Coventry City Football Club

Bob Ainsworth Excerpts

Tuesday 22nd October 2013 Westminster Hall

[Mr Bob Ainsworth (Coventry North East) (Lab)]

I thank you, Mr Caton, for presiding over our debate, and I welcome the Minister to her role. I was greatly helped by her predecessor, the right hon. Member for Faversham and Mid Kent (Hugh Robertson), and I can only hope that she is as capable and willing as he was. I pay tribute to him for the job that he did as Minister with responsibility for sport.

Over the past 18 months, the most vicious and destructive battle has been waged at Coventry City football club. Sadly, it has not been about football; it is a fight for land and property. The Ricoh arena was built and paid for by local and national taxpayers and a highly thought of local charity, the Alan Edward Higgs Charity. It was built to create jobs and economic activity in a deprived part of the city, and because the football club was not financially capable of building it itself. The club’s hedge-fund owners and its boss, Joy Seppala, want the stadium, the freehold and the surrounding land, but they do not want to pay more than a pittance for it, and have moved the club out of the city and nearly destroyed it in order to achieve that.

Part of the club was put into administration seven months ago. The owners have repeatedly claimed, through solicitors and direct statements, that the company owed rent to the stadium but had no assets. Documentation has now come to light that shows that to be untrue. Since 1 June 1995, this company, now in liquidation, has owned the club’s rights, title, and assets, all its playing staff, its good will, and the right to play in the league. Why did the administrator, Mr Paul Appleton of David Rubin & Partners, fail to discover that? He claims that he spent thousands of hours conducting his investigation. He possesses the full powers of an officer of the court. He is supposed to have ability. He charges more than £300 an hour. Despite protests from bidders, creditors and me, as MP for the local area, he sold the company that was in his charge without finding out what he was selling, thereby ensuring that the owners were the successful bidders. I ask the Minister why those who put companies into administration are able to avoid scrutiny and loss, at the expense of creditors, by choosing their own administrator. Now the appalling error has come to light—let us call it an error—can we ensure that an independent liquidator is appointed to look at the situation in Coventry?

Let me ask about the role of the Football League in this sorry tale. It told me that it acted to prevent another Milton Keynes Dons by changing its rules. I asked representatives to put that in writing, and they e-mailed me saying that the Football League board would not allow the club to move away from Coventry without demonstrating a clear plan to return within a prescribed time frame. The Football League then allowed the club to move to Northampton. Did the club show the league a plan, as it said it would require it to do, before it agreed to the move?

The Minister’s predecessor asked the league that question for me. My hon. Friend the Member for Coventry South (Mr Cunningham) and I went to see him in July, and he agreed to write to the Football League on this and other issues. Has the current Minister received a reply to that question?

The Football League has admitted administrative errors in the registration of players, but it has refused to say for how long that error continued, or to give any details of the error. With the new evidence about the structure of the club coming to light, will it look again at that decision? Will it give us the detail of those errors that it admits it made? That would show a little good will to the Sky Blues fans who feel that the league has let them down badly on this issue. Will the league uphold the conditions that it said that it had placed on the club when it returned the golden share to it?

Finally, and most importantly, I want to talk about whether we can get the club back to Coventry. This lunchtime, there was a small demonstration outside Council house. Fans are understandably desperate to see the club back in Coventry. Joy Seppala admits, however, that she is not interested in football and is not a fan. She is interested in her investors and describes herself as the shepherd of other people’s money. She says that she is £60 million down. She claims she was not involved in the catastrophic decision to buy the club in 2007. If I were a Sisu or a Sconset investor, one of her sheep, I would ask questions about that, but she says that she wants a return for her investors.

It is repeatedly claimed that a new stadium will be built near Coventry. It is said that it would cost around £25 million—nothing like the Ricoh arena. As Joy Seppala cannot get the fans to go to Northampton, it is estimated that she and her organisation are losing at least £3 million a year for at least the next three years as a result of playing their home matches in Northampton. If we add the £25 million to the £9 million probable losses from the club’s current course of action, that is £34 million. If she wants, as she has said, the stadium, the surrounding land and the freehold of that land, why does she not make a bid? Why is she incapable of making a bid of around £34 million? If she made a bid of that magnitude, she would be getting a casino and a conference centre thrown in for nothing, but she has not made that bid, and she will not do so. The question is why.

