Football Governance Bill [HL]

Lord Maude of Horsham Excerpts

2nd reading
Wednesday 13th November 2024 Lords Chamber

[Lord Maude of Horsham (Con)]

My Lords, I declare my interest as someone who, 57 years ago, became a supporter of Tottenham, largely to annoy my best friend at school, Matthew Harding, who even then was a passionate Chelsea supporter. As a Spurs supporter, I am accustomed to disappointment, and I have viewed the trajectory of the Bill from review to the first iteration, then to this version, with some disappointment—although in this event it was not preceded by the brief period of optimism that accompanies the life of a Spurs supporter before the disappointment sets in.

I start from a position of scepticism about whether the introduction of a state regulator is likely to improve the position of an incredibly successful activity. We have heard from many about how the Premier League is the richest and most-watched league in the world; the EFL is immensely successful and wealthy, and all credit to it. That is despite the lack of regulation, and it is not obvious that self-regulation has failed. My position is also one of disappointment at the outcome of the review, because it was not clear that the introduction of a regulator was needed; dismay that the previous Government’s Bill added significantly to what Dame Tracey had recommended; and consternation that this Bill adds yet more burden. Listening to this debate so far, I hear contribution after contribution suggesting that it should go even further. You need only to listen to the debate to know how real the risk of mission creep and scope creep is. There is a risk that serious harm will be inflicted on an activity that gives pleasure to millions in this country and to more than a billion people worldwide. We have to cherish what has been successful.

Apart from anything else, this is a huge export, with huge soft power benefits for the country as well. If we look at the ills around financial stability identified by Dame Tracey in the fan-led review, it is an unusual area of commercial activity where we can say that, overwhelmingly, most clubs in operation 100 years ago are still around. Show me another sector where that is the case; it is an unusual degree of financial and commercial stability. She identified as a crisis the effect of the pandemic, but football survived it. The noble Lord who spoke previously was talking about the amount of debt that my own club, Tottenham, has, but that was to build a world-class stadium, generally acknowledged to be the best in the world, which was then condemned to have a year and a half with no gate money coming in, so a bit of debt was not surprising. The benefit to the area—one of the most disadvantaged areas of London—of that investment, and the activity that has been brought to the area around it, is astonishing.

Then there is the concern about the ESL. What we forget is that it was killed off within hours of being announced, and not by the Government nor a regulator but by the fans: they made so much fuss about it that its promoters and the clubs that had signed up to it rapidly drew back. It is not obvious that there is a deep problem that needs to be solved by the introduction of a state regulator. It feels to me as if this is slightly like what Sir Humphrey described as the politician’s syllogism: something must be done; this is something; therefore, we must do it. We know that the things that come most readily to hand are legislation, regulation and intervention.

We have to be very much aware of the dangers of unintended consequences. I think it was the noble Baroness, Lady Taylor, who said that no one wants damage to be inflicted. Of course not, but that does not mean that damage will not be inflicted, because there will be huge costs involved in introducing this regulator. There will be the levy, which will be levied on the clubs to pay for the cost of the regulatory body, and the compliance costs on clubs, which reduce the pot available. It is all very well to have a perfect mechanism—if this turns out to be that—for distributing the goodies through the pyramid, but if you are reducing it by virtue of the intervention being promoted in the Bill, there will be less to distribute. We need to be very aware of that.

I will not add to what my noble friend Lady Brady said about the backstop powers and parachute payments. I will say only that, if the parachute payments were to be interfered with, there would be a danger of creating a greater gulf between the top of the Premier League and those lower down. It is really important to maintain that competition. Ironically, it was concern about the effect of loss of jeopardy and the lack of competitiveness that the ESL might introduce that led to it being rejected, so we need to be conscious that we are not recreating that.

I urge the Minister to look again at some of the provisions in the Bill and ask whether this is a sledgehammer to crack a rather small nut and whether there may not be better ways to ensure that there is genuinely light-touch regulation and we do not inflict great damage on an activity that gives pleasure to many but also makes a lot of money for this country.

Football Governance Bill [HL]

Lord Maude of Horsham Excerpts

Committee stage
Wednesday 27th November 2024 Lords Chamber

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I will also speak to Amendments 2, 3 and 4, in the names of my noble friends Lord Hayward, Lord Moynihan and Lord Maude of Horsham. I look forward to hearing them introduce their amendments later.

I am very pleased to open this first day in Committee on the Football Governance Bill and thank all noble Lords for their evident interest in it. I repeat my thanks to the Minister for the time she has made available to me and my noble friend Lord Markham as well as to other noble Lords across the Committee. I also thank her for the letters she sent this morning following the Second Reading debate; they were greatly appreciated by all who spoke then.

