Football Governance Bill [HL]

Lord Addington Excerpts

Committee stage
Wednesday 18th December 2024 Lords Chamber

[Lord Pannick (CB)]

My Lords, I declare again my interest as counsel for Manchester City Football Club in recent disciplinary proceedings brought by the Premier League. I offer my support to Amendment 173A from the noble Lord, Lord Moynihan. We discussed the principle of consultation on Monday evening. I repeat that, in my view, consultation with clubs and specified competition organisers is vital to ensure that they have confidence in the operations of the regulator. It is also vital to ensure that the regulator is operating, as he or she would want to do, in a fair manner. I very much hope that the Minister will give consideration to that and bring an amendment back on Report, in relation to Amendment 173A and earlier provisions of the Bill.

I am far less keen, I regret to say, on Amendment 172 from the noble Lord, Lord Markham, which seeks, as I understand it, to remove from the Bill the discretionary licence condition relating to restricting the clubs’ overall expenditure. I suggest that it is important to see the limits of that power of the regulator, because Clause 22(4) provides that this discretionary licence condition

“may not impose restrictions on expenditure of a particular kind or a particular transaction”.

As I understand it—the Minister will say whether or not this is correct—the regulator would therefore not have the power, using the example given by the noble Lord, Lord Markham, to say, “You can’t buy a particular player for £50 million”, as that would be outside the scope of Clause 22.

It is not difficult to see that there may be circumstances —one hopes that they would be very rare indeed—where the regulator takes the view that its objective under Clause 6

“to protect and promote the financial soundness of regulated clubs”,

which is what it is there for, would be damaged if it did not have a power to restrict in exceptional circumstances a club’s overall expenditure.

[Lord Addington (LD)]

My Lords, I am beginning to wish I had jumped up before the noble Lord, Lord Pannick, because I have come to a similar conclusion.

For every success story in football, if you look you will find a failure. It is often the case when people come forward and buy themselves the dream team, then something goes wrong. You will find that especially in the lower levels. There are stories of those clubs, with Bury et cetera copping out, that have more expenditure going out on wages than they have coming in from revenue. If the regulator does not have the power to stop that speculative spending in certain circumstances, it is being denied a basic power over one of the biggest problems that has led to instability, particularly in the lower parts of the game. After some of the discussions we had on this, I really cannot see how we can support the lead amendment here and still have the central thrust of the Bill.

How will the regulator assess the slightly strange finances of investing in people who are always one trip away from being worth nothing? One accident on a training field and your principal asset is worth nothing. How is that taken into account and balanced, which would require a level of expertise? Does the Minister have examples of where information will be gathered to make a sensible assessment on this?

On speculative purchases, we have heard about deals with agents, et cetera, on other parts of this Bill; it is important to bear in mind how these are done. If the Minister has information on how that information will be gathered and those assessments made, I would be very interested to hear it.

[Lord Moynihan of Chelsea (Con)]

My Lords, I hope the Minister will bear in mind that the repeated statements “For every winner there is a loser”, “The Premier League is in terrible danger” or “Football is in terrible danger” just ignore the fact that football is tremendously successful in this country. If for every winner there is a loser, there would have been no progress in the last 20 years. There has been progress and enormous success. We now have the greatest football league in the world. The statement that “Your biggest asset is only one accident on a training ground away from being worth nothing” completely ignores the fact that all football assets—all players—are insured. If, God forbid, your best player was injured irrevocably on the training ground, you would receive an enormous insurance payment, so it is just not true. The actual commercial realities of what is going on in football in this country seem to be completely mis-stated so often in this Chamber. I hope that the Minister will take heed of the tremendous success that private enterprise, unfettered by an onerous regulator, has created in the world of football in our country.

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[Lord Moynihan (Con)]

My Lords, this is one of the best debates we have had in Committee to date. I am equally sympathetic to the points made by the noble and learned Baroness, Lady Butler-Sloss, and the interventions of the noble Lord, Lord Scriven, and the concern about the practicality of this, but none of that is covered in Amendment 200, which is in this group.

Let us just assume, hypothetically, that a state-owned entity acquiring a football club in England has an excellent human rights record and no problems with modern slavery. Under Amendment 200, it would be banned from owning a club in England because it is state-controlled. All the points that have been made are relevant and important, but Amendment 200, in the name of the noble Lord, Lord Bassam, is very specific and states that:

“No state-controlled club may be granted an operating licence”.


There is no reference to human rights abuses or to any of the important issues regarding the supply chain, which have been mentioned. It simply states that a foreign-owned, state-controlled company cannot own an English football club. If we pass this amendment, immediately we would then have to divest the Abu Dhabi United Group of its majority ownership of Manchester City and Saudi Arabia’s Public Investment Fund of its ownership of Newcastle United, to mention but two cases.

