Football Governance Bill [Lords] (Fourth sitting)

Lincoln Jopp Excerpts

Committee stage
Thursday 5th June 2025 Public Bill Committees

[Stephanie Peacock]

I thank the hon. Gentleman for his amendment, but I am not sure that his remarks spoke much to the detail of it. I remind him that this part of the Bill has not been changed since its previous iteration under the last Government. He has once again made his well-rehearsed argument about UEFA, but there is no risk in that regard. We have been very clear. UEFA and FIFA are happy with the Bill as drafted, and the FA has made that clear to Members of both Houses.

The purpose of the clause is to allow the Secretary of State the power to prepare a football governance statement that sets out the Government’s policies on issues related to football governance, where these are consistent with the regulator’s statutory remit. We believe that this is an important tool that the Government can use to set out their priorities in football governance, similar to the way that the Government give a strategic steer to the Competition and Markets Authority and other regulators.

We drafted the provision with appropriate deference to Parliament. Any statement must be consistent with the purpose of the Bill and the regulator’s objectives as set out in the Bill. The Committee has already considered that purpose and those objectives and has approved them. Parliament has set out the statutory remit, but it is appropriate that the Government of the day are able to set out their policy priorities within that well-defined remit without requiring parliamentary approval each time. There are also restrictions on when statements can be made, to ensure that they are not overused. Any statement must be published and laid before Parliament, so Parliament can hold the Secretary of State accountable for its content. Requiring the Secretary of State to gain approval for this statement would add an extra burden to Parliament.

[Lincoln Jopp (Spelthorne) (Con)]

I struggle to understand what might be contained in the Government policy statements. The Minister is steeped in this legislation, so must have discussed this in the past. Can she give the Committee an indication of what sort of thing might be covered?

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[Mr French]

That is obviously not what this amendment is about. It is about transparency. It is not about the overall cost, but about the transparency of the cost. The hon. Gentleman asks about how things would have been funded before, but we have to accept that we are in different economic circumstances. A number of costs have impacted clubs already. I am talking about the cumulative impact of Government policy—the Minister has heard me say this in a number of debates, including in the debate on swimming yesterday—on clubs from the elite level all the way down to the grassroots level. The point is that there are now extra costs from the regulator, on top of the national insurance increase, which we think has probably been the biggest change, the changes to business rates calculations, which have negatively impacted a number of businesses, and wage increases. Hon. Members may or may not agree with those costs, but we are talking about their cumulative impact.

Because it is ultimately funded by the clubs, the regulator will increase those costs. The hon. Gentleman talks about how we perceived it would be paid for. The clubs will pay the costs of the regulator—that has not changed—but we are trying to get at the cumulative impact. We want transparency about that impact on clubs, including for Parliament, so that we, as hon. Members who represent constituencies around the country, can have informed debates about the impact on English football of the decisions that we make in this House. As Members of this House, it is not unreasonable to want to understand the impact of our and the regulator’s decisions. Whether or not hon. Members agree with the amendments, they make it quite clear that we are calling for transparency on the costs of the regulator.

[Lincoln Jopp]

It is important for the House to understand that once an organisation is in the hands of the regulator, it has no choice. I was a director of a company that was applying for an operating licence from a national regulator. It cost millions of pounds, and we never achieved it—we tried three times, and never got there. As long as the regulator is doing its regulatory work, that is okay as far as it is concerned. There can be circumstances in which regulators, as long as things are being done by the rulebook, do not care about the growth of their industry. The amendment is a reasonable counterbalance to that, and would ensure that the regulator understands the financial burden it is putting on teams.

[Mr French]

I thank my hon. Friend for sharing his experience of regulation more generally. He highlights an important point about growth, which we were trying to get at with our earlier amendment and which we have discussed again this afternoon. Unless the regulator has a clear growth mandate—as I said in the previous debate, I understand that the Chancellor is consulting regulators for growth ideas—it may not seek to stick to it, and it could therefore become obsessed with other issues and regulations. This amendment is not trying to alter what the regulator does; it is just trying to ensure that we have information on costs so that Members of this House can understand the impact. Again, I believe that is a valuable tool for us to have.

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[Stephanie Peacock]

I thank the shadow Minister for his amendment. He gave a wide-ranging speech, and I will focus my remarks on the amendment itself, but I will first respond to a couple of points that were made. Towards the end of his speech, he commented that regulation has not been done well for the past 20 years—perhaps I should remind him of who was in government for most of that time. [Interruption.] Indeed, the past 20 years. The hon. Member for Isle of Wight East said that some members of the Committee may or may not think that the regulator is a good thing. But of course we all stood on a manifesto that included it, so I hope that most Members here think it a good idea; fans up and down the country certainly agree that it is.

