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[Sir Roger Gale in the Chair]

– in Westminster Hall at 4:05 pm on 9th February 2012.

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Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe 4:05 pm, 9th February 2012

It is a pleasure to serve under your chairmanship, Sir Roger, in this important debate. We have heard a lot from both sides of the Chamber about the report and about people’s experiences of their local football clubs. It is clear that when football and football clubs fail, fans bear the cost, which is why we take the matter so seriously. Because football plays such a fundamental role in society—football in Britain is an expression of the country in which we live—it is right that Parliament takes a view on some of the issues that are highlighted in the report. Those issues affect the whole of society and not simply the administration of a football club or a football competition.

Photo of Mark Field Mark Field Conservative, Cities of London and Westminster

I can understand why many in the footballing fraternity might think it is not necessarily Parliament’s place to opine in the way that we are doing. Not only do we have an interest on behalf of our constituents, but we have a fundamental financial interest. The British footballing industry was on its knees during the mid-1980s after a series of disasters, hooliganism and, ultimately, the Bradford City fire, which led to the Taylor report. A huge amount of public money has gone, and continues to go, into the game. That is one of the reasons why it is appropriate for Parliament to have a say on the matter.

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

I agree with my hon. Friend. When we have foreign ownership and we do not know who the owners are; when we have a largely unregulated transfer market bringing billions of pounds into and out of the country, which is largely unknown and uncontrolled at its source; and when communities bear the cost of the financial failure of a football club and taxpayers bear the loss through unpaid tax bills, Parliament should take an interest. We do not seek to take away someone’s right to run their football club badly. That is beyond the control of Parliament. The report of the Culture, Media and Sport Committee and the debate have thrown up legitimate public interest concerns, however. The events of the past seven days demonstrate that the Football Association has an obligation to be the moral guardian of the game in this country, not simply the administrator of football.

I am sure that Members support teams in their constituencies at all levels. I am a lifelong supporter of Manchester United, but one of the most exciting football matches I have ever watched was when Hythe Town beat Staines Town last season to qualify for the first round proper of the FA cup for the first time in its history. That was the first time in more than 50 years that a side from the Kent league had qualified. That is a single competition in which a club in the Kent league can compete alongside clubs that are competing in the Champions League. When multiple clubs are playing in multiple formats and competitions, there must be a single governing body that can have some oversight over the whole of football in this country. That can only be the Football Association, which is the guardian of the game in all competitions.

I praise the chairman of the Football Association, David Bernstein, for taking a stand on the John Terry affair. David Bernstein rightly accepted that the captain of the England football team has a position in public life in the country, and millions of sport fans look up to him as a role model. If his position is put into question by a criminal charge that has been made against him, although he is not guilty of that charge, while doubt remains about his role it is not appropriate for him to be captain of the England football team. If the manager of the England football team, Mr Capello, could not accept that ruling, it was right for him to stand aside. Although we might not have wished for the outcome of the past seven days—the removal of the captain and the manager—the course of events was inevitable. It was right for the Football Association to take a moral lead on the case, and I commend it for doing so. There are real financial concerns about the administration of football and clubs in this country, and a real concern about the lack of powerful oversight and intervention. There are many areas of concern, and hon. Members have touched on a good number. I will limit my remarks to three issues—club ownership, the football creditors rule and player ownership and the player transfer market.

During our inquiry the fact that Leeds United was owned by a trust whose investors were not known was highlighted, together with the fact that Mr Ken Bates was employed by that trust to be chairman of the club, but did not know who the owners—the investors in that trust—were. No one in football in this country believes that Ken Bates did not always control that club. There is no other way in which he could suddenly have completed the purchase of it within days, without any kind of tendering process, and assumed ownership. He blamed the political obsession of the Select Committee, which was simply standing up for the legitimate interest of Leeds United fans to know who owned their club, for its interest in Leeds United. Many hon. Members have spoken about the role of the fit and proper person test. How can that test be applied if we do not know who the person is? That has been a recurrent problem for the football authorities, and shows that the test, which should function as a guardian, works only if the person who is being investigated is the owner, and if that can be proved beyond reasonable doubt.

Photo of Graham Jones Graham Jones Opposition Assistant Whip (Commons)

On that note, does the hon. Gentleman think that somehow the fit and proper person test could include stupidity?

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

The test is designed to make it possible to understand whether someone is a capable administrator, without criminal convictions, but also whether they have no conflicts of interest in the game, such as stakes in other football clubs that might give them a biased view in competition and an unbalanced view in the operation of the transfer market. “Dispatches” on Channel 4 highlighted the case of investors in the far east seeking to invest in British football clubs and taking multiple stakes in them by using different businessmen and personas to make the investments, beyond the football authorities’ ability to track them. That undercover report was an important piece of work, and it highlights some of the issues and the test’s failures.

Photo of Don Foster Don Foster Liberal Democrat, Bath

The hon. Gentleman constantly refers to the fit and proper persons test. Does not that draw attention both to the concern of many hon. Members that football clubs are often in the hands of an individual; and to the merits of greater supporter involvement, which would spread the load and the responsibility and would be a more sensible way forward?

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

I completely agree with my right hon. Friend that it is a good thing for supporters to have that interest, but if they do not control the club, and the controlling interest lies with another party, they should have the right to understand who that is, and the source of the finance. That is crucial. I made some inquiries of the Football League about the ownership of Coventry City. It transpired that it is owned by an investment trust—a private equity firm. It is not known who the investors in that trust are. The Football League had to concede to me that to this day it does not know who owns the club.

Photo of Tom Blenkinsop Tom Blenkinsop Opposition Whip (Commons)

The hon. Gentleman is making an excellent point and a valid argument. I want to praise the Government, who talk in points 40 to 42 of their response about allowing supporters to have representatives on club boards; but there would be a trigger point. What type of trigger point would the hon. Gentleman see as tenable, in allowing more clarity and transparency in club boards by allowing the fans in?

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

The hon. Gentleman makes a good point. I shall come on to my views on the solution to the problem; but many clubs in Coventry City’s position will have a management company—a holding company that runs the club—and a supporters’ trust may have a seat on that board. However, that is just a holding company. The ownership of the club is somewhere else completely, and that management company may not know who the owner is. It may deal with a businessman who represents the owners, but it may not know who the owners are.

I recently had conversations with a businessman who was involved in running Sheffield Wednesday from the moment when it went into administration through to the period when it was taken over by Milan Mandaric. He described a series of potential investors coming forward, some of whom used fake names and identities. When non-disclosure agreements were signed, it turned out that the principal investors were based in the far east and were not who they originally seemed to be. The impression is created of a murky world where no one is quite who they say they are. People running clubs in this country who seek to sell them to a foreign investor to raise funds for the club may not know who they are dealing with.

When I wrote to the Football League about Coventry City, I had a reply from Nick Craig, the director of legal affairs, who made a telling point:

“We have for some time expressed our concerns as regards investment vehicles (often offshore) and the issue of the lack of transparency surrounding ownership of them. Indeed we have previously sought assistance from DCMS and HMRC in that respect but to no avail. We are left in a position where we can regulate and seek to require clubs to comply but are reliant on self-declaration with no official means of independent verification.

That the proliferation of offshore investment trusts means we will never always be 100% certain in all cases but we continually assess the appropriateness of our rules in a changing environment.”

