Lord Parkinson of Whitley Bay:

Moved by Lord Parkinson of Whitley Bay

42: Schedule 2, page 90, line 16, after “six” insert “or more than twenty”Member's explanatory statementThis Amendment limits the number of members of the Expert Panel.

My Lords, I rise to move Amendment 42 and to speak to Amendments 45, 47 and 49, which are grouped with it. I am grateful to my noble friend Lord Markham who has put his name to them. These amendments seek to provide greater guidance on the operation of the expert panel that will be established under the Bill to ensure that those who are involved in the panel and its work are limited in number, do not have any broadcast interests, are limited in pay and must exercise their functions transparently. These amendments reflect our commitment to ensuring robust, transparent and impartial governance for football to safeguard the integrity of the game. I will speak now to Amendments 42 and 45 and say a bit more about Amendments 47 and 49 in my winding speech.

Amendment 42 would limit the number of members on the expert panel to no more than 20. The Bill already specifies no fewer than six, but the amendment would insert the words “or more than twenty”. It is in our view a sensible and pragmatic measure. Governance structures function best when they strike a balance between having diversity of experience and opinion and having operational agility and efficiency. By setting this range between six and 20, we think we can help to ensure that the panel is large enough to encompass a breadth of expertise while avoiding the pitfalls of having an unwieldy and bureaucratic decision-making body.

We have heard about a lot of the similarities between this Bill and its predecessor that was looked at in Another place in the previous Parliament, but this is another instance where the Government have decided to make some changes to the Bill. When I was going through it comparing the previous version to this one, this change perplexed me more than others. When the Bill before the previous Parliament was introduced by the Conservative Government, we capped the membership of the expert panel at 20. Will the Minister explain the policy rationale behind making this change to the Bill and removing the cap?

In football governance, clarity and focus are surely paramount, so this amendment that in effect takes us back to the previous Bill is, as noble Lords might expect, in keeping with Conservative values of efficient, streamlined and effective governance and will ensure that the expert panel is equipped to make sound decisions without succumbing to the inefficiencies of an excessively large committee. I hope these arguments will resonate with noble Lords whatever their political allegiances.

Amendment 45 echoes the debate we had previously on conflicts of interest relating to the chairman of the panel and would prohibit individuals with current media interests relating to football serving on the expert panel much in the same way as my Amendment 36, which we looked at earlier. I do not think we need to rehash the philosophical arguments behind that. I hope that the Minister will dwell a little on the need to make sure that we ensure impartiality for members of the expert panel just as much as we would for the chairman.

Football is a sport that attracts passionate commentary and debate, particularly across the media. While, as we heard previously, live perspectives are invaluable in their own right, the work of the expert panel must remain beyond reproach. Again, I worry slightly that people with active media roles could risk stumbling into conflicts of interest or, at the very least, the perception of them, which could undermine the important work of the panel and its credibility.

My Amendment 47 would introduce a cap on remuneration for members of the expert panel—in this case, limiting their annual pay to no more than £91,346. Again, that is not a round figure but takes by way of comparison the current salary for a Member in another place. While it is an illustrative number, not a precise and scientific one, I hope it is a way of probing the Government’s thinking about what their expectations are for the remuneration of members of the expert panel. I know that matter is to be decided, but if the Minister could give us a ballpark figure then I think the Committee would find that useful. As we progress through our scrutiny of the Bill, if such decisions are able to be taken then it would be useful to know them so that we can factor them into our thinking.

It would be useful to hear from the Minister whether the Government would be open to considering a cap on pay for members of the expert panel—whether or not we specify a particular number in the Bill—to ensure that taxpayers’ money is spent prudently. Again, not only would that argument land well on this side of the House; hopefully, it would resonate with all those committed to fiscal responsibility and using public funds wisely.

We do not believe that governance roles, even in football, which is a multibillion-pound industry, should command excessive salaries. We want people who are motivated by a genuine desire to improve the sport, not those who are simply seeking generous compensation. While I took on board the points made by the noble Lord, Londesborough, about the payment of the chairman of the panel, it is important that we ensure that compensation remains proportionate to the role and responsibilities that the panel members will be undertaking. By setting a clear cap, we would be able to make sure that we were getting value for money while still attracting highly qualified individuals to serve the challenge that the noble Lord set us in the discussions earlier.

The amendment seeks to make sure that public resources are used judiciously while providing adequate compensation to attract the skilled and experienced people that we need to serve while trying to avoid the risk that remuneration for these roles would escalate unreasonably, particularly in what is already a very high-profile sector. None of us wants to see the public trust in the independent football regulator undermined if panel members were perceived to be doing it simply for the disproportionate pay. I hope that is something we could avoid.

