(2 days, 8 hours ago)
Public Bill CommitteesI have woken everyone up there.
Clause 37 is an important safeguard, but without amendment 110, it lacks a clear and necessary line in the sand. Parliament has already determined that proscribed organisations represent a threat to public safety and national order. That same logic must apply here. I urge the Government to accept this modest but essential amendment and, in doing so, to help to ensure that our clubs are not just well run and financially sustainable, but led by people whose values are consistent with the country, communities and traditions that they are entrusted to serve.
It is a pleasure to serve under your chairmanship, Ms Butler. I rise to support amendment 110. I suspect the Minister might say that we do not need to cover everything and that there is a general catch-all measure in the clause, so we do not need to make this amendment.
I will draw the Committee’s attention to a similar case in my own constituency, however, where a member of the public wrote to ask if I could please hurry up his EU settlement scheme application. When we checked with the visas and immigration service, it turned out that he had been subject to a deportation order in 2017, and had indeed been deported in 2017. He had somehow managed to get back into this country illegally and make an EUSS application. He is still subject to that deportation order, yet for some crazy reason, the Home Office still have to go through his application. That is the sort of thing that we should not have to legislate for and that we should not have to state, but sadly we do.
It is a pleasure to serve under your chairship, Ms Butler. I rise to add my support to the amendment that the shadow Minister discussed very well and clearly.
The point is that the list set out in clause 37(2)(a) to (f), which gives examples of things that would prevent a potential owner from having the requisite honesty and integrity to own a football club, is missing a provision about their being a member of a proscribed organisation such as a terrorist organisation. In football, which is the most international sport and which has very international ownership, it seems particularly sensible to have that provision.
I do not think a terrorist offence is captured by someone being
“convicted of a criminal offence”,
because, as we know, the Terrorism Act 2000 was put in place to introduce various provisions relating to terrorism where it had not necessarily been identified that a perpetrator had committed a criminal offence. The provision in the amendment would therefore be a fair addition to that list.
Of course, clause 37(2)(g) is a catch-all measure that refers to “such other matters”. Nevertheless, the point is that this matter is particularly important and we do not want to leave it to be swept up in a catch-all measure. Of course, if it is argued that it could be swept up in a catch-all measure such as clause 37(2)(g), why have the list in clause 37(2)(a) to (f) at all? I support the sensible and non-controversial amendment.
I thank my hon. Friend for his amendment. We have seen far too many examples of the damage that can be caused by unsuitable custodians of clubs, and that is why the Bill introduces a strengthened owners and directors test.
I believe that my hon. Friend hopes that the amendment will give reassurance to fans that, where a club fails to comply with regulation and loses its licence as a result, the regulator will be able to remove the owner. The aim is to hold those responsible to account. Let me reassure my hon. Friend that the regulator is already empowered to hold individuals to account for their actions. If the club’s non-compliance or its financial situation gives the regulator concern about the owner’s suitability, it can test them, and they could be failed on that basis. If they are found to be unsuitable, the regulator will have the power to remove them. That ability to isolate and remove unsuitable owners and officers should mean that a club never has to have its licence suspended or revoked on the basis of poor ownership. That means that a club’s fans should not have to suffer the consequences of bad leadership.
The revocation of a club’s licence is the very last resort. We hope the regulator will never have to do that, but I reassure my hon. Friend that if a club is so seriously and consistently non-compliant that the regulator has no choice but to revoke its licence, we would expect the regulator to consider very carefully whether any responsibility for that failure can be laid at the owner’s door, and if the owner is tested and found unsuitable, they can be removed on that basis. We believe that the Bill’s provisions are sufficient to protect fans and hold owners to account where necessary. We hope that they will ensure that a licence is never revoked.
If a club has lost its licence, has it not therefore been taken beyond the purview of the regulator? How is the regulator still empowered to pursue the owner?
The hon. Member for Sheffield South East has stolen some of my lines. As always, he picked up the ball and put it in the net, as would be expected of the chair of the football all-party parliamentary group. There are inconsistencies in what is being discussed, and he was right to highlight them.
Clause 45 introduces a legal duty on clubs not to enter or operate a team in a competition deemed to be prohibited by the regulator. As has been discussed, the clause is clearly a response to the threat posed by breakaway leagues such as the attempted European super league a few seasons ago. While the intention behind the duty is understandable—to protect the structure and integrity of English football—the mechanism raises serious questions about competition and proportionality, as the hon. Gentleman just touched on.
First, on the principle, we agree that the pyramid structure of English football must be preserved wherever possible. Promotion and relegation are sacred principles of our game, and competition on and off the pitch must be upheld. The competitive nature of English football is what makes it so great. This season, certainly in the Premier League, has probably been slightly dimmer because it has been perceived to have not such great competition for the Championship and in relegation, as things were determined quite early in the season.
The Opposition have some sympathy with, in particular, the National League’s 3UP campaign, which has sought to close the gap between the National League and League Two. If we are looking at how to close the gap between the Premier League and the Championship, which has been the main argument from proponents of the Bill, we must also look at the bottom half of the pyramid to see how that competition can also be improved. That is a principle of fairness and competition for which I have a lot of sympathy.
Does my hon. Friend agree with the analogy that, although we are all very proud of having the Special Air Service as our elite forces, the SAS cannot be created without a very large Army underneath? While the Premier League is the jewel in the crown, it simply cannot exist on its own; it absolutely needs the game beneath it.
I will not question the experience of my hon. Friend, whose military background is far greater than one I could even dream of on a PlayStation, let alone in practice. He makes a valid point that English football is much more than just the Premier League. We take enormous pride in all the leagues in our country, as we do for British football more broadly. They are some of the most watched leagues in the world, with amazing clubs and competition. Competition across the pyramid is what we seek to promote and preserve going forward.
The proposed European super league rightly provoked outrage from fans, clubs and Parliament itself, and rightly collapsed after pressure from all those groups, but we must be cautious about giving a regulator the power to prohibit competitions on open-ended grounds. As the Minister has said, the Premier League probably would not exist in its current form if we had sought to prohibit it around 30 years ago.
I completely agree with the hon. Member’s sentiment. We will seek to debate that when we come to our player welfare amendment, because we are concerned about increasing the length of the season to generate further revenues. The tournament in America and the Asia tour that has just taken place at Man United are probably the prime examples of the impact that can have on players. The English team, in their performance the other night, sadly looked quite tired. There is an issue around player welfare that we must all acknowledge, particularly given the demands to generate more revenues for the financial fair play rules. I thank the hon. Member for making that point; I am sure we will come back to it when we reach the player welfare amendment.
On definitions and discretions in the clause, the Bill defines a prohibited competition in quite vague terms, and it is ultimately left to the discretion of the regulator. The explanatory notes state that subsection (5) sets out some factors that the IFR must consider when deciding whether to specify a competition as prohibited. What are the criteria for a competition to be deemed prohibited? Will they be set in primary legislation, by guidance from the Secretary of State or by the regulator? Is there a right of appeal if a competition is believed to have been unfairly designated as prohibited?
On international alignment, there is another issue that we must highlight. We must accept that football operates in a global ecosystem, as we have discussed. English clubs routinely participate in international and cross-border competitions, whether that be the Champions League, the Europa League or the Club World Cup, as does the national team. How does the clause interact with UEFA and FIFA competition rules? What happens if, for example, a competition is sanctioned by UEFA but deemed prohibited by the football regulator, or vice versa? This is a real issue for the regulation. We would like some clarity from the Minister on how such a conflict would be resolved, because it would put clubs in a very confusing situation.
On enforcement and penalties, clause 45 creates a legal duty not to participate, but what are the sanctions if a club does so? One assumes that it would lead to licence revocation, but what else? Would there be fines or points deductions? What penalties will the regulator look to enforce? Will they be proportionate? Will clubs be given prior notice and the chance to make representations?
On unintended consequences, we must avoid stifling innovation and competitive evolution in the sport. Not every new competition is a threat; some may bring financial or structural benefits, or benefits for fans. As I and the Minister have highlighted, we must remember that the Premier League was technically a breakaway league from the old First Division. If that happened today, we believe that the Bill and the regulator would be responsible for preventing that league, and all the attributes and characteristics that we celebrate in this country, from existing. We have to look at innovation carefully, and the answer must not always be no if there are clear benefits to the country and to the game of football itself.
We support the aim of preserving the integrity of English football, but the clause must be clearly defined, tightly drawn and fairly enforced. A law designed to stop the next European super league must not become a tool for bureaucratic overreach or political intervention by the regulator. The game belongs to its fans and its communities, not to the regulator or the governing body. I am interested to hear the Minister’s comments on my questions, particularly those about how the international system would interact with a prohibited competition.
I wish to build on my hon. Friend’s themes. Football has the unfortunate concept of the friendly; frequently, they are not very friendly at all. When I read the Bill, it was clear to me that the drafters had in mind the prevention of another flyaway European super league, which we have debated.
I would like the Minister to look at look at the example of a one-off friendly match. Many of our teams tour in the far east and in America, in their off-season, to generate additional revenues and expand their fan base and brand. Let us envisage a set of circumstances in which a North Korean has somehow managed to purchase an English football team, and they have the bright idea that they would like to play a “friendly” match in North Korea. It is a one-off match, but the Government in North Korea decide that they want to make a big deal of it, so it becomes the Pyongyang cup—a one-off match between the English team and the North Korean team. In the Minister’s view, would the regulator be justified in considering whether such a one-off match was a competition and therefore within the purview of the regulator?
It is a pleasure to serve under your chairmanship, Ms Butler. Pre-season friendlies constitute cup competitions all the time. There is the Audi cup; any major brand we could name will have sponsored friendly cups. When the Minister gives the hon. Gentleman assurance on the Pyongyang cup, perhaps she might also cover the friendly cups that actually exist.
The hon. Member makes a pertinent point. As I said, the word “competition” seems to refer to the sort of flyaway league we have discussed; are one-off friendlies competitions under the terms of the Bill?
I am grateful to Members for their contributions and will take their points in turn.
The clause applies both to existing and to new competitions. If any competition breaches the criteria, it can be prohibited, but matters such as scheduling are for competition organisers.
On shadow Minister’s points, we will come on to player welfare, to which we are all very sympathetic, just as we are sympathetic to the 3UP campaign, but it is outside the Bill’s scope and is for organisers. He asked some specific questions on the criteria; that will be for the regulator to determine. It is expected to do so based on a predetermined, proportionate, objective and transparent framework based on factors listed in the clause. For example, if a competition is not merit-based, jeopardises the sustainability of existing domestic competitions, and is not supported by the fans, we would expect it to be prohibited.
I hope the Minister can take this seriously; it is a worry that the Bill does not quite go far enough at present. The reality is that this legislation tries to deal with bad owners and anticipate how they might behave. The more restrictions that we can build around bad behaviour, and possibilities for controlling it, the better.
I appreciate the desire to legislate for bad owners, but is the hon. Gentleman not concerned about good owners who might find money very tight? They have assets beyond the home ground and team itself that they might have to consider selling, including a training ground, to remain financially viable and therefore be on the right side of the regulator in their business plan. Is he not concerned that, by extending even further the regulator’s purview into all properties, he might overly constrain good owners from doing what they want to save their clubs?
I do not believe that is the case. I understand the hon. Gentleman’s concern, but I think what we are saying here is that this gives the regulator the power to look at that situation. The worry is that some owners will try to exploit not for good football purposes but because they can see themselves making a profit on the side. That can damage the competitive ability of the clubs that they own. Unfortunately, some owners take that capricious view, and it is for them that we must legislate. I do not believe my amendments would adversely affect good owners, as I do not think the Bill does either.
Yes, I believe that there is provision in the Bill to do that. For those reasons, I ask my hon. Friend to withdraw the amendment.