There is not very much comfort there for any football fans concerned, because the Football League is saying that if a company is registered offshore and it buys a British football club, it does not have the authority or power to know who owns the club.

The Select Committee report contained a request to the Government for a retrospective examination of the Leeds United case. That would require powers beyond those of the football authorities to inquire what was the source of the finance to purchase the club out of administration, how much Ken Bates paid for it and where the money went, so that we could determine who controlled the club’s source of finance, even if it is impossible to determine who the owners were. The source of finance will take us to the owner of the club.

Photo of Graham Jones Graham Jones Opposition Assistant Whip (Commons)

The hon. Gentleman is generous in giving way, and makes an excellent point, which I want to add to, as well as supporting the Minister’s position. What would the hon. Gentleman say about a club such as Blackburn, however? The board exists, but it is being bypassed; the manager is directly responsible and flies out every month to Pune in India to run the football club. What would happen if the supporters’ trust sat on the Blackburn Rovers board? It now has no role within the club. Is that an issue that concerns the hon. Gentleman? How would he deal with it?

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

I am grateful for that comment, but I will make that the last intervention that I take, if the House does not mind, as I want to make a few other points. I said at the beginning of my speech that I do not think it is the role of the House or the Government to stop people running a football club badly. It would be difficult to legislate that a club now in private ownership should be majority owned and controlled by the supporters, even if the supporters might want that. As the report says, the Government should—they have stated in their response that they will look at this—make it as easy as possible for supporters’ trusts to be set up, so that such representation exists, where the club wants that.

As to ownership, I do not have a problem with clubs being owned by foreign investors. If people want to spend their money on football in this country to improve facilities and the quality of competition, that should be welcomed. However, there should be a clear register of any individual, with any investment in a football club, no matter how small, and that information should be available. I would push for it to be publicly available, but it should at least be available to the football authorities. In response to what the Football League said to me about Coventry City, if a football body—the Football League, the Premier League or whatever it is—cannot be satisfied about who the owner of a club is, it should stop that club competing in its competition. It should not necessarily be for the football authorities to chase round the world trying to find the owner of a club. If the club cannot demonstrate it to the satisfaction of the competition, it should not be allowed to take part.

A way to carry out that policy would be to request clubs, perhaps as part of the licensing scheme, to allow the football authorities to inquire of their bank what the source of funding is, and who the club’s owners are. The bank should make that information available, and if it cannot or does not, the matter should be passed to the Financial Services Authority. The ownership of clubs is not just a matter of football competition. If money is being channelled in by businessmen whose identity is not known, that should be a matter for the tax and financial authorities, as it would be in any other business.

I want to make a couple of points about the football creditors rule, which other hon. Members have touched on. As the chairman of the Football League said when I questioned him in the Select Committee, there is no moral case to justify the fact that, when a football club goes into administration, the local printer who prints the match programmes or the local building firm that does ground maintenance should get 1p in the pound for its debts, while a football club at the other end of the country or a multi-millionaire footballer get their football debts paid in full. That is wrong. The taxpayer loses too, because owed tax is not covered by the football creditors rule. That is currently the subject of a court case between HMRC and the football authorities. If that is not resolved, it should be a matter for legislation, and the House should resolve it. There is no moral case for that state of affairs, and we should move on.

On player ownership and player transfers, concerns have been raised that third-party ownership of players, although outlawed in this country, is still part of the game. A magazine, Tipsbladet, in Denmark, published an article this week that raises concerns about third-party ownership. Players are channelled through clubs in Denmark and, ultimately, on to the premier league. Funds that seek to own and control players have a financial interest in moving those players between clubs. That financial interest is greater than the interests of the player, or the club he may go on to on an intermediary basis.

Bloomberg’s news website also raised a concern last week about what it called “letterbox companies”, which are set up for a matter of days to loan money to a football club to purchase a player, and are then closed down almost straight away. It highlighted a case with Porto, in Portugal, where companies set up in this country had loaned money—non-bank lending—to FC Porto to buy players. Those companies were then shut down straight away, making it almost impossible for the authorities to identify where that money had come from.

The flow of money in football is an issue of the utmost importance, and one that we touched on in our report. The football authorities have to get to grips with the matter. The Government should consider it in their response to our report, and in their consideration of the response of the football authorities at the end of the month.

Photo of Mark Field Mark Field Conservative, Cities of London and Westminster 4:20 pm, 9th February 2012

I congratulate my hon. Friend Mr Whittingdale and his Committee on producing such a detailed and comprehensive report on the state of governance in our national game. I am the vice-chair of the all-party parliamentary football group, and I associate myself with the comments of other hon. Members about our late friend Alan Keen and all the work that he did.

I am a lifelong football fan, and in the past 20 years since the foundation of the premier league, English football has undergone a massive transformation. Rather than continually attacking FIFA—I am glad that we have not really spoken too much about the national game, but there has a campaign against FIFA, particularly in the aftermath in December of the Football Association’s failure to secure the World cup, either in 2018 or 2022—we need to examine seriously the governance of the domestic game. There should now be a pledge from both the Football Association and the Premier League to put their houses in order urgently. True fans of the national game have become increasingly dismayed—as we have heard from hon. Members—at the cynical culture of illegal payments, opaque ownership and disregard for the grass roots of the game in recent years, as global TV money has dominated.

As has been said, half, perhaps slightly more, of all premier league clubs are now foreign-owned, and an increasing number of sides in the championship are attracting wealthy investors from overseas. However, as the report points out, a majority of clubs are still owned by a local business man on a philanthropic basis. Foreign ownership itself is not a problem if we have a robust fit and proper person test. Many will recall that Manchester City has not had an easy path in this regard. In 2007, they were bought by the disgraced former Thai Prime Minister, Thaksin Shinawatra. As we heard from my hon. Friend Penny Mordaunt, Portsmouth had no fewer than four owners in a single season before entering administration in 2009-10. Manchester United and Liverpool have both been subject to highly leveraged buy-outs from US owners. That model is highly risky and is not supported by the vast majority of fans or, indeed, by the Premier League.

There is a risk of chronic overreaching by clubs. I fear that the reckoning—the same can be said for much of the rest of the economy—is yet to come. Under all types of ownership models, this has led to a massive inflation in the cost of running a football club, which has usually impacted most profoundly on loyal, long-standing fans who find themselves priced out.

Asset stripping is highly detrimental. The separation of a football club from the ownership of their ground often spells long-term financial disaster. We have heard that that was the genesis of many of the problems for Wimbledon in 1991. My hon. Friend Mark Lancaster is not here, but one of the lessons of the phenomenal success of AFC Wimbledon is that the franchising model need not necessarily be one to which we should aspire. It took eight long years—in the scheme of things, quite a short period of time—for Wimbledon to move their way right back up that pyramid into the Football League. If there are to be such instances as Milton Keynes—a new town with a large population that is not traditionally served by a nearby football club—I hope that that will be a lesson for the future. Outside the Football League, Darlington have high-profile problems, having fallen into administration only this season. They are now subject to a bid for a community takeover.