How have the Premier League and UEFA addressed this to date? They have focused on the word “control”. When the Premier League addressed the Newcastle ownership test, it received “legally binding guarantees” that the state of Saudi Arabia would not have control over Newcastle United in the event of any deal. However, the Bill goes much further. It grants powers to the regulator that are not just about control. An individual has to be considered who has

“a higher degree of influence”

over the ownership of a club. The control test that UEFA and the Premier League currently use, which is a tough test that takes up a lot of time and energy, is overridden by a requirement in this legislation—for the first time in sport—to test whether an individual has a higher degree of influence. There can be no doubt that the Crown Prince of Saudi Arabia, as chair of the PIF, has a very high degree of influence over that board —he appoints it. Indeed, a Minister from that board has been appointed to be chairman of Newcastle.

If we go forward and accept Amendment 200 as it stands, what would we be saying to football, to Newcastle, to the Qataris—who might want to acquire a company, which there has been much speculation about, not least in this Committee—and to Abu Dhabi in relation to Man City? It would drive a coach and horses through the current ownership of the Premier League. It would be a very serious decision by the Government to take state control over who owns the football clubs in this country.

I say that because it comes down to the degree of state influence that is behind the regulator. The Government have said:

“Regarding the scope of the tests, we recognise the trade-offs involved, and are aware of the range of corporate structures behind clubs”,


and they specifically mention here sovereign wealth funds. They go on to say:

“We are designing the legal scope of the tests with these challenges in mind”.


They call them challenges, to be faced down at the request of government. We would have an open back door in the Bill if we accepted the amendment in the name of the noble Lord, Lord Bassam, straying into foreign policy in a way that we do not currently do. We have plenty of legislation elsewhere on the statute book allowing the Government to intervene if they felt they needed to in a certain circumstance.

The Government have therefore further confirmed the scope of the regulator. To me, it is incredibly important that the regulator is not given so many powers as to require it to have direct influence. I lost an amendment on Monday night, when I asked for that at least to be defined and for consultation to go out to find out what “significant influence” means in this context. I think that is extremely important.

I have a question for the Minister. I cannot find an answer as a result of the debates we have had so far, but football needs an answer and probably needs it now. Is it the Government’s position that the Crown Prince, Mohammed bin Salman, should be able to own Newcastle United under the definition of ownership in the Bill? It is a very simple question, with a yes or no answer. If yes, why have Ministers deliberately constructed a Bill that will quickly put him through the ownership test of significant influence, and why did the Minister confirm on Monday that she wanted incumbent Heads of State to be tested? If no then surely the Government should say so, and we should have that as part of an open debate.

I hope that, if that question is answered this evening, there will be no doubt in future about what the Government intend, not least following the Prime Minister’s visit to Saudi Arabia last week and his offer to go to a football match with the Crown Prince. It is only reasonable for Saudi Arabia and the Crown Prince to know whether he is expected to divest himself of the interest in Newcastle United or not.

[Lord Addington (LD)]

My Lords, I welcome my noble friend Lord Scriven to this debate and congratulate him on making those points. When it comes to the modern slavery amendments—to take on the point from the noble Lord, Lord Pannick—if other people are looking at this, surely the regulator should be able to take their opinion. Surely that would be a reasonable step. If the Bill does not allow that, I am sure we could do that quite easily.

On state ownership, I put my name to Amendment 200 because I thought that at the very least we deserved an answer. The previous Government’s Back-Benchers did not like the Telegraph under control and, let us face it, more people have heard of Newcastle United than they have the Telegraph.

This is an important point. Are we happy with a cultural asset being in the hands of a foreign power, regardless of the fact that we have a reasonably good relationship with it on most things? It is not all things, as we do not like certain things about it. That is a real question, and the Minister is being asked a series of real questions. I hope that at the end of this we will know whether these points are worth pursuing at other stages of the Bill. These questions really should be answered, and I look forward to the Minister’s response.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, we have indeed touched on the matter of foreign ownership elsewhere in the Committee’s discussions. I am very glad we have had the opportunity to have a proper debate on it this afternoon, and I agree with my noble friend Lord Moynihan that it has been a very good one.

Of course, there are, and have long been, a number of clubs in English football with some element of foreign ownership, whether through individuals or investment vehicles. Many of them have been very generous funders of the sport and in certain cases have turned clubs around for the better, with huge benefits to their communities. But there is a fine line to tread here between maintaining that inward investment and openness to the world, and preventing malign interference.

