EU-UK Cultural Exchange Arrangements
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Baroness Twycross (Lab)
As I mentioned in an earlier response, Minister Murray co-chaired the first UK-European Commission high-level meeting on culture. One priority for his work in this area is ensuring that, working closely with music and arts industry stakeholders, we engage with European counterparts to work through some of the clear obstacles that we would be keen to address in relation to our creative sector being able to access EU countries. The previous question on visas shows that we are actively looking at this, but there are issues that we need to work through.
Lord Parkinson of Whitley Bay (Con)
My Lords, we all want to see better cultural exchange, not just with the 27 members of the EU but with 200 countries around the world. Issues of visas, cabotage and carnets are not restricted to the European Union. What work are the Government doing on the broader international stage to make it easier for artists, musicians and others to travel the world, not just to those countries immediately on our doorstep?
Baroness Twycross (Lab)
The UK has made a number of arrangements with non-EU countries that are possible because we have been outside the EU, as part of our work on that since Brexit, so there are opportunities for broader cultural exchange. One of the successes of this Government’s work on culture is in some of the delegations that have taken place to non-EU countries. There has been huge enthusiasm from our sectors here for that, but also from the countries to which UK delegations have travelled.
National Arts Bank
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Lord Parkinson of Whitley Bay (Con)
My Lords, I thank the noble Lord, Lord John of Southwark, for securing this debate and for outlining it so powerfully. I congratulate him too on the impressive record that he and his colleagues in Southwark were able to rely on. I am a Southwark resident myself—in fact, it was the strong cultural offering of the borough that attracted me to the area—so I have the benefit of seeing some of the fruits of his hard labour.
The noble Lord mentioned Mountview, the Central School of Ballet and the Old Vic in his opening speech. There are too many cultural venues in the borough to mention, but I will single out two that are celebrating significant anniversaries this year: the Southbank Centre, Europe’s, largest arts centre, which turns 75 this year, and Theatre Peckham, closer to where I live, which turns 40. I congratulate him on the pioneering work that he did and agree that other parts of the country could look to Southwark as a model.
I am glad that they will be able to think about culture much more proactively because of the concession the Government made during the passage of the then English Devolution and Community Empowerment Bill. In your Lordships’ House, we added culture as an area of strategic competence, which I hope will encourage more local authorities, particularly the metro mayoralties, to look seriously at this area.
The noble Baroness, Lady Warwick of Undercliffe, mentioned the work of the Theatres Trust as an arm’s-length body. The Government are looking at the planning system and the role that bodies such as the Theatres Trust have. Is the Minister able to say any more at this point on the powers they have on planning? I hope that they will be able to continue their work in encouraging local authorities to think about theatres and other cultural venues.
I am proud of the record of the previous Conservative Government. I had the pleasure of serving in the final three years as Arts Minister. In addition to securing a modest increase in the last Arts Council investment programme, I am proud that we expanded, and then made permanent, the tax reliefs available to theatres, orchestras, museums and galleries, which support them in innovative work and particularly in touring them around the country. However, the noble Lord is right that the capital needs of our cultural sector are pressing. As the noble Baroness, Lady Bonham-Carter, and others said, our cultural infrastructure is creaking. The noble Baroness, Lady Hyde of Bemerton, mentioned the figures by SOLT and UK Theatre for theatres alone.
A game-changer for our cultural life in this country was of course the creation of the National Lottery by the Conservative Government of John Major. That brought a huge influx of investment into our culture and heritage. We saw that first wave of lottery investment at the turn of the last century: everybody’s boiler, roof and building are now leaking and need fixing at the same time. There is a pressing backlog of work for our cultural sector. These are the unsexy things to fundraise for. It is much easier to get a new wing of something built than it is to replace a boiler, to improve the lavatories, and so on. Our cultural sector wants to take a lead in being more environmentally sustainable, and brilliant organisations such as the Theatre Green Book are helping them to do that. They want to be proactive in the changes that they make to their buildings.
The previous Government had a series of funds—the museum estate and development fund, the cultural development fund, the towns fund, the UK shared prosperity fund and the levelling-up fund—all of which gave grants to cultural organisations around the country to help them do some of that work. I had the pleasure of visiting some of the beneficiaries, including one in Southwark—the Old Operating Theatre, near London Bridge—where a grant of £157,000 helped it replace the Georgian skylight that looks down on the old operating table at St Thomas’ Church, part of what is now St Thomas’ Hospital.