It must be acknowledged, as other hon. Members have, that on occasion the football authorities are faced with the choice between allowing a bad owner to complete a takeover, or a club simply no longer existing. Football League clubs tend not to disappear, with the exception of Aldershot 20 years ago. However, often when they lose league status oblivion follows very quickly—one thinks of Maidstone United, Scarborough and Rushden & Diamonds. With that in mind, the Football League, rather than the Premier League, has led the way in recent years in improving the good governance of football in this country. Many measures that began in the Football League have since been adopted across English professional game.

A number of hon. Members have mentioned the owners and directors test, so I will not go over old ground. On players’ wages and the issue of debt, average wage spending per club at the advent of the premier league in 1992-93 was £4.5 million, which was 44% of turnover. That has since risen in the past 20 years to an average of £1.3 billion—68% of turnover. Deloitte and Touche suggests that 60% would be a prudent number. Wage spending is at its most corrosive in the championship, where it amounts to 88% of average club turnover. Championship clubs together made an operating loss of £133 million in 2009-10, and their aggregate debt hit £875 million in summer 2010—£36 million for each club.

Premier league clubs generally make an operating profit until financing and player trading costs are taken into the account. By contrast, each division in the Football League—championship, league one and league two—has collectively lost money. In total, debt across the 92 clubs stands at a £3.5 billion. Those staggering numbers really do put in doubt the future sustainability of our game outside the premier league, with all its wealth in its current format. Football League clubs are a vital pillar in all our communities and they play a vital role in developing young players, not just for our national team, in a professional and competitive environment.

One problem is parachute payments, which make getting into the premiership such a strong financial inducement. The pressure on clubs to succeed is perpetuated by parachute payments, which are paid over a four-year period after a club is relegated from the premier league and are currently worth £48 million in total. The justification is that it provides insurance to promoted clubs to allow them to be competitive in the premier league. The downside is that clubs only have to be in the premiership one in every five years to have such untold wealth coming their way. It therefore provides a perverse incentive, providing artificial support and allowing clubs to spend money that they have absolutely no hope of raising naturally. That distorts and undermines the integrity of the championship and, by extension, the rest of the football pyramid. There is no provision forcing clubs to use parachute payments to honour existing player contracts, for example, or to pay down debt. They can instead can be used, and often are used, to finance the purchase of new players in a winner-takes-all gamble to win promotion.

On financial sustainability, currently, all clubs must include divisional pay clauses in player contracts that indicate what the player would be paid in each division, if he were to play in them, in each term of his contract. A salary cost management protocol was introduced as long ago as 2003 for league two, limiting club spending on player wages to 60% of turnover. That limit was reduced to 55% this season. Clubs provide budgetary information to the league, which is updated as the season progresses. Any player registrations that take clubs beyond the threshold are refused. The protocol has proven successful, with the vast majority of clubs in the division spending less than 45% of turnover on players’ wages. League two’s operating losses fell from £9 million to £8 million in 2009-10. I am very pleased that league one clubs are currently shadowing the protocol this season, with a 75% limit of turnover in place, although at this juncture there are no sanctions for clubs. Next season, the threshold will reduce to 65% with firm sanctions in place. The limit will fall again in future years.

I understand that the Football League is currently in discussions with clubs in the championship regarding the introduction of UEFA-style financial fair play measures based on a kind of break-even model. That is much needed if championship clubs are to bear the brunt of some of the premier league-induced wage inflation without the requisite TV money to absorb it.

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

The hon. Gentleman mentioned the UEFA scheme. Does he share my concern that a report published by FIFPro this week, based on a study of players in the former Soviet republics in eastern Europe, showed that the salaries of 40% of the players it surveyed were not paid by the clubs that they play for, but by another party?

Photo of Mark Field Mark Field Conservative, Cities of London and Westminster

Yes, I share many of those concerns. I suspect, I am afraid, that at some level, even within our own professional game, there are similar problems.

Other hon. Members want to speak, but I hope that I have a few moments to say a little about sporting sanctions, which have caused considerable angst within the footballing community. The Football League pioneered the use of sporting sanctions, with a mandatory 10-point penalty applied to any club that enters administration. I strongly support the sanction, because it protects the integrity of the competitions by ensuring that clubs do not gain a competitive advantage, not just by going through insolvency, but through overspending in the years before that.

I understand why many fans are upset by the sanctions, particularly fans of clubs such as Luton Town and Plymouth Argyle, which have dropped rapidly through the divisions as a result of not just a 10-point penalty, but often more punitive penalties. In a sense, the new owners and loyal, much put-upon supporters find themselves left to pick up the pieces, although they are not responsible for many of those past misdemeanours.

We have not discussed agents’ fees to any great degree today, and there is also the issue of publication. The abolition of the minimum wage 51 years ago and the Bosman ruling, fundamentally, in 1995 have so massively tilted the power away from clubs to the players. It has gone from one terrible extreme of indentured play to the other, where the players have the whip hand. They have so much power that their agents can now extort huge fees. Although it is easy for the footballing fraternity —the FA, the premier league and even the Football League—to accuse agents of being at the core of all these problems, they often have a symbiotic relationship with agents, some of whom may be on their side, as Graham Jones said specifically in relation to Blackburn Rovers, but that applies within many other clubs as well.

I am keenly aware that other hon. Members want to speak. Payments to HMRC have already been discussed by other hon. Members. On FA governance, as we know, the Football Association was created in an Olympian, Victorian age. In fairness to Oxford university, it won the FA cup a few times in the 1880s, which is probably why it still has representation to this day, but clearly this is not a sensible body to go forward as a 21st-century model for running our national game.

Given the commercial explosion over the past couple of decades following the emergence of the Premier League, which I have mentioned, one has to wonder how the FA in its current form can have any influence. In many ways, the Premier League has, again, been complicit in this and has colluded and been happy to allow the FA to take quite a lot of flack for elements of the governance concerns that we have addressed today.

The FA will need to change its culture to understand that it alone is there to enforce the rules and policy agreed by the whole game. The overall direction of football in this country should now have significant input from the Premier League and the Football League—not as a takeover, but as a partnership. Just think how much more successful even a relatively traditional FA could be with more input from the acknowledged day-to-day leaders in the leading tiers of global club football. A change in the culture will see the FA participate alongside the rest of the football family in creating policy with more of a focus on oversight, which is close to all our hearts.

Hon. Members have mentioned having more independent directors. Such directors would have an important role in examining the game’s policies at a board level. More power should be handed to them and to expert executives who will initiate the policies.

The Government are keen to avoid having an independent regulator for our domestic national game. Football must accept that, if many of these proposals are not acted upon, working together with footballing organisations, an independent regulator may be a sanction. I am interested to hear what the Minister has to say about that. This subject has probably been a headache for him, knowing that he is, in truth, much more of a professed player of cricket and rugby—more than just a fan—but I suspect that football takes up a huge amount of his time.

This report will play an important role as a stepping-stone to ensuring that the national game, which all hon. Members have close to our hearts, will thrive in the years to come.

Photo of Therese Coffey Therese Coffey Conservative, Suffolk Coastal 4:38 pm, 9th February 2012

It is a pleasure to serve under your chairmanship, Sir Roger, and that of Mr Havard, the previous Chair, who probably prefers the oval ball, but accepts that the round ball game—the beautiful game—touches all four nations of the United Kingdom. I am delighted that three of those nations were represented in the debate at some point.