The Minister knows—I have approached her about this—that a club in my constituency of Spelthorne has gone into administration. It has no home ground, but it does have a training ground, which is a community asset. I am intrigued to know whether, in the potential conflict between the purview of the regulator and the enactment of companies law in dealing with the administration of the company, the provisions in the clause give the regulator power to influence the administrator on the manner of the administration and whether clubs’ training grounds can be bought or sold. What is the hierarchy of legislative authority between companies law and the clause?
(2 days, 8 hours ago)
Public Bill CommitteesIt continues to be a pleasure to serve under your chairship, Ms Butler. I do not know whether the Minister has ever run a company that was approaching either administration or insolvency, but had she, she would know that a number of incredibly onerous and important duties are placed on the directors of such companies, which are literally minute by minute, in terms of them being shown to be acting responsibly. That can include, potentially, having multiple board meetings during a day, which are minuted, in order to revisit the “going concern” statement that the company does indeed have sufficient resources to meet its obligations as they fall due.
The penalties for failing to act responsibly and in accordance with the Insolvency Act 1986 in such circumstances can include being barred as a director of any company by the Secretary of State for a number of years, whereas the jeopardy in this Bill is possibly losing the ability to own a football club or to be an officer thereof. On the basis that we can all become millionaires or start-up billionaires and buy a football club, it is very concerning that we are putting in law the ability to override the directors of said companies’ obligations under the Insolvency Act. I would be grateful if the Minister could tell us whether the Government have taken any legal advice on the specific question about the potential conflict between obligations on directors under the Insolvency Act and obligations on owners and officers under the Bill.
I will respond to the points made by the shadow Minister and then come to those from the hon. Member for Spelthorne. The appointment of an administrator would not delay a club entering administration, as that is a separate process from the appointment of a specific administrator. My officials have met both relevant teams in the Insolvency Service and the Department for Business and Trade to ensure that the provisions in the Bill do not impinge on the existing insolvency processes. That speaks to the point made by the hon. Member for Spelthorne.
As for the shadow Minister’s other questions on precedent, special administration regimes exist for various purposes, such as the water utilities or energy suppliers. They have distinct processes for entering administration. The provision in the Bill does not go as far as that. Ideally, the provision will not need to be used frequently, if at all, but if it is, it will look to ensure that fans can feel more confident than they do now. It works alongside the requirements but it still stands alone, so I commend the clause to the Committee.
Question put and agreed to.
Clause 47 ordered to stand part of the Bill.
Clause 48
Duty not to relocate without approval
Yes, I am happy to and will come on to that point. Amendment 111 would require the majority of fans to approve any such changes to a club’s official name, its badge or its home shirt colours, not just to support them. “Support” can be vaguely defined. It can be skewed by a few loud voices or specific interest groups, rather than being a genuine exercise in democracy. While consultation is important, it is ultimately no substitute for consent.
Football clubs are, by their very nature, multi-generational institutions. Most are older than the companies or corporate vehicles that now own them and some are even older than the Labour party that now seeks to impose this regulator. They existed before many of their current directors were born and will, we hope, outlast all of us.
The badge on the shirt is not simply a badge: it is a symbol of place, of pride, of glory and heartbreak, of a historic past and a hopeful future. The name of a club is not simply branding: it is geography, history and memory all in one. And the home shirt, whether it is red, claret, blue or black and white, is more than a colour scheme—I apologise if I missed any; orange for Wolves, maybe, but I am sure hon. Members get the point. It is part of the club’s identity, part of the community’s fabric.
When clubs change these things, particularly when they do so without the blessing of their supporters, they do more than upset tradition. They erode trust and sever the cultural connection that keeps that team and the English game alive. Let us not forget that when Cardiff City’s owner unilaterally changed their home shirt from blue to red, the backlash was enormous, because it was not Cardiff’s colour. Cardiff’s owners, much like the electorate, came to regret switching from blue to red pretty darn quickly. Will the Minister confirm whether clause 49 would prevent what happened at Cardiff or whether such a change could still be pushed through after a period of consultation, however superficial?
The clause imposes a duty on clubs to consult fans before making changes to heritage elements. That is better than nothing, but is quite a low bar. We have all seen what consultation can look like in practice—a web form, a vague email or a one-off survey. Then the changes proceed regardless of overwhelming opposition, with clubs claiming that consultation has been completed.
I think most hon. Members would agree that that is not meaningful engagement and it certainly does not reflect the degree of ownership that supporters rightly feel over the identity of their home club. That is why we support the amendment to move the requirement from consultation to majority fan approval—that is, in other words, a vote, or a similarly binding expression of fan will, overseen through whatever supporter representation structure the club has in place. Will the Minister set out what the Bill actually means when it states,
“the club has taken reasonable steps to establish that the changes are supported by a majority of the club’s fans in England and Wales.”?
The shadow Minister is making a completely reasonable amendment. We have the emblem, colours and name. Does he agree that it would be helpful if the Minister explained why the name has been taken out for different treatment from the emblem and the colours?
I am sure that the Minister will have heard that contribution from my hon. Friend and will be able to pick up on that in her comments. He is right to identify that such a distinction has been made in the Bill.
What does this mean? For example, will an hour-long Twitter poll on what a club should do be sufficient? We have seen how clubs have sought to use X in some quite funny ways at times, but on something as serious as this, we need proper consultation. Instead, does the Minister expect that clubs will engage in a full, proper and open consultation with their fans, such as one that includes a call for evidence, votes on different proposals and genuine engagement from the clubs themselves? Otherwise, this all risks just being for show, rather than real consultation.
Why stop at just consultation? If a proposed change is sensible, justifiable and supported by a club’s reasoning, why would the club not be able to win over the majority of its fans, if the fans agree it is in the best interests of the club? Why are the Government, in this Bill’s drafting, afraid of allowing fans to have a real and final say on these matters? This is not about allowing fans to micro-manage a club; it is about recognising that the symbols, colours and names of clubs are all held in trust, not owned in a transactional sense.
Football club owners are, in truth, temporary stewards. Their role is not to reshape the soul of a club but to protect it and hopefully strengthen it before passing it on. Far too often we have seen the reverse: owners who arrive with branding ideas and marketing consultants, determined to reshape the club’s visual identity to fit a certain commercial strategy, often with little or no understanding of the local footballing tradition in that community. Supporters have had to campaign, protest and plead to get what should have been theirs almost by birthright: a say in the symbols of their club. Does the Minister agree that clause 49, if limited to just consultation, risks becoming just a tick-box exercise, particularly in clubs without strong fan representation models in place?
There is a precedent for this kind of requirement. In Germany, the so-called 50+1 rule ensures that fans retain majority voting rights over key aspects of club identity and operation. In Spain, the socios model does so too. To be clear, we are not calling for full fan ownership, but we are saying that, on issues of identity, the final word should ultimately rest with the fans. Let us remember that this amendment would apply only to three specific heritage areas: the club’s official name, the badge—or crest, depending on how we want to describe it—and the home shirt colours. This is not about banning innovation or marketing altogether. It is simply saying that, when it comes to fundamentals, supporters should have a say.
No, there are no sporting sanctions in the Bill. Those are not in scope. To take the point about the FA further, it has a long track record of being able to take a considered approach to name changes, to listening to fans and heritage concerns, and to taking appropriate action.
I welcome the fact that the Minister is saying, “Let’s trust existing organisations to do it”, rather than bringing it within the purview of a higher regulator. On the basis that the FA has exercised such responsibilities when it comes to names, why cannot it be trusted to have the same consideration for emblems and colours?
As I said, the FA, with oversight of the levels of football, is in a good position to ensure that name changes do not have unintended implications for clubs that are outside the regulator’s scope. It has done that point on names well. That is why we want to leave it to do the good job it is doing.
I am still a bit uneasy about those clubs that are not going to enter into the spirit of the really important part of the Bill: proper fan consultation. I come back to Sheffield Wednesday and its owner, who thinks sitting down for 10 hours of deliberation with hand-picked fan groups and not answering any questions amounts to a consultation—it does not.
I was interested in what the Minister said about how the regulator will have the right to issue guidance about how consultation should happen, and then there can be enforcement if the guidance is not followed, which means the guidance effectively becomes a requirement. I hope that we can elaborate on that later in the Committee’s discussions, as she indicated we would, because, without those backstop powers, there will be some club owners who regard the club as their personal possession and believe that no one has a right to interfere in how they run it.
I am intrigued to know whether, with all his experience, his chairmanship of the football all-party parliamentary group and his background with the Bill, the hon. Gentleman thinks he has yet received an adequate explanation from the Minister on why emblems and colours are treated differently from the names of clubs.
I am happy to write to the shadow Minister. I appreciate that we added this clause; it was not in the previous iteration of the Bill. That is why I was keen to talk about reasonability. We appreciate that insolvency is a complex, fast-paced, changing and challenging situation, but we also appreciate—Members have talked about different clubs that have gone into administration—the worry for fans, so we want to keep them as informed as reasonably possible. The shadow Minister asked me for something further in writing and I am very happy to provide that.
Again, I am concerned about the clash of duties. The Minister has already told us that her team and the insolvency team have met and considered this issue. In a period of liquidation, not putting additional debt into a company, or indeed spending cash, is one of the directors’ responsibilities, but this will undoubtedly cost the club. Has the Minister sought and received reassurances that this approach is consistent with the Insolvency Act?
Perhaps I will add the answer to that question to my letter to the shadow Minister, and I will copy it to the hon. Member for Spelthorne. The clause is clear that the duty will apply only as far as possible, because we do not want to add a burden at an already difficult time. As this is quite a complex but important point, I am happy to write to both hon. Gentlemen.
Question put and agreed to.
Clause 51 accordingly ordered to stand part of the Bill.
Clause 52
Duty to publish a personnel statement
Question proposed, That the clause stand part of the Bill.
I thank the shadow Minister for his amendment, and I thank the hon. Members for Cheltenham and for Newbury for their new clauses. I acknowledge the intent behind them.
We will shortly discuss the levy in more detail when I speak to clauses 53 and 54, but in short, the Bill gives the regulator the power to collect a levy to recover its running costs from football clubs that hold an operating licence. I will outline why the Government intend to resist this amendment and these new clauses before directly answering some of the specific points that hon. Members have put to me.
The levy arrangement follows the precedent of other regulators, such as the Financial Conduct Authority, the Competition and Markets Authority and Ofcom. As the regulator is designed to improve the financial sustainability of English football, it is vital that the associated costs do not burden clubs, especially those further down the pyramid.
Amendment 133 and new clause 5 seek to address similar issues relating to ensuring that small or lower-league clubs are not burdened by unaffordable costs as a result of this regulation. I assure the Committee that the Bill is already designed with National League clubs in mind. The regulator will be tasked with improving the financial sustainability of football, and placing an undue burden on small clubs would be completely contradictory to that aim.
Clause 53(10) introduces a statutory requirement for the regulator to have regard to each club’s individual financial circumstances, and the league in which it plays, when setting the levy. Given that requirement, we expect that the levy will be proportionate, with the Premier League—specifically the six clubs with the highest revenues—covering the majority of the cost. That solidarity will reduce the burden on clubs lower down the pyramid. No club should be charged more than it can afford.
Through its levy rules, the regulator will also have the power to exempt clubs from paying the levy. That power, provided by clause 53(8), ensures that there is a mechanism to avoid burdening clubs. If certain conditions set by the regulator through rules are met, the regulator has the discretion to exempt clubs from paying the levy—that answers the shadow Minister’s question. The power will work in conjunction with the requirement on the regulator to consider each individual club’s financial resources, and the competition in which it plays, when setting the levy, as well as the requirement to consult all regulated clubs on its levy rules.
On new clause 24, I agree wholeheartedly that the regulator should not place an undue burden on a club that has already entered administration. I reassure the hon. Member for Newbury that the regulator will set out its levy methodology, including the discretion to set the levy according to a club’s individual circumstances, and to exempt a club completely if specified conditions are met.
The regulator has a core objective of improving the financial sustainability of English football, and I am confident that it will be cognisant of the impact that the levy could have on any club, and especially a club in administration or other financial distress. The Bill’s provisions, such as the regulator’s discretion to exempt certain clubs from the levy, if necessary, account for that core objective.