I am glad that the noble Lord, Lord Scriven, has been able to join the Committee today. I enjoyed the debate he brought on sportswashing, to which I responded. We touched on some of these matters, and my view when speaking from the Dispatch Box opposite, which I still share, is that there is a distinction to be made between news organisations, which provide information to the populus, and sports organisations. As my noble friend Lord Moynihan has pointed out on previous groups, sport has always succeeded in rising above politics and has often been a forum in which people can raise complicated issues and foster dialogue between countries that may not be able to talk about things directly quite so easily.

The amendments in the names of the noble Lord, Lord Bassam, and the noble Baroness, Lady Taylor of Bolton, address modern slavery once again. I am conscious that we had Amendment 153 on modern slavery from the noble Lord, Lord Mann, in that rather strange miscellaneous group the other day, so I will not repeat what I said about the issue then. But I am interested in and broadly supportive of the issues they are raising and very glad to have heard the contribution of the noble and learned Baroness, Lady Butler-Sloss, who has done such important work in this area. I am glad we have been able to return to the issue of modern slavery and let other noble Lords add their voices to what we said when we were debating Amendment 153 on Monday.

As someone from Tyneside, I must add my concern about the implications of Amendment 200 from the noble Lord, Lord Bassam, which, among other things, would prevent clubs being owned by sovereign wealth funds. I think he accepts that if we were to accept his Amendment 200 the way he has worded it—he alluded to the Public Investment Fund of the Kingdom of Saudi Arabia’s investment in Newcastle United—it would have the consequence that Newcastle might not be granted an operating licence and so would have to withdraw from the Premier League. I have to say that he would not be very popular on Tyneside if that were the case.

It would be very helpful to have some clarity from the Minister about how the regulator will deal with clubs that currently have foreign owners or foreign sovereign wealth fund investment, and how it might approach prospective owners from abroad in the future. Like others, I would be very keen to hear her answer to the questions that my noble friend Lord Moynihan has raised and repeated so powerfully today.

During the course of this Committee, the Prime Minister has visited the Kingdom of Saudi Arabia. He was there just before it was announced as the host of the 2034 World Cup. He has invited the Crown Prince to come and watch a football match here in the UK when he next has the opportunity to visit. I would be interested to hear whether they discussed football and some of the issues we have discussed today, or indeed the thorny question of whether the Bill would bring the Crown Prince and the Public Investment Fund of Saudi Arabia into scope in the way that my noble friend Lord Moynihan has suggested.

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[Lord Parkinson of Whitley Bay (Con)]

But somebody who is not subject to sanctions but who is connected to a Government whom the UK is in dispute with would not be covered because of the removal of this provision from the Bill. I am happy if the noble Baroness wants to write on this, but this is an important matter because this is a change to the Bill. I understand the Government’s stated reasons for changing it—we do not want to see football teams in this country unable to take part in international tournaments and we want to make sure that the regulator is independent of government—but I worry that by making the change in the way that we have and by not adding in the additional safeguard such as the one I am proposing through my Amendment 198, we open ourselves to a situation where somebody connected with a foreign Government cannot be taken into account by the regulator. If she is happy to commit to write on that, we would be grateful.

[Lord Addington (LD)]

We have gone through this several times. If there could at least be some private way in which those people involved in this could see this letter, it would be of assistance, because this is becoming a hardy perennial that is getting in the way of progress.

[Baroness Taylor of Bolton (Lab)]

I think everybody is thinking about the previous examples we have been given, but would not the example that the noble Lord, Lord Parkinson, just gave us of the non-sanctioned Russian individual be covered by the other considerations and the holistic attitude that my noble friend the Minister was telling us was the basis of the approach of the regulator?

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[Lord Addington (LD)]

My Lords, we need an answer about why these things are carried on for so long, because there are administrative burdens. If we want these clubs to survive and come back, we could probably make a case for two things. One would be an intermediate regulator, which I do not think would be terribly popular with certain sections of this Committee, and the other is deciding when you can come out of this, because there are duties that are probably an appropriate burden for a professional structure. A good few clubs have gone in and out of this structure, but there is a certain level at which you are not receiving income, you are not receiving support and you have become a part-time asset to the community. Surely there is some point at which there is a cut-off. A better definition of the Government’s thinking on this might be helpful.

[Baroness Taylor of Bolton (Lab)]

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

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[Lord Wood of Anfield (Lab)]

My Lords, I will be brief, partly because dinner is fast approaching and partly because this is an amendment to probe the Minister’s response to a good existing clause, Clause 48. This clause is about preventing home matches being relocated. The amendment is to probe whether the provision is sufficient to meet widespread fan concerns about possible exceptions.