I thank other Committee members. For a football fan, it was a fabulous inquiry. Steve Rotheram was a bit gutted not to be on the Committee at the time. However, he should take credit for having been part of the main inspiration for the inquiry in that seminal debate in Westminster Hall some time ago. I hope that he is proud now to be part of the Committee that was able to put the report to the House for consideration.

There is no question but that football is probably our most successful export. I appreciate that Sepp Blatter thinks that the Chinese invented football, but I firmly believe that it is the English version of the game that has gone around the world. Indeed, we seem to be importers of talent nowadays, but our game is no worse for that. The extent of professional football here goes far beyond anything we saw in Germany, in terms of the number of teams and the quality of football, as Mr Foster mentioned earlier. That is reflected in the fact that we have had such success in European competitions.

Success perhaps eludes the three lions. Of course, we all hope to put that right in 2012 in Poland and Ukraine, and in Brazil in 2014. But as I will mention later, that is one reason why the Committee felt that it was important to do something about football governance.

I will try not to repeat too many things that my hon. Friend Damian Collins said and I will try to develop a few different points, but I echo his tribute to David Bernstein. I ought to say that I am parliamentary fellow to the FA at the moment, so this is not being done in an attempt to try to get free tickets for any game, or anything.

I was looking at the evidence from 29 March 2011, when the Committee visited Wembley stadium to take evidence from the FA. At that time I brought up the issue of governance and Fabio Capello’s contract. All I can say is that David Bernstein’s responses that day gave me confidence, as did his actions, in respect of exactly what happened with the captaincy of England—and in the situation in the past 24 hours.

David Bernstein has persuaded the council, the shareholders and other board members to bring on two new independent non-executive directors. That has happened and already they are making a contribution to the board. Give credit where it is due, despite the fact that he is a Manchester City fan. As we all know, we can be very tribal in the main Chamber, but we are all here for the greater good of football.

Photo of Steve Rotheram Steve Rotheram Labour, Liverpool, Walton

Does the hon. Lady agree that the FA still needs to do more to become fully inclusive? An FA board needs to reflect all society and include, for instance, people from different socio-economic and cultural backgrounds and minority ethnic groups and perhaps even women.

Photo of Therese Coffey Therese Coffey Conservative, Suffolk Coastal

Of course, one of the new independent directors is a woman, which was a little bit of a surprise, but I was delighted that a lady with a pedigree at Millwall is already making a contribution at the highest level of the game. Kelly Simmons is in charge of the national game and does a great job working with communities.

A lot has been said about the ownership of football clubs and financial fair play. I was keen to ensure that the model of a significant owner was not condemned as a particularly bad thing. I say that because that is one reason why we are able to have so many clubs throughout the country. I do not want to come across as patronising, because I was born in Wigan and grew up in Liverpool and have always believed that it was working man’s philanthropy. Others ensure that their theatre keeps going or donate to the Royal Opera House and there is no greater thing than to keep a local football team going. I do not pretend to be an Ipswich fan. I always want them to do well. But whether it is Marcus Evans at Ipswich Town or the infamous Delia Smith, saying, “Come on, let’s be having you,” up at Norwich, it is important that people invest in something that is critical to their community.

Everyone is worried that the huge amounts of money coming in have skewed the field somewhat, and financial fair play will go a long way towards addressing that. I am impressed that the owners of Manchester City have basically put equity into their finance, as opposed to loans—that is a good thing—and it has to some extent shaken up the premier league. However, when the rules are introduced we must ensure that there are no loopholes, which we saw in Germany, when okay money has not been invested—a €100 million sponsorship deal for a particular team was the way of getting money in, and it went straight through to the profit and loss.

Photo of Damian Collins Damian Collins Conservative, Folkestone and Hythe

My hon. Friend is making an important point. She is referring to the loan made by Gazprom to Schalke. Such informal financial arrangements might, potentially, confer some influence over the running of the club, which people could find concerning.

Photo of Therese Coffey Therese Coffey Conservative, Suffolk Coastal

That might well be true, but I do not pretend to speak on behalf of Schalke. There are, however, some interesting, tidying things to be done, which financial fair play needs to take account of.

The involvement of supporters was part of the coalition agreement. Before the previous election, the three main political parties each had an element on how to get supporters more involved. Supporters Direct has been working hard to see how supporters can get involved. I support its bronze-level approach of ensuring that every team has a liaison officer or a trust, so that there is appropriate interaction with the club. To be honest, supporters having a veto on the sale of assets is a little unrealistic, although many will take advantage of the Localism Act 2011 and designate certain places as community assets, which might be a useful step. We have also seen fans getting together and buying their club—most recently in Wrexham, where a lot of my family live and where I fought the election in 2005. That is something to be welcomed, to keep it afloat.

Some interesting points have been made. Someone wrote to me from Arsenal, concerned about the illiquid market, although there is a supporters’ trust and a “fanshare” scheme. I cannot necessarily come up with a solution, and it might just be the nature of trying to raise finance in these times. Indeed, Spurs was taken off the stock market last month, because of the restrictions on how to get additional investment into the club. Something that the Government can easily do, therefore, which I am sure the Minister will confirm, is to amend the Financial Services and Markets Act 2000. Supporters’ trusts could then come together, whether through industrial and provident societies or community interest companies, and get over those silly bureaucratic hurdles, which were not meant for such community organisations.

Other colleagues have already talked about licensing. I must admit that the whole concept seems contrary to classic English law. Under the Napoleonic civil code, on which most continental law is based, people are permitted to do something—that is how the legal basis operates—whereas our basis is that people can do anything they like unless we legislate to say that they cannot. Licensing would change that, and at first I was a little unsure about it, but eventually I was persuaded that it is the right thing to do to provide stability in the football family. The Premier League and the Football League have already moved considerably to try and address some such points in their terms of practice, whether paying PAYE and national insurance on time or ensuring enough liquidity to operate for the next 12 months. The formality that we saw in the German league probably is appropriate and should put fans’ minds at rest.

We are interested, however, in the future and in the money that sometimes struggles to get down to the grass roots. The 50:50 rule has already been mentioned, and my understanding is that the national board are happy to leave it at that—I suggest leaving that option open. The investment that has been put into St George’s Park is fantastic. I was lucky enough to go up there only this week to see it. I cannot believe that it will open in September—perhaps I am too used to debating Network Rail and things taking a year and an eternity to be done. That is a genuine vision of how to put in place the coaching that we desperately need. Again looking across to Germany, after it had a disaster in Euro 2000, it set about a 10-year plan, which has proved rewarding. I pay tribute to David Sheepshanks, a former member of the FA board. He happens to be a constituent of mine, but credit is due to him for taking that vision along and making it a reality. Long may that continue.

Coming on to the structure of the FA, as has been explained we have the FA council, the shareholders and the board. Credit is due again for the two non-executives, which is quite a change of view by Mr Roger Burden who back in March last year was yet to be persuaded of the case for two independent directors. I am pleased that he changed his mind and with the vote in favour. My right hon. Friend the Member for Bath has already mentioned the committee structure. Our recommendation is imperative: that all committees should report to the board, rather than to a mixture of the board and the council, simply because we end up with the board effectively not being able to run the FA even though it has been given that direction by the council. That change is absolutely imperative, and I hope that the FA council will take it firmly on board.

