the discussion relates to definitions—whether about a light touch and what that means, or about fans and who they are. I want to say a little more about fans. The Government do not see themselves as the arbitrator of who counts as a football fan. That is something that fans and clubs themselves are in the best position to understand and discern. The makeup of a fan base differs from club to club; this diversity is part of the reason why the English football pyramid is so special. This is why the Government have introduced this legislation to protect English football by making it more sustainable and to help put fans back at the centre of their clubs, amplifying their voices on the issues that matter to them.

On the question from the noble Lord, Lord Evans of Rainow, about how the regulator will engage with fans, it will do so on a case-by-case basis. I would be happy to arrange for the noble Lord to speak to the shadow regulator team to provide him with more information about how it might do that. The regulator, once established, will be able to provide guidance for clubs on how to best consult fans. This will ensure that clubs have an appropriate framework in place that allows them to regularly meet and consult this group on key strategic matters and supporter interests.

The noble Lord, Lord Pannick, asked the key question about whether the regulator will have to ask itself whether intervention will address some substantial mischief, is likely to achieve some substantial benefit and is required because a similar outcome could not be achieved by a less burdensome means. That is our understanding. If that is the noble Lord’s understanding of where we are going with this amendment, that understanding is correct.

The noble Lord, Lord Birt, spoke about the risk of both underregulation and overregulation. This is about balance; we have added a new regulatory principle to achieve this aim, but we still think this will mean that the regulator will be effective. This is key, as both the noble Lord, Lord Birt, and the noble Lord, Lord Addington, made clear. The first part of this new principle of considering

“whether the requirement or restriction is necessary”

directs the regulator towards a light-touch approach to intervention as a whole, acting only where it needs to. I do not think we are a million miles away from where the noble Baroness, Lady Brady, thinks we should be, and I am happy to meet with her again to talk this through a bit further should she find that helpful.

The second part of the new principle ensures that any intervention that is considered necessary is as light-touch as possible by directing the regulator towards the least burdensome mechanism available in the specific circumstances of the outcome sought. Amendment 18 facilitates the regulator to take a different approach to clubs, alongside the proportionality principle, to ensure that each action taken by the regulator is the least burdensome it can be. We have not chosen to call that light-touch in the regulation, but it is intended to be light-touch. With that, I commend Amendment 17 to the House.

Amendment 17 agreed.

Moved by

[Baroness Twycross]

18: Clause 8, page 6, line 9, at end insert—
“(ba) it should, before it imposes any requirement or restriction on a person, have regard to whether the requirement or restriction is necessary and whether a similar outcome could be achieved by less burdensome means;”Member’s explanatory statement
This amendment includes a regulatory principle that the IFR should, before it imposes any requirement or restriction on a person, have regard to whether it is necessary and whether a similar outcome could be achieved by less burdensome means.

[Baroness Twycross (Lab)]

I beg to move.

Amendment 19 (to Amendment 18) not moved.

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Moved by

[Baroness Twycross]

20: Clause 8, page 6, line 13, leave out “recognises” and insert “has regard to”
Member’s explanatory statement
This amendment makes a minor drafting change to the regulatory principle in clause 8(d).

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[Lord Markham (Con)]

Given the late hour, I will speak briefly in support of these amendments. As the noble Lord, Lord Birt, quite rightly said, the value of the global rights is now greater than the value of the domestic rights. Of course, it is the rights money that affords the best players in the world. We have put out this stat before: the Premier League has 44% of the best players in the world, which makes it the most exciting, which creates a virtuous circle and grows the rights. It is entirely proper that the global appeal should be recognised in the “state of the game” report. We wholeheartedly support the amendments.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Birt, for his amendment. I am grateful for the huge amount of time and effort that the noble Lord has put into considering how we could all further improve this legislation. I also thank him for the amount of time he has given to discussing it with my officials and me over many weeks.

This amendment would see the regulator having to provide an overview of English football’s global appeal in the “state of the game” report. The report is focused on the issues affecting English football so far as relevant to the exercise of the regulator’s functions. The issue that this amendment intends to capture will likely already be captured in the “state of the game” report, as it could impact the regulator’s objectives and duties. We have purposely left the required content of the “state of the game” report broadly to the regulator’s discretion to ensure flexibility and independence. It would not be possible to list every issue worth including, as the list would be too long and doing so would remove the regulator’s ability to prioritise issues and to adjust them over time.

Amendment 22, requiring an updated “state of the game” report if the backstop is triggered, could place a significant burden on the regulator, and might slow the process down significantly. In our view, three months would definitely not be long enough to update a review of English football, given the breadth and depth of relevant issues it must cover. The regulator has to identify the analysis needed, request it from parties, let them respond, analyse it and consult on findings before publishing.

We also have to consider the significant burdens this amendment would place on the regulator, but particularly on smaller clubs. Furthermore, an updated “state of the game” report would be required solely if an application to trigger the backstop was put forward, regardless of whether that application was accepted. Ultimately, a three-month delay in the backstop process, with the burden on both the regulator and the industry to engage with a rushed updated review, would likely be disproportionate to the benefits. I therefore hope the noble Lord will withdraw his amendment.

[Baroness Evans of Bowes Park (Con)]

When the backstop first has to happen, the “state of the game” report is critical as part of the process. Is the noble Baroness now saying that for any future triggering of the backstop, the “state of the game” report is not part of that process? We thought she had said that it was always part of the triggering process. I may have completely misunderstood, so if the noble Baroness could clarify that, it would be really helpful.

[Baroness Twycross (Lab)]

The issue is whether there would automatically be a “state of the game” report simply because of a request to trigger the process. Once a “state of the game” report is in existence, it may or may not be necessary for it to be updated if somebody triggers the process. In our view, the automatic triggering of an updating of the “state of the game” report is disproportionate. There would already be a report in place. We absolutely intend for a “state of the game” report to be in place before an initial process is triggered. Clearly, it would have to be written within the relevant timeframe in the legislation.

[Lord Pannick (CB)]

May I suggest to the Minister that five years is an awfully long time between “state of the game” reports? That may be the defect here. The game can and does change immeasurably within a period of five years. Perhaps the Bill team and the Minister could consider, when the Bill goes to the other place, whether it might be more appropriate to have a more regular update on the “state of the game” report, perhaps every three years.

[Baroness Twycross (Lab)]

I will take that point away and return to this issue with noble Lords. My view is that it does not necessarily need to be more frequent, but we can discuss that further.

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[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Addington, for his amendments in this group. As the Minister for Gambling, I acknowledge the importance of monitoring the impact of gambling sponsorship in football. Indeed, the noble Lord has raised this with me on a regular basis. I absolutely agree that, where gambling advertising and sponsorship appear in relation to football clubs, they must do so in a socially responsible way. The cumulative impact of gambling advertising, specifically around football, is, as I said, raised with me frequently.

I have already set the gambling industry, relatively recently, a task to raise standards to ensure that gambling advertising more widely is both proportionate and appropriate. This work will be monitored closely. It is fair and reasonable for the Government to challenge the sector to make self-regulatory improvements first. In our view, this can deliver positive change more quickly. The Premier League has already made a decision to ban front-of-shirt sponsorship by gambling firms by the end of next season, and many clubs, as highlighted by my noble friend Lady Taylor, already do not take sponsorship or advertising by gambling firms.

All major sports have also published their gambling sponsorship codes of conduct, which set minimum standards for gambling sponsorships within sport. We will work with sports bodies to undertake a review of the implementation and impact of the codes of conduct to ensure they are effective. This review will provide key evidence to inform the most appropriate next steps. However, we do not believe the regulator should have a specific role in commercial matters such as advertising and sponsorship, which are rightly decisions for clubs.

It is important to recognise the vital revenue that many clubs currently rely on via advertising and sponsorship from gambling firms, as highlighted by the noble Baroness, Lady Fox of Buckley. We have to be wary of scope creep that sees the regulator straying into matters that should be reserved for the industry and stepping on the toes of industry authorities such as the FA and other regulators that have a remit over this area of policy.

On Amendment 29, current drafting already requires fan engagement on clubs’ business priorities and strategic approach. Discussion of a club’s overall approach to sponsorship could reasonably play a role in these consultations. We do not, however, think it appropriate for the regulator to require specific fan engagement on gambling advertising and sponsorship specifically, especially as it would not be relevant at all clubs, such as those with no gambling sponsors.

On Amendment 53, what constitutes the promotion of gambling could be interpreted extremely widely, such as players not being able to take part in competitions that have gambling sponsors. Clearly, this would, or could, have significant unintended consequences for clubs and the sport more widely.

On Amendment 23, a review of gambling advertising and sponsorship in football should not, in our view, be the responsibility of a regulator with a specific remit of the kind intended by this legislation. As I have set out, the Government are already taking action in this space in conjunction with the industry and governing bodies in football and other sports. This will review the implementation and impact of the codes of conduct to ensure they are effective. If further action on sponsorship and advertising is needed, we will take it, but for the reasons I have set out I hope the noble Lord will withdraw his amendment.

[Lord Addington (LD)]

I thank the noble Baroness for her response. However, it seems to be, “Yes, something should be done—at some point in the future, we will definitely do something”. I do not really think that we can carry on like that. We have to try to do something as quickly as possible, because the combination of the smartphone and the universal web means that the temptation to gamble is constantly with us. It is something that we have not addressed properly. Most of our regulation is designed for a day before the smartphone, so I hope that we will do something now.

As I said, a series of amendments was put down to give a series of options for the Government. The Government have decided not to bite. So I give fair notice that I will be pressing Amendment 53 when the time comes, but I beg leave to withdraw Amendment 23, standing in my name.

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Moved by

[Baroness Twycross]

24: Clause 11, page 7, line 26, leave out “three” and insert “five”
Member’s explanatory statement
This amendment changes the minimum frequency of revised football governance statements from every three years to every five years.