The noble Lord and other noble Lords who have spoken today are right: we need to look at innovative ideas in the round. The noble Baroness, Lady Wheatcroft, singled out the success stories of @sohoplace and the Bridge Theatre. As I understand it, the Bridge Theatre benefited, in part, from Section 106 money. Part of the development done in that part of London allowed the creation of a brilliant new theatre, thanks to the brilliant pioneering work of people such as Nick Hytner, Nick Starr and Nica Burns in the case of @sohoplace. We should be looking at organisations such as Figurative, which are looking at new funding models for arts and culture, and cultural leaders such as Sir Vernon Ellis, who is looking in great detail at how we can encourage more place-based giving.
As noble Lords have said, we should all be reading very well-thumbed copies of the report by the noble Baroness, Lady Hodge of Barking. I am very glad the Government have accepted all her recommendations. There are many good ideas in there. We have heard some of them. On the idea that the Arts Council could be given more powers to have a trading arm to benefit from some of the investment that it gives, would that require a change in its royal charter? If so, I do not know whether the Minister can say anything on how the Government might implement these recommendations, but we hope to see these ideas bearing fruit soon.
I was struck in the noble Baroness’s report by the French example of the loi Aillagon, brought in by Jean-Jacques Aillagon, who was the Culture Minister of France in 2003, which gives generous tax deductions of up to 60% for French corporations that make donations. When I was Arts Minister here, we saw a work by Gustave Caillebotte saved for the French nation—a £43 million painting going to the Musée d’Orsay—thanks to a donation from LVMH, a corporation. It was able to claim 90% of that back in tax relief, a very generous allowance that unlocks philanthropy.
I agree with the noble Baroness, Lady Wheatcroft, that we need to be much bolder in the face of boycotts. Like many, I regret the departure of Baillie Gifford from literary festivals. At the Hay Festival, I am afraid to say, two Labour politicians from both Houses were among those who pulled out. We all need to be strong in the face of boycotts and stand up and thank those companies that are generous with their money in support of arts and culture in our country.
The noble Baroness, Lady Bonham-Carter, was right: we benefit here from a mixed model of funding. It is not quite the subsidised model of the European continent and not quite the philanthropy of the United States, but a blend of both. When I was Arts Minister, people were very clear with me that individuals and businesses will give, but only if the Government are seen to be doing their part as well. Does the Minister agree that we benefit from that mixed model? Clearly, the innovative thinking in Southwark has done so, and I am very glad that we have been able to have this debate to look at new ideas to encourage people in other parts of the country, too.
National Museums and Galleries
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Baroness Twycross (Lab)
I am not sure that there is fear baked into their concerns, but I recognise that there are a large number of museums out there that do charge. Where museums charge, they tend to be quite modestly priced. The issues that we are exploring are broader than that. We will look at the whole range of things and could look at whether there is an issue around competition with other institutions.
Lord Parkinson of Whitley Bay (Con)
My Lords, I am sorry to hear that this is a policy under active consideration in Whitehall. As the Minister said, it is a complex matter. As the Government look at this, will she ensure that they look at all the implications and practicalities, such as how we actually identify the nationality of people in a nation without ID cards and the impact on British people of ethnic minority backgrounds and, of course, on the many generous donors and benefactors who have given money, grants and gifts to museums and galleries down the ages on the understanding that they would remain free for everybody, as was the policy that the last Labour Government brought in?
Baroness Twycross (Lab)
Absolutely: we will be looking at all those things. Indeed, when I spoke to the national museums directly, these were some of the issues that came up.
Charity Giving
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Baroness Twycross (Lab)
There are two things to say in relation to smaller charities. Some of the measures put in place last year mean that smaller organisations pay less employer contributions. That was done to support smaller organisations. I am happy to arrange a briefing for the right reverend Prelate on the place-based approach to philanthropy, which is around making sure that you can leverage large amounts of money. It is entirely intended to make sure that smaller organisations, as well as larger ones, can benefit from the huge generosity and opportunities that philanthropy offers.
Lord Parkinson of Whitley Bay (Con)
My Lords, as the report makes clear, this is the first reduction in giving for five years. If the British public were still giving at the level they were a decade ago, another £12.5 billion would be available to charities across the country. The Minister is right that the British people are a generous lot. However, does she agree that part of the problem is that they balk at paying the extra tax bills that charities are facing through additional employment costs and national insurance contributions? For the National Trust alone, this costs £10 million per year.
