FIFA

Debate between Jesse Norman and Damian Collins

Wednesday 10th June 2015 Westminster Hall

[Damian Collins (Folkestone and Hythe) (Con)]

I beg to move,

That this House has considered the UK’s relationship with FIFA.

It is a pleasure to serve under your chairmanship, Mr Streeter. At the start of my remarks, I welcome my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch) to her position, for the first of what I am sure will be many sterling debates and sterling performances as the Minister for sport. I congratulate her on her appointment.

The purpose of this debate is to consider the UK’s relationship with FIFA: not just the English Football Association but the football associations of Scotland, Wales and Northern Ireland; not just the relationship between the football bodies and FIFA, but FIFA’s relationship with the Government and any other UK commercial interests, too. The timing of this debate has undoubtedly been influenced by the dramatic events that unfolded in Zurich just over a week ago, with the arrests of 14 FIFA officials in an operation led by the FBI and carried out by the Swiss investigatory authorities. It poses the question of what our response should be to those dramatic events and to the new timetable for the rest of this year, now that Sepp Blatter has announced that he will be stepping down from the FIFA presidency. In my opening remarks, I will address how we got to our current position and the responses to the crisis that the UK should consider.

The events in Zurich come as no surprise to people who have followed the FIFA saga for a number of years. Earlier this year, I became a founder member of a new international campaign group, New FIFA Now, to push for change and reform in FIFA by forming an alliance of politicians, business people and people in the media to create external pressure on FIFA. In April, New FIFA Now published the results of a global survey of well over 10,000 football fans from across the world: 97% of respondents had no confidence in the leadership of FIFA, and 69% of respondents felt that there should be a full and open inquiry and investigation into the allegations of wrongdoing at FIFA.

In 2011, when I was a member of the Select Committee on Culture, Media and Sport, the Committee considered matters of concern regarding the World cup bidding process completed in 2010 that awarded the rights to host the tournaments in 2018 and 2022. In that debate I used parliamentary privilege to raise concerns that had been brought to the Committee’s attention in evidence submitted by The Sunday Times Insight team. That evidence alleged that two FIFA executive committee members, Issa Hayatou and Jacques Anouma, received $1.5 million in payments to support the Qatar bid for the World cup, linked to their votes in the process to award the rights to host the tournament. Lord Triesman came to the same Select Committee hearing to make his own allegations about approaches that he had received during the World cup bidding process from other FIFA officials who had solicited either bribes or favours from him. He named Mr Makudi from Thailand, Jack Warner, Nicolás Leoz and Ricardo Teixeira.

It is interesting to note what has happened to some of those individuals over the past four years. Issa Hayatou was reprimanded by the International Olympic Committee for receiving improper payments from sports marketing company International Sport and Leisure in relation to the awarding of rights. Jacques Anouma was accused of receiving bribes by Phaedra al-Majid, the Qatari whistleblower who worked on the Qatar World cup bid and is now living in the United States after making her allegations about that bid. Jack Warner was involved in the scandal over the attempt to buy votes in the FIFA presidential election, and he is on Interpol’s wanted list following a request for him to co-operate with the FBI investigation that came to such a dramatic conclusion with the issuing of arrest warrants in Zurich just over a week ago. Similarly, a warrant has been issued for the arrest of Nicolás Leoz. Ricardo Teixeira, the former head of the Brazilian football association, who was named by Lord Triesman, was removed from his position in world football after being found guilty of receiving bribes that, again, were linked to the ISL sports marketing corruption case, in which payments were made to FIFA officials in relation to their support on contracts awarded for World cup broadcast footage and World cup marketing rights. Ricardo Teixeira, along with the previous president of FIFA, João Havelange, allegedly received $41 million-worth of payments in relation to ISL.

[Jesse Norman (Hereford and South Herefordshire) (Con)]

My hon. Friend is making a brilliant speech, rightly showing how the culture of corruption at FIFA, which he identified so early, has embedded itself over many years. By mentioning Mr Havelange, he points to its rising up the organisation—I hope he will discuss how that has transpired. Does he share my view that not only is FIFA rotten from top to bottom but that the response last week from Mr Warner in particular was a remarkable reaction to the revelations?