It is fitting that we open this debate with perhaps the most fundamental of the issues under discussion: what will this Bill do, what are its guiding principles and what is its overarching purpose? The Bill states that it intends

“to protect and promote the sustainability of English football”.

The inclusion of the word “sustainability” in this initial purpose clause is a curious matter and the reason I tabled my Amendment 1. Why should English football be merely sustainable? Taken at face value, sustainability is a reasonable approach, and perhaps a reasonable one to take in this Bill. The Cambridge English Dictionary, which is far superior to dictionaries available from other universities, defines the word “sustainable” as being

“able to continue over a period of time”.

I would not argue against English football being able to continue long into the future—that is the reason that the Bill has been brought before your Lordships—but is that all we want from it? My Amendment 1 seeks to question and, I hope, to clarify what we are trying to achieve through the Bill. By removing the words, “the sustainability of”, from Clause 1, I am trying to highlight that the Bill should be aimed at protecting English football in toto.

As I set out at Second Reading, football has an incredibly long and rich history in this country. The Football Association was the first of its kind anywhere in the world, as was the English Football League. I spoke of the importance of heritage and how the distinct identities of each and every football club arouse the passions of so many people across the country and the globe. This strength of feeling and these passions are not best encapsulated by the limited notion of sustainability; they include something much more human and emotional, which we should have a go at capturing. Surely, through the Bill, we are also seeking to protect and promote these emotions and desires for the game.

I note that the provisions on home grounds and team colours seek to work to that effect, as do further amendments that my noble friend Lord Markham and I tabled, which we look forward to discussing later in Committee. However, if there are provisions relating to this in the Bill, why does the purpose clause at the very beginning—Clause 1—not address it? Sustainability is too limited a condition for success. If we leave it as it is, would we not condemn the regulator from the start to be inert? Would the regulator not be frozen in time and unable to look to the future and to the positive beneficial changes that could be made to the game? It is important that the regulator should have a forward-thinking attitude. It should not be merely content with the current state of football but constantly looking to drive the game forward. If it does not, this whole endeavour would be, at best, a wasted opportunity and, at worst, a failure.

That is why it is so vital to question what is meant by “sustainability” in the clause and seek to go beyond that limited and limiting definition, which risks putting the sport in a box or creating stasis. As my noble friends have pointed out through their amendments, which we will consider shortly, we could, rather than striking out words in the clause, supplement sustainability. My noble friend Lord Maude of Horsham, through his Amendments 4 and 4A, invites us to extend our focus to the success and growth of football. Those are two key goals and are important when we discuss the Bill and the game. No club would want to be frozen in time, never moving forward, eschewing new ventures or winning new glories. As has been pointed out by my noble friend Lady Brady, the many advantages of English football come from achieving the right balance between growth, competition and aspiration. Should we not look to place each of those concepts in the Bill or encapsulating them in its foundational principles? Those would give the regulator a clearer guiding path and ensure that it does not stray from the objectives that the Bill and this Parliament seek to set out.

One of the concepts that my noble friend Lord Maude mentions is growth; the Bill would stand to gain from its inclusion, focusing the regulator on moving the sport forward by growing the number of fans, the amount of revenue, the extent of viewership at home and around the world, and in other areas. I hope that this would entrench from the outset a forward-thinking vision, thereby preventing the independent football regulator from falling into the trap of other regulatory bodies, which have been blinkered in their outlook.

Like other noble Lords, I have been struck by the coverage we have seen this week from the all-party group that has looked at the work and conduct of the Financial Conduct Authority. Cross-party and cross-House concerns have been raised about the way in which the FCA has gone about its work. It is important, as we set up a new regulator, to give it clear instructions about what we want it to do and clear guard-rails about what we do not want it to do.

As I said at Second Reading, it is important that we get the Bill right. If we do not provide the regulator with the necessary tools from the outset, we would be setting it up merely to fail. That would have catastrophic consequences for the game and all those in this country who love it.

Football is, as well as a hugely enjoyed pastime, one of our largest and most popular industries. The Premier League makes up the largest share of the United Kingdom’s television exports, totalling £1.4 billion in 2019-20. Football is broadcast to over 1.5 billion people in 189 countries across the world. Through that export and shared enjoyment, it amplifies our values, spreads the best of British culture and generates hugely important economic growth for the whole nation. Football is undoubtedly a significant soft-power asset for the United Kingdom, and it is important to keep that in mind as we begin our detailed consideration of the Bill in Committee.