Coming on to other things such as the proposal for term limits, I understand that many felt that that was an attack on people who are very good for football. To be blunt, such people have been there in all weathers, painting the lines, coaching the young kids and running the teams, out there in the freezing cold, and they will be thinking, “Why is a bunch of MPs telling us that we can’t stay on our council?” It is not about that.

Absolutely, those people deserve full recognition; I have been out with Suffolk FA and local community clubs, and football would not survive without them.

If only the professional game were involved, we would not have that same emotional connection. However, given the role of the council, changeover of people is appropriate for governance. The reason we came up with 10 years was simply that the chairmanship of a Select Committee in this place is two terms of five-year Parliaments. That is where it came from—[ Interruption. ] We talked about it, didn’t we? We thought about how to ensure changes of governance as well as continuity, helping the organisation to look at itself. I understand fully that many people rightly deserve a little reward once they have been serving the FA for some time as a volunteer, and that should continue, but fresh blood is also useful. Likewise, older or longer-standing Members of the House hopefully recognise the value of change at an election, when we get new Members.

On that note, although we have had some interesting discussion, such as a spat—dare I say it—about Milton Keynes or Wimbledon, the debate shows the strong emotion that we have about our beautiful game, our national game. I hope that football fans at the FA recognise the opportunity to put our game on an even better footing. Long may the celebrations continue for Euro 2012.

Photo of Roger Gale Roger Gale Parliamentary Assembly of the Council of Europe (Full Member)

Order. I will call Mr Bingham next, then the two Front-Bench spokesmen. I understand that Mr Whittingdale may wish to make a few closing comments. As they say, do the math, please.

Photo of Andrew Bingham Andrew Bingham Conservative, High Peak 4:48 pm, 9th February 2012

I shall attempt to be as brief as possible. As ever when speaking last in such debates, a lot of things I wanted to say have already been said.

Football has seen great changes over the past 20 or 30 years: the advent of the premier league; the European championships in England in 1996, which I remember invigorating the nation with football; the Bosman ruling; pay-per-view television; and subscription television. Those changes have revolutionised the game. There has been an explosion in transfer fees, players’ wages, admission costs and corporate hospitality. The beautiful game of yesteryear has very much become the commercial leviathan of today.

The days when the chairmen used to count the gate receipts around a table after the match are long gone; they now deal in reaping the best sponsorship deals, the sale of shirts, negotiating image rights or perhaps preparing the prawn sandwiches so beloved by Roy Keane over at Old Trafford—the list goes on. I may be appearing to paint a rosy picture of halcyon days, with baggy shorts, flat caps, Stanley Matthews galloping down the line—I am a little disappointed that Paul Farrelly is no longer present to intervene about Stoke City—or George Best swerving around defenders.

I am not implying that things are not what they were—the game has been improved immeasurably in the past few years. It is a faster game, it is wider and with a more inclusive audience. Indeed, even Mrs Bingham has been known to go to the odd game in the past.

We have not talked about the growth of ladies’ football—there has been phenomenal growth up and down the country. In addition, modern football stadiums are much better than the ones that we used to have. Even someone of my tender years remembers the old football grounds. People were jammed into them, and they had inadequate toilet facilities and so on. I remember going to the last game at the old Wembley stadium and thinking how old and archaic it looked compared with the new and modern grounds.

[Interruption.]

I cannot comment on Bath City. I have to admit that I have never been to Bath.

The point that I am trying to make is that football has changed immeasurably from what it used to be. Apart from the basic rules of the game—give or take tweaks to the offside rule and one or two other things—it is a completely different business from what it used to be. Many of the changes have been for the better, but the question that I ask is whether they have brought it closer to the football fan, the man in the street, the supporter. It is still the beautiful game, but is it still the people’s game? Some may say that it is not, but it is still our national sport. As we have heard, it is watched by thousands of people each week, yet the distance between the players and clubs and the fans seems to have grown larger than ever.

The Select Committee report is a fabulous piece of work. I wish that I were a member of the Select Committee, because being involved in this inquiry would have been a labour of love for me. The report makes many recommendations, but one that caught my eye was the one in which it urged more involvement by clubs with supporters, through trusts or consortiums. The Government have agreed with that. Indeed, the Government response is equally good: they state their belief that football clubs are stronger when they have supporters

“at the heart of the club”.

I agree with that.

I would not seek to draw like-for-like comparisons between non-league football and the heady heights of the premier league. A club such as Manchester United cannot replicate the homely atmosphere of somewhere such as Buxton football club in my constituency, but I do look at local non-league clubs and the way in which they work. I am a particular fan of non-league football, sad as that may be. I used to be on the committee at Buxton. I think that I have been watching the team since 1971. The team plays at what is reputed to be the highest football ground in England—I can promise that it is one of the coldest, particularly at this time of year.

We also have New Mills football club and Glossop North End. Glossop is one of the oldest football clubs in the country. It is a former member of the first division. If Sir Roger will permit me a little self-indulgence—I do have an eye on the clock—I will tell hon. Members that it was formerly chaired by Sir Samuel Hill-Wood, one of my predecessors as Member of Parliament for High Peak. To this day, his family are still involved in football. His grandson is Peter Hill-Wood, the chairman of Arsenal. His grandfather left Glossop when they were relegated, and came down to Arsenal. Arsenal’s fortunes went one way—and Glossop’s have not quite gone the same way as Arsenal.

All those clubs have people at their heart. Many people work in a voluntary capacity, but they are also at board level. We have heard hon. Members today talk about people sweeping car parks, selling programmes and so on. That supporter involvement creates a strong club with a happy atmosphere. When Glossop reached the final of the FA vase in 2009, the whole town was gripped by it. When the team came back on an open-top bus, it was just like Manchester United coming back from Wembley—the whole town came out. Unfortunately, we did not win the cup—we lost—but even going down to the final we had the Glossop special. Who remembers the old football special trains? We had a huge train going from Glossop. I had been on the train for two hours and I was further from Wembley than I was when I started. The whole atmosphere grabbed the town.

That is the power of football when it embraces the supporters and makes them feel that they have a stake in and are part of their club. We do not say that football supporters should completely own every club; we are talking about involvement. By necessity, non-league clubs are leading the way. They are showing the premier league and the other big clubs what can be done. I understand that it is impossible to recreate that at the big clubs, but if the supporters had some representation on the boards, they would feel that their voice was being heard. They would have a say in the direction of their club. Above all, they would have that sense of ownership of the club. The pride that people feel in their local club would be fostered in the big clubs.

I have been as brief as possible. I congratulate the members of the Select Committee. This is a great report, and I thoroughly enjoyed reading it. We in the House read many reports. With some of them, the pages do not turn quite as quickly as they did with this one—it is a thumping good read. I support the recommendation for more supporter involvement in clubs. I urge the FA to take on board the report’s recommendations and to get on with it, but please, can we get an England manager by next week first?

Photo of Roger Gale Roger Gale Parliamentary Assembly of the Council of Europe (Full Member)

I am grateful to the hon. Gentleman for his forbearance.

Photo of Clive Efford Clive Efford Shadow Minister (Culture, Media and Sport) 4:54 pm, 9th February 2012

I congratulate the Select Committee on the report. I join the Chair of the Committee in the tribute that he paid to our friend and former colleague, Alan Keen. I believe that our former colleague David Cairns was also involved in the inquiry when it started, although sadly he passed away before the report was written.