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Moved by

[Baroness Twycross]

30: Schedule 4, page 97, line 27, leave out paragraph (b) and insert—
“(b) any emblem or crest of a relevant team operated by the club;(ba) the predominant home shirt colours of a relevant team operated by the club;”Member's explanatory statement
This amendment adds a reference to a team’s “emblem” alongside “crest”, to avoid confusion with the heraldic use of the term “crest”.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Parkinson, for his passion for heraldry and the interesting discussions we have had on this topic in Committee and afterwards. The Government absolutely agree on the importance of this legislation being able accurately to protect club heritage. That is why officials have worked closely with the College of Arms, and I thank it for its engagement. In doing so, we have ensured that the legislation remains in step with both the FA’s heritage guidelines and heraldic terminology. The Government have tabled Amendments 30 and 49 to expand the references from “crest” to “crest or emblem”, and the noble Lord has my commitment that we will add additional clarity in the Explanatory Notes which accompany the Bill. We will include language to the effect of the noble Lord’s Amendment 80 in the Explanatory Notes.

Turning to government Amendments 48 and 79, I would like to thank my eagle-eyed noble friend Lord Bassam again for raising awareness of the consistency of drafting in Clause 46. We absolutely agree that it is best for language to be consistent where possible. That is why we are bringing forward this amendment to align drafting. I would like to reassure noble Lords that this change has no impact on the policy; none the less, it is a change we are welcoming. I beg to move.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, for reasons I cannot fathom, our debates on heraldry always seem to come late in the evening. But I am delighted to see that it is commanding such interest from the Government Benches this evening. I take that as great encouragement.

I thank the Minister and her officials, who have taken a number of meetings and had a number of conversations on a subject that might seem recherché but is important not just to me but to the College of Arms and, indeed, to many who have been following the Bill. As I set out in Committee, this point was raised on social media; in a very new medium, an ancient problem was highlighted.

Some might think that the use of correct heraldic terminology is trivial, but it is my firm view that it is not. Not only should we generally aim for precision in the language we use in legislation but where the provisions of the Bill, and indeed the actions of the regulator, may intervene in the activities of a body as venerable as the College of Arms, we need to ensure that we get it right.

I welcome the good will that is reflected in the fact that the Government have brought forward some amendments, but I am afraid we have not quite got there yet, which is why I have risen to speak to my Amendment 80. To briefly summarise what I set out in Committee, the problem in government Amendment 30, which the Minister has just moved, is the term “crest”—which some will take to be the badge part of a coat of arms but is in fact what appears above it. The word “crest” is repeated in the explanatory statement to Amendment 30, where the Minister has said:

“This amendment adds a reference to a team’s ‘emblem’ alongside ‘crest’, to avoid confusion with the … use of the term ‘crest’”.


It is better to avoid that confusion by not using it, hence the amendment I brought in Committee suggesting that we should properly call it a “badge”. We are repeating the incorrect term, which is the problem that I and the College of Arms have been raising with the Government.

During the meetings we have had, we have been trying to land this point with the Government but have not quite been able to get there. I am aware that correspondence was had with the Minister’s department only today, following up the points. I know the college welcomes what she is going to put in the Explanatory Notes, as do I—that is very helpful—but it is looking for a saving clause that simply asserts, or reasserts, the authority of the Kings of Arms over armorial bearings. That is the sticking point that I hope we might yet be able to resolve on this matter.

As I understand from the College of Arms, the department’s argument is that the regulator does not approve the content or substance of a proposed club badge but merely decides whether it went through the required process of consultation under the Bill. The department argues, therefore, that there is never any risk of the regulator straying on to the college’s turf since the regulator is not involved in the question of what a badge consists of or looks like. The Government argue that that is why nothing is needed. Rather perversely, they argue that a saving clause would create the impression that there is a conflict here, but that misses the point. When taken as a whole, the Bill does create approval for a badge, which it incorrectly calls a crest, albeit via consultation with fans and others. The Bill creates a mechanism for the approval, and indeed disapproval, of a badge—mistakenly called a crest—in statute. That cannot fail to create a sense that, at some level, the badge that has gone through the process has achieved some kind of authorised status.

In Committee we discussed the examples of problems that may occur. In lots of local authorities, a football club uses the same or a similar coat of arms as the local authority. If there were to be a conflict between that local authority and that club about the proper use of it, the College of Arms would be asked to step in and adjudicate. So there is a risk that the Bill unwittingly encroaches on the Crown’s prerogative in regard to heraldry. This is not the same as trademarks, but in the case of coats of arms we are talking about the Crown prerogative, which surely limits the extent to which parallel clauses for other parties are required.

What the College of Arms is asking for, and what I am suggesting in my Amendment 80, is not unusual. There are plenty of examples of saving clauses in other legislation; for instance, Section 33 of the Immigration Act 1971. My Amendment 80, which the college hopes to see put on the face of the Bill, not just in the Explanatory Notes, would follow the well-established precedent of protecting with absolute certainty the rights of the Kings of Arms.

All of us who have come into your Lordships’ House have taken our first steps in this Chamber following, slowly and reverently, the footsteps of the Garter Principal King of Arms, an office that has existed since 1415. We went to see him at the College of Arms, to seek agreement for our very names and titles. We have sworn an oath of allegiance to the sovereign that it is his solemn duty to proclaim at the moment of accession. So I hope that we can give him a few moments of our attention, even at this late hour and at this late stage of the Bill.

The saving clause that I have proposed, drafted in general terms, will not create the impression that the regulator will be involved in considering the substance of designs—or anything else, for that matter. I believe it is a simple but important amendment, which I very much hope the Minister will be able to accept. Happily, if there should need to be a Division on my Amendment 80, it would not come tonight but on day 2. I hope that, if she is not able to give that reassurance now, she will be able to take it away, reflect on it further—particularly in the light of the correspondence that I know she and her department have had today—and avoid the need to divide on this.

I am very grateful for the time and attention that the Minister has given, and for the improvements that we have had already. This final insertion really is the matter that would allay the concerns of the College of Arms and, therefore, my concerns as well. I beg to move.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Parkinson, again for his engagement on this matter and for his amendment.

We genuinely do not think that this matter is trivial but we do believe that the language in the noble Lord’s amendment would be a redundant addition to the legislation; we do not think that it is required. This is because, aside from the terminology used regarding the club emblems, the regulator’s powers are not expected to interact with the College of Arms and, therefore, the powers of the Kings of Arms.

Indeed, the regulator will ensure that fans have been properly consulted on proposed changes, but it will not be for the regulator to approve designs, only the process of clubs working with fans. This is rightly for other organisations, including the College of Arms, but also the Intellectual Property Office and other bodies.

As the regulator has no role in what the crest or emblem looks like, nor whether it infringes on any trademarks or copyright, it is implicit that the relevant body’s decision will supersede any related action by the regulator. There are many instances where the regime has been designed specifically not to conflict with existing powers and processes, such as law enforcement investigations or HMRC business requirements. However, it is unnecessary and unconventional practice for all parties that may work on parallel issues to the statutory body to be listed.

I hope that, through the changes we have made, and through further explanations in the Explanatory Notes, the noble Lord will be reassured that the sanctity of the College of Arms will be preserved. I am happy to meet him to discuss this further but, for the reasons that I have set out, I hope that he will withdraw his amendment. I hope that noble Lords will support these government amendments. I beg to move Amendment 30.

Amendment 30 agreed.

Football Governance Bill [HL]

Baroness Twycross Excerpts

Report stage
Monday 17th March 2025 Lords Chamber

[Lord Parkinson of Whitley Bay (Con)]

My Lords, although I am mindful of the rules of debate on Report, I am sure that noble Lords will understand if I preface my remarks with a short, two-hour encomium to Newcastle United, congratulating them on their victory in the Carabao Cup, their first domestic trophy in 70 years—that is longer than the living memory of any of my relatives. That is an area on which I know the Minister and I are in full agreement. I am mindful that other noble Lords were present at Wembley yesterday and hoping for a different result, so I shall not go on about it, other than to say that I hope that anyone who had the pleasure of being on the London Underground yesterday was as delighted as I was to see all the lads and lasses there with smiling faces and will join me in sending hearty congratulations to the Newcastle fans, who have waited so very long for this moment.

The Government’s new corporate governance provisions have, I think it is safe to say, received considerable attention during our debates on this Bill. My noble friend Lord Jackson of Peterborough has just set out the concerns of many on these Benches very powerfully, and the noble Baroness, Lady Fox of Buckley, has echoed them and added her own concerns.

I have been very clear throughout the passage of the Bill that we on the Opposition Benches are not persuaded by the changes the Government have made to the Bill, compared to the version we put forward in the last Parliament. As I said in Committee, we do not believe that the additions the Government have made in this area are necessary either. The Bill already has strong corporate governance requirements, mandating a corporate governance statement as part of the licensing process, and that is in addition to the rules already enforced by the Football Association and competition organisers.

Regardless of whether one believes that prescribed EDI policies would improve the operation of clubs and football in this country—and as we can see from the short debate we have had again today, that is by no means a settled view—clubs already have to comply with similar rules and, in many cases, voluntarily go further. The noble Lord, Lord Bassam, alluded to some of the work they do, and my noble friend Lady Brady mentioned it in more detail in our debate in Committee. Mandating further policies and action to promote equality, diversity and inclusion is, therefore, a clear example—we think—of unduly onerous regulation which has little to do with financial stability. The Minister has been clear throughout our scrutiny that this is intended to be a sustainability regulator.

Our concern is that placing new EDI duties in the Bill and, therefore, tasking the regulator with concocting rules to that end would increase the risk of mission creep, which we have all been very concerned about. We are clear that this will end up meaning more, not less, regulation. At a time when the Prime Minister is promising to clear out the regulatory weeds, and the Chancellor is writing letters to regulators asking them to promote economic growth, we should be aiming for fewer regulatory burdens, not more.