Baroness Twycross (Lab)
The noble Lord will be entirely aware of the difficult decisions this Government had to make on winning the election in 2024. My noble friend Lord Livermore is not here, but I think he would probably refer that back to the Benches opposite. If the noble Lord has not read the report—it is a really interesting read—that was not one of the specific things I recall coming up in it. We would prefer to look at it in a much more positive way and to make the case for people giving. We will continue to do that as a government.
Class Inequality in the Arts
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Baroness Twycross (Lab)
We are aware of the basic income scheme for artists in Ireland. We are not considering a basic income scheme for artists at this time. However, we believe that British creators are second to none and we are committed to giving them security and a regulatory and fiscal environment where creativity can flourish. This is exemplified by our recent Employment Rights Act, our commitment to appoint a freelance champion and our 5% uplift to national portfolio organisations, as well as our commitment to addressing some of the unfair practices in the grass-roots music industry, such as pay-to-play.
Lord Parkinson of Whitley Bay (Con)
My Lords, in January, Exeter Cathedral School announced it would be closing its doors at the end of this academic year, after eight and a half centuries of training talented singers from all backgrounds who provide solace and tranquillity to those who need it. Parents and staff have said the Government’s imposition of VAT on their fees and scholarships was the “final nail in the coffin”. The headmaster of Wells Cathedral Choir School has similarly warned that, “VAT is of huge concern. Access to choristerships should be open to everyone. It is getting harder and harder to do that”. Will the Government think again, so that this important part of our living heritage can be open to everybody, not just those whose parents can afford it?
Baroness Twycross (Lab)
One of the issues with private schools is that, in principle, they have not been open to everyone. Ending the tax breaks on VAT and business rates for private schools was a tough but necessary decision that will secure additional funding to help deliver the commitments by this Government relating to education and young people. The schools that focus on the performing arts are in scope of the policy, in order to ensure fairness and consistency. However, we are pushing forward with making sure that there is better, revitalised arts education more generally, and that includes continuing some of the bursaries that are available to young people.
Uniformed youth groups: Promoting Skills and Resilience in Young People
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Baroness Twycross (Lab)
I think “Be prepared” could usefully be used as a motto for Ministers standing at the Dispatch Box in your Lordships’ House as well. There is clearly a role played by cadet forces and other uniformed youth organisations in the broader resilience piece. However, a thread that goes through all our policies on youth is around that resilience that young people so desperately need. All noble Lords from across the House will be aware of the crisis that so many people are feeling, and we want to make sure they feel equipped for the challenges they may face in the future.
Lord Parkinson of Whitley Bay (Con)
The Minister said in her initial Answer that the last Conservative Government set up the uniformed youth fund to give young people these life-changing skills and opportunities, and I was glad to hear about the evaluation she mentioned. It is sad, therefore, that the fund is ending in March. In the transition to the new funding arrangements, can she guarantee—as she said in response to her noble friend—that all of the organisations, including the Sea Cadets, St John Ambulance, the Guides, the Scouts and others, will continue to receive funding support so that young people can continue to have these life-changing opportunities?
Baroness Twycross (Lab)
I have committed to my noble friend to take the point about transitional funding back to the department. However, as the noble Lord will be aware, the uniformed youth fund was announced in the immediate aftermath of Covid and was intended to allow the groups to set up additional units. It was only ever intended to run until 2025. Therefore, the additional year has been while we have been setting up the programmes and funds under the new national youth strategy, which we are proud to say we have co-produced with young people. That is why the focus has shifted to a different way of rolling out funds.
Heritage Craft and Building Sector
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Baroness Twycross (Lab)
I am sure that my noble friend is in no doubt about the commitment of the Prime Minister and this Government to apprenticeships. From my perspective, it is an exciting opportunity for us to make sure that we increase the number of apprenticeships available in heritage skills. We have a problem in that heritage construction is not recruiting fast enough to replace an ageing workforce; that will become critical if we do not address it. Rather than tell the sector what we think should happen, I want to work with it to make sure that we get the workforce we need for the future to restore and maintain our incredible built environment within the heritage realm, which we know the public value hugely.