The amendment seeks to emphasise that fairness and restraint are just as important when it comes to governance as they are in the game itself. It seeks to reflect the fact that the new independent football regulator is a body intended to regulate football for the benefit of fans, players and communities across the country. That echoes the spirit that football is not just a game; it is a cornerstone of our national life and an important force in communities across the country.

Amendment 49 would require the expert panel to exercise its functions transparently. Transparency in decision-making is fundamental to good governance. The amendment would introduce measures ensuring that not only were the expert panel’s decisions publicly accessible but they were accompanied by the necessary context, so that people following its work could understand how it had reached the decisions it had.

That level of detail would ensure that decisions are seen not as obscure or opaque but instead as reflecting in a positive way the breadth and diversity of opinion among the people appointed to the expert panel. If we were to do that, we would not only strengthen public trust but encourage a culture of robust debate and accountability among panel members as they discharge their duties.

Moreover, proposed new sub-paragraph (3) would require the publication of records of committee meetings, as per paragraph 30. That provision is important, because it would ensure that the broader discussions and deliberations leading to a decision can be preserved and made accessible to the public who watch on. They would provide a valuable insight into the panel’s reasoning and ensure that football fans can fully understand the nuances and trade-offs involved in the inevitably complicated decision-making process.

I hope the Minister will look at the amendments in this group with these points in mind. I beg to move Amendment 42.

I thank my noble friend for introducing these amendments, which are also in my name. As in previous groups, he set out some of our concerns, particularly where there are media interests involved—by media interests we are speaking very much about involvement with media rights and, as we discussed earlier, inside information and conflicts.

Amendment 49 is all about the transparency of the process. The real value of an expert panel is that there are a lot of complicated issues. If anything, the last three days have shown us that this is a highly complex area and that we would be asking the expert panel to opine on a large range of issues. The strength of that panel will be its breadth.

One area of particular concern to me is the example I gave before about clubs which are in what you might call the start-up phase—for example, Brighton, as they were a few years ago, when they invested heavily in players as part of a well-reasoned plan to get promoted. I am concerned that a regulator, with its sustainability hat on, might say that that is not very sustainable.

However, I would expect and hope that the expert panel had a range of views. While some may be more of the button-down accountant-type who would have concerns about that, I would hope that others would be of a more entrepreneurial nature and would understand what these aspiring clubs were trying to do, and so give that balanced view. To me, that is exactly what a good expert panel should be doing. On transparency, being able to hear those minority views and take them into consideration overall is an important dimension to all of this.

We have plenty of good examples of this. In the Monetary Policy Committee you have so-called hawks and doves, and a lot of information is often gained by not just the Majority view in the vote but the dissenting voices. You see similar things in Supreme Court rulings, where you have minority opinions. It is about trying to bring that sort of richness to this, so that we have a range of expert views, which we will all benefit from. That was very much the thinking behind Amendment 49. I look forward to the Minister’s views.

My Lords, I will make one or two comments in relation to this group of amendments. First, Amendment 42 seeks to set an upper limit. I strongly support that, whatever the number happens to be. Many years ago—not that many—I drafted the changes in legislation in relation to parliamentary boundaries for the Commons. Over the years, we had seen a steady drifting up, with ever-more Members of Parliament, as the Boundary Commission decided to duck a decision here or a decision there. Ultimately, we set a figure for the total number of Members of Parliament. I will not go into detail as to whether I think the figure is right now, but I had watched it drift ever upwards.

The debate about this House has included very heavily the question of the numbers that there should be in it. I am a strong believer that there should be a limit, and that the limit should be very substantially below where it is now. The numbers have just drifted up and up, because some people have appointed too many people into this House. I am therefore in favour of having a limit on the panel, because I can see the risks of not having one. I do not mind whether it is 20, or whatever it may happen to be, but I am in favour of some upper limit on any public panel in these circumstances.

I am not going to comment on the next two amendments, on the basis that I have done so already in previous conversations, but I will refer to Amendment 49. I agree strongly with the principles outlined in it. We are talking about a public body here. We are saying that the football clubs, which are regulated and licensed, must be open to comment from their fans. If the football clubs must be open to comment and scrutiny from their fans then surely the regulator and the expert panels must also be open to that same public scrutiny. It is not acceptable for people who are on that sort of panel to hide behind an overall decision. It would therefore be important to go down this sort of route.

I made an Intervention on the noble Baroness, Lady Taylor. I do not think I misinterpreted what she said earlier—I apologise if I did, because she is not here at the moment. When I asked her about strong or weak chief executives, she expressed concern that the wrong chief executive might be in the position. If there is, and he is leading a weak panel, then people could hide behind it. I am strongly in favour of a public display of decision-making in that process.