I shall say a few words about Amendment 34, which my noble friend Lord Markham outlined the case for, which relates to independent non-executive directors. We had a strong cross-party exchange on this topic in Committee, when amendments to the same effect were tabled by the noble Lords, Lord Knight of Weymouth and Lord Blunkett. They were evidently satisfied with the Minister’s response, so they have not brought them back, but I am glad that my noble friend Lord Markham has tabled his. I am very grateful to the Minister for taking the time to discuss this issue with both of us, as I believe she also did with a number of other noble Lords who raised it in Committee. She kindly copied us in to the letter she sent to the noble Lord, Lord Knight of Weymouth, about it, but I look forward to any further reassurances she is able to give on Amendment 34.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

I join the noble Lord, Lord Parkinson of Whitley Bay, in his congratulations to Newcastle United, and I offer commiserations to Liverpool and its supporters. Good football is always a joy to watch, but only one side can win; I feel for those who put in all their effort and did not go away smiley-faced.

I want to address one of the points raised by the noble Lord, Lord Jackson of Peterborough, in relation to reports in the media this morning. The noble Lord should be mindful of the old adage that you should not believe everything you read in the newspapers. Your Lordships’ House has heard at length during the Bill’s passage that too many football fans have been left with nowhere to turn when faced with reckless owners, financial mismanagement and threats to their club’s very existence. That is why the Government remain absolutely committed to introducing an independent football regulator to put fans back at the heart of the game.

We had extensive discussion on the topic of equality, diversity and inclusion in Committee, when a number of noble Lords opposite aired their considerable concern over what is a very standard addition to almost all corporate governance codes. I am sure that the noble Lord, Lord Jackson of Peterborough, and the noble Baroness, Lady Fox of Buckley, will not be surprised to know that I do not agree with them. The Government have not changed our view that equality, diversity and inclusion is a key part of good corporate governance. Research has shown that diversity on boards and in organisations promotes better governance, decision-making and transparency, all of which in turn contribute to improved financial sustainability.

We heard in Committee about the vital work that the industry is already undertaking in this area. The regulator will look to work co-operatively with other stakeholders, to draw on the expertise of the sector and to add to industry initiatives through the code. As with fan engagement, this will be a statutory baseline.

The noble Lord, Lord Jackson, referred to the Green and Hand report, which was forwarded to me —I am very grateful to the noble Lord, Lord Moynihan of Chelsea, for that. I appreciate that the noble Lord, Lord Jackson of Peterborough, noted the findings of Green and Hand regarding McKinsey studies into the relationship between EDI and corporate performance. I recognise that the assessment refutes the link between ethnic diversity and financial performance. However, it remains my view that the relationship between diversity and improved corporate performance is well established and accepted beyond the studies of McKinsey alone. For example, both the Financial Reporting Council and the Association of Chartered Certified Accountants acknowledge this relationship. Clubs that already champion equality, diversity and inclusion will not have an additional burden placed on them, other than having to periodically report on these things.

My noble friend Lord Bassam of Brighton outlined a number of issues that remain within the game. Under the corporate governance code, clubs will simply be required to explain how they are applying the code and what action they are taking on equality, diversity and inclusion—nothing more. As suggested by the noble Lord, Lord Addington, that does not feel onerous, but it is a helpful and transparent measure, in the Government’s view, and I refer noble Lords to the points made by the noble Lord, Lord Pannick. As I have said previously, the regulator is not going to prescriptively micromanage each club’s board, or set targets and quotas on EDI. That is not the role of the regulator, and would be a significant burden on both the regulator and clubs.

Turning to Amendment 34, in the name of the noble Lord, Lord Markham, I thank the noble Lord for this amendment and for his engagement on this, along with a number of other noble Lords. I particularly thank my noble friend Lord Knight, who has been a strong advocate on this issue and has met me to discuss it. I wrote to him about it, as the noble Lord, Lord Parkinson of Whitley Bay, mentioned, and I would be happy to lay a copy of this letter in the Library of the House.

As I outlined in the letter, we are fully in agreement with the principle of independent non-exec directors. We recognise that they can greatly improve decision-making, provide independent scrutiny and drive up corporate governance standards. This supports the regulator’s objective of better financial soundness, stability and decision-making for football clubs. However, while we agree with the principle, we do not feel it is right to include this detail in the Bill. We do not believe that the Government should be writing the corporate governance code, or making detailed recommendations on how a club’s board should operate. Indeed, no corporate governance code is written in primary legislation; this helps ensure flexibility and future-proofing.

We are setting up an independent, specialist football regulator, which will have in-depth knowledge of the unique challenges of football club governance. It will be for the regulator to then develop, consult on and ultimately publish this code. This approach enables consultation with industry, including clubs, which is essential to ensure that it is appropriate for the football industry and that it can be adapted in the future to reflect best practice. However, I again assure noble Lords that we fully expect the regulator’s code to include detail and guidance on independent directors. This is the norm for all corporate governance codes, and we do not expect the regulator’s code to be any different.

I think there is broad agreement on the importance of independent non-exec directors, and I thank noble Lords across the House for the interest shown in this issue. I hope that the reassurance I have provided will satisfy any concerns that INEDs will not be included in the corporate governance code. I therefore hope that noble Lords will not press their amendments for the reasons I have given.

[Lord Jackson of Peterborough (Con)]

My Lords, I thank all noble Lords for their contributions to this short debate, particularly the thoughtful remarks from the noble Baroness, Lady Fox of Buckley. I will briefly correct the assertion made by the noble Lord, Lord Bassam. I have not tabled an amendment that is against EDI; it is against a compulsory and costly duty enshrined by the corporate governance document in the Bill. That is a separate thing. I am disappointed that no noble Lords, except the Minister, actually engaged with the evidence that both the noble Baroness, Lady Fox of Buckley, and I have put forward.

There is one point that I would challenge the Minister on. Once again, despite being challenged in the letter from my noble friend Lord Moynihan of Chelsea, and by me today, she has yet to come forward with any alternative to the McKinsey study showing evidence that EDI improves the bottom line in business, let alone the football world. That is a very important issue.

The Minister was right when she said we have had a good and lengthy debate on this issue over many weeks, both before Christmas and this year. Notwithstanding that, I do not think she has answered the specific questions we have raised. On that basis, I would like to test the opinion of the House.

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Moved by

[Baroness Twycross]

32: Schedule 5, page 99, line 36, at end insert—
“(ca) how the club contributes to the economic and social well-being of the local community with which it is associated,”Member’s explanatory statement
This amendment makes a club’s contribution to the economic and social well-being of its local community part of its corporate governance.

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[Lord Pannick (CB)]

I will add just two comments, the first on Amendment 35 on the women’s game. It is plainly at a very sensitive stage of development and we would all wish to encourage that development. My concern is that including Amendment 35 might perversely deter some clubs from investing in women’s football, and that would be most unfortunate indeed.

In relation to Amendment 36, to which the noble Lord, Lord Parkinson, just spoke, this is an exceptionally vague provision: the idea that the regulator should have power in relation to discretionary licence conditions where there is

“conduct which it reasonably suspects to be harmful to the interests of the United Kingdom”.

This would be very difficult to apply and would lead to all sorts of probably legal arguments on what this means. In any event, it is a power that would be given on the basis of reasonable suspicion. That is most unfair to the clubs concerned, because there might be a reasonable suspicion that is not justified. As always, I declare my interest as a practising lawyer, partly in sports law, acting in particular for Manchester City in current disciplinary proceedings.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Parkinson, Lord Goddard of Stockport and Lord Moynihan, and the noble Baroness, Lady Grey-Thompson, for tabling amendments, and my noble friend Lord Grantchester for moving, in her unavoidable absence, the amendment tabled by the noble Baroness, Lady Grey-Thompson.

I welcome in particular the opportunity to discuss the women’s game and to set out the Government’s position on it, not least in relation to this Bill. I know that the noble Baroness, Lady Grey-Thompson, was keen to have a debate on the women’s game and frustrated that we did not have one at earlier stages, so I am sorry that she could not join us. However, I hope that I can give all noble Lords who have spoken in support of the women’s game the assurance that the Government really do want to see women’s football in this country thrive.

Recent years have seen incredible growth in the sport, catalysed by the amazing success of our Lionesses. I know that all noble Lords are hugely proud of their achievements. We understand why there is an interest in ensuring that women’s football is accorded some of the same protections that the Bill would deliver for the men’s game. As someone who was not allowed to play football at school, I am delighted that my nieces take it absolutely for granted that they are, so this is an area that I personally want to see grow and thrive.

My noble friend Lord Grantchester spoke passionately in favour of the women’s game. We agree with the independent review of women’s football that he noted, and which was expertly chaired by Karen Carney. As my noble friend stated, that review recommended that the women’s game should be given the time, space and opportunity to grow and govern itself. So, while there are some shared features, the problems facing women’s football and men’s football are not the same. The Government are in regular contact with the Women’s Professional Leagues Ltd. We are confident that it will be able to implement the structures, processes and regulations to drive the sport forward. Where appropriate, this can involve taking learnings from the men’s game and the regulator.

I reassure my noble friend that, as with all regulation, the scope of the regulator will be kept under review. As it is not intended in the first instance for the regulator to cover the women’s game, the “state of the game” report will consider only matters in scope of the regulator. However, if appropriate in the future and following proper consultation, the regulator’s remit could be extended to include women’s competitions via secondary legislation.

To expand slightly on why we are not at this point intending to regulate the women’s game, it is by its own admission at a different stage from the men’s game. It is still in a start-up phase, needing significant investment and growth to achieve its potential. The men’s game, by virtue of being a more mature commercial product, has no issue with growth or investment. Its issue is that it spends unsustainably, accumulates debt and cannot keep the massive revenues that it raises within the game. Therefore, neither the Government nor the women’s football industry believes that statutory regulation is the correct approach to helping women’s football at this stage.

The noble Lord, Lord Moynihan, alluded to issues that might be prevented. I will refer to the specific example of Reading Football Club. I do not want to assume that the noble Lord was referring to it as an example of where the regulator might have helped. Currently, the women’s game is not intended to fall within the regulator’s initial scope, so the regulator could not have directly prevented funding to Reading Football Club Women being cut. However, importantly, it would have been able to address financial problems at the men’s club, which may have averted the issue. So it is an indirect benefit, potentially. It would also have had access to information that it could have shared, only in certain specific circumstances, with the authorities in the women’s game. This might have allowed them to identify and react earlier to an issue and protect the women’s team. So we are confident that the authorities responsible for governing the women’s game will be able to implement the appropriate protections to prevent a future similar scenario to that which happened in Reading.

