Football Clubs (Governance)

Alec Shelbrooke Excerpts

Wednesday 8th September 2010 Westminster Hall

[Steve Rotheram]

I totally agree with my right hon. Friend; there is not a one-size-fits-all response to this problem. First, we must identify that there is a problem, to see what we as Members of Parliament can do to alleviate it. Football supporters are shouting from the rooftops about it.

In my own neck of the woods, the pressure group Keeping Everton in our City achieved its objectives by stopping its club from being used as a pawn by big business. The aforementioned SOS-ShareLiverpoolFC has more than 30,000 members and a board packed full of expert professionals with a detailed proposal for funding and securing a buy-out of its club and for governance restructuring along more democratic lines. Supporters are thinking and talking big.

[Alec Shelbrooke (Elmet and Rothwell) (Con)]

On the specific point about governance from the fans, does the hon. Gentleman know—perhaps the right hon. Member for Leigh (Andy Burnham) can help as well—what the fans who may be running a club would think, say, of the commercial viability of a ground share between Liverpool and Everton? Would that be an example of fans’ passions overriding the business case?

[Steve Rotheram]

Give us an easy one! The tribal nature of football, which I will come to later if I have the opportunity, can sometimes override the common-sense approach. The example that the hon. Gentleman gives is a good one. Although the economics stack up in favour of Liverpool and Everton sharing a football ground, there are not many examples in the whole of the United Kingdom of such ground-sharing schemes. It is like suggesting to a Man United supporter that they share Manchester City’s stadium. If that is what the hon. Gentleman is suggesting, it would be a difficult proposal to sell on the doorstep.

There are those who would say, “Leave them to it. Keep politics out of football and football out of politics.” The UK Government have traditionally veered away from being heavy-handed in football business, leaving the sport to its own internal devices and regulatory systems. However, the game itself is now a huge, complex and lucrative industry, which, by definition, impacts on the economy. Premier league clubs alone are saddled with an estimated cumulative debt of about £3 billion. We ignore that and the culture it has permitted it at our peril.

Another major money-yielding industry that, until recently, was deemed untouchable and was pretty much left to get on with things on its own went belly up. On that basis alone, there is a strong case for the Government to intervene. I will go even further and say that the Government not only have a right but a responsibility to get involved. Football has received much financial and political support from Government over the past decade or so, and, at a national level, with Government support, it is bidding to host the World cup. Therefore, in return, the Government have a right to expect the highest standards of governance and a duty to step in when the game falls short of those standards, which it currently does.

However, the case is more nuanced than that; for many, it is personal. The football industry is unique because football is a product like no other. Supporters in general are not simply consumers who can exercise purchase power and walk away from the product if they are unhappy with its quality or performance. Football fans invest emotionally as well as financially in their clubs. Club allegiances, as we have just identified, are deep-rooted and passionate and are often passed down from generation to generation. They are inextricably bound with community ties and identities. In that respect, football, like politics, is tribal. It commands loyalty and constancy and requires member engagement if it is to thrive. The industry itself should recognise and respect that.

The issue is political in other ways. It is said that the new politics is about transparency and accountability, and about more rigorous and meaningful forms of democracy. It is precisely those democratic principles—transparency and accountability—that football followers wish to see enshrined in the conduct of their clubs. It is entirely in keeping with the spirit of the age that football fans should seek greater influence in how their clubs are run, particularly when they see the clubs being run into the ground by profit-fixated asset strippers with little or no understanding of or empathy with a club’s heritage or culture.

--- Later in debate ---

[Mr Mark Field (Cities of London and Westminster) (Con)]

I congratulate the hon. Member for Liverpool, Walton (Steve Rotheram) on enticing a bigger attendance than even the antics of the Independent Parliamentary Standards Authority. He is greatly to be congratulated. I suspect that I speak for virtually everyone here when I say that I share the sentiments in his final peroration about his passion for the game. I am also a keen and lifelong football fan, having followed the fortunes of Bury. I am glad to see that my hon. Friend the Member for Bury North (Mr Nuttall) is here; he will point out, as I suspect will many hon. Members, that it is the only Greater Manchester football club to be located in a Conservative constituency, although we will hopefully work on that in time.