This is an extensive and detailed report on the future governance of football. It would have been better if we could have had this debate in the full knowledge of the response of the Football Association, but given what has gone on over the last couple of weeks in football, it has given us an opportunity at least to pass some comment on what has been going on. For my part, I pay tribute to the Football Association for showing strong leadership on these issues and particularly on the issue of racism in football. Its leadership has been exemplary. The international football bodies could learn from the way in which the FA has dealt with that issue. It has acted in the best interests of football, and I sincerely wish it all the best in selecting the best replacement as

England manager. If that means that the FA has to take time in doing it and allow people to finish current contracts, it should be given that time in order to do what is in the best interests of the England football team.

This report and debate give us an opportunity at least to set out the will of Parliament to the Football Association ahead of its response to the report. They allow us to say what we feel about football governance and what we think the FA should respond to. We all have a responsibility to face up to the many challenges that the report highlights. That applies to us all, from the FA at the top, through its executive and the council, to the county FAs. I say to the people in those particular bodies that they have to look to themselves to review the vested interests highlighted in the report, because unless all of us together, as one community of people who love football, are prepared to take on the issue of change in the governance of football, the changes that we need will not come about. It will also require the other governing bodies, the Premier League, the Football League, club chairmen, managers, players, the dreaded agents and, of course, the fans. All of us together have an opportunity to set out a course that will resolve the problems that face our national game. We can begin to work together to take on the tough choices over the future of governance and finance in order to democratise our game and bring it closer to the fans.

Football is our national game because it is played in every community the length and breadth of the country. Football teams are part of the communities in which they are based, whether it is Manchester United, at the very top of the game—it is one of the biggest and most highly recognised clubs in the world—or Darlington, in the conference league, which is struggling to survive on what is, frankly, a pittance compared with what is paid to a premier league agent, player or manager or the receipts that those clubs get from TV rights. Darlington was saved from complete closure only by a couple of fans, who at the last minute were able to raise £50,000 to buy more time to save the club. Without them, there would be no club to save.

I spoke to my hon. Friend Mrs Chapman yesterday about the fight to save Darlington football club. The reason why she is not here speaking on behalf of her local community is that she has had to return to Darlington to try to bring together all the different parts of her community that are fighting to save Darlington football club. I urge everyone here to get behind her and the local community—those people who bought that extra time to try to save Darlington football club. Everyone needs to work together in the best interests of the club. Something that we can do here today with the debate and the response to the Select Committee’s excellent report is to put the case for change that will prevent a situation like the one that has affected Darlington football club from arising again in the future.

One of the best examples that I can point to of a local community-based football club is AFC Wimbledon. If we consider its history, notwithstanding the speech from Mark Lancaster—I make no comment on Milton Keynes Dons or any criticism whatever; I wish them all the best, except for when they are playing Millwall—we have a club that started from scratch in the local community.

When Wimbledon moved to Milton Keynes, it virtually just moved the management structure and a bank account—what was left in it, that is—but the heart and soul of the club clearly stayed with the local community, which exemplifies my point about football clubs being part of their community. We have a remarkable story from what was left of the club: five promotions in nine years and back in the Football League. That just shows what fans can achieve when they work together to support their club and to help in its management and running.

Even some of the mighty clubs are vulnerable in this current climate. We have heard about Leeds United—I will not dwell on it—and Portsmouth. Their experiences testify to some of the pitfalls in football today. Even Manchester United is not beyond controversy over its finances. The green and gold campaign is not just about a dispute with the club’s current owners, but came about because many fans were absolutely shocked to discover that despite a very successful season in 2009, their club would have been in deficit had it not been for the sale of Cristiano Ronaldo for £81 million. Manchester United Supporters Trust is the biggest in the world. Who is to say that even the mighty, internationally recognised Manchester United might not end up a fans’ co-operative some day in the future? If it can happen to Manchester United, why not to other clubs?

The Spirit of Shankly is another group of supporters who were in dispute with the then owners of their club. Its ultimate aspiration, which is still on its website, is to own Liverpool football club. Recently, we have seen the dispute between Chelsea fans, who hold the ownership of Chelsea football club, and the owners, who want to get that ownership back and possibly move the club.

I pay tribute to Penny Mordaunt for her contribution to the debate. I was alarmed to hear that the administrator would not speak to the local community. I would like to know what the Football League is doing to ensure that the administrator talks to the local community and the fans about trying to save the club.

The problems at Portsmouth are an example of where things are going horribly wrong in our game. Mr Antonov’s bank, Bankas Snoras—I have not made up that name—applied in 2006 to operate banks in the UK, but was turned down by the Financial Services Authority. It was suggested that the bank had repeatedly given incomplete and inaccurate answers to the FSA. The FSA’s website states:

“Bankas Snoras was likely to fail to deal with the FSA in an open and co-operative way.”

Yet in 2011, Mr Antonov was allowed to take over Portsmouth football club. If the FSA had that degree of concern about the financial matters of this individual, it must have been written large for others to ask questions about his suitability to own one of our large football clubs.

Such a case highlights our concerns that due diligence is not taking place and that there are not sufficient fit and proper person tests. Something should have alerted the Football League or the FA to that person’s history, and they should have considered whether the purchase was in the best interests of the club or the game. I do not make that point to ask for an inquiry or to blame somebody for that decision, but we have the right to demand that the governing bodies go back and look at those cases. They should put their heads together and learn from such experiences. They should establish a set of criteria that will try to prevent such sales from happening again.

My hon. Friend Graham Jones made a powerful contribution about Blackburn and vividly described the gaping holes in the current administration of our national game. He set out how one of the biggest clubs in the Premier League fell foul of the financial regulations and the investigations that are carried out by our governing bodies prior to people taking over clubs.

As Damian Collins said, under the current regime it is too easy for people to hide the real owners of our football clubs. It is coming out loud and clear from this debate today that that is simply not acceptable.

The report is unequivocal in its condemnation of the issues relating to club ownership. It referred to “startlingly poor business practices” and “unacceptably low” levels of transparency. It is clear that football has begun to move in the right direction to protect the future integrity of the game, but more needs to be done. The UEFA financial fair play regime is a step in the right direction, but we need to remind ourselves, as Mark Field pointed out, that 56% of debt that is held by football clubs in Europe is held by our Premier League.

The pursuit of survival in the top flight is forcing clubs to over-extend themselves. The slightest hiccup in their cash flow, and they are in serious difficulties. Meanwhile, those clubs with owners with seemingly bottomless pits of wealth can be run at eye-wateringly high levels of losses, and that is simply not sustainable. Although we cannot resolve this matter overnight, our debate today, the Select Committee report and the responses from football’s governing body can make a start at addressing the problems that we face. Too many clubs hit a financial brick wall when they run out of money or simply when their financial backers run out. We must move to a system in which clubs have to balance their books, otherwise the present form of our game will not survive.

Every club has links with its local community. Every Member present can provide examples of their clubs doing excellent work within the local community. They may be dealing with young people or trying to tackle antisocial behaviour. I am not just talking about Football League clubs, but clubs at much lower levels. Indeed, clubs at the lowest level have armies of volunteers who go out every Sunday morning or Saturday afternoon to run the line, organise football matches and engage hundreds of thousands of young people up and down the country. Football is right at the heart of our community and something that we all hold in high regard.