Amendment 36 would allow the regulator to stop a club accepting funding that it reasonably suspects to be harmful to the interests of the United Kingdom. I know that protecting football from wider harms is important to the noble Lord, Lord Parkinson of Whitley Bay, as it is for us all. I agree with the intent and thank him for his engagement on this. However, it is not for a football regulator to judge what is harmful to the interests of this country; indeed, this is what the UK’s financial sanctions regime is for. If there is an oligarch or bad actor with connections to a hostile state acting against UK interests, they can be sanctioned. That would automatically stop a club receiving funding from the party in question. Sanctions can be imposed for a whole range of reasons, including in the interests of national security.

Beyond this, the Bill already provides protections against wider harms. The owners’ and directors’ test, for example, will look at the fitness of a club’s owners and officers, including sanctions, and whether the individual has been prevented from entering the UK. This seeks to protect English clubs from unsuitable owners or officers. In conjunction with the power to restrict funds suspected to be connected to serious criminal conduct, this will help to ensure that clubs are protected from harm.

I thank the noble Lord, Lord Goddard of Stockport, for his Amendments 38 to 41 and his continued engagement on the Bill. I have written to the noble Lord on some of the points he raised on discretionary licence conditions and the commitments in lieu process, and I am happy to lay a copy of this letter in the House Library for other Members of your Lordships’ House to access as well. As I outlined in that letter, we feel that it is appropriate for competition organisers to have a formal opportunity to intervene on a financial issue if they could achieve the same goal in a more effective and less burdensome way. This commitments in lieu process encodes the light-touch and collaborative approach that we have discussed at great length in your Lordships’ House.

The Bill as drafted allows clubs ample opportunity to make representations about proposed financial discretionary licence conditions. As part of ongoing supervision by the regulator, clubs will be made aware of what potential action the regulator may take to improve the clubs’ standards. However, if a competition organiser proposes a commitment that the regulator believes would solve the issue in a quicker, more effective or more proportionate manner than the regulator’s proposed licence condition, the club should not be able to veto this.

I turn to Amendment 95 in the name of the noble Lord, Lord Parkinson. We understand the intention of this amendment, and we agree that the regulator should avoid any burdens or disruptions that may be associated with mid-season licensing of clubs, including the risk, albeit remote, that licences are refused mid-season. As currently envisaged, once the regulator is set up, it will make rules around how and when clubs need to submit their applications. The noble Lord’s amendment would prevent the entirety of Part 3 being commenced until the period between seasons. For example, if the regulator were ready to start preparing clubs for licensing in September in a given year, it would have to wait until the following May before it could do so. We want clubs to be able to prepare their application and engage with the licensing process early to avoid a rush and high burdens in the relatively short window between seasons. This amendment would prevent that.

By contrast, if commenced properly, there will be a substantial onboarding time for clubs, and the regulator will not have to process 116 applications in a short space of time. The noble Lord’s intention of avoiding mid-season disruption can be achieved through a careful commencement of Part 3. We intend to delay commencing the Clause 15(1) requirement on clubs to have a licence until all clubs have had the necessary opportunity to obtain one.

On Amendment 96 in the name of the noble Lord, Lord Moynihan, I understand that the noble Lord’s view is that the Secretary of State guidance on significant influence and control is integral in providing certainty for the industry, and that it must be produced in a timely manner. That is why, last week on Report, I committed

“that the Secretary of State’s guidance will be produced before clubs are required to identify their owners who meet the definition of having significant influence or control”.—[Official Report, 11/3/25; cols. 626-27.]

I would like to reiterate this commitment and reassure the noble Lord that it would be superfluous in this instance to make this amendment. Additionally, I remind the noble Lord that the House made its view on the definition very clear when it voted against Amendment 7. I hope he will agree that it would be an inefficient use of the House’s time to discuss this issue any further and will take reassurance from the commitment I have already made.

I turn finally to government Amendment 37. A number of noble Lords have raised concerns regarding consultation requirements and discretionary licence conditions. We are making a change to the consultation requirement that the regulator must satisfy before submitting a request to the Secretary of State, to amend the scope of discretionary licence conditions. We were confident that the previous drafting would have captured clubs and competition organisers, but we have listened to concerns across the House about this not being stated explicitly. Therefore, we have brought forward this amendment to put this beyond all doubt and address those concerns. As a result of this amendment, the regulator will now be required in legislation to consult all regulated clubs and each specified competition organiser in this process.

For the reasons I have set out, I hope the noble Lords will not press their amendments.

[Lord Grantchester (Lab)]

I thank all noble Lords who have spoken in this little debate on this group of amendments. Although I would have welcomed a little further development from my noble friend, I certainly understand her response. I also understand the comment from the noble Lord, Lord Pannick, to which I respond merely that if a men’s club does not believe in women’s football, it certainly should not invest in it. With that, I beg leave to withdraw the amendment.

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Moved by

[Baroness Twycross]

37: Clause 22, page 15, line 14, leave out “such persons as the IFR considers appropriate” and insert “—
(a) all regulated clubs,(b) each specified competition organiser, and(c) such other persons as the IFR considers appropriate.”Member’s explanatory statement
This amendment requires the IFR to consult clubs and competition organisers, in addition to other persons it considers appropriate, before making a request to the Secretary of State to make regulations amending the types of discretionary licence condition set out in clause 22(1), (2) and (3).

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Moved by

[Baroness Twycross]

48: Clause 46, page 38, line 39, leave out “carries on an activity” and insert “takes any step”
Member’s explanatory statement
This amendment corrects a drafting inconsistency in clause 46.

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Moved by

[Baroness Twycross]

49: Clause 49, page 40, line 27, leave out from “to” to end of line 28 and insert—
“(a) any emblem or crest of a relevant team operated by the club, or(b) the predominant home shirt colours of such a team,”Member’s explanatory statement
This amendment adds a reference to a team’s “emblem” alongside “crest”, to avoid confusion with the heraldic use of the term “crest”.

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Moved by

[Baroness Twycross]

51: Clause 53, page 43, line 19, at end insert—
“(8A) If levy rules make the provision mentioned in subsection (8)(b), they must provide—(a) for the rate at which interest is charged not to exceed an annual percentage rate of 5% plus the Bank of England base rate,(b) that the IFR may charge interest at a rate determined by the IFR that is lower than the rate that would otherwise be applicable under the rules, where the IFR considers that appropriate, and(c) that the IFR may disapply a requirement for interest to be charged, where the IFR considers that appropriate.”Member’s explanatory statement
This amendment caps the rate of interest on late levy payments that the IFR may provide for in the levy rules at an annual percentage rate of 5% plus Bank of England base rate and gives the IFR discretion to charge a lower rate of interest or no interest in particular cases.

[Baroness Twycross (Lab)]

My Lords, I rise to speak to a package of government amendments: Amendments 51, 78, 86 and 88. I will speak to other amendments in this group in my closing remarks. The government amendments follow constructive discussions with the noble Lord, Lord Markham, who proposed an upper limit on interest that can be charged by the regulator on missed levy payments. Our amendments will impose a limit of the Bank of England base plus 5%. We believe this strikes the right balance between deterring non-payment and preventing undue burden. It also provides greater internal consistency within the Bill; the rate used for this upper limit is the same applied to missed financial penalty payments. With this amendment the regulator will maintain the discretion to set the interest for missed levy payments and could therefore set it lower than this cap or disapply it entirely. I hope this satisfies the noble Lord’s concerns on this issue, and I beg to move.

[Lord Markham (Con)]

My Lords, Amendment 52 seeks to reverse one of the more surprising changes to the Bill. The previous Conservative version stated that the regulator must consult on all changes to the levy rules. This seemed fair and proportionate. If the regulator is to change how it charges the levy or how much it wishes to charge, it seems pretty reasonable that those who will bear the burden of that charge are consulted.

The changes introduced by the Government provide that the regulator does not have to consult if it considers those changes to be minor. The issue is that the definition of “minor” is to be determined by the regulator. What would happen if the regulator tries to claim that somehow a change is “minor”, but other interested parties do not agree? Is there not the possibility here for the regulator to skirt around important consultations by simply claiming that the changes it is proposing are not significant enough to warrant discussion? The problem here is that this could create endless discussions about what warrants being termed “minor”. Surely it would be far simpler for the regulator just to consult on all changes, as was the case in the previous Bill.

Separately, it is welcome that the Government have accepted the principle that interest charged by the regulator on unpaid levy charges should be capped by the legislation. This was an amendment that my noble friend Lord Parkinson and I tabled in Committee. At the time, the Minister said that

“setting the rate of interest charged on non-payment of the levy is an operational decision for the regulator, which needs the flexibility to charge interest at a rate that deters non-payment”.—[Official Report, 18/12/24; col. 337.]

We disagreed with this assessment at the time. Although it is right that some flexibility is needed, it is not right that the regulator should be the one that sees fit to charge whatever it thinks is right. I am therefore very pleased that the Minister has changed her mind on that matter and brought a government amendment to this effect.

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[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Parkinson of Whitley Bay and Lord Goddard of Stockport, for their amendments.

Amendment 52 from the noble Lord, Lord Parkinson, would require the regulator to consult every regulated club, as well as the Secretary of State, the Treasury and others that the regulator considers appropriate, for minor changes to the levy rules. As noted by the noble Lord, Lord Pannick, the Bill is currently written so that consultation is not needed for minor changes to levy rules. This is intended to allow the regulator to make immaterial amendments or corrections without excessive bureaucratic burden. In the Government’s view, the amendment would add a layer of unnecessary process.

There is no need—and, I imagine, no great desire—for clubs to be made aware of every typographical or grammatical error that the regulator wishes to correct. I note the points raised by the noble Lord, Lord Markham, in his support for the amendment, and I can assure noble Lords that clubs will be properly consulted on matters that affect them. For all changes to the levy rules that constitute material changes, the Bill already requires the regulator to consult, amongst others, every regulated club.