That is to say nothing of the millions of people who follow football here at home. To all those people in the United Kingdom and across the world, the ruination of English football would rip the heart out of communities across the length and breadth of the country. I am sure that Members of the Committee would not want that, and I hope that giving detailed thought to the purpose of the Bill and dwelling on its initial clause will be a way to lift our aspirations for it and seek a more important and meaningful goal than mere sustainability. I beg to move.

[Lord Maude of Horsham (Con)]

My Lords, I am grateful to my noble friend on the Front Bench for the eloquent way in which he moved the amendment and started the important debate on this group. It is important that we take time to consider this properly, because the Bill, if enacted in this form, will create a state regulator with an ability to impose a levy to make exactions on the football clubs that make up the football leagues. It is important that the tone of the regulator is set from the beginning.

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[Lord Bassam of Brighton (Lab)]

My Lords, I am intrigued by the amendments from the Benches opposite because there is a degree of amnesia in some of this debate. The noble Lord, Lord Parkinson, moves to strike out “sustainability” from Clause 1. I have a copy of the Bill that was introduced in another place at the beginning of the year. In Clause 1, “Purpose and overview”, it says:

“The purpose of this Act is to protect and promote the sustainability of English football”.


That is the same wording as is in the Bill before us. I say to noble Lords on the Benches opposite that this Clause 1 is exactly the same as the Clause 1 that the noble Lord, Lord Parkinson, would have brought to this House, had he still been the Minister and had the Conservative Party not lost the general election. So I am extremely puzzled by the approach of noble Lords opposite.

[Lord Maude of Horsham (Con)]

Picking up that point, I think the noble Lord is trying to make it appear as if this is a partisan thing, but it is not. I would have tabled exactly the same amendments if this had been the previous Government’s Bill that he refers to. This is not a party-political matter at all; it is about a game that we are passionate about and that is a spectacular success. We do not want to see something done that damages it.

[Lord Bassam of Brighton (Lab)]

The noble Lord has the benefit of supporting Horsham FC. I have the benefit of supporting Brighton and Hove Albion, and I am absolutely passionate about my football club, which is one of the best clubs in the Premier League. I would not be party to wishing to do anything that damages the Premier League, and neither would my colleagues on these Benches. We recognise, understand and appreciate that the Premier League is an institution that is more than worth supporting. It is the best in the world and we know that.

The other thing that noble Lords need to focus on in this debate is that when the noble Lords opposite were in government, they were very keen to have this legislation. A DCMS report published in September 2023 quoted the findings of a research paper that showed that there continues to be

“a widespread issue of clubs being run in unsustainable ways from a traditional financial analysis viewpoint”.

That was then the position of the party now in opposition, and I am hoping that it has the same range of concerns about our football finances now as it did back then, because it was quite clear that that was the primary motive for the legislation, and it is the primary motive for the legislation today. It is about its financial sustainability.

If a product or a good cannot be produced in a way that is sustainable, it will not be, as the noble Lord, Lord Hayward, made a great song and dance about, successful. That is why my noble friend Lady Taylor and I have tabled our amendments in the first group—to focus on making sure that the Bill and the regulator that the Government are seeking to create promote the sustainability and success of our beautiful game. That is why we are here today; that is what we are arguing about and what we are so passionate about. It is for that very reason that we tabled our Amendment 10 to Clause 1.

I hope that the party opposite is not going to suffer from this collective amnesia for too long, but that it will get behind the Bill, get behind the purpose and objectives set out very clearly in that first clause—a clause that, in government, it amply supported and gave voice to. We need to get behind the Bill and make sure that it is sustainable for the future.

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[Lord Markham (Con)]

I definitely do not want the regulator to be involved in every nook and cranny, but when the regulator is sitting here in front of us and we are assessing whether or not it has done a good job, to me, the only criterion is not whether all the clubs are still out there in existence. That is a pretty limiting move. Why would we want to narrow ourselves down to that measure? I do not understand why any noble Lord would not want an objective to be that TV viewership goes up or that media sports rights money goes up. I will sit down to give noble Lords a chance.

[Lord Maude of Horsham (Con)]

The noble Lord, Lord Mann, asks: would we want a matter such as that to be decided by the regulator or the clubs? Well, the clubs made the right decision. The decision was: “We want the Premier League to remain very competitive to prevent those who have access to, in effect, unlimited funds being able to stack the odds in their favour”. The clubs made a decision that this would not become a less competitive league than it currently is.

[Lord Markham (Con)]

I thank my noble friend for his point. I would totally include in that measure of success, as the noble Lord, Lord Mann, says, enjoyment. That is absolutely part of it, because it is the enjoyment which means that people will pay a lot of money for their TV subscriptions, but it is all about the financial health of the game.