[Damian Collins]

My hon. Friend is right. We are talking about a widespread, systemic failure of an organisation—widespread corruption—and the role of Jack Warner in this is key. He has said that he has handed to the FBI an “avalanche” of evidence, which includes references to Sepp Blatter himself. I think it is highly likely that Sepp Blatter will be asked to co-operate with both the FBI investigation and the Swiss authorities’ criminal investigation into the World cup bidding process.

Football Clubs (Insolvency)

Debate between Jesse Norman and Damian Collins

Tuesday 18th March 2014 Westminster Hall

[Damian Collins]

The hon. Gentleman makes an important point. Undoubtedly, in the past, footballers could often be treated poorly by their clubs and had few of the rights that would normally be expected in the workplace. I am certain that no one would want to go back to such a situation, but I will come to how the financial guarantees work to encourage greater risk taking and irresponsibility with the finances of the game, with a direct consequence and knock-on effect for the insolvency of clubs.

[Jesse Norman (Hereford and South Herefordshire) (Con)]

Did my hon. Friend just say that under the football creditors rule, football creditors take precedence over the taxman? If so, can he think of any other industry or sporting activity in this country of which that is also true?

[Damian Collins]

My hon. Friend makes an extremely important point. The taxman lost his preferred creditor status in 2003. An informal arrangement exists between HMRC and football, and I will come to that, but the taxman is not a preferred creditor. The only preferred unsecured creditors are people within the game of football, who must be compensated in full under the rules of the Premier League and Football League. Other creditors get only pence in the pound. For example, when Crystal Palace went into insolvency, football creditors were paid in full, but non-football creditors received 2p in the pound. When Plymouth Argyle went into administration, again, football creditors were paid in full, but non-football creditors received less than 1p in the pound in compensation for the debts that they were owed.

[Damian Collins]

The hon. Lady makes an extremely good point. It does enormous damage to the credibility and reputation of football. That point was made by Niall Quinn, a former player and club chairman of great distinction, when he gave evidence to the Select Committee. How can it be right that in a community where a club has gone through insolvency, a small business that prints match programmes or paints the stadium receives none of the money that it is owed, while watching a player paid tens of thousands of pounds a week drive out of the gates to the ground in a smart car, having received every penny he was owed? It makes no sense at all. It is seen as a massive injustice and, given the huge amounts of money within the game of football, it cannot be justified in any way for football to reserve preferred status for its own creditors.

The Select Committee called in its 2011 report and its follow-up report in 2013 for the football creditors rule to be scrapped. Numerous debates have been raised in the House about both the generalities of football governance and finance, and specific cases relating to clubs such as Coventry and Leeds. Members have raised their concerns about such clubs in particular. Often in those debates, we have been reassured that the Government’s view is that the rule is one whose time has come, that we should move on and that we should not allow it to continue. I secured this debate to ask the Government where they stand on the football creditors rule.

I am grateful that the Minister with responsibility for consumer affairs, the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for Cardiff Central (Jenny Willott) is here to answer the debate. Often, when we have had such debates, the Minister responding has not been the Minister responsible for insolvency laws in this country. Today we have the insolvency Minister here to answer the debate.

[Jesse Norman]

I absolutely share my hon. Friend’s view. He is making a powerful case, and it is doubly good to hear it from someone educated in Hereford, a city whose football club is in some difficulty due to the imbalance between the money sloshing around at the top of the game and the meagre pickings at the middle and lower end.

The issue I want to raise with my hon. Friend is the Government’s position. When I asked the Under-Secretary of State for Culture, Media and Sport, my hon. Friend the Member for Maidstone and The Weald (Mrs Grant), who is Minister with responsibility for sport, she responded:

“The Financial Fair Play rules now introduced across football which, combined with compliance checks…aim to improve financial management and stability...Legislation remains an option if the football authorities do not demonstrate that they can reform their own governance of the game. The Government’s position on the football creditors rule is clear.”—[Official Report, 27 February 2014; Vol. 576, c. 495W.]

I put it to him that, whatever the Government’s position is, it is not “clear”, and that that answer did not particularly clarify it.