Derby County Football Club

Nigel Huddleston Excerpts

Tuesday 28th June 2022 Westminster Hall

[The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Nigel Huddleston)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank my hon. Friend the Member for Mid Derbyshire (Mrs Latham) for securing this important debate on the administration of Derby County football club, and I thank all of those who have participated, including my hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter), the right hon. Member for Derby South (Margaret Beckett), my hon. Friends the Members for Bolsover (Mark Fletcher), for North West Leicestershire (Andrew Bridgen) and for Amber Valley (Nigel Mills), and the hon. Member for Manchester, Withington (Jeff Smith).

It is also important to stress, as my hon. Friend the Member for Mid Derbyshire did, that several other colleagues have played very close attention to the club’s situation, particularly my hon. Friends the Members for Erewash (Maggie Throup), for Derby North (Amanda Solloway) and for South Derbyshire (Mrs Wheeler), and the hon. Member for Chesterfield (Mr Perkins), who have had frequent conversations with me, my officials and others. As we get to the final stretch, it is important that our constituents are aware of how much time, attention and effort has been put in by all the right hon. and hon. Members I have mentioned, because they recognise how important the future of Derby County is to their constituents. I applaud everybody I have mentioned for their efforts, which show the House at its best. Along with all Members present, I am hopeful about the recent positive developments, and I hope that the matter will soon be resolved to the betterment of the club. I hope that any future parliamentary engagement we have about the Rams will not be in the face of such jeopardy.

Like many Members of this House, particularly those who have joined today’s debate, I know that football clubs are at the absolute heart of our communities, and it is incredibly worrying to see them at risk. That is why the issue is so high on the political agenda here in Parliament and in so many constituencies, especially when there are significant shocks to clubs’ financial security. Match days are days of pride and community and of bringing people together, and the ongoing success of clubs affects the local economy and the wider finances of the football ecosystem overall. The Government understand the importance of this, as does the whole House. That is why we have had the fan-led review of football governance, which has received strong support from all parties.

We are working at pace on the White Paper, which will set out further details on how we will implement wide-ranging reforms in this area. My opposite number, the hon. Member for Manchester, Withington, has asked me on many occasions to confirm when it will be published. He knows that it will be in the summer, although there is often parliamentary debate about when the summer starts. I can assure him that my officials are moving at pace, and I appreciate that he recognises that this issue is complex. It is one thing to say, “Let’s set up a regulator,” but the devil is in the detail. The scale, scope of responsibilities, location and financial support of the regulator all need quite a lot of work, but we are working on them.

Turning to Derby County football club, the situation has for too long remained worrying for fans, the local community and the football ecosystem alike. I know that this environment of uncertainty is frustrating for all stakeholders. That the club has kept its focus, and that the fans have been so loyal despite this uncertainty, is a huge credit to them. Along with colleagues, I praise Wayne Rooney, who confirmed this weekend that he will be leaving the club with immediate effect, one year earlier than planned. I pay tribute to his efforts and those of the wider team on and off the field.

No one wants to see a founding member of the Football League in administration and facing threats to its survival. I am sure that the team’s efforts this season have made an extremely positive contribution to securing this historic club for years to come, for the Derby County fans of the future. We remain clear that the governance surrounding the administration of Derby County is a matter primarily for the English Football League, the administrator and the club. I thank the right hon. Member for Derby South for understanding that there are things I can control and have influence over, and other things that I cannot. These are self-organising private sector entities that are making commercial decisions.

However, as all hon. Members have said, this is an issue that everybody is interested in. The Government take an interest in the very real concern of Derby County fans, particularly because the club has endured such a long period of risk and uncertainty—so long, in fact, that it has recently begun to threaten the club’s place in the EFL next season, and there are potentially greater ramifications for the club as a whole, as several hon. Members have pointed out. For that reason, I have been receiving regular updates for some time. Most recently, I convened the EFL, the administrators and many hon. Members here today to receive reports on progress. I hear hon. Members’ comments about the frustrations they have experienced with the EFL and the administrators. I will ensure that I communicate those frustrations to those stakeholders.