Lord Parkinson of Whitley Bay (Con)
My Lords, as the Minister recognised, our historic churches do not just rely on the talents of skilled craftspeople; they provide fantastic opportunities to acquire new skills and pass them on—I have met some of the stonemasons at Gloucester Cathedral who are apprentices there. For a second year running, the custodians of our churches and cathedrals are uncertain about whether the Listed Places of Worship Grant Scheme will continue beyond March. Some 260 churches and cathedrals have said that they have put essential repair works to one side while they wait to see whether this will happen. Can the Minister shed some light on whether the scheme will go beyond March and whether the cap that was imposed last year might be lifted?
Baroness Twycross (Lab)
The noble Lord is aware that the current scheme is funded until the end of March, when the budget is reached. We are very clear as a department that huge value is placed on listed places of worship by local communities and by their congregations. We extended the scheme in recognition of the importance of the listed places of worship scheme. The cap has not affected the majority of applications—94% of applications will be unaffected by the change; most claims are under £5,000. Immediately before Christmas, I met key stakeholders such as the National Churches Trust and the Church of England to make sure that they are kept up to date on where we are going as a department. I appreciate that people will be anxious to know about potential future funding and potential changes, and I will provide an update as soon as possible.
Broadcasting: Recent Developments
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Lord Parkinson of Whitley Bay (Con)
My Lords, like all others, I am very grateful to the noble Lord, Lord Fowler, for giving us the opportunity of today’s debate. It has proved to be a timely one, because it is the first opportunity that we have had to discuss the Government’s Green Paper on the BBC, published in the week before the Christmas Recess.
When I saw the Motion mentioning recent developments in broadcasting, I wondered how far we might roam in your Lordships’ House—and, indeed, we have heard about the Second World War a few times, the Home Service and the Light Programme. But noble Lords have also talked about some of the more recent trends in broadcasting that we have seen. The noble Lords, Lord Razzall and Lord Hampton, and, very powerfully, my noble friend Lord Bailey of Paddington spoke about the declining connection between young people and our public service broadcasters. The noble Lord, Lord Hall of Birkenhead, talked about the 30% reduction in the BBC’s income from the licence fee without accompanying public debate. My noble friend Lord Vaizey of Didcot, still sporting his very Santa-like beard, highlighted that YouTube is now the second most popular broadcaster in the United Kingdom.
It is against the backdrop of recent changes such as this that we will soon be asked to consider the BBC’s royal charter for the next very uncertain decade. That is a vital moment not just for the corporation but for our other public service broadcasters and our nation as a whole. It comes hot on the heels of a recent litany of errors from the BBC that noble Lords have pointed out and which I shall not repeat—other than to say that those errors have profound consequences, whether that is multibillion-pound lawsuits or a decline in trust and connection between audiences and our broadcasters. We have seen that the proportion of people in the United Kingdom who say that they trust BBC News has fallen by 15 percentage points since 2018. That is something that should worry us, as I know it worries the BBC.
As noble Lords know, I am sympathetic to the BBC and our public service broadcasters. In that sense, I am a Fowlerite Conservative: we ask a lot of the BBC and expect the high standards that it has come to be renowned for over the last century. We should remember that 94% of adults use some of the BBC’s services in some form each month. As the noble Lord, Lord Young of Old Windsor, said, it is to the BBC and our other public broadcasters that we turn in our nation’s most important moments.
However, the BBC faces some structural problems as we confront its next decade: a declining number of viewers, as the Christmas viewing figures prayed in aid by many noble Lords showed; increasing competition from other channels, as anyone who, like me, has tried to work out how to use the Christmas edition of the Radio Times in the modern age will be able to attest to; the declining number of licence fee payers, with 2.5 million fewer over the past decade, as the Government’s Green Paper points out; and the increasing evasion of the licence fee, the rate of which has doubled and now stands at 12.5%, which is one in eight people who should be paying for the service that we all enjoy and who is not.
We need to ask some very big questions to set the BBC and broadcasting more generally on the right course for the next uncertain decade. I, for one, find it difficult to predict what the next 10 years might hold, so I think it is important that we have these regular opportunities. A forever charter would be even harder to try to set out. But, unfortunately, the Government’s Green Paper ducks so many of the big questions that confront us over the coming years. The Government chose to disband the expert panel that was formed to look into future funding for the BBC in 2023, wasting some time and independent insight, and have ruled out some of the most basic questions in their Green Paper. For instance, it dismisses certain funding models seen in other countries. A recent paper by the British Academy draws some interesting comparisons with Australia, Canada, Denmark, Germany, Norway, Spain and others. The Government have already ruled those out in the Green Paper, yet they leave the door open to advertising—something that the BBC itself is so opposed to. Can the Minister explain a bit of the rationale there?