Moving to Amendments 55 and 56 from the noble Lord, Lord Goddard, I completely understand the intention behind these amendments. A right of approval for the regulator over relevant competition organiser rules would enable the regulator to clearly maintain authority on matters within its remit and to manage any potential duplication or conflicts. However, the Government are firmly of the view that competition organisers should be free to implement their own rules autonomously. As membership organisations, they should be free to set rules on their members in pursuit of their own objectives, which are likely to be broader than the regulator’s.

Overreach by the regulator into the rules of competition organisers risks the kind of scope creep that UEFA has warned against. We are confident that the regulator will be able to work with competition organisers to manage any interactions between their rules and its own regulatory system without the need for an approval or veto power. As a result, we do not think the regulator needs the power to require additional information from competition organisers here either.

On the specific points raised by the noble Lord, Lord Goddard, the regulator will put in place the necessary minimum standards for all clubs in scope with statutory powers to enforce and maintain these standards. This would be business regulation of football clubs setting the statutory baseline they must meet to operate as football clubs in this country. Beyond this, competition organisers are free to set membership requirements on their member clubs. If they wish to layer additional requirements or processes on top of the regulated statutory baseline, they will be free to do so, providing that they are consistent with the law. Of course, it would be in no one’s interests to have unnecessary duplication, so we would perhaps expect the competition organisers to focus on other objectives and leave sustainability in this regard to the regulator.

In light of these points, and others, raised, I hope that the noble Lords will recognise the risks associated with their amendments and will be content not to press them as well as to support the government amendments.

[Lord Hayward (Con)]

Before the Minister sits down, I refer her back to the answer that she gave to my noble friend Lord Markham and the noble Lord, Lord Pannick. When I was chief executive of the British Beer and Pub Association, I had notification from the Treasury about a change on tax rules that it considered minor. The Treasury expected it to go through with no contest, but the brewing industry went berserk because the Treasury was unaware of the implications of what it was proposing. That is precisely what appears to be the case regarding the comments from my noble friend and the noble Lord, Lord Pannick: it cannot be for the regulator to judge whether something is minor or major, because it may well be unaware of the implication of what it is doing for one club or another, or for a group of clubs in one form or another. I find the Minister’s answer surprisingly inadequate.

[Baroness Twycross (Lab)]

I am sorry that the noble Lord finds my answer inadequate. I am happy to give further reassurance to noble Lords by asking the shadow regulator for some examples of what type of change it may see as minor.

[Lord Markham (Con)]

I thank the Minister for her comments, but I think it is the feeling of a number of noble Lords, particularly the noble Lord, Lord Pannick, and my noble friend Lord Hayward, that it cannot be right in principle that the regulator gets to be judge and jury on what is or is not consequential, particularly as it does not have the full knowledge that the clubs might have. The regulator might think it is minor, but it might make a real difference to the clubs. Therefore, at this point, we are minded to test the opinion of the House when we come to Amendment 52.

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[Noble Lords]

The noble Baroness cannot speak again on Report.

[Baroness Twycross (Lab)]

I thank the noble Lords, Lord Parkinson of Whitley Bay and Lord Markham, for tabling these amendments, and the noble Lord, Lord Markham, for speaking to them.

As discussed in Committee, the Government fully acknowledge that parachute payments are a significant part of football’s financial landscape. As the noble Lord, Lord Addington, made clear, this is part of the current landscape. However, it is precisely because of this importance that the regulator must be able to consider them as relevant revenue for the purposes of the backstop, especially if they are proven to be destabilising. How else could the regulator possibly make a fully informed and effective decision without a complete picture of football’s finances?

Amendments 57, 75, 76 and 84 all attempt to remove parachute payments from consideration under the backstop. They also remove the power for the Secretary of State to amend the definition of relevant revenue, preventing them ever being included in the definition of relevant revenue in the future.

In our view, these amendments are fundamentally short-sighted. I hear the concerns from the noble Baroness, Lady Brady, but we heard a very different alternative view from my noble friends Lady Taylor of Bolton and Lord Bassam of Brighton and the noble Lord, Lord Goddard of Stockport. Clearly, it is disputed within your Lordships’ House. If the effects of parachute payments are risking the sustainability of the wider pyramid, the regulator must have a lever to address the issue.

These amendments make the definition of relevant revenue less flexible, less able to address the changing landscape of football’s finances and, overall, less effective. The current power in the Bill allowing the Secretary of State to amend the definition of relevant revenue is balanced, requiring substantial consultation with the relevant leagues. Removing this instead leaves us with a static definition that is likely to become outdated over time. For the reasons I have set out, I ask the noble Lords not to press these amendments.

[Lord Markham (Con)]

I thank the Minister and all noble Lords for their comments. It has become clear in this heavily truncated debate, but taking on the major points that we spoke about in Committee, that all noble Lords care passionately about what we are trying to do here, and that between us we are all trying to find what we think will be the best solution for football overall.

My concern and the concern of my noble friends and many others is that if you damage the competitiveness of a lot of those Premier League games, it will result in less money being paid in media rights to the Premier League, which will mean less money to all the clubs in the pyramid. That is the real danger that we are talking about here.

To directly address the points made by the noble Lord, Lord Bassam, around the closed-shop nature of the Premier League, only five clubs have been in the Premier League for the whole of its existence, so that is not a closed shop, and 55% of all the clubs have been in the Premier League at some point.

Although the Minister’s comments were not unexpected, I believe that the previous version of the Bill that was presented by the then Conservative Government was better than the one before us today, and one of the major reasons for that is the changes around parachute payments.

I regret that, although the Minister understands the importance of all the amendments, she is not minded to accept our Amendment 70 as a genuine attempt to reach compromise and consensus on this issue. That means that the regulator can still, if it considers it correct, abolish those parachute payments in their entirety, which I truly believe would have a significant impact on the game and damage all 92 clubs. As a result, I am afraid that I am not satisfied by Minister’s response and, as I indicated earlier, I would like to test the opinion of the House on Amendment 57.

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[Baroness Twycross (Lab)]

My Lords, I thank the noble Lords, Lord Birt, Lord Pannick and Lord Burns, and the noble and learned Lord, Lord Thomas of Cwmgiedd, for tabling the amendments in this group. It is indeed an impressive team, as the noble Lord, Lord Pannick, stated. I particularly thank the noble Lord, Lord Birt, for his considered engagement and persistence, and for the time he spent considering ways in which we could improve the backstop process for the good of football, which is what the Bill is intended to provide.

I am grateful for the contributions from other noble Lords co-sponsoring the amendments and other noble Lords from across your Lordships’ House who have contributed to debates and engaged constructively during discussions and during this debate. We have had a series of productive meetings exploring some of the aspects of the model that were not discussed in detail in Committee.

If I may give a personal view, as someone who has learned a huge amount through the passage of the Bill and been on an incredibly steep learning curve, I think it is unfortunate that the tone and nature of the debate in Committee at times prevented these sensible discussions taking place on the Floor of your Lordships’ House. However, I am grateful to the noble Lord, Lord Birt, and others, as they have raised a series of important questions that have helped to inform our government amendments in this area. I genuinely appreciate his and other noble Lords’ time and expertise. I particularly appreciated how the noble Lords, Lord Birt and Lord Burns, viewed the draft legislation with the regulator and the regulated in mind, using their considerable relevant experience to provide fascinating and useful insights.

We have heard the view of the noble and learned Lord, Lord Thomas, with his experience in dispute resolution. The IFR needs effective tools and, as the noble and learned Lord said, the tools and the approach should be fair and careful. I add to his point that they also need to be seen to be fair.

The noble Lord, Lord Hayward, asked for a specific commitment. While I recognise his concerns, we do not think it would be possible to reach an agreement before the conclusion of Report or Third Reading in the Lords. Our current position is that, while we are sympathetic to the intent of the amendments tabled by the noble Lords and the constructive way in which they have engaged, their approach differs significantly from existing drafting. We therefore do not think there is enough time to conclude discussions on these important differences at this stage or before Third Reading. We kept the model—

[Lord Hayward (Con)]

I thank the Minister for answering as she has, but implicit in what she said is that the Government might find a way to introduce amendments when the Bill goes to the other place. Can I please seek clarification as to whether that is what she intended to say, or whether that was just something that would take it further down the road?

[Baroness Twycross (Lab)]

The only commitment I will give is the one I have in my speech. We do not think it is possible to reach an agreement before the conclusion of Report or Third Reading in the Lords. Our current position is that while we are sympathetic to the intent of the amendments, they differ significantly from the existing drafting.

As I started to say, we kept the model chosen by the previous Government. This model is intended to create the right incentives. A number of noble Lords, including my noble friend Lady Taylor, spoke of the intention behind the current model. The final offer mechanism is designed specifically to address unequal negotiations between parties with power imbalances such as those that naturally arise in the football industry. The noble Lord, Lord Addington, said it was designed for people not to get there. It is actually designed not to be used.

The process as it stands in the existing legislation heavily incentivises reasonable proposals, since an unreasonable proposal has a very high chance of rejection when compared to a more sensible competing offer. We must maintain this incentive—

[Lord Markham (Con)]

My Lords—

[Baroness Twycross (Lab)]

If I may, I will get through the points and finish; I am happy to give way if I do not answer the noble Lord’s point.

Our objective is to ensure that the backstop effectively pushes leagues to co-operate—the point that I think my noble friend Lady Taylor of Bolton was driving at. This was, and remains, the rationale for the existing drafting and model adapted by the previous Government, and in the Bill brought back by this Government to your Lordships’ House.

Alongside this, we want to ensure that the model is light touch—to echo a point made by the noble Lord, Lord Pannick—low cost, flexible and has a clear process. In considering strengthening the model, we must also ensure due consideration, and that appropriate engagement with the relevant stakeholders takes place.