On the point made by the noble Baroness, Lady Taylor, I know that in terms of Clause 10 and the funds for six months, the amendment is well intentioned and sounds quite reasonable. However, I have been speaking to a different Premier League chair—I am sure that we have all been speaking to club chairmen—and from one of those clubs that is very respectable. They are afraid of having to lock a lot of money into escrow for their sustainability. They said that all that this will stop them doing is investing in their team and their players. They look at their club as a balance sheet, with assets and liabilities. If the worst came to worst, they would look to sell one of their players, because they are assets. That is what businesses do; it is what clubs do. You do not need to say, “You’ve got to lock six months’ worth of money in there, £30 million, so you can’t afford a striker”. It is, “If you want to buy that striker, take the risk,” as my noble friend would say.

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[Lord Maude of Horsham (Con)]

My Lords, I am grateful to my noble friend Lord Moynihan for the way in which he has introduced and moved his Amendment 5. My Amendment 6, which also carries the name of my noble friend Lady Evans of Bowes Park, has a similar effect. It would deal with the consequences if the Bill is not amended in a way that protects against those consequences. It is another way of getting at the same point—the same danger, risk and jeopardy that English football is potentially in if this is not dealt with at a very early stage.

On this business of English football having its own autonomy and not being subject to influence or control by government, we know that there are countries where football is an important activity and where national teams take part in international competitions. But in some of those countries, the boundary between where the state ends and the Government begins is sometimes unclear. It may be contended that in these circumstances, given the undoubted influence and control over English football that will come if the Bill is enacted in its current form, there will be state intervention, for sure. Is that the Government? It will be contended that this is an independent regulator.

None the less, it is a regulator appointed by Ministers in the Government. Its powers will be defined in secondary legislation drafted by the Government and if there is mission creep and scope creep, which some of us fear is almost inevitable, that will come about because of government decisions. This is a real issue; it is not scare- mongering. UEFA has written on these concerns, so when it is argued that this cannot really matter because Germany has regulated football, the fact is that that has been done in a way that prevents those concerns.

UEFA, which matters for these purposes, is not content at this stage that this jeopardy does not exist, so it has to be dealt with. The sooner that the Minister can give us some comfort that she understands how serious this is and the political danger the Government would be in if they—by lack of proper care and attention to these risks—allowed this malign effect to come about. It is very important to indicate at the earliest possible stage, which is really tonight, in this debate, that a provision which deals with this risk will be incorporated into the Bill by way of government amendment. I think that would be a great comfort to all of us.

[Lord Bassam of Brighton (Lab)]

My understanding of the exchange of correspondence was that UEFA’s primary concern was that the scope of the legislation in the Bill may go beyond financial concerns. It was entirely happy with the regulator being concerned about the finances of football, and rightly so. I do not quite see the fear that lies behind this set of amendments. Although the noble Lord is right that we need early clarification, the regulator’s purposes are clear: they are about ensuring sustainability and success, and all the rest of it, of our brilliant game. I think UEFA was just seeking clarification that it was tightly constrained around the notion of football finances.

[Lord Maude of Horsham (Con)]

I am grateful to the noble Lord. I am a bit of a Brighton supporter myself. Tottenham is my first love; Horsham is my second; Brighton comes a very close third. I hope the letter from UEFA will be published so that we can see in exact detail what is said and therefore satisfy ourselves that the concerns will be dealt with comprehensively and finally so that there is no lingering anxiety.

I totally understand the point raised by the noble Lord, Lord Bassam. I wish I could be as happy as he is that there is no risk of subsequent mission creep, which is exactly the concern that UEFA raised. Some of us have raised that, in the Bill as currently drafted, there is scope for precisely the kind of mission and scope creep that UEFA seems to have identified. That is why it is so important at this stage that it should be dealt with and for it to be finally laid to rest that this concern need not be a concern.

My noble friend Lord Goodman spoke about the political risk for the Government if they come to be the people who have enacted a Bill which inflicts savage damage on English people’s expectations that their clubs will be able to participate in the Champions League, the Europa League and even the Europa Conference League, which West Ham so spectacularly won. It has to be dealt with quickly, cleanly and effectively, so that we no longer need to have sleepless nights over this.

[Baroness Fox of Buckley (Non-Afl)]

My Lords, I welcome this group as a point of clarification and reassurance, as has been asked for. I would expect the Minister to accept this, because she has been at great pains to stress that this is intended—I do not doubt her good faith—as light-touch regulation motivated by the best of intentions. But I think that there is a real problem with this Bill that could potentially destroy football, so I want that worry at least to be taken seriously.