The Green Paper rules out looking at the size and scope of the BBC. It says,
“we do not believe a smaller BBC is in the UK’s interest”.
However, I think we should at least ask the question whether the BBC ought to have so many television and radio channels. Do we really need four versions of Radio 1, with 1Xtra, Radio 1 Dance and Radio 1 Anthems—which, I was disappointed to learn, is not the place where one can find the much-missed Radio 4 “UK Theme”.
My noble friend Lord Black of Brentwood is right to point out the impact of the BBC on other media, particularly local newspapers. The Government’s Green Paper does not say much about greater collaboration, or perhaps even mergers, between some of our public service broadcasters in the years to come. In the Government’s Creative Industries Sector Plan, which was published last June, they said that they would ask the Competition and Markets Authority, supported by Ofcom, to set out how changes in the sector
“could be taken into account as part of any future assessment of television and advertising markets. This would include when considering any potential closer, strategic partnerships or possible consolidation between broadcasters”.
Did the Government ask the CMA and Ofcom about this, and what progress have those two bodies made in the intervening months? However, as the noble Viscount, Lord Chandos, says, the CMA does not have a good track record in this area. It rejected Project Kangaroo, the plan for a consolidated streaming service for all our public service broadcasters, which would have given them such an important head start on Netflix and the others that have now gained pace.
The Green Paper contains some damaging ideas, such as the notion of free TV licences for people on benefits. That would only fuel division, resentment and some of the disconnect that audiences feel, and would add to the pressures on public spending that have led to many of the problems that noble Lords have identified in their remarks today. Perhaps the Minister can set out why the Government are looking at this.
We need to ask these big questions so that the BBC and other public service broadcasters can compete. We saw in recent weeks the news that the BBC has been replaced by TNT Sports as the broadcaster for the forthcoming Commonwealth Games—a great shame for those who wish to follow them. This will lead to increased piracy, as people try to watch their favourite sports or TV programmes illegally.
Noble Lords rightly point to the mergers and growth of already large international streamers and corporations, and to the way that they are pushing up production costs, making it more difficult for the BBC, Channel 4 and others to compete. I was glad to hear a number of noble Lords talking about the knock-on effect that this has on cinematic releases. Timothée Chalamet has been speaking very powerfully about trying to get people into cinemas to watch his latest film, “Marty Supreme”—something that would buck the trend.
Lord Parkinson of Whitley Bay (Con)
The noble Lord, Lord Hacking, does not like it, but I am glad that he has at least been to the cinema to see it.
What discussions have the Government had with awards academies about the qualifying period that is necessary for films to be entered into things such as the Oscars and the BAFTAs? Should they not insist on a greater cinematic release? Having taken the Media Bill through your Lordships’ House in 2024, I agree with the comments that have been made about implementing and enforcing the provisions of that Act in relation to prominence and more.
The noble Lord, Lord Dodds of Duncairn, spoke powerfully about digital terrestrial television. In July 2025, Ofcom recommended that the Government make a decision about whether to invest more in digital terrestrial television, which, at present, is guaranteed only until 2034. At the time of Storm Goretti, we are reminded of what a vital lifeline our broadcasters are, particularly in rural parts of the United Kingdom. Perhaps the Minister could say a bit about that?
The noble Lord, Lord Hannay of Chiswick, and others spoke about the BBC World Service. The director-general, Tim Davie—who will be much missed—has been in front of the Public Accounts Committee in another place this morning. He pointed out that the BBC World Service has not yet had its financial settlement for the 2026-27 financial year. Can the Minister say when that will be set out? Against such a turbulent geopolitical backdrop, surely the BBC World Service needs to know how it much can spend later this year?