There is increasing discussion about domestic football games being moved overseas. We have seen statements from the chairman of my own team, Liverpool, and broadcasters such as NBC are talking about relocating Premier League games abroad. The FIFA working group is reviewing its policies to allow this. There are all sorts of stories, rumours and plans afoot to possibly allow Latin American domestic games to be played in the United States. There is historical evidence showing that the Premier League once proposed an additional 39th game to the season, which would not be played at the ground of a Premier League club. We also see countries such as Saudia Arabia that have intervened—let us put it that way—in sports properties, buying them and moving them around, for golf and boxing. There is reason to think that this is not a very remote possibility.

The Bill sets out to prevent clubs relocating matches away from home stadia without the approval of the regulator. I hope that enjoys widespread support; it is welcome and important. The point of my amendment is to probe the idea that the clause is not quite as watertight as it should be. The concern is that the current wording is based on the relocation of matches which are already designated as home matches. What happens if the competition organiser allocates games directly, before the season’s fixtures are issued, to Riyadh, Los Angeles, Singapore, Paris or wherever? They could claim that no home game is being relocated and say, for example, that weeks 10 and 20 are weeks in which games are played elsewhere. What if the 39th game proposal, so widely reviled by fans, is revived? That is not about the relocation of a home game; it is an extra game.

The new clause addresses this by placing a requirement on the regulated competition organisers to seek approval from the regulator before moving a domestic game overseas. That way, there is no longer a need to define what a home game is to bring it in scope, and it ensures that as part of the assessment of this request to relocate a game, the regulator must specifically consult UK-based fans of the clubs involved in the relocation. Importantly, this does not rule out the relocation of a game; it requires any additional fixture that is part of a competition to be subject to consultation in the way specified in the Bill.

I would welcome the Minister’s observations on this amendment and her assessment of two questions. First, what happens if the competition organiser allocates games directly to an overseas location? How will the existing clause protect against that? Secondly, what happens if the competition organiser creates a new format, such as another 39th game that cannot easily be defined as a home game? The amendment tries to cover those extra, niche cases. With that in mind, I beg to move.

[Lord Addington (LD)]

My Lords, I am assuming that this is a probing amendment. Other sports—not British sports—do this, such as American football. Is it the Government’s intention that the regulator will make sure that such games are played at home? If the Minister can say that that is the intention, we are all comparatively happy; if not, we have a real problem.

[Lord Harlech (Con)]

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

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[Lord Parkinson of Whitley Bay (Con)]

My Lords, we look forward to hearing what the Minister says about the amendments in this group, although I think, as my friend Lord Maude of Horsham pointed out, we are all listening with different hopes and expectations about what she may say.

Briefly, my Amendment 256 in this group specifies that the regulator must consult the Chancellor of the Exchequer rather than His Majesty’s Treasury in the abstract. It seeks to ensure a clearer line of accountability and strengthen the governance structure for decisions relating to the levy. The Chancellor might well delegate this responsibility, but she should be accountable in law and the Bill ought to point to her as the Minister at the head of that department and not anyone else at the Treasury. I look forward to the noble Baroness’s responses to the amendments in this group.

[Lord Addington (LD)]

My Lords, very briefly, it is probably important to remember that a lot of this is about making sure that we preserve our football league. If a different Government had not intervened, we would have a European Super League and the Premier League would not be there. That is what happened.

We must remember that the preservation of those top five leagues is intrinsic to the Bill. If we want that to carry on, some money will occasionally have to be raised to support their structure so that it is more stable. The noble Lord’s amendment is reasonable. There may be a reasonable answer about why it does not have to go in, but I agree with the concept.

[Lord Maude of Horsham (Con)]

What the noble Lord says is simply not the case. When the European Super League was proposed, what stopped it from happening and what made the clubs drop it like a red-hot potato was the fact that the fans reacted with fury. Admittedly, the rather populist Prime Minister of the time responded to the fan fury by uttering threats, but it was not the politicians, the Government, your Lordships’ House, the other place or a fantasy regulator who stopped it; it was the fans who stopped it, and we should have absolutely no illusion about that.

[Lord Addington (LD)]

My Lords, that might be the noble Lord’s interpretation, but, ultimately, it is government that makes law.

[Lord Markham (Con)]

My Lords, just to be clear for the record, no law was passed in this instance. In a matter of days the clubs quickly withdrew from the competition because, as my noble friend mentioned, it went down like a lead balloon and fans were up in arms. The Government were nowhere near it. That was a perfect example of where the clubs and the fans regulated themselves.