English Premier League Football

Lord Stevenson of Balmacara Excerpts

Thursday 25th July 2013 Lords Chamber

[Lord Stevenson of Balmacara]

My Lords, I congratulate the noble Lord, Lord Bates, on securing this debate, which I hope has lived up to his expectations. Certainly we have had fantastic contributions from all round the Chamber. Any debate which attracts my noble friend Lord Graham to speak must be judged a success.

The Premier League is the football world’s leading revenue-generating club competition, with revenues last year of more than €2.9 billion. The nearest rival was the Bundesliga, with nearly €1.9 billion. It is a very successful economic entity. VisitBritain says that more than 900,000 football-watching visitors spent nearly £700 million attending games, so it attracts a wide amount of inward investment as well. It is an economic success and one that can be built on and developed. The Premier League can genuinely argue that it provides huge social, economic and cultural benefits to the UK and, as we have heard, it is a major soft-power element. The noble Lord, Lord Bates, mentioned the link with the British Council, and with football being a global operation this will be increasingly important as we go forward. There is much to celebrate but, as we have heard, there are a number of concerns. They are about long-term financial sustainability, the effectiveness of diversity policies, the way in which the Premier League deals with its supporters, whether sufficient money is reinvested in grass-roots football, how talent is developed and how communities which support clubs are to be supported as they go forward.

As my noble friend Lord Faulkner said, the success of the Premier League comes with some downsides: for young talent, for the other leagues engaged in the game and, of course, for the national team. Then there is the matter of the DCMS Select Committee report on governance and related matters in July 2011 and the Government’s response, which was presented to Parliament as long ago as October 2011. As has been said, it is not for the Government to run football or indeed any other sport. Sports are best governed by modern, transparent, accountable and representative national governing bodies able to act decisively in the long-term interests of the sport. That is not what we have here. As my noble friend Lord Faulkner pointed out, the Government are on record as saying that the DCMS Select Committee’s report,

“lays out in stark detail the way in which the existing structures, governance arrangements and relationships have failed to keep pace with the challenges and expectations surrounding the modern game”.

I hope the Minister will be able to enlighten us as to what is going on in this area.

We have a number of concerns about the way in which the current arrangements are set up. It must be important to ensure the long-term sustainability of the Premier League and, if that is to be the case, debt has to be brought under control. Financial fair play, which was referred to by a number of noble Lords, provides an opportunity for clubs to bring their spending under control. However, as it strictly applies only to clubs involved in European competitions, we will need to see continuing monitoring to ensure that loopholes are not being abused.

It is astonishing that Premier League net debt last year was £2.4 billion; £1.4 billion of this came from interest-free soft loans from owners. The huge level of spending in the top tier also puts pressure on the lower leagues to keep up. The Championship has a net debt of some £0.9 billion. That is worrying as the lower professional leagues have higher wage-to-revenue ratios than the Premier League and do not have the same level of income from broadcasting.

Several noble Lords raised the issue of wages. If wages are to continue to spiral out of control, particularly with increased TV rights money becoming available, the Premier League is surely in danger of perpetuating a culture of greed. The wage-to-revenue ratio in the Premier League was 70% last year. Of the big five leagues—England, Germany, Spain, France and Italy—only Italy has a higher ratio than this; the Bundesliga has the lowest ratio of 51%.

As the noble Lord, Lord Birt, reminded us in a very powerful speech, British football owes much of its success to the fans and the local communities that support the clubs. Therefore, it is only fair that any increase in income for the Premier League ought to result in increases in funding for those who play—about 7 million people—at grass-roots level. Does the Minister agree that the Premier League should, at the very least, give 5% of its income from broadcasting rights to grass-roots sport, as it has committed to do, and ensure that there are mechanisms in place to make sure that is delivered?

Supporters are the basis under which all football and indeed, all sports operate. Clubs must be willing to engage with supporters’ groups, particularly around issues such as ticket prices. In our 2010 manifesto we committed to making it easier for fans’ groups to gain stakes in clubs. As my noble friend Lord Hunt pointed out, Supporters Direct is a really important organisation in this area and its financing needs to be sorted out. As we have heard, there are interesting and important plans for greater involvement of fans in football clubs and I would be grateful if the Minister could say what the Government are planning in this area.

On diversity, the noble Lord, Lord Bates, praised the diversity policies of the Premier League and there have been some notable successes but, as the noble Baroness, Lady Young, and the noble Lords, Lord Ouseley and Lord Taylor, pointed out, much has been achieved but much more needs to be and could be done in areas such as harassment, bigotry and homophobia and in ensuring diversity in all levels of the game, particularly in coaching, the backroom and boardroom. In that respect, I felt that the points made in relation to the women’s game were very important and I hope that these will also be picked up. My noble friend Lord Faulkner drew attention to the unacceptable position of disabled supporters at many clubs, something which clearly needs attention.

To return to my opening point, I believe that the Select Committee report, as has been said, was a very good one in the range of issues it raised. It is interesting that when the Government responded in October 2011, they believed that there were three immediate priorities:

“the creation of a modern, accountable and representative FA Board”;

agreement to implement a licensing framework to be administered by the FA; and agreements to change the decision-making structures within the FA, particularly,

“in relation to the Council”.

The government report goes on:

“We expect the football authorities to work together to agree proposals, including plans for implementation, by 29 February 2012”.

That deadline has of course passed. What is the timetable now?

Finally, the Government say that they are,

“fully committed to ensuring that the changes put forward by the football authorities make a lasting and substantive difference. If that does not happen the Government will introduce a legal requirement”,

on the FA,

“to implement the appropriate governance clauses by the swiftest possible means … the Government will seek to secure, using all available channels, appropriate legislation as soon as Parliamentary time allows”.

Time has moved on. If that is not the current plan, what is plan B?