As other noble Lords have rightly done, I want to end by connecting broadcasting to other art forms. The noble Earl, Lord Clancarty, spoke of the great and much-missed playwright, Sir Tom Stoppard. I recently saw his “Indian Ink” at the Hampstead Theatre, which I believe began as a radio play. Last night, at the Donmar Warehouse, I saw JB Priestley’s “When We Are Married”. He was another of our great playwrights who jumped from stage to screen to radio. In a recent report by UK Theatre, the producer of the BBC’s “The Night Manager”—which I am sure many of us are currently enjoying—speaks powerfully about the connection between funding for theatre, and other art forms, and what we will be viewing on our screens and streamers for years to come. During this helpful and wide-ranging debate, it is right that we have been able to switch over from broadcasting to talk about other art forms too.
Arts and Creative Industries: Social Mobility
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Baroness Twycross (Lab)
One of the key barriers to social mobility is opportunity. We are keen for those programmes not to be overly informal because, as soon as they are, they become very dependent on networks and exclusive entry routes. We are clear that we need to make sure that the roles filled through personal networks, including work experience, are open to everyone. This is an issue that the Minister of State in DCMS is keen to explore further, but I will write to the noble Baroness with specific details.
Lord Parkinson of Whitley Bay (Con)
My Lords, a recent study by the Association for Art History and the Courtauld Institute of Art showed that just 17 state schools offer history of art at A-level, and only two of them are north of Nottingham. The subject is important not just for those who might become the curators and museum directors of the future but for a generation that will need to distinguish fact from fiction in an age of AI and deepfake images. What are the Government doing to make sure that everybody, no matter who they are, where they live or what their parents did, is able to enjoy this part of our shared cultural inheritance?
Baroness Twycross (Lab)
I agree with the noble Lord opposite that it is important that people get the opportunity to study art history. I raised this with a sector organisation this morning. That organisation was very clear that, although it is concerned about the geographical distribution of art history, there are so many more routes in. It was keen for us to make sure that people know about the opportunities that exist within the sector, because if people do not know about the opportunities that exist, how do they get those jobs? I am keen to explore this, both with my noble friend and with others, but, beyond that, there is a basic question about how we make sure that, in primary schools, children of all abilities and interests get to know about the hugely exciting range of opportunities that exist within the creative industries and sector as a starting point for what they might study later.
Draft Statutory Guidance on the Meaning of “Significant Influence or Control”
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Lord Sentamu (CB)
My Lords, I apologise for speaking when the Front Benches have started speaking—I was going to stand up, but the noble Lord, Lord Addington, jumped up far too quickly.
When it comes to football, I want to use a phrase that the late Bishop of Southwark, Roy Williamson, applied to me. We had been working hard to get the Holy Trinity Church restored; it was a very poor congregation and fundraising was really very difficult, but we managed to do it. He came to open this amazing refurbished place, with the organ returned to its great glory. The church was full, and he said, “Your vicar, John Sentamu, can almost be compared to a Yorkshire terrier—never letting go, or only doing so in order to get a firmer grip”. That is how I see the noble Lord, Lord Moynihan: when it comes to football, he is like a Yorkshire terrier. He does it not wanting to control or anything but just because he loves football, and he knows a lot about football. He is doing this with an honest attitude. I do not think he is doing it to prevent regulations and all that is happening. But because he is like a terrier, I think this is the moment he needs to let go.
This stands on a three-legged stool. The first is what we passed here in your Lordships’ House—an Act of Parliament, the primary legislation. If you go there, you discover that the Secretary of State has power to do what he has just done. He is not doing it out of any reason other than that the Act that we passed gave him that power. The noble Lord, Lord Pannick, said exactly the same thing.
Secondly, there is the regulator, with powers given, again, by an Act of Parliament. The third leg is guidance—but I always look at guidance not as the key driver of things, which is why it cannot be clearly defined on every occasion. As the noble Lord, Lord Pannick, said, guidance always has to be understood in context. You cannot simply talk about what happens to my little club, which is not in paradise. York City Football Club is climbing up slowly, but it fell out of League Two a long time ago. You cannot say to the people of York City that paragraph 1.6 should not apply to them, when it says that
“regulated football clubs will be required to submit and publish a personnel statement identifying all owners. The definition of ownership, including the concept of significant influence or control, will ensure this statement publicly identifies the correct persons as owners, providing transparency to fans and the wider public”.
That will also apply to my little York City Football Club. Therefore, I do not see those phrases needing to be more precise.