[Mr Marcus Jones (Nuneaton) (Con)]

I thank the right hon. Gentleman for giving way and commend him for securing this debate. Many of my constituents and I are long-term supporters of the Sky Blues and are absolutely devastated at what has gone on. Does he not agree that, in regard to having a successful football club in Coventry, the club must own a greater stake in the Ricoh arena if it is to make the business viable, wash its face, and give us the sort of success that we are looking for, bearing in mind the council tax payers in Coventry and the money that they have put in? Does he agree that all parties need to get round the table, and that it is imperative that Sisu look to open negotiations with Coventry city council?

[Martin Caton (in the Chair)]

Order. This is a short debate.

[Mr Ainsworth]

I broadly agree with the hon. Member for Nuneaton (Mr Jones); I have never disagreed with him. In the past, under previous leadership, perhaps members of Coventry city council have not agreed with that line. However, if the club needs to own its stadium, it needs to pay for it, does it not? Does it expect the stadium to be given to it for nothing? That is what I am asking, because I believe that what we are looking at is an attempted land grab. Figures such as £7 million are being floated by Sisu’s fans for a stadium that cost more than £100 million to provide. Property markets have gone the way that they have, and the economy is not in the same condition as it was, so people will make a loss, but to float derisory figures such as that is an indication that there is an attempt at making a killing at the taxpayer’s expense.

[Mr Geoffrey Robinson (Coventry North West) (Lab)]

I am glad to hear my right hon. Friend speaking with such passion on an area that we have not seen him taking an interest in at all for many, many years. Where he and I would utterly agree is that we want to get the club back to Coventry. That means that we have to create a new sense of good will between the various parties that, at the moment, are locked in the most antagonistic struggle that I have seen in many years, and that I have certainly never seen in Coventry before. It cannot be just one-sided—there are always two sides. I ask him this: does he really think it helps to get the atmosphere that we want, and to get the club back, when he launches these bitter personal attacks on Joy Seppala on one side, as opposed to seeing—

[Martin Caton (in the Chair)]

Order. That was another very long intervention; I think that we have got the picture.

[Mr Ainsworth]

My hon. Friend the Member for Coventry North West (Mr Robinson), by saying that I have paid no attention to this area in the past, provokes me into letting people know that he was the steward of the club. His stewardship may have been part of the reason why I was silent in the past, but I am relieved of that responsibility now that he is no longer connected with the club, and I am free to speak on a matter that concerns a major business in my constituency.

I am not “bitter” about Joy Seppala. Most of the things that I have said, she has said herself on the record. I am bitter about the Football League, which has allowed this to happen. I think it is outrageous and unforgivable that it has done so, and its governance of our national game needs to be looked at because of what it has allowed these owners to get away with.

[Mr Lee Scott (Ilford North) (Con)]

Will the right hon. Gentleman give way?

[Mr Ainsworth]

I will not give way, because I have agreed to give my hon. Friend the Member for Coventry South some time to speak, and I need to try to finish up, if I can.

I was asking why, if this is not a land grab, the owners are not prepared to make a reasonable offer. If they did, nobody would be happier than me, the fans and those who were outside Council house today. However, I fear that that will not be the case—that the owners will not make that reasonable offer, and that we will not get our club back until Joy Seppala tires of her losses and sells up. I sincerely hope that I am wrong.

I ask the Minister, what is it that attracts this kind of owner to our national game? Is it time to look at the special insolvency regulations that football enjoys, and to legislate for good governance, as the Football League is proving in this case to be incapable of taking decisions in a consistent way? Or maybe even more radically, but even more productively, we should, in the end, look at the Bundesliga model of fan ownership, instead of the ownership model that applies in this country.

[Mr Jim Cunningham (Coventry South) (Lab)]

rose—