In response to the shadow Minister, I note that there is no cap, but the regulator can set costs related only to its functions. As I have just outlined, under the powers granted to the regulator by the Bill, it could exempt small clubs from the levy, if that is deemed necessary. However, we do not think that mandating a complete exemption in legislation is appropriate. Exempting a whole league before an assessment has been made of whether clubs in that league can afford the levy would be disproportionate.
I want to clarify whether the Minister is entirely comfortable that the Government are in no way able to control the amount of money spent by the regulator. If, in fulfilling its duties, the regulator decided it was important to fly business class to meet UEFA and FIFA once a month—if I were the regulator, I could probably make the case that I was fulfilling my duties by doing that—it would create a huge cost and involve hiring additional staff. Are the Government really prepared to give the regulator a blank cheque?
There is no cap. However, I draw the hon. Gentleman’s attention to the regulatory principles we addressed earlier in the Bill. Obviously, the regulator needs to be proportionate and reasonable. The regulator will guide its operations according to those principles.
I say gently that I think the shadow Minister is misunderstanding, and I am happy to write to him. The amendment means that all functions can now be covered by the levy, whereas previously there were two funding mechanisms in the Bill. It is a technical change.
I agree with the Minister—my understanding of what she just said is the same—but that leaves a tiny bit of clarity still to be given. Will all the normal running costs of the regulator be met by the levy, and none by the taxpayer?
Yes, that is the intention.
Amendment 18 agreed to.
Amendments made: 19, in clause 53, page 42, line 13, leave out “leviable functions” and insert “functions under this Act”.
This amendment is consequential on Amendment 22.
Amendment 20, in clause 53, page 42, line 14, leave out “leviable functions” and insert “functions under this Act”.
This amendment is consequential on Amendment 22.
Amendment 21, in clause 53, page 42, line 19, leave out “leviable”.
This amendment is consequential on Amendment 22.
Amendment 22, in clause 53, page 42, line 26, leave out subsection (4).—(Stephanie Peacock.)
This amendment removes the definition of “leviable functions” so that the IFR may charge a levy for all of its functions under the Act.
The clause sets out the consultation process that the Government’s new regulator must follow before introducing or amending the rules governing the industry levy that clubs will pay to fund the regulator’s operations, as we discussed on clause 53. The clause is designed to ensure that any such changes are not made in a vacuum and that the regulator consults the right people, provides a draft of the rules and gathers feedback before finalising anything. On the face of it, this is a welcome safeguard, but, as is so often the case with this Bill, the detail deserves much closer scrutiny.
Let us be clear: the industry levy is not a trivial matter. It is the mechanism by which clubs will fund the regulator, and the amount of levy and the method by which it is calculated or collected could have serious financial consequences, especially for clubs operating on tight margins, as we have discussed. We are talking about a compulsory statutory payment, not a voluntary contribution or a negotiated fee. Any change to the rules governing the levy must therefore be subject to robust scrutiny, proper stakeholder input and full transparency.
The clause requires the regulator to consult a named list of stakeholders as well as any others it considers appropriate. It also requires a draft version of the proposed levy rules to be published as part of the consultation. So far, so good. But—this is a significant but—the clause also includes a major loophole.
The clause states that the Government’s regulator does not need to consult at all if it considers the proposed changes to the levy rules to be “minor”. Crucially, the regulator itself is to determine whether such a change is minor. Why is the regulator being permitted to define what counts as minor without any external check, threshold or approval? That creates a dangerous conflict of interest where the Minister’s regulator becomes the judge and jury in its own process. What is minor to the Government’s regulator may be highly significant to lower league clubs, such as a League Two or National League club trying to manage a tight budget.
Once again, the Bill has a significant risk of regulatory mission creep. We must consider the cumulative effect of so-called minor changes: one small rule adjustment may seem harmless, but several such changes made without consultation could over time significantly alter the levy framework, placing new burdens on clubs without ever facing proper scrutiny. That is how regulatory creep begins, and that is precisely what the clause should be guarding against, but, as drafted, it does not.
Would the Minister consider amending the clause to define “minor” changes more clearly, perhaps by setting out objective criteria or requiring approval from the Secretary of State, Parliament or an independent panel? Alternatively, would she consider a threshold mechanism where changes with a financial impact above a certain level must trigger consultation regardless of her own regulator’s view?
I suspect that the answer to those questions will be no, which is why I tabled amendment 102, which would remove the regulator’s power to skip consultation when it determines a change to be minor. The intent behind the exemption may be practical and be—to avoid unnecessary bureaucracy—but in reality it gives the Government’s regulator unilateral power to decide whether stakeholders should be consulted on changes that could have material financial consequences.
Crucially, the definition of “minor” is left entirely to the regulator’s own judgment, as I have said. There is no objective test, no threshold and no review. Will the Minister explain why the Government believe it is acceptable for a statutory regulator to decide, on its own authority, when it is allowed to bypass the requirement to consult clubs and stakeholders that will be legislated for by Parliament? In every other walk of regulated life, such exemptions would be expected to come with clear limits or external oversight, yet in this instance we are effectively giving the Government’s regulator the ability to mark its own homework.
Let us not forget that the levy is not an optional contribution but a statutory obligation. Clubs will have no choice but to pay whatever is set, which means that even small changes could have big consequences, particularly for those lower down the pyramid. What may seem minor to the regulator may not seem so minor to a National League club balancing its books.
Does the Minister recognise that cumulative so-called minor changes could, over time, significantly increase the regulatory burden on clubs without ever triggering a formal consultation? That is the risk of leaving this loophole in the Bill. It is not just about what the Government’s regulator might do today; it is also about what a future regulator—possibly a more activist regulator, although I hope not—might decide in years to come. We need to close the door now before that risk becomes reality.
If clubs are to have confidence in the new regulatory regime, they must feel that major financial decisions will not be made without their involvement. Even the perception that the Government’s regulator could tweak the levy regime unilaterally using the exemption for minor changes could erode trust, particularly among the smaller clubs that are already concerned. Consultation must not be seen as optional; it must be the default, not the exception.
That leads me to amendment 103, which aims to improve the clarity of the Government’s regulator’s approach to any levy that it seeks to impose. The specific issue that it seeks to correct is that, under the Bill as drafted, the regulator must publish details of the levy as soon as is reasonably practicable before the start of a chargeable period. My amendment would require the Government’s new regulator to publish the levy rules at least six months before the beginning of the chargeable period to which they apply. It is about financial certainty, about clubs being able to plan and about not changing the rules on the eve of a new season.
We know that many clubs, especially further down the pyramid, operate on tight annual budgets. They finalise player contracts, ticketing strategies and community programmes months in advance. A late change to the levy rate or calculation method could throw all that into confusion. The amendment would help to give English football clubs the clarity that they need to prepare. It would ensure that levy changes are not imposed at short notice and it would enforce a principle that reasonable regulators should provide advance notice of costs.
What safeguards, if any, will the Government establish to ensure that levy changes are communicated to the affected clubs in good time? If the answer is that it will be left to guidance or good practice, that will simply be not good enough. Good intentions are no substitute for legislative certainty. Both amendments are modest, reasonable and—we believe—entirely consistent with the Government’s stated ambition to build a trusted and transparent regulator that works with clubs, not over them. We must get the process right.
Clubs must know when a charge is coming and how much it will cost them and their fans, and they must be given a chance to respond. That is what the amendments would provide—nothing more and nothing less. Removing the minor change loophole would ensure that no future regulator could bypass scrutiny at its own convenience, and the requirement to provide six months’ notice would guarantee that clubs are not left scrambling to deal with cost changes with no time to prepare. This is about good governance, fair process and fiscal discipline.
Clause 54 provides the procedural backbone for how the Government’s regulator will engage with the industry when amending leverage rules.
Let me provide some context. I will not name the team, but there is a team in the National League whose cash at hand in 2020 was £25,000, and by 2022 that had reduced to £9,802. We are talking about clubs with an incredibly tight financial structure. I completely agree with my hon. Friend the shadow Minister that changes may be minor to the regulator, but they will not be minor to such teams.
I thank my hon. Friend for that valuable contribution, which gets to the heart of the amendments and what we are seeking to do. As I have said, they are designed not to undermine the regulator but to give transparency and fairness to clubs, so they can prepare their finances accordingly.
As I was saying, clause 54 leaves too much discretion in the hands of the regulator, particularly through the vague and undefined minor change exemption. We cannot create a system in which financial rules that affect the entire English game can be altered without oversight simply because the Government’s regulator says that the change is small or minor. If we want confidence, we need consistency. If we want accountability, we need clarity. Let us ensure that the Government’s regulator consults not just when it wants to, but when it needs to.
I thank the shadow Minister for tabling his amendments. Amendment 102 would require the regulator to consult every regulated club, the Secretary of State, the Treasury and others that the regulator considers appropriate, for minor changes to the levy rules. Clause 54 imposes a statutory duty on the regulator to consult the Secretary of State, His Majesty’s Treasury and regulated clubs, as well as other appropriate stakeholders, on its levy rules. However, clause 54(2) sets out that consultation is not needed for minor changes to the levy rules. This is intended to allow the regulator to make immaterial amendments or corrections such as typos or minor rewording without excessive bureaucratic burden.
The amendment would add a layer of unnecessary process that is unjustified given the extensive consultation requirements on substantial changes. It is not in anyone’s interest, especially the regulator’s, to stretch the definition of minor, which is a well-recognised legal term. If the regulator does not consult on a change that has made a material impact on a club, it could face a legal challenge through a judicial review. That will ensure that the regulator is accountable for what it considers minor.
I do not know whether the Minister has ever conducted a judicial review, but we could not get one done for £9,000.
I appreciate the hon. Gentleman’s point, but refer gently to my earlier comments. We are talking about typos and very minor changes. I give that example to show that the regulator is accountable for what it considers minor.
On amendment 103, requiring the regulator to publish the information on costs laid out in clause 54(4) six months before the chargeable period would create an operational challenge and would simply not work in practice. The regulator would have to estimate its costs for a chargeable period, having only half a year’s costs to base it on. That could lead to inaccurate levy charges, which could see the regulator underfunded or clubs needlessly burdened. The current requirement to publicise charges as soon as reasonably practicable strikes the right balance between adequate notice for clubs and operational flexibility for the regulator to ensure an accurate and appropriate levy charge.
For the reasons I have set out, I cannot accept the amendments.
(4 days, 8 hours ago)
Public Bill CommitteesSchedule 4 sets out the three threshold requirements—financial resources, non-financial resources and fan engagement—that clubs will have to meet in order to be granted a full operating licence. As I set out last week, to apply for a licence, a club must submit a business plan and a personnel statement. These are basic requirements that any club should be able to complete. As I have made clear, the regulator will support them with their applications wherever needed.
Before discussing the requirements for a full operating licence, I would like to correct a point I made last week regarding the hypothetical scenario where a club is not granted a provisional licence. I want to clarify that once a provisional licence is in force, a club must have a licence to be able to play in a specified competition.
As I have set out, to receive a provisional licence, a club must submit a business plan and a personnel statement. We think these are basic requirements that any club should be able to complete, and the regulator will support them with their applications where needed.
The Minister mentioned the two criteria of the business plan and the personnel statement. I thought from our discussions last week that giving the regulator any form of information that the regulator so requested was an additional condition.
The two I mentioned are the basic points. The regulator has the ability to ask for further information should they want it. I think I gave the example that if the regulator is unsure about the source of funds, or whether there is enough, it could ask for more information. That will be at the discretion of the regulator—we had a well-rehearsed debate on that point last week.
We think that the requirements for a provisional licence are basic requirements that any club should be able to complete. As I was really keen to stress in the debate last week, the regulator will be keen to work with clubs to do everything it can to help them to meet those requirements.