I have been the vice-chairman of the all-party group on football, and I played a role in the debates and reports of 2003 and 2009, to which the hon. Member for Liverpool, Walton referred, on the governance and finance of the game. We have long argued that football as a whole is far too loosely regulated.

English football has undergone a dramatic transformation in the 18 years since the creation of the premiership, as the hon. Member for Stoke-on-Trent North (Joan Walley)—perhaps I should say the hon. Member for Burslem and Stoke—pointed out in her intervention. There is now an unprecedented and in many ways unbridgeable gulf between the top clubs and the rest, partly as a result of lax governance and the absence of effective regulation. The fact is that English football is a multi-billion pound global branding industry, with a hugely complex domestic structure and turf wars between the Football Association, the Football League and the premier league. As the hon. Member for Liverpool, Walton pointed out, frankly, such a situation works only to the interest of the very largest premier league clubs.

The new coalition Government have sought to introduce more co-operative types of club ownership, for example, by the fans. However, in reality, that will be virtually impossible to impose without ripping up company law and effectively nationalising privately owned businesses.

[Alec Shelbrooke]

Will my hon. Friend give way?

[Mr Field]

If my hon. Friend will excuse me, I will not. I know others want to contribute, so I shall speak for only a few moments.

Those people who push a somewhat idealistic view are a little misguided. In citing both Barcelona and Real Madrid as model clubs, the Minister made the important point that the massive advantage those two Spanish clubs have over any of their potential competitors in their home country is that they can sell their television rights in that market individually rather than collectively, as happens with the premiership. Before the world is too much older, I fear that there may be a big push to do something similar in this country—if not from the big four then from a big seven or eight that might emerge. That should be resisted at all costs.

I should also point out that the role of the president of a club such as Barcelona is similar to that of an owner in the UK—one must not get confused by the terminology. In Spain, a club that narrowly came fifth in its league, Real Mallorca, has been disbarred from European competition this year because of the magnitude of its debts. That is obviously a debate that will particularly affect Liverpool and Manchester United in their current state.

Some clubs do flourish under co-operative ownership; for example, Exeter City briefly dropped out of the league and have come back much stronger. However, co-operative ownership has also led to some big problems. Stockport County is a good example of a club that has ended up in administration. It has only just come out of administration after a damaging period in its history, which occurred after following that particular model. Forcing a single one-size-fits-all ownership model on all clubs is wrong. I am sure that some clubs would gain from co-operative ownership models, but others could fail. One ownership model will not necessarily fit the demands of every single football club. The reality is that vast majority of clubs are in one form or another owned by fans. Sometimes that might involve individuals—men and women—pumping millions of pounds into their team. They might get very little credit or support from the supporters of a club for doing so.

I would like to mention a couple of things that are happening outside the premiership, because much of the debate has inevitably focused on the big four—or at least the big 20—within the premiership. The attendance of Football League games last year exceeded 17 million, and the league clubs’ community teams worked locally with more than 1.5 million people. I have had a chance to see one or two of those projects over the years and, most recently, I have watched what has been happening with Crystal Palace. That club has been in great financial difficulties, but it has done a tremendous amount of work with its academy and has ensured that educational standards have remained tremendously high for young players, some of whom are breaking into the first team already. Such clubs are very much at the heart of their communities, and I think that many hon. Members in this Chamber who are here to represent football clubs will share the community values referred to by the hon. Member for Liverpool, Walton.

The reality is that there are quite effective cost controls in league two—the fourth tier of the English professional game—because clubs cannot spend more than 60% of their turnover on players’ wages. That measure has been extremely effective and I hope that it is rolled out to other parts of our professional game. There is no doubt that the championship—the second tier of football—is massively financially overstretched because of the huge incentive of going into the premiership. Parachute payments have been extended from two to four years for clubs that come out of it—in other words, provided that a club spends one year in every five in the premiership, the road seems to be paved with gold. However, all sorts of problems arise as a result of that.

We need to make it absolutely clear—I hope the Minister will do so—that it is important to pay immediate attention to proper cost controls within our national game. If we can find a way forward in that regard, it will allow our clubs to focus on what they do best in their communities. We need to ensure that they have proper community facilities and are engaged in youth development at academy level and within their local vicinity. The funds required for that crucial work, which is very much part of the big society, can be obtained only through having proper cost controls within our game. There is a vicious cycle that must be broken at the earliest opportunity.