We recognise the intent of the proposed amendments in supporting these objectives, including how the process is triggered, how mediation is conducted and how a final decision is made, including the criteria for a decision. I know that the noble Lords’ proposals have the best interests of football at heart and are based on the huge amount of experience of all those who have signed the amendments. The department will continue working to ensure that the backstop delivers the right balance and the right result for football. This is our shared goal.

I understand that the noble Lord may still wish to divide the House, given that I cannot give a firm commitment at this stage or commit to bringing something back before Third Reading. But throughout the Bill’s passage and consideration of amendments in the Commons, we are very happy to engage with the noble Lord, Lord Birt, and noble Lords who have signed up to his amendments, as well as with other noble Lords with an interest in this area, with the hope of reaching a more amenable compromise before Royal Assent. With that in mind, I ask the noble Lord to withdraw the amendment.

[Lord Markham (Con)]

If I may, I will make what I hope is a helpful suggestion. The Minister mentioned the lack of time ahead of Third Reading. It is my understanding that it is within the Government’s power to delay Third Reading in order to give sufficient time for this. Given that one of the previous amendments said that we would not put forward measures that would have an impact during a season, and given that we all accept that this legislation will not be passed before the beginning of the new season, there is no practical difference in terms of timing and what that will mean. We have a real opportunity here, which will not have any timing impact on football but will give us the opportunity to seek the better way mentioned before.

[Baroness Twycross (Lab)]

There are currently no plans to move the timing of Third Reading in your Lordships’ House, but I commit to ongoing discussions with the noble Lord, Lord Birt, and others, who have been extremely considerate in the time they spent discussing their concerns about the current model with me, the Bill team and others. We wish to continue those discussions in the spirit I described previously.

[Lord Birt (CB)]

St Paul, Messi—the compliments have been flying around. For the avoidance of any doubt, despite having two of the leading lawyers in the country on the team, no fees were paid during the preparation of these amendments.

I have to say that if was not a party to this debate, I would have been sitting listening with my jaw dropping open at the quality of the contributions from right across the House. I am genuinely grateful to everybody who spoke—without exception. Forgive me if I particularly mention my noble and learned friend Lord Thomas. If I had been the Minister, I would have said, “I am going to give up straight away”, because his arguments were so completely devastating and convincing.

I am surprised and disappointed by the Minister’s response, which I had not expected. As she knows, I had no desire to divide the House. I had hoped, given the strength of the arguments she has heard, that she would adopt a more conciliatory and supportive line. I ask her, if she does not mind, recognising that time is not on our side and the Bill is going to go to another place: is she willing to accept my colleagues and I and others from around this House having a meaningful debate about the re-engineering of the backstop, in line with the arguments heard from all over the House today? It is possible that I am not clear on what it is that she is saying.

[Baroness Twycross (Lab)]

I apologise to the noble Lord if I was not clear. I am very keen to continue to have ongoing debate and dialogue with the noble Lord and his co-sponsors of the amendment, in a similar vein to the conversations we have had up until now. I apologise if I did not make that clear in my speech. That is absolutely the intention, but unfortunately, I cannot commit to bringing something back before Third Reading.

[Lord Birt (CB)]

Obviously, I do not expect the Minister to commit, but she has always been very generous in the past at inviting people in for talks. Let us be honest, there have been some changes to the Bill, although not many. Does she think there is a reasonable chance that we can fundamentally re-engineer the backstop process?

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[Baroness Twycross (Lab)]

I am really sorry but I cannot commit to that, but I can commit to the ongoing discussions.

[Lord Birt (CB)]

I am afraid that I do not think the Minister gives me any choice. I will test the opinion of the House.

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Taken together, these amendments would create a backstop that respects fundamental property rights while ensuring football’s sustainability. They will provide certainty that when the funder fully meets regulatory objectives, their rights and interests are respected. They would ensure that any redistribution of funds serves its intended purpose through proper accountability mechanisms. I believe that they would deliver fair, effective and sustainable outcomes for the entire football pyramid.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Parkinson of Whitley Bay, and the noble Baroness, Lady Brady, for tabling these amendments, and the noble Lord, Lord Markham, for speaking to this group.

On Amendments 60 and 61 in the name of the noble Lord, Lord Parkinson, the five-year timeframe is critical to the effective functioning of the backstop. A set timeframe gives the industry certainty that the regulator can intervene to end the deadlock between the leagues if they cannot agree for an extended period. In addition to this, due to the imbalance in bargaining power between the parties in this case, we do not want to allow a situation in which a league could be coerced into a much longer agreement that essentially renders the backstop unusable.

On Amendment 69 in the name of the noble Baroness, Lady Brady, Clause 61(5) is intended to function as a protection for the interests of relegated clubs, ensuring that final proposals take into account the disproportionate impact that removing or reducing parachute payments will have on them. The amendment would broaden the provision out so that final proposals consider the financial sustainability of all effective clubs, not only relegated clubs, but that change is unnecessary. Final proposals must already address the financial soundness of clubs and the financial resilience of English football as a whole. To be chosen, a proposal must advance the regulator’s objective. Of course, parachute payments may affect the overall balance of leagues, but relegated clubs are the most directly affected. That is why they need the specific protection that the current clause offers.

On Amendment 71, as the House will know from our debates over the past months, the sustainability of English football is at the heart of the Bill. I understand the noble Baroness’s intent, but the sustainability of English football and advancing the regulator’s objective are already explicitly at the heart of the backstop. Clause 7 already requires that, as far as reasonably practicable, the regulator must exercise all its statutory functions in a way that is compatible with the purpose of the Bill. Of course that includes the backstop, and it would not be appropriate to require leagues to set out how their clubs would spend the disputed funds, nor to implicitly require the regulator to approve exactly how clubs spend funds. That would be overly prescriptive and disproportionate.

As I have set out before, concerns surrounding potentially reckless spending by clubs are already addressed in the financial regulation provisions in the Bill. These measures will ensure that clubs have appropriate resources and controls in place to manage their financial risk. For example, clubs will be required to provide up-to-date financial plans, backed by appropriate financial resources, which will be stress tested. This is the most appropriate way to address how clubs spend their money.

The noble Baroness’s Amendment 73 would require the funder’s proposal to be chosen by default, as long as it met a minimum level of consistency with the principles in Clause 62. However, the fundamental aim of the backstop process is to bring balance to a negotiation between two parties where one has significantly more bargaining power than the other. That means impartiality is key and no party can, or should, be favoured.

On Amendment 74, we understand the concerns regarding property rights, and I take this opportunity to reassure the House. The provisions relating to distributions allow for interference with property rights, but that interference is lawful; it is proportionate and in accordance with the law. Most importantly, any interference would also be in the public interest. The backstop can be used only in limited circumstances where a clear issue has been identified. For a proposal to be chosen, it has to be in line with the regulator’s objectives; there is, therefore, no situation where the proposal chosen is not in the public interest. This is set out in more detail in the ECHR memorandum that accompanies the Bill. We are confident that the current drafting of the Bill, as well as the requirements of the Human Rights Act, ensure that property rights must be respected.

I move on to the government amendments in this group, Amendments 68 and 89. We have listened to the concerns raised by the noble Baroness, Lady Brady, and fellow Peers that it is imperative that financial sustainability of relegated clubs is protected under the backstop. We argued in Committee that this protection was already implicit in the Bill, but these amendments put it beyond doubt. If the backstop is used to resolve questions relating to parachute payments, the leagues must address the sustainability of relegated clubs’ finances in their final proposals. We hope that that clarity will ease the concerns of clubs that face relegation.

With regard to Amendment 62, we want to ensure that our policy intention is clear. The backstop is intended to be a last-resort power, only to be used if another regulatory intervention would not achieve the same result. We have therefore tabled an amendment adding a requirement to the list outlined in Clause 59(2) covering the considerations that the regulator must take into account before triggering the backstop process. This new requirement ensures that the regulator must consider whether any of its other functions would achieve a similar result before approving an application to trigger the backstop process. This change demonstrates clearly that the backstop will be used only if other regulatory interventions would not solve the problem.

Amendment 63 requires the regulator to outline any findings in its most recent “state of the game” report that it considers relevant to the question or questions for resolution. The regulator must outline this in its notice to trigger the backstop process. We have always been clear that we expect that the “state of the game” report will play a crucial role in the decision-making process for the backstop. However, by tabling this amendment we have made this commitment explicit in legislation. This will give clarity to the leagues as to how the findings of the report could shape the backstop process. It will also provide reassurance in the Bill that the “state of the game” report will be published before the backstop process can be triggered. The findings of the “state of the game” report will be crucial evidence to inform the regulator’s decisions, including those made as part of the backstop process.

Finally, on Amendment 66, we acknowledge the concerns raised by Peers, most notably the noble Lords, Lord Birt and Lord Burns, both in your Lordships’ House and in meetings since Committee, that the current drafting of the Bill has a hard deadline that puts an automatic end to the mediation phase. While it is important that the backstop process comes to a timely conclusion, we understand the concern that parties may be timed out due to the statutory deadline for the mediation phase being triggered. To be clear, we do not want the mediation phase to come to an arbitrary conclusion if further useful discussion could take place. The Government would strongly prefer an industry-led solution, and we hope the mediation phase will facilitate this, so we have tabled an amendment to allow the mediator to request a single extension of the mediation process, up to 28 more days. This will allow for productive discussion without extending the process unreasonably.

For these reasons, I urge the noble Lord to withdraw his amendment, and I ask for your Lordships’ House’s support on the government amendments in this group.

[Lord Markham (Con)]

First, I thank the Minister for the points that she has made, and particularly the government amendments, which show in a number of places that the Government have been listening to the points raised in Committee. We are grateful, as all those things help to progress and make it a better Bill.

At the same time, it is a shame that the Minister is unable to accept Amendment 60. It still seems strange to me that, when the Premier League and the English Football League have mutually reached an agreement, we are saying that they are not allowed to do it—because the word “backstop” implies that a backstop should come in force only when the Premier League and the English Football League have not agreed. Here we are saying that we are going to set preconditions on what the EFL and the Premier League are able to agree. That all remains strange to me, and a mystery as to why the Government should not be supportive of allowing the Premier League and the English Football League to come to an agreement.