The regulator needs to be satisfied that a club will be able to meet the mandatory licence conditions and duties on clubs once it has been granted a licence. This is a forward-looking “would comply” test. The expectation is that the provision of information and documentation, as well as the engagement with clubs as part of the application process, will be sufficient to satisfy the regulator. It should be straightforward for all clubs to obtain a provisional licence. Once they are in the regulatory system, a club will have time to improve standards up to the necessary requirements for a full licence, with the support of the regulator as needed.
I am sure that the Minister realises that one of the variants in a club’s business plan is whether its matches are selected for being televised. It is an incredibly haphazard process and difficult to predict, because they are decided within season. What guidance will the Minister give, as the appointer of the regulator, as to reasonable assumptions in the business plan regarding expected television revenue in season?
I understand the point that the hon. Lady makes, but we still believe that clubs have a right to representation and to appeal, which is what this amendment seeks to put into the Bill.
My amendment would fix the problem. It would require the Government’s regulator, before making any decision to revoke a licence, to provide the club with written notice of its intention to do so, and not just stating that it will be revoked but setting out the reasons and the evidence relied on. The club would then be entitled to respond—to make representations within a reasonable timeframe, to challenge the basis of the proposed revocation and to outline any mitigating circumstances or corrective measures.
Such a mechanism would not just be fair; we believe that it is necessary. The consequences of revocation of an operating licence are profound. It would prevent a club from competing in the regulated pyramid, as has been highlighted already. That would be likely to trigger financial collapse, job losses and irreparable harm to the club’s standing and its local community. Therefore, the decision to revoke must be taken only after the fullest consideration, and that cannot happen if one side is not allowed to speak.
There is a broader point about public confidence in the Government’s new regulator. For it to earn the trust of clubs, fans and the wider footballing ecosystem, it must be seen to operate fairly and transparently. Due process, consultation and the right to be heard before sanctions are imposed are all basic principles of good governance and the basis of justice. By incorporating my amendment in clause 19, we would be helping to enshrine those values at the heart of the regulator’s enforcement powers.
I urge the Committee to consider the precedent being set. If we allow revocations to occur without a statutory right to respond, we risk creating a regulatory regime that is reactive rather than reflective—one that punishes rather than reforms. That would be to the detriment of the game as a whole, particularly if clubs are chucked out or have their licence removed midway through a season. That would cause a much greater ripple across the league system.
Let me be clear: this amendment does not seek to tie the regulator’s hands. It does not require the regulator to delay action indefinitely or to overlook serious misconduct. What it does do is ensure that any action is taken with the full knowledge of the facts and with the benefit of a fair and balanced process. As we have heard already, clubs, especially those in lower leagues, do not have legions of lawyers or vast compliance departments. Despite best intentions, they may make genuine mistakes or fall foul of complex regulations. We must allow them the chance to explain, to engage and, where appropriate, to put things right, before the ultimate sanction is imposed.
This is a measured, sensible and proportionate amendment. It aligns with principles that Members across the House support, and I hope that the Committee will support it. If we are serious about building a strong, fair and sustainable regulatory regime, we must ensure that justice is not only done but seen to be done. On my broader concerns about the drafting of the clause, I ask the Minister what transparency will apply in such situations.
Does my hon. Friend agree that his amendment is very much in the spirit of football? We have seen many injury time winners, when all the odds are stacked against a club, but in the dying moments they manage to rescue an almost impossible situation. So it is not only in the spirit of fairness, but in the spirit of football.
I thank my hon. Friend for putting it very poetically. He talks about the spirit of football. I am not sure how many last-minute winners Chelsea have scored over the years, but he might have misbehaved on the terraces with joy and jubilation when it has happened. His description was much nicer than calling it the VAR amendment, which would not have been so popular across the House. His point is well made.
Will the regulator be required to publish clear criteria and case-by-case justifications for any licence revocation, so that Parliament, the press and the public can understand why the decision was taken? What consideration will be given to the fanbase—the loyal supporters who may find their club’s future in jeopardy through no fault of their own? How will we be acting in the interest of fans of English football if we do not have transparency?
We must also bear in mind the risk of regulatory overreach. Such a power as this, unless it is tightly constrained, could inadvertently create uncertainty and instability in the football ecosystem. Clubs, owners and investors must know where they stand. A stable regulatory environment, not a reactive or arbitrary one, is essential if the Government’s new regulator is to command respect, not just fear. I hope the Minister provides more clarity on how her new regulator will apply clause 19 in practice and on what guidance will be issued to ensure that the power of revocation is exercised only with great caution and care. When dealing with a matter as serious as extinguishing the operating licence of a football club, we owe it to the game and to the people who love it to think through every safeguard properly.
My hon. Friend is absolutely right. No one wants to see the regulator come in and compel clubs to change ownership. That is not the intention. Encouraging owners to behave better so that that intervention is not necessary is of course the ideal outcome, but history would teach us that not every power or potential use of power will compel some owners to behave properly. This is about what happens when they do not.
The whole purpose of these arrangements in the Bill is to stop the Burys happening again, or to stop the situation at Reading getting worse than it did. At this stage, I do not see where the power is for the regulator to do anything other than to say that someone is not a fit and proper person.
Has the hon. Gentleman considered that, essentially, we are talking about the state seizing someone’s assets and giving them to someone else? If a club falls into administration, the administrator is governed by a very strict set of laws in terms of treating all creditors fairly. Is he not concerned that this power could fly in the face of existing powers for the administration of companies?
The hon. Member raises a worthwhile point for consideration. It may be that in the situation of Reading, if it had not changed ownership, the club would have gone into administration, because it would have had no income coming in because it could not play in the competition. That is entirely possible. It is possible that the chairman could just walk away and say, “Right, I am dissolving this organisation—I am off.” That would not be acceptable for fans.
That is why I said at the beginning that it is a complicated legal issue, and I am not saying that I have the only solution here. What I am saying is that there is a problem that does not currently appear to have a solution in the Bill. It is a problem. I keep going back to the situation at Sheffield Wednesday. We have a situation where an owner is running out of money. We do not even know where his money comes from. It clearly does not come from his companies, because his companies are loss-making. Is he being supported by his family? Is the Thai Union Group providing the money? Is the family trust providing the money? The regulator will have the power to find the source of funding, which might be quite interesting in some cases. We had a situation at Leeds a few years ago where we did not even know who owned the club.
Getting that information on the record and giving the regulator powers to find out who actually owns the club, what the source of funding is and whether the beneficial owner is the same as the owner who claims to be the owner are important issues, but then we get to the point where the owner is found to be not fit and proper. What actually happens? I do not know the answer. I have read the Bill many times and debated it many times, and still do not know the answer. There has to be an answer.
My understanding of the Bill is that under those circumstances, they would lose their licence to operate.
They would, and therefore the club disappears. No one wants to see that. The whole purpose of the Bill is to stop clubs disappearing, to stop what happened to Bury, and so there is a gap in the legislation, because what happens in that situation? It nearly happened at Reading—the club nearly disappeared, but in the end it was a last-minute sale. If the owner had not sold it at the last minute, however, the EFL has no powers to deal with it, and the regulator will not either. The regulator has the power to say: “You shouldn’t be owning the club. You shouldn’t have a licence to operate the club, because of what you have done, you haven’t got the funds, your source of funds is inappropriate”—all those things—but then what happens?
I am saying to the Minister that the whole intention of the Bill is to ensure that the clubs that fans have supported for years, for generations—for communities, it is their club—do not disappear, go out of business or lose their place in the competition they are playing in. Clubs might get relegated, that is fine, but they should not lose their place because they have an owner who is not fit and proper, and does not meet the test. We have to find way of dealing with this, which the Bill does not do as drafted.
(1 week, 2 days ago)
Public Bill CommitteesThe Lib Dem spokesman makes an interesting comparison. As I said in the Committee’s debate on Tuesday, my focus is on football, and I am outlining with this amendment my concerns about the interactions of a sport with other international competitions. I will come on to explain why football in particular is interwoven with international principles. The majority of fans want to focus on the sport, rather than politics. I am sure that there are many more debates to be had on issues such as the ECHR in the rest of this Parliament. I will stick to football today, but I appreciate the hon. Gentleman’s comments.
UEFA’s ultimate sanction would be excluding the federation from UEFA and teams from competitions. That risk is very real: it has happened before and can happen again. In 2006, the Greek football federation was banned from European competition. People might argue that I am trying to scaremonger, but I am trying to highlight that this is a real risk.
It is important to clarify what FIFA and UEFA mean by “third-party interference”. It is not a casual term; it is clearly defined in their statutes. It refers to instances where public authorities, including Governments or regulators created by Government legislation, exert influence over how football is run in a way that compromises the independence of football associations and clubs. Examples include dictating the appointment or removal of club directors—which the Bill does—influencing the outcome of football disciplinary procedures and imposing governance models that conflict with internationally recognised standards.
Any new licensing requirements introduced by the IFR must be meticulously aligned with existing UEFA and national frameworks. It is therefore important that the IFR’s licensing criteria are complementary to football and created in full consultation with clubs and any other affected parties. Does the Minister accept that clubs, as entities directly impacted by licensing regulations, must have a full voice in the development and implementation of those requirements? What consultation are the Government or their regulator currently undertaking on these regulations?
Let me be clear: I understand that the creation of the IFR in and of itself is on the borderline of what constitutes third-party interference. We are taking great care to help the Government to redesign a regulator that is fully independent of Ministers and professionally competent. However, in the absence of clear statutory guidelines to avoid conflicts with international rules, there is a risk, or perhaps even an inevitability, that the Government’s regulator may, at some point in the future, cross a line drawn by UEFA or FIFA.
It is a pleasure to serve under your chairmanship, Mr Turner. The shadow Minister is making a pertinent and important point. If the independent football regulator were inadvertently to cross lines into the jurisdictions of UEFA or FIFA, it could be catastrophic for English football. Clearly, that is not the purpose of the regulator. Given the success of many English teams in Europe, that would have serious ramifications. I genuinely think that the shadow Minister’s amendment is meant to be helpful and is incredibly important.
I thank my hon. Friend for making that point. That is exactly what we are trying to do. This is not a wrecking amendment; we are just trying to tighten the Bill to ensure that no conflict arises that would damage the participation of English clubs or the national team in future competitions.
We know that UEFA is concerned about the potential for scope creep and that the Government’s regulator may expand its mandate beyond its loosely defined current competences. That expansion, intentional or otherwise, into broader aspects of football governance could undermine established structures and processes of the sport and amount to Government interference.
That is why my amendment is needed. It would place a duty on the regulator to abide by long pre-existing international frameworks within which English football exists. It requires the Government’s regulator to ensure that, in pursuing its objectives, it does not create legal or procedural clashes with the statutes of FIFA and UEFA. Legislation that compromises the FA’s autonomy as the primary regulator of football in England would be non-compliant with those international statutes, which are upheld and enforced rigorously across Europe and globally.
Some may ask why Parliament should concern itself with the rules of unelected international bodies. Why not simply legislate as we see fit and allow the regulator to act as robustly as necessary? On the surface, that is a fair political question, but we must recognise the reality of football governance. FIFA and UEFA are not advisory bodies; they are the organisations through which our clubs gain access to international competitions, including European competitions. They are custodians of the World cup, the European championship and the Champions League, to name just a few. Their statutes form part of the accepted legal architecture of the global game and all member associations, including the FA, are bound by them.
I would argue very strongly that when the English football team finally wins the World cup, it will get much more out of FIFA than this country would ever get out of the European Union.
English football does not exist in a vacuum, but the Bill acts as if it does. The global football ecosystem is fantastically complex, but the Bill is simple, clunky and—I am afraid to say—full of holes, which would potentially leave English football to drown among its international competition. I also fear that it will create even more legal cases, whereby clubs end up spending more time in courts than they do focusing on the football matches themselves.
To act as if we can disregard those international rules, or to suggest that a domestic regulator can impose conditions without reference to them, would be to invite precisely the sort of jurisdictional collision that could see English football punished because of the good intentions of Members of this House. We cannot just pander to the politics; we must be practical about the potential havoc that the Bill will wreak across the English football pyramid.
