Coventry City Football Club

Debate between Damian Collins and Bob Ainsworth

Tuesday 2nd September 2014 Commons Chamber

[Mr Ainsworth]

I think that they have been the main agents of this partial victory.

Other people who deserve congratulations include the Higgs Charity, which has an interest in the stadium and has been steadfast in the face of intimidation and attempts to distress and bully it. I have got evidence that the Football League effectively joined in that bullying. This local children’s charity has stood fast and refused to get out of the way of Ms Joy Seppala’s ambition to get the Ricoh Arena on the cheap. That was its only crime—it stood in the way of that ambition to gain control of the stadium on the cheap, for next to nothing. We have seen a well-funded Cayman Islands hedge fund seek to take on, intimidate and distress both the trustees and a well-thought-of local children’s charity to achieve its ends, and it has failed to do so. All strength to their elbow for the tenacity shown in resisting that pressure!

Coventry city council, too, should be congratulated. Labour and Conservative councillors have stood together, and I have been able to detect no politicking. Nobody has been point scoring. The entire council—the Labour majority and the Conservative minority—has stood shoulder to shoulder to resist this attempt to gain control of the city’s asset provided for by the taxpayer at great expense. Officers of the council, some of whom have been traduced by this appalling organisation, were congratulated on their work by the High Court judges in their judgments in complete condemnation of what the football club had done. The councillors have done a tremendous job and the council deserves to be congratulated.

Local journalists should be congratulated, too. The hon. Member for Folkestone and Hythe (Damian Collins) talked about the Coventry Telegraph. It has a first-class local journalist, Simon Gilbert, who has brought straight, unbiased reporting to this issue, which has done great credit to him personally, to his newspaper and to journalism in general. He should be congratulated on his in-depth reporting over a long period.

[Damian Collins]

I, too, would like to pay tribute to Simon Gilbert’s work on this story. Does the right hon. Gentleman agree that because of how insolvency law works with football clubs, in such a case, where there is a financial dispute between a club and a non-football organisation, all the power lies with the football club, which can threaten administration, knowing that the other body is likely to get virtually none of its money back?

[Mr Ainsworth]

I was coming on to that. The hon. Gentleman clearly has more expertise on football governance than I have; I come at this issue from a Coventry point of view. The hon. Gentleman is absolutely right. The football club creditors rule cannot be justified in moral terms; it does not apply in any other area of business, where following administration, creditors get treated in a proper fashion—but not in football. People are there to be ripped off by a system that was set up to protect the game. It really needs to be looked at further.

Some credit is due, too, to Mr David Conn of The Guardian, who fearlessly reported what was going on in Coventry and got threatened with legal action for his troubles. He was totally and fully vindicated in the subsequent High Court judgment, which made exactly the same claims as he had made in his reporting—that the fans and the Sky Blue Trust had been threatened with legal action by the club’s owners simply for providing a link to The Guardian article. That shows the kind of people we have had to deal with—people who have threatened their own fans with legal action for providing a link to a national newspaper.

One of my worries is that David Conn has been the only national journalist to look at this issue and to seek to expose what is an absolute scandal. In 2014, an offshore hedge fund has sought to attack the taxpayers of Coventry and gain control of an asset, attacking a local children’s charity in the process. So where were the rest of the media? Why have they not been as probing and as fearless as Mr Conn? We have had good local newspaper reporting, as the hon. Member for Folkestone and Hythe said, but we could have done with more from the national media to sort the problem out. What has happened in Coventry is indicative of a malaise in the game, as has been said repeatedly.

We must congratulate the two High Court judges, who made devastating comments about the club’s owners, Sisu, in their judgments. Coventry City are now playing back in Coventry. Ms Joy Seppala, the chief executive officer, said that she would never return to the Ricoh arena unless she owned it lock, stock and barrel. Well, she is back and she does not. She said she does not negotiate but tells people what she needs. As soon as the second High Court judgment was delivered, her right-hand man, Mr Fisher, was saying, “Let’s negotiate.” Therefore, there have been some U-turns and progress, but it has been off the back off some stern British justice that has seen through what has been going on.

Therefore, those are the people who deserve the credit for Coventry City coming back. I congratulate them. It is a good day. However, I want to give a warning, as my hon. Friend the Member for Coventry South did, against thinking that that is the end of it and this is victory. I do not think that it is.

Sadly for the people of Coventry—I am not just talking about the fans; I represent not the fans, but a third of the city; my hon. Friend represents another third and the hon. Member for Nuneaton (Mr Jones), who is sitting opposite, represents an adjacent constituency —the Ricoh Arena will never be able to reach its full potential, which is massive. It is on the Coventry to Nuneaton railway line. It is on the motorway network. It is a fantastic arena in the poorest part of the city capable of huge regeneration. That is the only thing that justified the taxpayer investment in that facility in the first place. However, it will never be able to reach its full potential until there are football club owners or partners in the stadium who are interested in creating value.

That is the thing that some people have not been able to understand. The owners of Coventry City football club have not been interested in creating value. They have destroyed the football club not through incompetence but through their deliberate actions. Their interest has been in destroying value to get their hands on the asset at a knockdown price. That is the problem, which is still there, because those owners are still there. I do not believe that they have changed and will now become partners in the local economy, working with the city council and other partners to create a good sporting culture and economic regeneration in my constituency. I do not believe they are that kind of people.

That brings me to the points that the hon. Member for Folkestone and Hythe made so well. What is it that brings that kind of owner to our national game? I have not been a football fan for many years. I used to be when I was younger but the money interest put me off hugely. Mostly these owners are flamboyant, rather extraordinary people—we see them at other clubs—with rather dodgy backgrounds. There are many of them. Up and down the country, there are many examples of the kind of owner who has been attracted to the game. The Coventry City owners are different. This is a hard and ruthless hedge fund operation prepared to destroy a children’s charity to make money. Something wrong in our national game attracts that kind of person. I think that it is the football creditors rule and the total lack of governance. I do not believe that the Football League genuinely acts as a governing body looking after the interests of the game, the fans and the British people at large. It is effectively a self-interested club for owners. The new chief executive officer of the Football League put his own club, Leeds United, into administration twice while he was there.

This is a malaise, and it is important. I am not making a party political point because we were in government for 13 years and we did nothing about this. The present Administration have been in power for almost an entire term and they have not done anything either, and it is not easy because football is glamorous, powerful and moneyed and it is hard for politicians to say, “Wait a minute, there’s something deeply wrong here,” but if we do not do so, then we saw what happened in banking. I am not suggesting that what will happen in football will be as economically disastrous as what happened within British banking, but in some respects it is more important, because this is not just economically important; it is culturally important as well.

After the World cup we are seeing the Americans getting into football in a bigger way than ever before, and there is a huge upsurge in football interest in China, too. Our national game has huge potential for this country if it is properly run and therefore can be properly exploited to project our national culture, our national identity and our national interests, but it cannot do that if it is not properly governed, and Government really must grapple with this.