It is also members of the local communities who gather outside football clubs when those clubs are in trouble. Who is it who commits their hard-earned cash to save their club? It is always the dedicated fans from the local communities. They are the ones who desperately fight for the survival of their clubs when the chairman or executives have long gone. They do that not just because they feel passionate about their teams but because of the place that football occupies in the heart of communities up and down the country—from the local pub team to the professional clubs. Fans respect the work that their local clubs carry out in the community, and it is at the heart of what they want from their clubs in the future. From supporters’ trusts to fans’ representative bodies, such as Supporters Direct, the common desire to enhance links between clubs and local communities is right at the heart of what they want to achieve. Fans are the community and they are the future of the clubs; they are fans at the professional grounds and they are the coaches and managers at the lower levels of the game. It is essential that everyone at every level of football respects that fact. Fans are looking to the sports governing bodies to give them more influence over their clubs, with a licensing system that is regulated from above, from the FA down, but is monitored by fans who can be the eyes and ears of the system, and police it at local level. For that, they need access to information, and resources.

Photo of Steve Rotheram Steve Rotheram Labour, Liverpool, Walton

On access to information, people are probably aware that Everton football club and its supporters are going through a troubled time. Everton football group—Trust Everton—is trying to raise money to purchase Everton’s training ground at Finch Farm. If the FA adapted appropriately, and gave power to supporters, they could access the very information that they need to help their own football club.

Photo of Clive Efford Clive Efford Shadow Minister (Culture, Media and Sport)

That is absolutely right. I could not agree more with my hon. Friend. What we want from governing bodies, who support Supporters Direct, is not just to hold meetings when fans can investigate decision-making processes at their club, and the decisions made, but the opportunity to interrogate the board members. If they identify something that is going wrong, they should have the means to raise that at the most appropriate level. We are not asking just for a fan on the board, or for a meeting every year when fans can come along and ask questions. We want to know what the governing bodies will do and how they will respond when fans ask questions and receive answers that cause them concern. If we do not empower fans, and allow them to investigate the sort of things that my hon. Friend the Member for Hyndburn described about Blackburn, how will we ever have an early-warning system? The fans are the early-warning system to tell us what is going wrong at a club.

Photo of Tom Blenkinsop Tom Blenkinsop Opposition Whip (Commons)

Guisborough Town football club in my constituency—I am its president—has an excellent supporters group network. I am also a fan of Middlesbrough football club, which has a disabled supporters association, an official supporters club, and Middlesbrough Supporters South, which organised an event last night with parmos provided to make sure that exiled Teessiders had some food and fare after the Sunderland game. For all those good intentions and good endeavours, paragraph 37 of the Government’s response states that consideration will be given to the establishment of

“an informal expert group to report on the degree to which there are other issues that create genuine barriers and to provide recommendations for practical action”,

which would allow groups to make informative and informed decisions, and to be able to see what is happening at their club.

Photo of Clive Efford Clive Efford Shadow Minister (Culture, Media and Sport)

That is absolutely right, and we need a mechanism so that the FA, the Premier League and the Football League can set up a system whereby they can hear the voice of those people at that level, and take action when necessary and when that comes under their jurisdiction.

Finally, I want to consider the role of agents and their influence on the game. That was highlighted in recent court cases, and by my hon. Friend the Member for Hyndburn. In the Premier League last year, more than £70 million was paid in agents’ fees, but only £10 million goes to grass-roots football from the Football Association. That cannot continue. In the Football League, it was £16.7 million. I know that action is being taken following the Stevens report, which was published in 2007, and some work has been done to tighten up the activities of agents, but those figures are not justifiable. They cannot continue, and more must be done to restrict agents’ activities, and the malign influence that they still have on the game. We must address that factor in our game.

Paragraph 254 of section 8 of the report states;

“There is a need for a strong FA”.

There is a need for a strong and robust response from the Football Association to the issues that have been highlighted in today’s debate, and in the Select Committee’s report. I hope that its shows the same strength that it has shown in the response to the issues that have occurred in the last couple of weeks. I sincerely look forward to reading its response.

Photo of Hugh Robertson Hugh Robertson Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Sport and the Olympics) 5:15 pm, 9th February 2012

Without wishing to disappoint anyone, I have a horrid feeling that the eyes of the football world may not be on Westminster Hall this afternoon in view of what is happening elsewhere, but this is a timely moment to debate the report. I want to join others in paying tribute to Alan Keen and David Cairns. I knew Alan Keen very well. I was not a good enough footballer to play football with him, but I played cricket and hockey with him for parliamentary sides. He played hockey in rather the same way as he played football, and I think that in his mind the two games were interchangeable. He was a fabulous man, and a great sports fan.

I thank the Select Committee for its report, and pay tribute to its Chairman on the way in which he conducted the inquiry. Football is an emotive topic, and there are strong views on almost every side, so it is not always easy to pilot the way through those choppy waters. However, at the end of the process the Select Committee produced an excellent report and gave us a fantastic basis for moving forward.

The debate has been long running. It has been going on for just less than 20 years, through the football task force, the Burns review, and the exchange of letters that Andy Burnham undertook. I think there is a real desire—there certainly is here, and I hope that there is in the football world—to bring the matter to a conclusion. We do not want to be having these debates in a couple of years’ time. It is important for the footballing world to realise that this is an opportunity for the football authorities—the FA, the Premier League and the Football League—to come together, to work together, and then to present the

Government and Parliament with a solution. I very much hope that they will respond positively by the end of this month.

I absolutely share the reservations expressed by my hon. Friend Mr Whittingdale, the Select Committee Chairman, but the football authorities must be left in no doubt that if they do not step up to the mark, we will legislate. It will be difficult to find time for primary legislation in the next Session in view of what else is going on, but if we do not achieve that, we can certainly do so beyond that, and there will be opportunities through private Members’ Bills.

Photo of Therese Coffey Therese Coffey Conservative, Suffolk Coastal

The Minister will have plenty of volunteers to help.

Photo of Hugh Robertson Hugh Robertson Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Sport and the Olympics)

I hope that the football authorities will step up to the plate and produce the right response at the end of the month, but if they do not do so, I suspect that the next stage will be for us to hand the formal consultation back to the Select Committee and to get it to look over it and then to seek a recommendation, if necessary, to go to legislation from there. I am keen to do that not only to recognise the Committee’s contribution to the matter, but because it is important that a clear message goes out to the football authorities that there is cross-party support for that, and that it is not a party political issue.

I will quickly run through some of the contributions from individual Members before concluding. The Chairman of the Select Committee spoke, as always, wisely, and is absolutely right that the core issue of the debate is reasserting the FA’s role as football’s governing body. There is a thought that it is some sort of representative organisation with power flowing up from the bottom. That is not my wish; it is not how other sports work; and I do not think that that is the way in which effective governing bodies work. The FA needs to have control of the national game.

I absolutely share the Committee Chairman’s desire to see a board of 10. We normally say that for good governance principles throughout sport we like boards to be between eight and 12, so 10 is perfect. It should have a much better mix of independent expertise, and represent the constituent interests in the game. In that way, the expertise of people who have had a lifetime of involvement in the game can be brought together with people outside who have independent expertise.