If FIFA or UEFA were to exclude English clubs or the national team from international competitions as a result of perceived third-party interference, the consequences would be nothing short of catastrophic. As hon. Members will know, the Premier League generates more than £6 billion in revenue annually, with over £1.8 billion coming from overseas broadcasting rights alone. In fact, I understand that the Premier League is the first sporting competition in Europe to generate more from its international broadcasting rights than it does from its domestic rights.
I suspect that Government Members will oppose the amendment. Given that, does my hon. Friend think that it would be reasonable of me to ask the Minister the extent to which UEFA has seen the Bill and signed it off as something that does not constitute political interference either way?
I thank my hon. Friend for that intervention. That is something that we discussed at some length during the Committee’s first sitting. It is disappointing that all members of the Committee, including my hon. Friend, do not have access to that information to help them to make informed decisions.
I appreciate some of the what-aboutery and counter-arguments that are made, but, as I have said, I will defend the right of Committee members to have full access to information. It is so important, in particular given the Committee’s function in respect of this legislation, that its members should have full and frank information. It is disappointing that that has not been disclosed so that we can fully understand all the risks.
The Premier League’s broadcasting rights are in no small part predicated on English clubs’ participation in the Champions League and the Europa League. Exclusion from those competitions would make our top clubs less attractive to global audiences and sponsors, shrinking the broadcast value of the league and undermining its international appeal.
Without wishing to confuse my sporting metaphors, that would have a knock-on effect further down the pyramid. If the Premier League makes less money, there is less money to distribute to the English Football League or the National League, which we will come on to when we consider other parts of the Bill. The Champions League alone contributes more than £300 million each season to English clubs, not including the knock-on commercial benefits. For top clubs, it accounts for up to 20% of their total revenue. Stripping that away would lead to cost-cutting, player sales and job losses, not just in clubs themselves but across the local economies that depend on matchday trade and revenue.
The FA also receives critical funding linked to England’s participation in international tournaments, as I know a number of pubs do; for example, when we are in the Euros in the summer, that normally means that the economy receives a boost. A ban from the World cup or the European championship would not only harm national pride but cut investment in grassroots football, which is often funded in part through FIFA’s global redistribution programmes or revenues generated by the national team.
Mr Turner, you will have seen the declaration of interests that I made on Tuesday. I seek the Committee’s indulgence; this is the only gratuitous intervention that I will make. Can the shadow Minister remind the Committee of the identity of the only team who have won every major European trophy, having recently won the UEFA Conference League?
I agree with the shadow Minister. I suppose there is a not-too-fanciful theoretical situation in which the football regulator makes a decision on the ownership of a club that has otherwise qualified for the Champions League, and that decision was made by a body headed up by someone who had donated to the Prime Minister of the country. I think that that would be a problem. However, if clause 7 were amended, he would have to recuse himself, or the body would have to deal with it in a different way. My hon. Friend demonstrates perhaps the most likely scenario and the most powerful justification for backing the amendment. I urge all Members to do so.
I ask the Minister to respond to this simple question: has the Bill as drafted been shared with UEFA? Is UEFA satisfied that it does not represent political control?
I thank the hon. Member for that intervention. As I said, it really is about transparency. We believe that we, as elected Members of this House, need to have an understanding of the impact that the regulator will have on the ultimate person, which in this case is the club’s fans. That is what the amendment seeks to do.
I understand the hon. Member’s point, and I did say that the causes of price increases are complex. I will not read out all the figures, but clubs’ costs have increased just this year, whether because of energy bills, national insurance or wages. We are concerned about the burdens and requirements that the regulator will impose on clubs increasing their costs and about those being passed on to the end fan, who is already under significant pressure.
Ticket prices are not an incidental issue; they are a barometer of whether the game remains accessible to its core community. We know that regulation drives up prices, through compliance costs, as I have said, and by reducing investment and squeezing margins even further. The Government must have the courage to recognise that and to adjust course if necessary by ensuring greater transparency about costs. Requiring the regulator to report on that, in its general state of the game report and its annual report, would embed an essential feedback loop in statue. It would ensure that the impact on fans was not an afterthought, but a standing obligation for the regulator.
It is not enough for the Government’s regulator to simply say, “We have improved governance and we ensure sustainability,” if we then learn, in the same breath, that the average family can no longer afford to attend any more games. Football cannot become financially sustainable by pricing out its own supporters: I suspect all Members would agree on that point. I would add that ticket affordability is a deeply traditional concern. It goes to the very heart of football’s place in English lives. Fans must not be priced out of their favourite club in the name of regulation. If we forget that, we forget the point of the Bill, which is the fans.
Let me also stress that the amendment does not restrict the regulator. It does not tie its hands; it simply requires transparency. It says to the Government’s regulator: “If your actions are driving up the cost of entry to the game, tell us, tell the fans and tell Parliament.” Then, we can at least have an honest discussion in this House about whether those actions are justified or proportionate. That is especially important when we consider that many of the regulator’s decisions, whether on licensing, financial rules or ownership models, will almost certainly have financial consequences. Clubs will find ways to balance their books, as the hon. Member for Cheltenham just intervened to say, and if the regulation increases their fixed costs, the easiest lever to pull is ticket price. That is not conjecture; it is basic economics—although we know that some members of the Labour party struggle with that.
In the end, these two amendments ask only that we shine a light on the question that supporters ask every season: “Why is it getting more expensive to watch my club?” If relegation is part of the answer—[Interruption]—or rather if regulation is; relegation is definitely part of the answer—then we have a duty in this House to know and to ensure that we make laws that shine a light and ensure transparency for everyone to understand.
I rise as someone who currently has an invitation in my inbox to renew my season ticket for an eye-watering £950. I would love to know where all that money goes, as the shadow spokesman said, and why the price has gone in the direction it has.
The amendment should not be seen as counter to the regulator. There was significant pushback from the Government Benches when we tried to amend the regulator in terms of size and pay, and we also discussed the budget. If, in a regulated environment, the ticket price went up from £950 to, say, £980, then this amendment would ensure that fans were made aware that that 30 quid had gone on being part of a regulated industry. That is a perfectly reasonable thing for us to want to communicate with the viewing public. Equally, it would create a relationship between the fan and the regulator that might not otherwise be there, so I support the amendment.
We are strongly opposed to the amendment, for a few reasons. First, it will be impossible for the regulator to know whether its actions and costs are being reflected in ticket prices. It must be absolutely obvious to everyone that the cost of the regulator per club is dwarfed by the salaries of the first team of a Premier League club alone. A bit of back-of-a-fag-packet maths tell us that. I am aware that the hon. Member for Isle of Wight East is not keen on this, but it is important for us just to use some simple logic. It will be impossible for the regulator to know, so it will have to go to the football clubs and ask the owners, who, let’s face it, might have an interest in blaming the regulator for increased ticket prices, whether or not the actions of the regulator have been the cause.
The Liberal Democrat spokesman talks about dodgy owners. My season ticket is for a Premier League club; a season ticket for, say, Ashford Town (Middlesex) FC for the forthcoming season is £130. I think part of the function of this amendment is to make the regulator aware of the costs that it puts on well-run but smaller clubs. Simply making decisions and acting under this legislation without any sense of the financial impact and imposition that it is making on those clubs would be a very worrying way to do business, but the amendment would slightly redress the balance between club and regulator.
It is not clear to me that Ashford Town (Middlesex) would be one of the clubs covered by the regulator. I am not sure what division they are in, but I do not think they are in the top five at the moment, although I wish them well in the forthcoming season and their efforts for promotion.
(1 week, 2 days ago)
Public Bill CommitteesI thank the hon. Gentleman for his amendment, but I am not sure that his remarks spoke much to the detail of it. I remind him that this part of the Bill has not been changed since its previous iteration under the last Government. He has once again made his well-rehearsed argument about UEFA, but there is no risk in that regard. We have been very clear. UEFA and FIFA are happy with the Bill as drafted, and the FA has made that clear to Members of both Houses.
The purpose of the clause is to allow the Secretary of State the power to prepare a football governance statement that sets out the Government’s policies on issues related to football governance, where these are consistent with the regulator’s statutory remit. We believe that this is an important tool that the Government can use to set out their priorities in football governance, similar to the way that the Government give a strategic steer to the Competition and Markets Authority and other regulators.
We drafted the provision with appropriate deference to Parliament. Any statement must be consistent with the purpose of the Bill and the regulator’s objectives as set out in the Bill. The Committee has already considered that purpose and those objectives and has approved them. Parliament has set out the statutory remit, but it is appropriate that the Government of the day are able to set out their policy priorities within that well-defined remit without requiring parliamentary approval each time. There are also restrictions on when statements can be made, to ensure that they are not overused. Any statement must be published and laid before Parliament, so Parliament can hold the Secretary of State accountable for its content. Requiring the Secretary of State to gain approval for this statement would add an extra burden to Parliament.
I struggle to understand what might be contained in the Government policy statements. The Minister is steeped in this legislation, so must have discussed this in the past. Can she give the Committee an indication of what sort of thing might be covered?
That is obviously not what this amendment is about. It is about transparency. It is not about the overall cost, but about the transparency of the cost. The hon. Gentleman asks about how things would have been funded before, but we have to accept that we are in different economic circumstances. A number of costs have impacted clubs already. I am talking about the cumulative impact of Government policy—the Minister has heard me say this in a number of debates, including in the debate on swimming yesterday—on clubs from the elite level all the way down to the grassroots level. The point is that there are now extra costs from the regulator, on top of the national insurance increase, which we think has probably been the biggest change, the changes to business rates calculations, which have negatively impacted a number of businesses, and wage increases. Hon. Members may or may not agree with those costs, but we are talking about their cumulative impact.
Because it is ultimately funded by the clubs, the regulator will increase those costs. The hon. Gentleman talks about how we perceived it would be paid for. The clubs will pay the costs of the regulator—that has not changed—but we are trying to get at the cumulative impact. We want transparency about that impact on clubs, including for Parliament, so that we, as hon. Members who represent constituencies around the country, can have informed debates about the impact on English football of the decisions that we make in this House. As Members of this House, it is not unreasonable to want to understand the impact of our and the regulator’s decisions. Whether or not hon. Members agree with the amendments, they make it quite clear that we are calling for transparency on the costs of the regulator.
It is important for the House to understand that once an organisation is in the hands of the regulator, it has no choice. I was a director of a company that was applying for an operating licence from a national regulator. It cost millions of pounds, and we never achieved it—we tried three times, and never got there. As long as the regulator is doing its regulatory work, that is okay as far as it is concerned. There can be circumstances in which regulators, as long as things are being done by the rulebook, do not care about the growth of their industry. The amendment is a reasonable counterbalance to that, and would ensure that the regulator understands the financial burden it is putting on teams.
I thank my hon. Friend for sharing his experience of regulation more generally. He highlights an important point about growth, which we were trying to get at with our earlier amendment and which we have discussed again this afternoon. Unless the regulator has a clear growth mandate—as I said in the previous debate, I understand that the Chancellor is consulting regulators for growth ideas—it may not seek to stick to it, and it could therefore become obsessed with other issues and regulations. This amendment is not trying to alter what the regulator does; it is just trying to ensure that we have information on costs so that Members of this House can understand the impact. Again, I believe that is a valuable tool for us to have.
I thank the shadow Minister for his amendment. He gave a wide-ranging speech, and I will focus my remarks on the amendment itself, but I will first respond to a couple of points that were made. Towards the end of his speech, he commented that regulation has not been done well for the past 20 years—perhaps I should remind him of who was in government for most of that time. [Interruption.] Indeed, the past 20 years. The hon. Member for Isle of Wight East said that some members of the Committee may or may not think that the regulator is a good thing. But of course we all stood on a manifesto that included it, so I hope that most Members here think it a good idea; fans up and down the country certainly agree that it is.