I turn to Amendments 69 and 71, spoken to by my noble friend Lady Brady. It seems entirely reasonable to ask clubs to put down what they plan to spend the money on. Again, it seems entirely reasonable that, when we are talking about wanting to ensure sustainability, the clubs receiving or making the bids for large amounts of money as part of redistribution should need to make a case that the things that they intend to spend the money on are towards a long-term sustainable model in terms of investment in the club and the infrastructure of the facilities there. Again, it seems strange to me that it is not something that the Government or the Minister would say was entirely in keeping with the intention of what we want to try to do on this. As a result, I believe that the Bill would be better off for the inclusion of these amendments, but I regrettably withdraw my amendment at this stage.

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Moved by

[Baroness Twycross]

62: Clause 59, page 48, line 34, at end insert “, and
(c) considers that the question or questions for resolution could not be resolved within a reasonable period of time by the IFR exercising any of its other functions under this Act.”Member's explanatory statement
This amendment requires the IFR to consider whether the question or questions for resolution could be resolved by the IFR exercising any of its other functions before deciding to trigger the resolution process.

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Moved by

[Baroness Twycross]

66: Clause 60, page 50, line 6, at end insert—
“(6A) The IFR must extend the period in subsection (6)(b)—(a) if requested in writing to do so by the mediator, and(b) by such period as is set out in the request, which may be up to a further 28 days.(6B) The period in subsection (6)(b) may only be extended once.” Member's explanatory statement
This amendment requires the IFR to extend the mediation period by up to a further 28 days if requested to do so by the mediator.

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Moved by

[Baroness Twycross]

68: Clause 61, page 50, line 27, leave out from beginning to “require” in line 28 and insert “Where a notice under subsection (3) sets out a question for resolution that relates to relegation revenue (within the meaning given by section 62(3)), the notice must”
Member's explanatory statement
This amendment requires specified competition organisers to include in their final proposal the explanation described in clause 61(5) where there is a question for resolution that relates to relegation revenue.

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Moved by

[Baroness Twycross]

78: Schedule 9, page 116, line 13, leave out sub-paragraph (3)
Member's explanatory statement
This amendment removes the definition of “Bank of England base rate” in order for it to be moved to the definitions clause.

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Moved by

[Baroness Twycross]

79: Schedule 10, page 117, line 36, column 1, leave out from “the” to “mentioned” in line 37 and insert “taking of any step”
Member's explanatory statement
This amendment is consequential on the amendment to clause 46 at line 39.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, Amendment 80, which relates to my favourite topic of heraldry, has already been debated. At the end of that debate on the first day on Report, the Minister very kindly agreed to a further meeting with me and with the College of Arms, which took place this morning. I am going to move my amendment in order to allow the Minister to say what she took from that meeting. On the basis of what I expect her to say, I will not be pressing this to a Division, but I look forward to hearing her.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Parkinson of Whitley Bay, for sharing his expertise and enthusiasm on this topic in your Lordships’ House, and for the opportunity to respond on this point. I thank him and the College of Arms for their time earlier today. Before he confirms whether he is going to divide the House, I reiterate that it is the Government’s intention that nothing in the Bill is to be read as superseding or impairing any prerogative powers of the Crown in relation to coats of arms, whether exercised directly by the King or on his behalf by the Kings of Arms. I guarantee that something to this effect will be added to the Explanatory Notes to this clause.

[Lord Parkinson of Whitley Bay]

My Lords, I am very grateful to the noble Baroness, particularly for all the time that she has spent on this niche but important issue. I am also grateful to the Bill team for their meetings, including the one we had today with Norroy and Ulster King of Arms. With gratitude, I beg leave to withdraw my amendment.

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, the noble Baroness, Lady Fox, is right that the congratulations that have been coming my way for Newcastle are entirely misplaced. However, I am sure that the cross-party support the noble Baroness and I gave them on the first day of Report buoyed the team and their success, but it had nothing to do with me. But I can reassure noble Lords that my uncle Barry was probably the person cheering the most loudly at Wembley last night.

I also agree with all those who have welcomed the Government tabling Amendment 90. In Committee, there was cross-party support for looking at how this will all work in practice, from those who are keen to see the regulator up and running swiftly to those who are more sceptical. We had support from the chairman of the Hansard Society and my noble friend Lord Norton of Louth, who watches legislation very carefully. I join the welcome expressed to the Government for bringing forward Amendment 90.

My noble friend Lord Goodman of Wycombe has argued throughout the passage of the Bill, from Second Reading onwards, that greater oversight and post-legislative scrutiny would be needed. I therefore hope that the Minister will look at the further helpful amendments that the noble Lord has tabled today, arguing that it would be better for an independent body to conduct the review of this independent regulator. Again, my noble friend has been very constructive in the points that he has raised.

Amendment 81, tabled by my noble friend Lord Maude of Horsham, which leads this group, covers the same area that my noble friend Lord Hayward has just touched on in his contribution: the cost of compliance with the new regulatory regime. Clearly, since the Bill that was brought forward in the last Parliament, we have seen new things such as increased employer national insurance contributions, the increase in the minimum wage and the further costs to business that will be coming through the Employment Rights Bill. The financial position of smaller clubs takes place in an even more difficult economic environment. We on this side of the House remain concerned that imposing a levy and further regulatory costs on top of these will likely make clubs less financially sustainable, not more.

My noble friend Lord Hayward points once again to the impact assessment, which does not account for the increased costs of hiring. It says that clubs will have to hire more staff to comply with the extra regulation but does not consider that those extra employees will cost more now than they would have done even when we first looked at the Bill. This is particularly severe when it comes to the smallest clubs in the National League. The general manager of the National League, Mark Ives, and the chief executive of Dagenham and Redbridge, Stephen Thompson, have both warned of the potential for the Bill to create onerous consequences for National League clubs which are not only financial but bureaucratic. Mr Ives 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”.


National League clubs operate with a very small number of staff, with many in Mr Thompson’s words working on only

“two or three people and some volunteers”.

There is a real risk that some of these smallest clubs will struggle with the further burdens that are placed upon them, so I hope the Minister will look at these amendments.

My Amendment 94, which is in this final group, seeks to ensure that the review takes into account the effect of the regulator’s activity on ticket prices. We had a good debate on this during our first day on Report and indeed a Division which was very conclusive, so I will not say anything further about that issue other than to thank the Minister for all the engagement that she has given during and since Committee, ahead of Report and during our two days on Report. We are all very grateful.

[Baroness Twycross (Lab)]

I thank the noble Lord, Lord Goodman, for his amendments and for speaking to the amendment in the name of the noble Lord, Lord Maude of Horsham, and other noble Lords who have spoken during this short debate.

In Committee, Peers across the House raised the topic of evaluating the impacts, efficacy and success of the regulator. I thank the noble Lord, Lord Norton, in particular, for his expertise and time in discussing the topic despite his complete lack of interest in football. I have sometimes found that those noble Lords who have an interest in the details relating to legislation or a regulator come at this topic with a slightly different perspective, which is really helpful, and I welcome his contribution tonight. I am keen to continue discussions on this and other topics with noble Lords across your Lordships’ House—although I must admit that I am quite pleased to be reaching the end of Report.

We agree that it is good practice for the impact of regulation to be monitored and evaluated post-implementation. I am grateful to noble Lords across the House for welcoming government Amendment 90, which will require the Secretary of State to carry out a review of the operation of the Act and its impact on the industry. This must be completed no later than five years after the full commencement of the licensing regime. Among other things, the review will look into whether the regulator has been effectively achieving its objectives or whether they might be better achieved in a different way. This includes explicitly considering whether delegation might be appropriate, for example, to an independent industry body.

As part of looking into the impacts of the regulator on the market, the review will also consider interactions with industry rules and any resulting burdens. It will also be a set opportunity for the Secretary of State to formally consider and set out whether the competitions in scope of the regulation remain appropriate. The report will be laid before Parliament and will lay long-term scrutiny of this regime by this House and the other place.

The noble Lord, Lord Hayward, has been a champion of clubs in relation to costs throughout. In relation to compliance costs and the statutory review proposed, a separate review of compliance costs alone might be unnecessary, duplicating the work of the post-implementation review and creating additional costs. The statutory review will offer an opportunity for a more complete and detailed view of the regulator’s performance, per se, and will therefore be more useful in understanding the costs and benefits of regulation to clubs. It will also capture compliance costs that are more reflective of ongoing costs instead of the initial costs of the first year of familiarisation, although we expect that, in its annual report, the independent football regulator will have due regard to these issues.

I thank the noble Lord, Lord Goodman of Wycombe, for tabling his amendments. I completely understand their intent—namely to introduce more independent scrutiny of the legislation and its effects—but, unfortunately, we do not think it is appropriate for an external third party to carry out this review of the Act. As is common practice, it should be carried out by the Government, particularly because the review may inform future government policy and because its conclusions may include recommendations to add, amend or repeal primary legislation. The Government introduced this legislation, and, in our view, it should be the Government which review whether it has achieved what it intended. However, we completely agree that there should be additional scrutiny, and the intention is that this review will facilitate that scrutiny, for example, by a relevant committee of Parliament. However, it is not for this Act or the Government to direct Parliament to undertake that scrutiny.

On Amendment 92, we have not taken the approach anywhere in the Bill of prescribing specifically where publication must be done. Clearly, the norm these days is for publication online. However, there is no need to mandate where online, as to do so would risk the legislation becoming outdated.

I appreciate the intention of Amendment 81, tabled by the noble Lord, Lord Maude of Horsham: to ensure the regulator is offering value for money and not unduly burdening clubs financially. Ensuring efficiency and avoiding unnecessary costs have been at the heart of the Bill’s development, but the proposed amendment would duplicate the Government’s statutory review amendment and would therefore impose unnecessary additional costs and burdens on the regulator.