This three-legged stool of the Act, the regulator and the guidance provided by the Secretary of State will, I am sure, make even my little club of York City feel emboldened that it actually knows who really owns it and who those people are. I think this is a good thing. I beseech the highly admired noble Lord, Lord Moynihan, that this is the time to drop the Motion. He can continue to be keen on football, but this is not the time—otherwise, you are going to play a game that is not going to take you anywhere.
Lord Parkinson of Whitley Bay (Con)
My Lords, I for one am grateful to my noble friend Lord Moynihan for giving us the opportunity to consider this guidance in full and for acting, if I follow the metaphors correctly, like a trout-fishing terrier who loves football too much but did not read the Tory manifesto with enough diligence. Of course, had my noble friend not brought this Motion, I doubt we would have had quite as many people here, or quite as many speeches, or spent such a long time looking at the guidance that is before your Lordships’ House—and I am glad that we have, because much has changed even since the debates we had on the Bill before it left your Lordships’ House and went to another place.
For instance, we saw just yesterday the sanctions that the EFL has handed to Sheffield Wednesday, following multiple breaches of its regulations relating to payment obligations. The EFL has given that club a six-point deduction and banned its former owner from owning any club in the English Football League for three years. Had we known that example at the time of the Bill’s passage, we might have taken it into consideration when discussing the amendments allowing some of the regulation to be delegated to the leagues themselves—but that debate has passed.
We are also meeting this evening after the Commissioner for Public Appointments appeared before a Select Committee in another place, where the appointment of the chairman of the Independent Football Regulator was likened to a
“mafia appointment in Sicily sometime in the 1950s”.
Lord Parkinson of Whitley Bay (Con)
Well, those were the comments of the chairman of the Select Committee in another place. But rather more pertinent are the comments not by a politician but by the commissioner, Sir William Shawcross himself, who spent the morning giving evidence to a Select Committee of Parliament and who said that he had never seen an appointment with as many breaches of the Governance Code on Public Appointments as this one. He said that it was
“not easy to set those breaches aside”
and called that very disappointing. I am sure we all agree that it has been a very disappointing process.
Baroness Debbonaire (Lab)
I thank the shadow Minister for giving way, but are we not somewhat straying from the subject of this Motion? We appear to be now discussing the football regulator and some very flowery language used by the chair of the Commons Public Accounts Committee this morning, which was wholly unfair and wholly unreasonable, when we are actually supposed to be discussing the guidance. Are we not just using a political opportunity to have a go?
Lord Parkinson of Whitley Bay (Con)
This is guidance and this is a Bill that is to be enforced by a new independent regulator. We did not know the name of the Government’s preferred candidate for the regulator when the Bill went through, regrettably. We know now who is entrusted with applying this new regime, and we know that the Commissioner for Public Appointments has criticised not just the Government but this morning Mr Kogan himself for a lack of transparency. It is straying from the guidance, but I wonder whether the Minister, when she rises, will have anything to say about the comments made by the Commissioner for Public Appointments today.
The noble Baroness, Lady Debbonaire, is right: the focus of this debate is the guidance before us. On this too, my noble friend Lord Moynihan has raised a number of pertinent questions, some of which we touched on during our scrutiny of the Bill and some of which are raised by the guidance that has now been published. Under particular consideration today is an issue that we spent considerable time on. When we were looking at the Bill, we were provided with rather scant information about what significant influence or control would mean in practice. We now have draft guidance—but, as my noble friend Lord Moynihan says, that appears to raise rather more questions than it answers.
As my noble friend pointed out during our scrutiny of the Bill, there is no requirement in the legislation to consult before publishing the guidance, which has now been published. I think that is regrettable. I see from some of the comments that there has been informal consultation with some in football, but maybe the Minister can set out in a bit more detail the consultation and discussions that were had, which led to the drawing up and publication of this draft guidance.
A second and rather more serious point of contention regarding the new owners’ test, again raised by my noble friend in his speech and his Motion today, is the significant departure from the current concepts of ownership employed by the Premier League, the EFL, UEFA and others in football. The noble Lord, Lord Pannick, made some remarks about obscenity—not obscene remarks, I note carefully—drawing attention to other areas of law, both in this country and in the United States, where different tests are made. But in a football context alone, the Premier League’s handbook uses the notion of control and control only, whereas here in the guidance we see the new concept of significant influence or control. So this is introducing some new thoughts into this particular sphere of football regulation. The draft guidance states:
“The right to exercise significant influence or control over a club may result in that person being considered an owner for the purpose of the Act, regardless of whether or not they actually exercise that right”.