In speaking to the amendment, I again remind the Committee that no changes have been made since the previous Bill. The Government agree that it is vital that the cost of regulation should not place an undue burden on clubs. That is why we have designed an agile and light-touch regulator that takes a collaborative approach with those it regulates. Unfortunately, the amendment could do the exact opposite of what I think it intends. If the regulator were to track and publish compliance costs every year, it would need all clubs to measure and report on that on an ongoing basis.
What makes the Minister think that clubs themselves would not, as a normal matter of course, be noting their compliance costs?
Clubs may well do that, absolutely, but the amendment goes further than is needed and I will continue to make the case as to why I simply do not think it is necessary. It could involve the lengthy and onerous process of identifying and separating compliance costs from their overall operational costs. Reporting on compliance costs would drive up those costs unnecessarily. The regulator and Department will already be required to undertake monitoring and evaluation of the impact of regulation; that includes the review of the Act by the Secretary of State as per clause 96. For those reasons, I cannot accept the amendment and I ask the hon. Member for Old Bexley and Sidcup to withdraw it.
It is a pleasure to serve under your chairmanship, Ms Butler. Subsection (3)(c) of clause 16 is an absolute Trojan horse; it gives carte blanche to the regulator to demand whatever it wants, regardless of whether a club produces such documents or information on a routine basis. Anyone who has worked with a regulator will know that means that clubs will have to employ lawyers, because they would never submit anything to their regulator unless it had been through lawyers first.
The shadow Minister used the phrase “blank cheque”, but it is almost a blank invoice to the poor clubs that will simply have to comply. When a regulator says, “Jump”, they do not say, “Why?”; they say, “How high?” However high the bar is set, they have to get over it. It is completely reasonable, at this stage of the regulator’s development, to seek limits so that it can take some very well-defined steps in regulating football, prior to giving it the carte blanche that subsection (3)(c) represents. As the shadow Minister said, I fear that the unintended consequences of subsection (3)(c) will be considerable.
Does the hon. Gentleman accept that regulation evolves anyway? My brother runs a property business, and I can tell the hon. Gentleman that what he was first required to deliver to his regulator in 2012, when he set that business up, versus what he is required to deliver today has changed beyond imagination. Things move all the time, so it is appropriate for the regulator to be able to determine what it needs to perform the relevant functions.
Regulation does indeed evolve, but giving this football regulator carte blanche to evolve it without any recourse to Parliament is a key weakness of the Bill’s current drafting, which is why I support amendment 99.
The shadow Minister has already set out in great but necessary detail the reasons why amendments 99 and 100 have been tabled and should be supported. The issue is that subsections (3)(c) and (5)(b) of clause 16 provide a catch-all that allows the regulator to include such other information and documentation as it may specify when a club applies for a provisional operating licence. I support these amendments because I think those two provisions open the floodgates unnecessarily, and clause 16 already sets out the things that the regulator wants to see football clubs submit. To have that completely open floodgate is a problem for the reasons given.
If the Government were keen to have some flexibility here, they could have allowed the Secretary of State to specify any other such information in the future. At least there would then be some accountability via the Secretary of State’s being an elected person and ultimately accountable to Parliament. The particular issue here is that the regulator, once set up, does not have direct accountability, and therefore it would be easy for it to start stipulating all sorts of things. I support the amendments and I think that it should be tight, but the Government could have steered a halfway course here by retaining some powers for the Secretary of State, rather than the unelected regulator.
The hon. Gentleman can make that well-rehearsed comment, but I specifically said there are no changes to this part of the Bill. I am focused on what we are talking about, and the parts of the Bill that amendments 99 and 100 relate to have not been changed. He also said that he would not oppose just for the sake of it, but that does seem to be what he is doing.
My hon. Friend the Member for Isle of Wight East and I were not here in the last Parliament, so what went on and the provenance of the Bill are not really our concern. We are being asked to contribute to the discussion and the debate on the Bill that has been placed before us. Neither of us saw the last one, so these are genuine points.
I take that point, but both the hon. Gentlemen stood on a manifesto that committed to introducing the Bill.
The Minister just said something that I am not quite clear about; perhaps, given my hon. Friend’s experience, he could explain it to me. If a club gets promoted to the English Football League—the happiest day of the club’s history—it then has to apply to become regulated, but if it does not have that licence by the beginning of the next season, the Minister just said that it can play. Where should I look in the Bill to understand the latitude that clubs have to play in the English Football League without regulation?
The granting of a provisional operating licence will act as a first step towards a club gaining a full operating licence, and will allow the club to operate for a time-limited period. That will be up to three years initially, although it could be shortened or extended depending on the circumstances. This provisional period will allow the regulator time to assess the current standing of the club and determine what steps will need to be taken to attain a full operating licence, as well as giving the club the time to take those necessary steps. The club will provide a personnel statement and a strategic business plan as part of the application process, providing an overview of the club’s operations and financial information.
Once a club has a provisional licence, it will be required to meet basic requirements set out in the mandatory conditions, as well as to comply with the free-standing duties contained in the Bill. This will help to safeguard the club’s sustainability and heritage. There are three aspects to the test that the regulator will apply when deciding whether to grant a provisional operating licence. First, the club must operate a team in a specified competition, which effectively means that the club must be in scope of the regulator. Secondly, the club will comply with the mandatory licence conditions that will be attached to the licence by the regulator; full details of the mandatory licence conditions are in schedule 5. The third aspect is that the club will comply with the duties on clubs, as set out in part 5.
If the regulator is not satisfied that the club meets all the elements of the test, it must let the club know and give it an opportunity to engage with the regulator to rectify the issues identified before the regulator takes a decision. That collaborative approach will aim to ensure that clubs are given every opportunity to meet the requirements and gain a provisional operating licence.
The test for a provisional licence has been carefully designed to get clubs into the regulatory system as quickly as possible, and then to give them a transition period to raise standards, if necessary, and obtain a full licence.
The Minister said that clubs would still be allowed to play in the absence of a provisional operating licence. How long would they be allowed to play for before being granted such a licence?
We do not anticipate that happening. Enforcement would take place, but we do not want the regulator to stop clubs being able to play. I am outlining how the regulator will do everything it can. The information is fairly basic, and the aim is to move as quickly as possible, so we anticipate clubs being able to receive that provisional licence.
Clause 18 establishes the second step of a two-step licensing process designed to ensure a smooth transition to regulation. Being granted a full operating licence should be the aim of all clubs in scope of the regulator. The full licence means that the regulator is satisfied that the club meets all relevant requirements, including the threshold requirements. For a club to pass the test for a full licence, the regulator must be satisfied that the club
“meets the threshold requirements set out in Schedule 4”
and is complying with and
“would continue to comply with the mandatory licence conditions”
and the free-standing duties on clubs set out in part 5. Finally, the regulator must not have determined
“that any person who is an owner or officer of the club is not suitable”
for the position they hold.
The clause also details the power that the regulator has to extend the provisional operating licence for a club. That will be done only if the regulator believes that the club does not meet the bar for a full licence at present, but will do if given more time. Clubs will have had time and support, while provisionally licensed, to ensure that they can meet the higher bar for a full licence. Once the club has a full licence, it will not have to be periodically reviewed. Instead, the regulator will continue to monitor and supervise the club. There will be an annual touchpoint in the form of an annual declaration, in which the club will notify the regulator of any relevant changes. That will minimise burdens while still ensuring that the club continues to adhere to the necessary requirements, including requirements that ensure that fans’ best interests are at the heart of the club’s decision-making process. I commend the clauses to the Committee.
(1 week, 4 days ago)
Public Bill CommitteesI am a member of the Robins Trust at Cheltenham Town.
It is a pleasure to serve under your chairmanship, Sir Jeremy. It is disappointing to see the return of amendments 132 and 74 after the extensive debate in the other place, where it was made very clear that they would likely make the Bill hybrid. I will respond to some of the points that Committee members have made but will outline the Government’s position first. Throughout the development of the policy, there have been countless opportunities for all affected and interested parties to make representations on scope. These wrecking amendments would serve no purpose other than to kick the legislation into the long grass.
The hon. Member for Isle of Wight East, a new Member, said that amendment 132 would be a simple addition. He should know that the addition of those competitions would indeed make the Bill hybrid. As I said, the issue was debated extensively in the House of Lords. The amendment would unnecessarily delay a Bill that was in both parties’ manifestos. This time last year, I spent many hours in a room on this corridor debating the previous Government’s version of the Bill; the hon. Gentleman, of course, stood on a manifesto that committed to it.
I regret that I have not spent as long as the Minister has in considering this issue. Could she point me to the clauses that make it absolutely clear that the English national team could not be taken within the scope of the regulator and that “a club” could not apply to the Football Association?
I thank the hon. Gentleman for his contribution; I will come to debate some of the points that he has made later in the Bill. We are very clear that UEFA and FIFA have no issue with the Bill and that the England national team do not fall foul in any way of this legislation.
I move on to the amendments. I understand the desire for up-front clarity in the Bill about which competitions will initially be in scope. There is a sound policy rationale for the approach that we have taken in clause 2. By delegating to secondary legislation, we are merely following the precedent established by other, similar, sport-related legislation, including the Safety of Sports Grounds Act 1975 and the Football Spectators Act 1989. The delegated power ensures that the competitions in scope can be amended in a timely manner and that the scope of the regime remains relevant. It future-proofs for future innovation and protects against circumvention by ensuring that clubs and competition organisers cannot simply reconstitute, rename or establish new competitions to avoid the regulator’s regime.
As mentioned, the intended scope of the regulator is well known and has involved extensive consultation with the clubs and leagues that will be in scope. Any changes in the future would again require consultation and would be subject to appropriate parliamentary scrutiny under the affirmative procedure.
Again, I think we are broadening what I am talking about to a slightly different point—[Interruption.] Hold on! The hon. Lady’s point is whether Select Committees have the right to disagree with the Government and vice versa. That is not the point I am making. My point is that members of the Select Committee should have the information to make their decisions. What I am talking about here is clear: I am trying to ensure that all Committee members, of all different parties, have the information that they require to make informed decisions as elected Members of this House.
I thank the shadow Minister for giving way. In essence, with this amendment, we are trying to set the regulator up for success. Presumably the question mark about whether someone appointed was the best person for the job—as opposed to any extraneous influence that donations might have had—should be the primary consideration.
I thank my hon. Friend for that contribution, because that is exactly the point I am trying to make. Now or in the future, we do not want the appointment of whoever is appointed as chair to be marred by perceived conflicts of interest. As I have said, that would undermine that crucial and important role of the regulator in the football pyramid. As the Minister has said—I agree fully—we hoped that clubs and leagues would have come to a consensus many years ago that would have solved many of the issues that still exist in football. The chair of the football all-party parliamentary group, the hon. Member for Sheffield South East, who sits on this Committee, has done more work on this issue than most people in the room—I thank him for that—but the fact is, we are here now to set up a regulator who is supposed to be independent of politics and of having any perceived bias for any league or club, and that is difficult.
I make this point again, without being unsympathetic to the situation for this or previous Governments: trying to find a person with the right skills and expertise to fulfil the role, without having any of those risks of bias, is very difficult. We have sought to find the right person, with the right blend of skills and experience, who would almost certainly have to come from within the football world or the regulatory world. Of course, if they come from the football world, there would always be issues of perceived bias.
Another counterpoint to the whataboutery argument is that this proposal will cut through massively with the British public and the football-supporting public. We had the appointment of the director general of the Department for Science, Innovation and Technology, who was a Labour donor, and the director of investment at the Treasury, who was a Labour donor. Those things matter to us here, but they do not cut through to the public in the same way that the football regulator will. It has to be cleaner than clean to instil the confidence of the footballing public.
I thank my hon. Friend for his intervention. I will not get into what the public are more interested in or not, as that is dangerous ground for a shadow Minister for Culture, Media and Sport to get into—obviously, I have to meet a lot of different bodies, and people have different interests. My hon. Friend’s point about the independence of sport and why it is so important has not been missed. I am sure that as the Bill progresses we will debate the question of why independence is so important.