The reform of the council is absolutely important, as the Committee’s Chairman has said. It is there to be a parliament; it is not an executive body. He is absolutely right that the principle of financial fair play should underpin the licence. The full implications of the European ruling are as yet unclear. Lawyers are working on that issue and my hon. Friend the Member for Maldon is right to say that it will have an impact. What he and other hon. Members have said about supporters’ ownership is what we want to achieve. It is a spectrum with a dedicated fan or supporter liaison officer at one end, and supporters who sit on the board at the other. Different solutions will work in different ways for different clubs, but the current situation is clearly some way from where it ought to be.

Steve Rotheram—perhaps I should say the hon. Member for Everton and Liverpool football clubs—spoke passionately as always. He is right to concentrate on the make-up of football boards. Until we get right the corporate governance at the top of the game, little else will be achieved.

Mr Foster was right to speak powerfully about the importance of financial fair play, governance and licensing, and he will have an important role in moving forward the debate on supporters. The work that the Deputy Prime Minister is doing on shareholder involvement will be key to unlocking that issue. As well as encouraging football clubs to do something, we must encourage owners to make available more of their shares for supporters’ groups to buy. How we do that will be a key part of unlocking the debate.

Tom Greatrex, quite properly, paid tribute to the work of Supporters Direct, and I pay tribute to the work that he did during his time at Fulham. He is right to emphasise the crucial link between a club and its ground. Selling grounds is not always bad, but often it is, and the hon. Gentleman was right to draw attention to that issue. My hon. Friend Penny Mordaunt, who was speaking in the main Chamber a moment ago, was right to congratulate her newly formed supporters trust. I wish her well in her discussions with HMRC. I agree that a community buy-out would be an exciting new chapter for her club.

I am not sure whether I should intervene in the private dispute between Wimbledon and Milton Keynes, except to pay tribute to the excellent community work done by both clubs involved. Siobhain McDonagh and I discussed the matter at some length in a recent Adjournment debate. I do not know enough about Blackpool football club or its owners, or indeed about chicken burgers, to comment at any length, but the situation described by Graham Jones is cause for concern. My hon. Friend Damian Collins made a powerful case for reform. No one would doubt the veracity of his remark that if we are to have a fit and proper person’s test, we need to know the person involved, and we should pick up on that in the new licensing proposals.

My hon. Friend Mark Field was right to draw attention to the importance of wages. I had not heard the figure of 60% of turnover, but it seems a prudent level. When one considers that that figure is 88% in the Football League—I think that was the figure given—one understands why, when asked what he thought was its biggest problem, its chairman simply replied: “Debt.” My hon. Friend also asked about an independent regulator for football. I think that the Committee considered that, although it is not something on which we are consulting at this stage—I hope that the Chairman of the Committee will correct me if I am wrong.

I pay tribute to the work done by my hon. Friend Dr Coffey as a parliamentary fellow for the FA. She is right to draw attention to the excellent work done by David Sheepshanks at St George’s Park. There are always as many reasons to be cheerful about English football as there are to be miserable, and one of the great developments of the next few years will be the introduction of St George’s Park, and the way that it will turbo-charge the production of coaches and officials in the game at grass-roots level. It is an extraordinarily exciting development.

My hon. Friend Andrew Bingham spoke powerfully in favour of supporters’ representation. He must be the only person from my 10 years in the House who has described a Select Committee report as a thumping good read—a great tribute to the Committee’s Chairman. I thank Clive Efford for his contribution. As I said earlier, cross-party support is vital, and like him, I send my best wishes to those hoping to save Darlington football club.

We await a response from the football authorities by 29 February. So far, their approach has been encouraging and they have worked together constructively. I hope that they will produce something that will allow us to move on by the end of the month. It is fair to warn people that this is a complicated subject involving many different views and passions that are running high. If we are to achieve a solution by consensus—and I hope we do—we will need a bit of compromise and give and take from all sides.

I feel that good progress has been made on a licensing system. The principle is that an overall licensing system will be held by the FA, with a degree of subsidiarity to individual leagues. Progress has been made on tidying up the work of the council and shareholders, but reform of the board is proving more difficult.

Photo of Clive Efford Clive Efford Shadow Minister (Culture, Media and Sport)

I wanted to say that there is no quick fix. This is a huge problem that has grown up over many years, mainly since the creation of the Premier League. It is something that will take time to fix, and we must work together consistently on that.

Photo of Hugh Robertson Hugh Robertson Parliamentary Under-Secretary (Department for Culture, Media and Sport) (Sport and the Olympics)

I thank the shadow Minister for those remarks. If anyone has any doubt about whether something as arcane as a board is important to the process, they should consider that if this inquiry is about anything, it is about governance and the way that the game is run. The FA board is crucial. I am delighted by the introduction of the two independent non-executive directors. In the short time that they have held their posts they have already made a considerable impact, including on events in recent days. For the outside world, however, reform of the board is emblematic of the whole process. Crucially, if one looks at the Committee’s report, unless the board is reformed and the FA has a proper system of corporate governance, it becomes difficult to achieve a great number of the other things that lie further down the stream.

I will hand the debate back to the Chairman of the Committee for the final few minutes. Once again I thank him for his leadership and the Committee for its report. We are committed to this process, and I hope that by the end of the month we will have the right response from the football authorities. They should be in no doubt that if such a response does not arrive, the House will legislate, although I hope that things will not come to that. I hope that through the process under way we will see long-term and systemic change in our national game.

Photo of John Whittingdale John Whittingdale Chair, Culture, Media and Sport Committee, Chair, Privacy and Injunctions (Joint Committee), Vice-Chair, Conservative 1922 Committee 5:27 pm, 9th February 2012

With the leave of the House, I will make one or two brief comments. One of the pleasures of chairing the Culture, Media and Sport Committee is that although the topics that we examine may not be at the centre of political debate, they often involve things that people talk about in living rooms, pubs and cafés. No subject fits that description more than the one we have debated this afternoon. We have heard passionate contributions from across the Chamber. Hon. Members have mentioned their own clubs, and there was an entertaining discussion between Siobhain McDonagh and my hon. Friend Mark Lancaster. We are all agreed, however, that at least we have two good football clubs as a result of that discussion, so progress is being made.

My hon. Friend Penny Mordaunt and Graham Jones made more worrying contributions that illustrate some of the problems of individual clubs. Passion for the game was shown by my hon. Friends the Members for Cities of London and Westminster (Mark Field) and for High Peak (Andrew Bingham), and by the hon. Member for Rutherglen and Hamilton West

(Tom Greatrex). There were also contributions from other members of the Committee, and from Mr Foster who has asked me to say in the short time available that the chairman of Bath City football club is a woman—Manda Rigby—so progress is being made.

We discussed earlier whether it would have been better to wait until we have a response from the FA, and then debate the proposals. It helps, however, that three weeks remain before the Minister’s deadline, and whatever the differences in the views expressed this afternoon, I am gratified that the recommendations contained in the report have received unanimous support. I hope that that will send a strong message to the FA that it has three weeks to come up with serious proposals that meet the objectives that we have set for reform. I would prefer it if the Government do not have to legislate, as, I suspect, would the Minister. Nevertheless, he has made it clear that he will legislate if necessary, and for that I am grateful. I thank both Front-Bench spokesmen for that strong message.

Question put and agreed to.

Sitting adjourned.