I would not necessarily agree that the amendment has perfect wording. For example, in proposed new sub-paragraph (2)(d), whether or not you have “the reasons why” is another matter. However, one category that is not in here is the question of timescale, which has come up in other elements of our discussion. It must be right that, throughout the process of regulation, there should be timescales imposed. It is all too easy for people to drift on decisions, whatever they happen to be, and put them back and back.

We are talking here, as we have identified, about a very competitive industry, competing not only in the football world but in other worlds as well. To maintain the position of our competitive pre-eminence within that field, we need to ensure throughout that regulators abide by timescales. I therefore suggest that, on Report, not only in this amendment but elsewhere, there should be timescales involved, as well as the other classifications that are identified.

My Lords, I rise to support the three amendments in the name of my noble friend Lord Parkinson.

On Amendment 45, it is very important that we have Chinese walls around media interests and that we preclude, if possible, any potential conflict of interest. We are not talking about a corner shop; we are talking about very serious big business and huge amounts of money for broadcasting rights. The information that will be contained within this regulator and the expert panel is phenomenally important in terms of its commercial confidentiality. Therefore, it is appropriate to put in the Bill a protocol which precludes the possibility of any interference from those who have a vested interest in media, and particularly in the workings of the expert panel.

We can look at models across the world whereby you have to keep secret from many people confidential information that is market-sensitive and may affect stock and share prices. Some of the information in the United States’ Securities and Exchange Commission would fall into that category. This is not quite as lucrative, but it is very big business. Therefore, we need to protect individual clubs that do not have economic heft, and bigger clubs that may be affected by a leak of information or inappropriate use of information from the expert panel.

Amendment 47 strikes a balance on the ability to pay an expert the appropriate amount of money. You want someone who has accumulated knowledge, skills and experience of football on the expert panel, but you do not want to pay them more than, for instance, the Prime Minister is paid. You want to have a set amount, and I think it is appropriate to put it in the Bill, in primary legislation. We know that £91,346 is pretty much two and a half times the average salary. It is a decent amount of money for the services that will be provided by the members of the expert panel.

The amendment I support most strongly is Amendment 49 because, as Judge Louis Brandeis, a Supreme Court judge in 1913, said, daylight is the best disinfectant. That was not said by a British historian, as people think, but by a Supreme Court judge. He was absolutely right about this in all the ways government is conducted. This gets the balance right, because there will be Chinese walls between different functions within the independent football regulator. This is light-touch transparency. It would not divulge the intricate proceedings of the expert panel within the IFR, but it would allow people to make a value judgment on how key decisions had been reached and who had made them. There would be accountability and transparency, as you would know not only who was making a case but the reasons why they did not support a decision. It is right that we would not include detailed minutes of the deliberations of the expert panel, because that would not be in the interest of the game and good governance, but it would be important to understand how decisions were made.

If you put that together as a complementary mechanism, with parliamentary oversight and scrutiny of the independent football regulator as a whole, it is a very useful amendment for making sure there are key checks and balances. It would make sure that certain clubs are not dominating and certain other clubs are not being pushed out, and that everyone has an opportunity to have empirical evidence, data and proper facts put before the expert panel. Ultimately, the panel will be accountable, first, to the IFR, then to Parliament and then to the wider public, including the fans.

I am not saying that the IFR is exactly the same as the Securities and Exchange Commission, but, for those reasons, I think there is a framework here that can be used to make sure that we deliver a decent and effective IFR—but in a fair and equitable way that is open, transparent and, above all, accountable to the taxpayers and people of this country.

My Lords, I will speak briefly. The middle two of these amendments are effectively a rehash of arguments we have already had—fair enough, so I will not comment on them. But, on the first one —about the numbers on the panel—and Amendment 49, what are the Government’s plans? Do they have any idea what would be a top number, or have they ever given this any consideration? That would be helpful to know—20 would seem to be a reasonable figure.

On the transparency of decision-making, the Government must have some idea, at the very least, about reporting, because it is almost impossible not to have some plan for reporting. If they have a standard or are thinking about one, it would help if we heard it now.

A couple of these amendments are well worth discussing, particularly the one on transparency. But I suspect that the Government have a plan for this—if they do not, they should have—and I look forward to being reassured by the Minister.

My Lords, at the beginning, I said I would speak to my Amendments 47 and 49 in my winding-up speech, but I said what I wanted to say about them then, so I shall not elaborate on them now. I am grateful to my noble friends Lord Hayward and Lord Jackson of Peterborough in particular for their support, and obviously to my noble friend Lord Markham, who signed the amendments.

To pick up what my noble friend Lord Hayward said, this is not intended to be perfect wording—this is a probing Amendment. He is absolutely right to refer to adding timescales as an important matter of consideration. My noble friend Lord Jackson gave another argument in our useful discussion about the dangers of having somebody with a current live media interest serving in different capacities in these roles. If they are privy to sensitive information about the leagues and clubs, which are multi-million pound businesses in many cases, a careless word or an evasive answer in an interview or on a TV show panel could give the game away—all too literally.