We have spoken about public perceptions, and about the political process in this House, but what we have not spoken about yet so far is the role of international regulators, including UEFA and FIFA. We will make the point, as I said on Second Reading, that independence is crucial to that. For English clubs to continue playing in European competitions, the regulator must be independent. That is very clear.
We have urged the Government on multiple occasions to publish discussions with UEFA—again, I am happy for it to be on a private basis—so that all Members of this House can make informed decisions about the risk to English football if an independent regulator either expands its scope, through scope creep of the Bill, or is perceived by international bodies to not be independent. That is so important, because the international football community has made it increasingly clear that it will not accept Government interference with the running of the sport.
(1 week, 4 days ago)
Public Bill CommitteesIt is dangerous to indulge in hypotheticals, but if an applicant for the football regulator chair role had been integral to the negotiation of broadcasting rights for the Premier League, would they not be conflicted in their duties under the Bill? They would have done something in their former life that could disadvantage certain leagues and certain divisions of the league, and they would be seeking to protect that legacy.
I thank my hon. Friend for that interesting and important intervention. I touched on this concern briefly before lunch. The perception of such a conflict of interest is a particular problem in the choice of chair. I appreciate your comments, Sir Jeremy, about sticking to the scope of the Bill, but there is a broader point here about how the Bill is drafted to ensure that such conflicts of interest do not arise.
As our amendments on this issue make clear, we are talking about people who are currently holding jobs, but we would expect that the interests of any person appointed to a board such as this would not conflict with their ability to make independent decisions. My concern is that that perception, rightly or wrongly—I genuinely mean that—will be applied to future decisions because of the chair who has been chosen and his experience. That is not personal; I am just concerned that that will be a problem for any future decisions.
Amendment 117 would mandate that a candidate for chair of an independent regulator must declare all their political donations. It would not be merely a voluntary process. I back that, and in the absence of any good reason not to, I urge Government Members to do the same.
Does my hon. Friend remember the case of a referee whose footballing allegiance became public a couple of seasons ago? It caused a huge ruckus because it generated a suspicion that he had been, in some way, partial in the way he had conducted his independent role as a referee, which is not unlike that of the regulator. For football affiliation, read political affiliation. There will be semi-political decisions. Does that not also make the point that the regulator should not be politically aligned?
I will, Sir Jeremy. It is about precedent. Does the shadow Minister think that this is an issue only for football governance and only for this appointment? As my hon. Friend the Member for High Peak noted, current practice for appointments to regulatory bodies and public bodies has been in place a long time. Paragraph 6 of schedule 2 strengthens that process and gives clear details of what it looks like. I guess this is a case of “do as I say and not as I did”.
It is a pleasure to serve under your chairmanship, Sir Jeremy. I wish the Committee to entertain a semi-hypothetical set of circumstances. I have spent many minutes googling in order to find the only club in the Football League represented by a Conservative Member of Parliament—the mighty Bromley, as I am reminded constantly by my good and hon. Friend the Member for Bromley and Biggin Hill (Peter Fortune). I think he said in the Chamber that visiting supporters have started chanting, “You’ve got the only Tory.”
This is a very particular set of circumstances—there is only one. Bromley has done jolly well this season. Let us just hypothetically suggest that they caught the eye of a very wealthy potential new owner, which would bring riches beyond belief. That would come under the strictures of this Bill in terms of change of ownership. Let us suggest that, in carrying out its normal duties, the football regulator questioned, delayed and, finally, denied that change of ownership.
If the football regulator was a paid-up member of another political party and a donor to that other party, does the Committee not understand that the perception would be that part of the reason the regulator had come to the conclusions that it had was political? That is what we are trying to avoid with the amendments. I ask Committee members to reconsider, in order to give the regulator the best possible chance of success.
Seb Coe is a successful leader of sports bodies in this country and of our 2012 Olympics. He is a former Conservative MP and peer. I saw him act with integrity and did not question his political past. Why can people not act with integrity and be members of political parties? This is looking to spin a political angle when there might not be one at play.
If people appointed to regulators and quangos have fully declared what they have done, ab initio, that does a lot to dampen down concern about partiality. It would be nice to see the Government select someone for one of these appointments who was not a donor at the last election.
Before speaking directly to these amendments, I want to address the comments made about the chair appointment. I am very aware of the direction that you have given, Sir Jeremy, so I will focus my remarks on the comments made by the shadow Minister and Opposition Members.
David Kogan brings with him a wealth of expertise from the sport and media industries. The shadow Minister’s speech had three parts, so I forget when he said this, but he made the point more than once that it is about attracting the right candidate with the right experience, and how that is a challenge. We are confident that David Kogan is the right person. He was found appointable for the role by a panel that included a senior independent panel member who was agreed by the Commissioner for Public Appointments.
David Kogan declared his political activity to the DCMS Committee, as the shadow Minister has stated, which endorsed his appointment, adding a further layer of robustness to the appointment process. The donations were declared during the Committee session, as the shadow Minister also stated, and the Committee was sufficiently aware when it published its report endorsing him.
I know the hon. Gentleman is new to the House, and I will stand corrected if I am wrong, but I believe that it was a unanimous decision by the cross-party Select Committee. There will have been similar instances in the previous Parliament, so I think his point is somewhat unfair, but it may be a reflection of the fact that he is new to this place.
Reference was made to the fact that we have received a letter from the Commissioner for Public Appointments, and we will of course co-operate fully with his office. No conclusions have been reached at this stage, and we will completely co-operate. Some points were made about what was said on Second Reading and to the Select Committee. The governance code already sets out the requirements for political donations. Donations in scope of the governance code were provided to the Select Committee in advance of the hearing. The leadership campaign donations fall outside the reporting window and the threshold for declaration; however, they were disclosed to the Select Committee in the interests of transparency, which endorsed the appointment on a cross-party basis.
I completely take the Minister’s point about the unanimity of the Select Committee. In that same spirit, it is worth quoting the Chair of that Committee, my hon. Friend the Member for Gosport (Dame Caroline Dinenage), who said:
“While Mr Kogan’s background and experience make him well-suited for the role, his past donations to the Labour Party will inevitably leave him open to charges of political bias in a job where independence is paramount.
We want to see the new Independent Football Regulator succeed, so it’s crucial that nothing undermines the regulator as it gets up and running. Mr Kogan must give 110% when it comes to reassuring everyone in the game that he is his own man. The Committee looks forward to working with him constructively and holding him to account.”
Imagine how much simpler life would be if someone who did not have that perceived conflict of interest—
It is a pleasure to serve under your chairship, Sir Jeremy. I want to make two quick points. First, it seems to me that the previous Government were going to impose extra regulation, and there would have been a regulator that probably would not have been run by volunteers. By the logic we have heard today, the Conservatives previously proposed some kind of increase that they worried would put up ticket prices. I do not agree that that is necessarily going to happen.
Secondly, one of the first things that my local club, Cheltenham Town, said to me after I was elected, was, “Please support the Football Governance Bill, because that will make our club more sustainable.” Then I spoke to the Robins Trust, of which I am a member, and it said, “Please support the Football Governance Bill.” If the club and the fans are both saying, “Please support the Football Governance Bill,” it is my duty as their local Member of Parliament to take their word for it that they think things will get better as a result of the Bill.
Cheltenham Town is a League Two club; sometimes, in a good period, they are in League One, but these are not people who are burdened by the concerns of billions of pounds, as at Manchester United. Ticket prices at Cheltenhm are about £20—I think I might be able to get in for £20 for some games. Price sensitivity is probably an issue for Cheltenham Town fans and the club, and they tell me I should back this legislation, so I do not know why, based on that and having heard the arguments made by the shadow Minister, I should change my mind, because there is nothing to suggest that anything has changed between the previous regulator and the newly proposed regulator. The opinions of the club that I serve are entirely clear.
The hon. Member says that both his club and the fans support the football regulator, but they do not know how much it is going to cost or how big it is going to be. They like the purpose of the regulator, but they do not yet know the cost. Is it unfair to set a boundary on some of those aspects in the Bill, so that it does not grow arms and legs and put regulatory burdens on his club outwith their ability to meet them?
We have a fundamental disagreement here on the Bill and the need for regulation. It is clear that the Conservatives have decided that they will now not support the concept of a football regulator. That is a perfectly legitimate political decision. It is also legitimate to point out that that was not their view until a few short weeks ago. It is also legitimate for me to point out that both the club I represent and the fans are telling me that I should support the Bill.
I hate to make a point about political ideology, but sometimes I do. This perhaps is one of those instances when we just have to let organisations decide for themselves. My understanding is that traditionally that has been a Conservative thing. Someone sets up something or there is an existing business, and the Conservatives might say that that organisation can make decisions for itself. The next amendment is about salaries, and I will probably make the same point. Sometimes we just have to let organisations make their own decisions and let the market decide.
It is rather tempting to make a gibe about Liberal Democrats and back-of-a-fag-packet economic comments, but I will not. If it is as simple as the hon. Gentleman says, then let us hear that from the Minister. Let us hear assurances and guarantees that we are talking about pence, because frankly any inflation of ticket prices beyond pence is unacceptable, given the current prices and the legitimate views of fans about them.
The hon. Member for Rushcliffe made the very powerful observation that, in identifying a target operating model, form should follow function. The function has been pretty well defined in the Bill, which rather prompts the question why the Government do not have some idea of the form that the regulator should follow. Without any cap whatever, we would simply be inviting untrammelled mission creep and cost growth. Perhaps the hon. Member disagrees with where the cap has been put and with the methodology approaching it, but I would be interested to know whether he agrees with the principle that he and other hon. Members should have an opportunity for scrutiny if there is a proposal to grow the budget, the wages or the number of people in the regulator.
It is interesting to note the varied approach across the regulatory network. Do we think that the football regulator will be like the Drinking Water Inspectorate, which is pretty important—we all drink water—and does its work with 55 people? Coming in next is the Office of Rail and Road, which has up to 370 people. The Information Commissioner’s Office has 500-plus; information is all around us, so that is pretty important. Not quite topping the tree, but coming pretty close, is the Pensions Regulator, with 900 people.
The point is that untrammelled bureaucracies have a tendency simply to grow. There is no limit on the amount of fan consultation that could be done. A member of the football regulator could be sent down to every fan meeting if it really wanted to convince itself that the club was engaging with the fan base. All the amendment seeks is some measure of control, to give Parliament the opportunity once again to stop this thing growing arms and legs and moving way beyond its intended purpose.
The hon. Gentleman has made the point clearly: he has named a number of organisations that are significantly bigger than the random figure in the amendment. I am not disputing what he says, but the bottom line is that it makes no sense to include an arbitrary figure in formal legislation.
I am sorry to jump in—I am a bit keen. The point that the hon. Member for Rushcliffe makes supports the point that we have made throughout. The political argument that the Government have made is that the objective is to have a light-touch regulator. Does my hon. Friend agree that by trying to limit its size, in principle, we are helping the Government to do exactly what they are promising?
We do not know yet what the target operating model will be. I think the Government can do that work, as they have a pretty clear picture of the functions of the regulator that are envisaged in the Bill. The shadow Minister asked the Minister to give some indication of the limits on money and structure, because we have the powers and the functions. I, for one, welcome the opportunity to hear the Minister’s answers.
I thank the hon. Member for Old Bexley and Sidcup for his amendment. I note the irony of him saying he does not want to oppose the Bill for the sake of it, given our discussion today and the fact that the Bill began its life under his Government. I completely understand the intent to ensure that we do not end up with an overstaffed regulator that is not delivering value for money. That is exactly why there are appropriate controls over the regulator’s expenditure.
Proportionality is key to the point about costs. We will have a further debate today or on Thursday about the regulatory principles, which are really important, but the operational cost estimate is between £77.4 million and £106.8 million over 10 years. That was based on the impact assessment signed off by the previous sports Minister, the right hon. Member for Daventry. Those costs have not changed—with the caveat, of course, that that is an estimate.