Surely the combination of this broader interpretation of the meaning of owner and the fact that one does not actually have to do anything to be considered as such, under the Act, means that this guidance would capture a far greater number of people than one might initially anticipate.
Lord Pannick (CB)
Of course the guidance goes further than addressing ownership. That is because the legislation which Parliament enacted requires attention to “significant influence or control”. That is the whole point.
Lord Parkinson of Whitley Bay (Con)
My question to the Minister is: will that capture more people than one might imagine? I think the lay person looking at this imagines a single owner of a club, but as in the legislation that Parliament has passed, a number of people can be considered an owner and to have “significant influence or control”, and I will come on to a few more examples of that. For instance, on page 7 of the guidance, paragraph 2.11 states:
“A person might exercise significant influence or control if their recommendations or instructions are always or almost always followed by other owners and/or officers, due to the financial relationship of the person to the club”.
What does that mean, for instance, for a club sponsor? They have a clear financial relationship with the club, and they might make recommendations to the club which are often followed by the officers of the club. Does that mean, under these regulations and the Act that we have passed, that they could be considered to have “significant influence or control”? Would a sponsor in any circumstance count as an owner under these regulations?
Lord Sentamu (CB)
I do not like interrupting the noble Lord, because he always puts the facts as he wants to put them, but the question that the noble Lord, Lord Pannick, asked was: would it catch everybody? Yes, if they are regulated football clubs. Paragraph 1.6 states that
“regulated football clubs will be required”,
so it will catch everybody. Everybody must do what paragraph 1.6 says.
Lord Parkinson of Whitley Bay (Con)
My point was a broader one about whether, under the definitions in paragraph 2.11, a club sponsor could be considered to have “significant influence or control”. It seems to me, on a reading of the guidance, that they might, but I look forward to the Minister’s response. It certainly seems that there is quite an expansive list of people that the regulations might apply to. Paragraph 2.12 states that a former owner who sold his or her shares to a close friend could still be considered an owner if he or she makes recommendations on how to vote to the person to whom he or she sold those shares. So, under the guidance, a person with no current financial stake in the club at all could actually count as an owner. I would be grateful for confirmation of that from the Minister. I see her nodding, but I look forward to her confirmation.
My noble friend Lord Moynihan set out, through the history of Leeds United, the complicated arrangements by which football clubs are owned. Another example might be Bournemouth. In 2022, Turquoise Bidco Ltd obtained 100% of shares in Bournemouth Football Club. Turquoise was then renamed Black Knight Football Club UK Ltd, which is a UK-based holding company wholly owned by Black Knight Football Club US based in Nevada. That American entity is in turn owned by Cannae Holdings, Inc. According to the US Securities and Exchange Commission, Cannae owned 44.3% of Black Knight, but Cannae is in turn owned by institutional investors, including BlackRock and the Vanguard Group. An American businessman, Bill Foley, owns 7.7% of Cannae, meaning that his beneficial ownership of Bournemouth is 3.4%, but a filing in April this year disclosed that his economic interest in Black Knight is 28%. That adds to the example of Leeds given by my noble friend Lord Moynihan of the complexity of even the most straightforward football clubs and the difficulty that will be involved in setting out all the people that might need to be regulated, investigated and brought before the regulator.
I conclude by echoing the question that my noble friend asked, as the Minister would expect, given my roots in Tyneside. The question that my noble friend posed will be of great interest to my friends and family there: would she advise the Crown Prince of Saudi Arabia to continue to invest in Newcastle United, through the Saudi Public Investment Fund, given what this might mean for him and for the club? That is just one of many questions of great interest to football fans, which is not made clear through this guidance. I am very grateful to my noble friend for giving us the opportunity to probe those in a rather fuller House than I think we would have had in Grand Committee.
Lord Parkinson of Whitley Bay (Con)
My Lords, I am grateful to the Minister for answering the questions that were posed. I apologise if I missed this, but does she accept that, under paragraph 2.11, it might be possible for a sponsor of a club to be considered as part of the new owners and directors test, if the sponsor’s recommendations are usually followed by the club? That is the test that paragraph 2.11 shows.
Baroness Twycross (Lab)
I will have to defer to the Box on that point, but I will be happy to pick that up with the noble Lord afterwards.