I simply reiterate the questions that I put to the Minister in my Opening Speech: whether she sees a role for a cap on salaries at all, and whether the Government intend to publish their expectations for remuneration, even if they do not set out a figure. We would be grateful to hear an explanation of the reason for the change between the last Bill and this one, on the removal of the upper limit.

I thank the noble Lord, Lord Parkinson of Whitley Bay, for tabling these amendments on the expert panel. The regulator’s independent expert panel will be responsible for making various important decisions across the regulator’s regime when and where it is appropriate. It is important that the panel has a range of expertise and experience to reflect this. The number of members of the expert panel is to be determined by the chief executive officer in response to the operational need. The Government do not want to restrain the effectiveness of the expert panel by introducing an arbitrary cap on the maximum number of its members. In our view, the regulator needs the flexibility to react in the event of high workload for the panel. The regulator would still need to deliver value for money, and has a regulatory principle encouraging this, so we do not believe that the CEO would appoint and maintain an unnecessarily large panel.

The Government acknowledge the intent behind Amendment 45 and other similar amendments to fortify the provisions in the Bill for dealing with conflicts of interest. It is essential that the regulator can deliver its regime free from undue influence and vested interests. I would like to reassure noble Lords that the Bill, supported by public law principles and non-legislative measures already in place, already sufficiently makes certain that the regulator will be free from conflicts of interest. For example, the Bill already places an onus on the chief executive officer to check for conflicts of interest at the point of making an appointment to the expert panel, and on an ongoing basis from time to time. In addition, the Bill sets out that the chief executive officer must ensure that the expert panel has the relevant range of skills, knowledge and experience.

It is possible that this amendment would limit the ability of the chief executive officer to do this, as it would restrict the pool of potential members of the expert panel. This, in turn, could hinder the IFR’s ability to fulfil its objectives. All in all, we are confident that these are comprehensive safeguards to examine and manage conflicts of interest appropriately. As noble Lords discussed earlier in relation to the composition of the board, we do not think it is appropriate to arbitrarily rule out specific sectors or sector interests.

I thank the noble Lord, Lord Parkinson of Whitley Bay, for Amendment 47. The Government very much appreciate the importance of ensuring that the regulator offers value for money. The regulator will be required to lay its annual accounts before Parliament and the Comptroller and Auditor-General for scrutiny. The regulator will also be subject to pay remit guidance in the same way as central government departments ensure that pay rises are justifiable. This will ensure value for money to taxpayers and operational flexibility for the regulator. Having a maximum salary in legislation would leave the regulator potentially unable to adapt to inflation and market changes. This could leave it without the expertise necessary to make critical decisions that allow the regulator to effectively deliver its remit.

Finally, I thank the noble Lord, Lord Parkinson of Whitley Bay, for tabling Amendment 49 on the transparency and accountability of the regulator. The Government very much agree that it is vital that the regulator is transparent and able to be held accountable by Parliament and others. Therefore, there are already a number of provisions in the Bill that ensure this. The exercise of the regulator’s functions will be reviewed in the regulator’s annual report. The Secretary of State and Parliament will be able to scrutinise these reports, which will be laid before Parliament. On the expert panel, the legislation already sets out a number of requirements to publish decisions and the reasons for them.

On this point, it is important for noble Lords to focus on the fact that transparency in decision-making is hugely important, but it is also really 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. In my view and the view of the Government, it will also be necessary, in some instances, for details to remain private for commercial, personal or other sensitive reasons. For the reasons I have set out, I ask the noble Lord to withdraw his amendment.

I am grateful to the Minister for her responses to the points raised here. I am a little perplexed by the answer she gave on operational need, and her dismissing the argument for having an upper limit to the panel. It is not a party-political point. I said earlier that I was perhaps most perplexed by this change from the previous Bill to the current iteration. This is not a partisan point; there must have been some further thinking by the Bill team that worked on both versions, but I am confused as to what operational needs might mean that a panel of 20 could not do it. I will take that away and reflect on it and, if she has anything further to say, I am sure that in one of the meetings we have or in a future letter she can set it out.

On the salary point, I take what the Minister says about not carving it in stone and being limited to inflation, but there are other ways around it, such as pegging it to an equivalent salary in an equivalent profession. There might be ways around doing it so that there is flexibility for salaries to increase as inflation demands without them spiralling in a way that could undermine the work of the panel. In dismissing all these amendments as a group, we could end up in a situation with a potentially infinite number of panel members being paid a potentially infinite sum of money, so we are keen to probe where the limits of good sense are. We might come back to this issue with a bit of further thought, but in the meantime I am grateful and I beg leave to withdraw my Amendment.

Amendment 42 withdrawn.

Amendments 43 to 49 not moved.