We do not believe that the changes are significant enough to lead to a significant increase in costs.
Quoting those figures is very helpful. Can the Minister tell us what personnel assumptions those figures were based on?
I am happy to provide the Committee with a copy of the impact assessment. I will address the point on staffing in a moment, if the hon. Gentleman will allow me.
On that principle, does the Minister agree with the Secretary of State for Defence, who said yesterday that the number of people in the Army would be 73,000?
It is not for us to say. It is an independent regulator. The hon. Gentleman outlined how different regulators have wildly different numbers of staff. We do not think that we should set a cap.
I have listened very carefully to contributions from hon. Members on both sides of the Committee and to the answers provided by the Minister. I am concerned that the Government will not publish a refreshed impact assessment because, as I have highlighted, the costs to businesses and football clubs around the country have increased since the impact assessment was published. The regulator designed by the current Government also differs from the previous Government’s. We believe that it is bad practice for Members not to have all the information to hand for a live discussion about the expected costs of the regulator or concise information about what the size of the regulator may be.
Does my hon. Friend share my frustration? The Minister said that some indicative numbers for the costs came from the impact assessment for the previous version of the Bill. I asked her what personnel numbers that was based on, because if such assumptions do not underpin the budget, that is as random a number as any.
My hon. Friend makes a pertinent point. The amendment is about the headcount, and he asked the Government, who oppose the amendment, what assumptions they have made for the headcount in their financial calculations. That is a completely fair question for Committee members to ask in this debate. I am not satisfied with the Minister’s answer, and I do not believe my hon. Friend is either, based on his intervention. Members should have the information on the impact of staff costs. I have set out some of my concerns about what it may mean for fans down the line. I am afraid we have not had assurances that give us any confidence that the Government will seek to cap the size of the regulator. We want to get a vote on the record, because we believe there should be a cap on the size of the independent regulator.
Question put, That the amendment be made.
I will address some points on amendment 121 and then respond to the hon. Gentleman’s questions. The Government recognise it is vital that the regulator is transparent and able to be held accountable by Parliament and others. That is why, for the expert panel, the legislation already sets out a number of requirements to publish decisions and give reasons for them.
Transparency in decision making is important, but it is also 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. It will also be necessary in some instances for details to remain private for commercial, personal or other sensitive reasons. We absolutely agree that transparency around the regulator’s processes and decisions is important, particularly in football, where fans often complain of being out of the loop. That is exactly why the Bill already contains extensive publication and consultation requirements and the regulatory principle encouraging the regulator to be transparent. However, the amendment goes further and risks undermining the operation of the expert panel. Some details may be commercially sensitive, as I have outlined. Equally, individual panel members should not necessarily be singled out for their contributions to decisions; the panel as a whole makes decisions and is held accountable as a whole.
I am at risk of comparing apples with oranges, but we spoke earlier about the Select Committee. In this place, we will have minorities on Select Committees, and I do not believe that those Members who do not agree have their names published. I acknowledge that I am not comparing like with like, but I make a gentle point about how members should be able to make decisions without fear or favour.
The hon. Member asked some specific questions about the expert panel. For the panel to take a decision, it must form a committee of at least three members. If that decision is appealed, three new members will be needed to form a committee to take a new decision, so the minimum number of members required for the expert panel is six. There is no cap on the maximum number of members as the regulator should have flexibility to react in the event of a high workload. Obviously, different panels may be required for different issues. For those reasons, I ask the hon. Member to withdraw his amendment.
I am grateful to the shadow Minister for giving way. The Minister admitted that with Select Committees she was not comparing like with like. Would not a better comparison be another big regulator, the Bank of England, where the Monetary Policy Committee in setting interest rates does indeed allow for minority reports, which are helpful to the market in understanding the logic behind those who want rates to go up, go down or stay the same?
The hon. Gentleman is making a passionate speech about the heritage elements of cup competitions, and a genuinely important point about fixture scheduling and how the international teams impact that. We are talking about Club World cups and tours of Asia—we have just seen Man United go straight to Asia. However, to try and spin a positive on the situation—I am not defending certain clubs—would the hon. Member agree with me that it is a good thing that this year the underdogs have won those cups? There is value again in those cup competitions, whether that is Crystal Palace winning a tournament—the hon. Member for Dartford is nodding at that—or Newcastle winning.
(1 month, 2 weeks ago)
Commons ChamberBromley—there we go. I think that has rather proved my point for me. The Conservatives’ reference to the risk of increased ticket prices suggests that they are either uninformed about or wilfully ignorant of the existing problems that football fans suffer every week with ticket price inflation, as tens of thousands of fans will confirm. Unaccountable football club owners are not forced to engage with football fans on the issue of ticket pricing.
In my reflections on how to improve the Bill, I will begin with financial fairness. According to Simon Perruzza, the chief executive of the Cheltenham Town Community Trust, the Bill is needed
“to ensure clubs like ours continue to make a valuable contribution to supporters and the community, the game’s fractured governance model and inequitable distribution of finance need to be urgently addressed”.
The Premier League generates more than £3 billion each year from media rights alone, yet the share reaching clubs further down the pyramid is dwindling; it keeps 84% of the revenue now, up from 74% in 2007. Any suggestion that the Premier League is a golden goose that will be killed by the Bill somewhat misunderstands the problem in our game. The campaign group Fair Game warns that the balance of funding between the top division and lower leagues in this country stands in stark contrast to that in other major leagues. The fact is that the money simply is not trickling down here as it does in other European leagues.
Given that the person who negotiated that rights deal is going to be the regulator, how confident is the hon. Member that they will change the process that he criticises?
Well, that person will be working within the boundaries of the regulator, and he is obviously very good at striking deals, is he not? If the hon. Gentleman’s contention is that he did a good job in his old job, we can be confident that he will do a good job in his new role.
The Liberal Democrats think that the redistributive mechanisms ought to go even further to promote financial sustainability, including by taking account of the restricted resources in the fifth tier, and redistribution beyond that level to cover more grassroots clubs in the national leagues north and south and beyond. Then, there is social responsibility. Football clubs are not just businesses; they are also civic institutions. They are often the most visible and well-loved organisations in any community.
Liberal Democrats in the House of Lords pushed for clubs to be mandated to report on their community work, so I welcome the new clause requiring clubs to do so. In my constituency, the Cheltenham Town Community Trust delivered £5.4 million-worth of social value work with young people and older people, and to reduce antisocial behaviour, in its last reporting year. What gets measured gets done. Clubs want to continue doing such work, but they cannot keep doing it if they cannot afford to because the Premier League is hoarding all the money. We need to go further to support clubs in that, particularly by providing help for smaller clubs that may struggle to fulfil reporting requirements. I agree with the Members who have made similar comments.
We believe that the Bill must go further on problem gambling. Nearly 30,000 gambling messages were posted across the premier league’s opening weekend this season. That represents a tripling of ads compared with the almost 11,000 recorded over the opening weekend of the season before. Such ads are normalising a dangerous relationship between football and gambling that is destroying lives. Football should not be a gateway drug to problem gambling. It cannot be right that, whether watching on television or in the stands, we are bombarded with gambling adverts to the extent that the enjoyment of the game is now, for so many people, culturally intertwined with placing bets. It cannot be right that broadcasters can launch their own gambling platforms, and use advert breaks to promote those platforms, using the pundits who describe the games as mouthpieces for gambling. That merger of journalism and advertising should give us all pause for thought.
The football regulator would have a wider role than currently envisaged in the Bill if the Liberal Democrats were in charge.
When the Lords tried to tackle the proliferation of gambling ads, the Government committed a professional foul. As the Bill makes its way through this House, we hope that MPs will show gambling companies a yellow card—yellow cards on this matter are very Liberal—not a red card; we do not propose the banning of gambling, shadow Ministers will be pleased to hear.
I will not be placing any bets from this Chamber today—not to the benefit of myself anyway.
On ownership, this Bill provides a stronger defence against owners who might have a dodgy track record, but there are still gaps at the back. The new owners and directors test still makes no explicit mention of human rights. That is a glaring miss. Sportswashing is an all-too-common tactic used by oppressive regimes to launder their reputations through our national game. As the historic home of the global game, we have a moral duty to seek to use the soft power of football. Those who want to run a football club in this country should not be able to do so while running roughshod over human dignity elsewhere in the world. Liberal Democrats will continue to push the Government to replace the red carpet for dodgy foreign owners with a red card.
On broadcasting, not a single premier league match this season has been shown on free-to-air television. All 380 matches in the premier league now lie behind a paywall, while matchday tickets are increasingly expensive. The latest deals will see Sky Sports and TNT Sports have the rights to show premier league matches for a four-year period. That means that those without a subscription will have no opportunity to watch a live match on television until the 2030s at the earliest.
Spain’s la liga has one free-to-air game per week, as does England’s women’s super league. We will continue to champion expanded access to free live sport broadcasting in this Bill. We will also call for the strengthening of the Bill to ban domestic games being played abroad. The thought of Manchester City playing Arsenal in Dubai should leave us all reaching for the sick bucket.
We can go further to build a game that is open, accountable and properly rooted in its communities. Every good manager knows when to switch to a 4-3-3 and bring on the super-sub. It could be Steve Howard—I understand that the Minister, the hon. Member for Barnsley South (Stephanie Peacock), is a Birmingham City fan. Now is the time for Ministers to embrace that principle of bringing on substitutes, changing the formation and being even more ambitious about this Bill; after all, they have more than enough players sitting on the Government Benches to be more ambitious. They should do that because football is not just a business. It is part of who we are as a nation, so let us treat it that way.
(6 months, 2 weeks ago)
Commons ChamberI thank my hon. Friend for being such an outstanding champion of his community, and I extend my warmest congratulations to Newton Aycliffe. He is right to highlight the invaluable contribution that families make to the success of young people. They often pitch in as volunteers and coaches, and take children and young people to matches come rain or shine—I imagine that in his neck of the woods, like mine, it is more often rain than shine. I am really glad that they have such a good champion.
The Minister with responsibility for sport graciously met me to discuss the future of London Irish in my Spelthorne constituency, and she undertook to ensure that the club would get the meeting with Sport England that it so desperately desired. Can the Minister give us an update?
I was grateful to the hon. Gentleman for coming to speak to me about this issue. I will speak to my officials and make sure that we approach Sport England very speedily.
(7 months, 3 weeks ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
It is a pleasure to serve under your chairmanship, Sir Edward. I pay tribute to my hon. Friend the Member for West Suffolk (Nick Timothy) for securing this important debate. I declare an interest: just 12 miles or so from here, and just round the corner from where I live in Sunbury in my Spelthorne constituency, is Kempton Park racecourse, where I enjoyed Jump Sunday as a guest of the Jockey Club last Sunday. It was a glorious and memorable day, and all my family will be back on Boxing day to enjoy the King George VI and Kauto Star Novices chases.
To the people of Spelthorne, the all-weather flat and turfed jumps courses are much more than that. The racecourse plays host to the weekly market and to the fortnightly international antiques market, now in its 40th year, where the buyers from the nearby Shepperton studios create the sets for the around 31 soundstages there. The annual total attendance for the racing is 20,000, multiplied many times by the global television audience, and for the antiques market it is 80,000. The course regularly hosts school visits and police training, and has a sell-out fireworks display in early November.
At its heart, Kempton Park is about the racing and the 70 or so meetings held there every year, and it is every bit as important to our national fabric as Formula 1, our world-leading track cyclists and the premier league. But, as my hon. Friend described, British horseracing, having led the world from its inception, is in danger of falling behind the leading group internationally. Where horseracing fails, it fails fast, and the Government want no piece of that.
Enough of the stick—what about a bit of carrot? The Minister has a huge opportunity to be the jockey who rides in a winner, generating growth and prosperity for our nation. With a swift and judicious settlement of the levy and protection from egregious taxation and regulation, the Minister will lead a late run on the stand rail. Glory awaits; I hope she achieves it.