It would be inappropriate for me to comment on all the points that my hon. Friend the Member for Mid Derbyshire made, but I will always call on all stakeholders to be pragmatic, act at speed and put the interests of fans at the heart of everything they do. As several hon. Members said, I have regularly called on the administrators and EFL to keep MPs and other stakeholders updated. I specifically said, “If you don’t, I will be called to the House in Westminster Hall debates and others to answer on your behalf,” and here we are, so that point is particularly relevant. I am somewhat disappointed to hear the frustration of many hon. Members, who said that they do not believe they were appropriately updated. There are potentially lessons to be learned for the future if such a situation were to arise again.

Similarly, I have had regular engagement with the EFL, and I will pass on hon. Members’ comments. The EFL has many stakeholders, and of course its responsibility is not to support one club, but to work on behalf of all its members. That sometimes causes contradictions and conflicts that are difficult for the supporter of any individual club to understand, but if we were in a slightly different situation, mindsets might change. As I say, I will pass on all those comments.

My hon. Friend the Member for North West Leicestershire raised the Middlesbrough issue, which was obviously resolved by the clubs Middlesbrough and Derby County themselves. I am afraid that I do not necessarily agree with his suspicions about ulterior motives. I was glad that the situation was resolved, and I believe that the EFL acted in good faith. There were also concerns about legal issues, and they were matters to be resolved directly between the clubs. As I say, I will pass on the concerns that hon. Friends and others raised.

The collapse of the purchase by the previous preferred bidder, Chris Kirchner, was a very difficult moment for the club, but I was reassured that other parties remained interested in it. The EFL also set out that there were a number of ways in which the club could continue in the 2022-23 season, with or without a long-term buyer in place. However, there have been numerous developments in the past week, which I hope are broadly welcomed by the fans. As we speak, Clowes Developments has issued a loan to the club to demonstrate the funding necessary to start the next season. Its chair, David Clowes, has purchased the stadium and had an offer for the club accepted by the administrators. As hon. Members have noted, there are hopes that the purchase of the club could be completed this week, and I certainly hope that that will be the case.

Of course, the sale raises questions about the wider financial sustainability of football, which was focused on by my hon. Friend the Member for Amber Valley. I can give him the reassurances he was looking for. If everything was right in football, and all the regulatory frameworks working as they should, we would have had no need to implement the fan-led review. We did so because there were failings across the board in football. Financial sustainability and financial regulation are at the heart of the role of the regulator, to do precisely the things that my hon. Friend called for. The finances of too many clubs are unsustainable. Consistently spending greater than 100% of revenue is not a viable long-term business model, but for some reason that seems prevalent in football. Ongoing financial monitoring will be a key role of the regulator. The Government accepted all 10 recommendations made by my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch). As I have said, we are proceeding at pace with the White Paper, which we will provide more information about soon.

Our plans amount to very significant reform in our national game, and our vision sets a clear direction for that reform, which will reduce the likelihood of financial distress and make football more resilient and sustainable in the long term. I understand that the conversation with Mel Morris was very stark. He did say that, had we had the proposed system in place, Derby County might not have been in the situation it finds itself in now. I think that probably applies to several other clubs that have been in financial distress.

We will publish the White Paper, setting out more details on the breadth of changes that we will make via legislation. I am fairly confident that we will get the support of most, if not all, of the House for that legislation. At the core of those reforms will be an independent regulator for English football. As I have said, the regulator will focus on financial sustainability, overseeing a licensing regime, which covers the top five leagues in English football. We will also act on our view that the current owners’ and directors’ tests do not go far enough and must be strengthened. That will include enhanced checks on the source of funds and the strength of business and financial plans.

The Government are fully committed to reforming football governance, to enable a long-term, sustainable future for the game. Accepting all the strategic recommendations within the review is the next step to do exactly that, and will represent a wholesale change in the way in which football is governed in England. In the meantime, the Government will continue to engage closely with the EFL, the administrators and, of course, hon. Members, until it is confirmed that this fantastic club has been saved. I hope to hear very good news very soon.