On Amendment 94, in the name of the noble Lord, Lord Parkinson, we are acutely aware that ticket prices are a key issue for fans. That is why the Bill explicitly requires clubs to consult their fans on this point. It may well be that the regulator also chooses to look at ticket pricing as part of the “state of the game” report. However, as it is a commercial decision, the regulator will not intervene beyond this. I again reassure the House: we do not believe that an increase in ticket prices would be a proportionate reaction to the cost of the regulator. The levy will be distributed proportionately, and no club will be asked to pay more than is fair and affordable.

An industry that earns over £6 billion a year in revenue and spends hundreds of millions of pounds on player transfers every year cannot legitimately say that it has no choice but to pass the cost of regulation on to fans, particularly since the cost faced by any one club will be relatively low and proportionate to their financial resources. However, if the regulator were to lead to higher ticket prices, this in our view would be captured within the review, which must look at the impacts of the regulator on football in England and Wales.

I turn finally to Amendment 94D in the name of the noble Lord, Lord Moynihan. As I have set out, one aspect of the statutory review will be to consider whether delegation might be beneficial. However, we do not believe that the power to delegate should be provided for in the legislation at this stage. We should not pre-empt the findings of the review, particularly as there is no way of predicting what delegation might need to look like or to whom that delegation might be. We have been clear, as the previous Government were clear, that independent regulation is needed in English football because the industry has shown itself to be incapable. Any decision to delegate back to the industry is not a decision that should be taken lightly, nor should powers established by an Act of Parliament be transferred to private third parties without proper parliamentary process. I am surprised that the noble Lord has tabled this amendment, given the concerns that he has raised repeatedly on delegated powers.

For these reasons, I hope that noble Lords will not press their amendments, and will accept government Amendment 90 when we come to it.

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Moved by

[Baroness Twycross]

86: Clause 92, page 74, line 19, at end insert—
““Bank of England base rate” means— (a) the percentage rate announced from time to time by the Monetary Policy Committee of the Bank of England as the official dealing rate, being the rate at which the Bank is willing to enter into transactions for providing short term liquidity in the money markets, or(b) where an order under section 19 of the Bank of England Act 1998 is in force, any equivalent percentage rate determined by the Treasury under that section;”Member’s explanatory statement
This amendment, together with an amendment to paragraph 13 of Schedule 9, moves the definition of “Bank of England base rate” into the overarching definitions clause from Schedule 9.

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Moved by

[Baroness Twycross]

88: Schedule 11, page 119, line 8, at end insert—

“Bank of England base rate

Section 92(1)”

Member’s explanatory statement
This amendment inserts a cross-reference to the definition of “Bank of England base rate” into the table in Schedule 11 of defined terms used in more than one place.

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Moved by

[Baroness Twycross]

90: After Clause 95, insert the following new Clause—
“Review of Act(1) The Secretary of State must—(a) carry out a review of the operation and effect of this Act,(b) set out the conclusions of the review in a report,(c) publish the report, and(d) lay a copy of the report before Parliament.(2) The report must be published before the end of the period of five years beginning with the day on which section 15 comes fully into force.(3) The report must, in particular—(a) assess the extent to which the objectives intended to be achieved by this Act have been achieved,(b) assess whether those objectives remain appropriate and, if so, the extent to which they could be achieved more effectively in any other way (for example if the IFR could delegate its functions to persons other than those listed in paragraph 17(1) of Schedule 2), (c) assess the impact of this Act and the IFR’s actions on football in England and Wales,(d) assess the interaction between this Act and the rules, requirements and restrictions imposed by competition organisers and whether that interaction is appropriate, and(e) assess whether the appropriate competitions are specified under section 2(3), including whether a competition that is not specified should be specified.(4) In carrying out the review, the Secretary of State must have regard to—(a) the purpose of the Act (see section 1);(b) the IFR’s objectives (see section 6);(c) the IFR’s general duties (see section 7);(d) the IFR’s regulatory principles (see section 8);(e) any state of the game report published by the IFR (see section 10);(f) any annual report submitted to the Secretary of State by the IFR (see section 14).(5) Before publishing the report, the Secretary of State must prepare a draft report and consult the following about the draft report—(a) the IFR,(b) the Football Association,(c) each specified competition organiser, and(d) such other persons as the Secretary of State considers appropriate.”Member’s explanatory statement
The amendment requires the Secretary of State to carry out a review of the Act and publish and lay before Parliament a report setting out the conclusions of that review.

[Baroness Twycross (Lab)]

I beg to move.

Amendments 91 to 94D (to Amendment 90) not moved.

Football Governance Bill [HL]

Baroness Twycross Excerpts

3rd reading
Wednesday 26th March 2025 Lords Chamber

Moved by

[Baroness Twycross]

That the Bill be now read a third time.

A privilege amendment was made.

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Moved by

[Baroness Twycross]

That the Bill do now pass.

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)]

My Lords, it has been over four months since the Bill had its Second Reading in your Lordships’ House. I have resisted football puns throughout, but we are now reaching full-time in your Lordships’ House, so I decided to make an exception today. I hope to get through this debate without any own goals or penalty shoot-outs. This is historic legislation that will ensure that fans are placed at the heart of our national game.

I pay tribute to the work of Dame Tracey Crouch. Her fan-led review highlighted how too many football fans have been left with nowhere to turn when faced with reckless owners, financial mismanagement and threats to their clubs’ very existence. It was this work that led to all three main political parties committing to introducing an independent football regulator in their manifestos.

We supported the previous Government’s Bill, though I strongly believe that the Bill that we presented was better and has been improved further throughout its passage in your Lordships’ House. We have made changes to refine and strengthen the legislation to ensure that the regulator successfully delivers for fans and communities while protecting the strength of English football. We are taking a proportionate and flexible approach to regulation to provide the certainty and sustainability required to drive future investment and growth so that English football continues to be a global success.

I thank my noble friends Lord Bassam of Brighton and Lady Taylor of Bolton for their invaluable contributions and for promoting greater transparency of the regulator and its work. As a result, we have added a requirement for the regulator to establish a system for all board members and expert panel members to declare relevant interests and to keep a register of those interests. I also thank my noble friends Lord Watson of Invergowrie and Lady O’Grady, who, along with other noble Lords, have championed the inclusion of players and fans. We have amended the regulatory principles to explicitly add players, fans and others who may be affected by the regulator’s decisions to the list of persons whom the regulator should proactively and constructively engage with.

I particularly thank my noble friend Lady Blake of Leeds for her continuous support and for stepping into the breach to offer me some respite on those extremely long Committee nights. Across the House, I want to give special thanks to the noble Lords, Lord Addington and Lord Goddard of Stockport, for their constructive and at times humorous engagement and for advocating for a social responsibility duty. Our addition to the definition of corporate governance for football clubs to include a club’s contribution to the economic and social well-being of its local community will help to shine a light on the good work that clubs do for their local areas.

I thank the noble Lords, Lord Birt and Lord Pannick, for their considered engagement and for the time they spent considering ways in which we could improve the Bill, not least the backstop process, for the good of football. I want particularly to mention the noble Baroness, Lady Grey-Thompson, who raised issues about women’s football. While not envisaged as part of the initial regulatory regime, we fully support women’s football and the aims of the Carney review.

While we may not have agreed on every issue throughout the Bill’s passage, I thank the noble Lords, Lord Parkinson of Whitley Bay and Lord Markham, for their scrutiny and for ensuring that the niche but highly important issue of heraldic terminology is appropriately reflected in the Bill. I am also grateful for all noble Lords who have participated with a range of knowledge and expertise—not always on football—including but not limited to the noble Lord, Lord Norton, on post-legislative scrutiny and, clearly with expertise in football, the noble Baroness, Lady Brady, and the noble Lords, Lord Moynihan and Lord Hayward, for their unique perspectives and expertise, and for occasionally missing matches to take part in proceedings.

The discussions and changes that we have made in this House will guarantee that English football remains the best place to be a football fan now and in the future. The Bill’s passage through this House has been long and, at times, slow, so please excuse me for taking a moment briefly to thank the many civil servants who have worked so diligently and patiently. In particular, I am very grateful to the Bill manager, Bill team and policy team. My thanks also go to the numerous lawyers and my private office, who have been very patient—mainly with me, to be honest.

I am proud to stand here today being the one to pass this Bill over to the other House—so arguably it is half-time, not full-time, in parliamentary terms. This is important and much-needed legislation which will protect and promote the sustainability of English football in the interests of fans and the local communities that football clubs serve. Football fans up and down the country deserve and want this regulator. I beg to move.

[Lord Addington (LD)]

My Lords, it comes to my turn to say a few words. It has been a very interesting experience, and I thank the Minister for her engagement and for a number of meetings when she made her time and her staff available to us. I may have walked past the department door on my first meeting, but I certainly did not do so for the next half-dozen. I also thank my noble friend Lord Goddard. It was nice to have a wing-man, and occasionally letting him fly the plane proved a very wise move as well.

I also thank the Minister for some of the specific things they brought in. I always felt social inclusion was lacking, and although football does good work, it is bitty. Making sure it is there means taking on something that has been outside the remit of government; but we have an interest in it and we have now secured it, in its current form or something like it, for the foreseeable future. Making sure that that happens also implies a duty to the community and I hope that, now we have that mentioned in the Bill, the two-way relationship will be expanded.

I was only shouting in the chorus for the inclusion of fans and players in the Bill, but I am very glad it happened. Players have only short careers and most of them, despite the myths, have short and not very well- paid careers in the lower divisions. They deserve some consideration as well.

I also thank many of the people from the Opposition Benches for enlightening me on a range of subjects. I never thought I would learn something about heraldry on this Bill, so I thank the noble Lord, Lord Parkinson, for that.

I hope this Bill fulfils its functions and goes forward and I hope we do not have to come back to it.

--- Later in debate ---

[Lord Pannick (CB)]

My Lords, from these Benches, I too thank the Minister, the Bill team and the Secretary of State for the exceptional level of engagement that they have shown in relation to the concerns and interests of noble Lords around the House. It has resulted in a much better Bill, which is of course the function of this House.

[Baroness Twycross (Lab)]

I thank all noble Lords for their comments.

Bill passed and sent to the Commons.