The examples given by the noble Lords, Lord Moynihan and Lord Maude, were in relation to UEFA and FIFA and what damage could be done. I understand that, but I think this is a point of principle. It is really important that the Government state at this point that they believe that the Bill is not to be used as a vehicle for government interference in football. That is what they agree with, so why not put it in the Bill?

Should I just be having a moment of paranoid delusions? I spent as much time reading the amendments last night as noble Lords spent on the first group, possibly longer—i.e. it took me a long time. They are, in many instances, the vehicle for what can be described only as a wide range of political hobby-horses for people who believe that this Bill and the regulator should be asked to do things that are extraordinarily contentious, political and have absolutely nothing to do with football. The fact that they are deemed in scope of the discussion on this Bill is nerve-wracking. Consequently, this group seeks—very importantly—to state as a matter of principle that the Government should not interfere in the autonomy and independence of football in England and Wales, and English football particularly.

I want to stress, and I said it at Second Reading, that this not just because of any technical matter; it is because football came from and remains at its heart a grass-roots part of civil society. The last thing it needs is an overbearing political hand that will try to shape it into the image of the particular Government of the day. The particular Government of the day might be one that the Government trust; it might be one that many football fans trust, but imagine if it was not? We do not want the political fashions of the day to dominate football—to destroy football. I think the Minister will agree and therefore accept these amendments willingly, because it will reassure us that we are not all being paranoid about it. It will reassure football fans that the Government are doing it in their best interests rather than trying to use football as a hobby-horse to push a particular political agenda.

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[Baroness Twycross (Lab)]

As I said, UEFA had a meeting with the Minister for Sport. My understanding from that meeting, at which I was not present, is that this was confirmed. It has not raised other concerns. If any noble Lord knows of other concerns that it has raised directly with them, please get in touch afterwards.

[Lord Maude of Horsham (Con)]

We are listening very carefully to this, and it is really important. I have absolutely no doubt about the honesty of the Minister’s —or the Government’s—intentions and sincerity. The concern is that stating that it is not the intention that the regulator would do anything, or that the Bill would have any effect that would conflict with these international football bodies, is not quite as reassuring as it is meant to sound. The concern has always been the unintended effects, and the fact that, for all their good intentions, she, the Government and indeed the Prime Minister cannot bind future Governments. The regulator is meant to be independent, so there is scope for activity. Unless it is explicitly excluded in the primary legislation, there will continue to be a doubt, whatever good words we hear either first or second hand. To put it beyond any doubt, it is essential that this is in the Bill.

[Baroness Twycross (Lab)]

I can only repeat that I know that the Minister for Sport is clear that she had a positive and constructive meeting with UEFA, and that we will continue to work with it. The only other point I was aiming to make on this matter, rather than repeating what I had already said, was that when the Government say that we want to keep the Bill within its current scope, this is clearly partly to avoid mission creep, with the unintended consequence that we might then stray into areas that are problematic. When we debate subsequent groups, please note that it is front and centre of our minds that we are very clear that this Government will do nothing to jeopardise the ability of English clubs or the England team to play in international competitions, whether they are European, world-level or at the Olympics. I hope that noble Lords accept that there is no intention to do anything that will jeopardise that. The advice we have had is that this will not be the case. The engagement with UEFA is essential, and it is aimed at ensuring that there are not any unintended consequences that would damage the ability of English clubs or national teams to compete in UEFA, FIFA or Olympic competitions.

This legislation does not impose undue third-party influence on the FA, and therefore does not breach FIFA or UEFA statutes, which the FA has confirmed. In any case, there is an additional safeguard already in place in the Bill, in that the regulator must have regard to its duty to avoid any effect on sporting competitiveness of regulated clubs. For the avoidance of any doubt, and to ensure that there is no possibility of any clauses that may concern these sporting bodies, we have already taken action. As previously noted during the debate, we have removed a clause from the previous Bill which allowed government foreign policy and trade considerations to be considered when approving takeovers. The regulator will be fully independent from Government and tightly focused on the financial sustainability of the game.

On Amendment 24 in the name of the noble Lord, Lord Moynihan, I say that we are extremely confident that no powers or potential actions taken by the regulator would be in breach of the rules, and thus preclude England’s national teams from competing in international competitions. We are mindful of UEFA’s governing principles around undue third-party influence, and this has shaped how we are setting up the regulator.

I am proud that this is a Labour Government Bill that we are taking through this House, as was noted, with agreement from the previous Government. This legislation will not impact the intention for our teams to play in UEFA competitions. For the reasons I have set out, I am unable to accept the noble Lords’ amendments and hope that they will not press them.