In speaking to the amendment, I again remind the Committee that no changes have been made since the previous Bill. The Government agree that it is vital that the cost of regulation should not place an undue burden on clubs. That is why we have designed an agile and light-touch regulator that takes a collaborative approach with those it regulates. Unfortunately, the amendment could do the exact opposite of what I think it intends. If the regulator were to track and publish compliance costs every year, it would need all clubs to measure and report on that on an ongoing basis.

[Lincoln Jopp]

What makes the Minister think that clubs themselves would not, as a normal matter of course, be noting their compliance costs?

[Stephanie Peacock]

Clubs may well do that, absolutely, but the amendment goes further than is needed and I will continue to make the case as to why I simply do not think it is necessary. It could involve the lengthy and onerous process of identifying and separating compliance costs from their overall operational costs. Reporting on compliance costs would drive up those costs unnecessarily. The regulator and Department will already be required to undertake monitoring and evaluation of the impact of regulation; that includes the review of the Act by the Secretary of State as per clause 96. For those reasons, I cannot accept the amendment and I ask the hon. Member for Old Bexley and Sidcup to withdraw it.

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[Lincoln Jopp]

It is a pleasure to serve under your chairmanship, Ms Butler. Subsection (3)(c) of clause 16 is an absolute Trojan horse; it gives carte blanche to the regulator to demand whatever it wants, regardless of whether a club produces such documents or information on a routine basis. Anyone who has worked with a regulator will know that means that clubs will have to employ lawyers, because they would never submit anything to their regulator unless it had been through lawyers first.

The shadow Minister used the phrase “blank cheque”, but it is almost a blank invoice to the poor clubs that will simply have to comply. When a regulator says, “Jump”, they do not say, “Why?”; they say, “How high?” However high the bar is set, they have to get over it. It is completely reasonable, at this stage of the regulator’s development, to seek limits so that it can take some very well-defined steps in regulating football, prior to giving it the carte blanche that subsection (3)(c) represents. As the shadow Minister said, I fear that the unintended consequences of subsection (3)(c) will be considerable.

[James Naish]

Does the hon. Gentleman accept that regulation evolves anyway? My brother runs a property business, and I can tell the hon. Gentleman that what he was first required to deliver to his regulator in 2012, when he set that business up, versus what he is required to deliver today has changed beyond imagination. Things move all the time, so it is appropriate for the regulator to be able to determine what it needs to perform the relevant functions.

[Lincoln Jopp]

Regulation does indeed evolve, but giving this football regulator carte blanche to evolve it without any recourse to Parliament is a key weakness of the Bill’s current drafting, which is why I support amendment 99.

[Joe Robertson]

The shadow Minister has already set out in great but necessary detail the reasons why amendments 99 and 100 have been tabled and should be supported. The issue is that subsections (3)(c) and (5)(b) of clause 16 provide a catch-all that allows the regulator to include such other information and documentation as it may specify when a club applies for a provisional operating licence. I support these amendments because I think those two provisions open the floodgates unnecessarily, and clause 16 already sets out the things that the regulator wants to see football clubs submit. To have that completely open floodgate is a problem for the reasons given.

If the Government were keen to have some flexibility here, they could have allowed the Secretary of State to specify any other such information in the future. At least there would then be some accountability via the Secretary of State’s being an elected person and ultimately accountable to Parliament. The particular issue here is that the regulator, once set up, does not have direct accountability, and therefore it would be easy for it to start stipulating all sorts of things. I support the amendments and I think that it should be tight, but the Government could have steered a halfway course here by retaining some powers for the Secretary of State, rather than the unelected regulator.

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[Stephanie Peacock]

The hon. Gentleman can make that well-rehearsed comment, but I specifically said there are no changes to this part of the Bill. I am focused on what we are talking about, and the parts of the Bill that amendments 99 and 100 relate to have not been changed. He also said that he would not oppose just for the sake of it, but that does seem to be what he is doing.

[Lincoln Jopp]

My hon. Friend the Member for Isle of Wight East and I were not here in the last Parliament, so what went on and the provenance of the Bill are not really our concern. We are being asked to contribute to the discussion and the debate on the Bill that has been placed before us. Neither of us saw the last one, so these are genuine points.

[Stephanie Peacock]

I take that point, but both the hon. Gentlemen stood on a manifesto that committed to introducing the Bill.

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[Mr French]

I do not plan to speak again at length. I appreciate the Minister’s comments, but we are concerned that without a set timetable on the regulator’s granting of a provisional licence, the uncertainty would create a number of issues.

[Lincoln Jopp]

The Minister just said something that I am not quite clear about; perhaps, given my hon. Friend’s experience, he could explain it to me. If a club gets promoted to the English Football League—the happiest day of the club’s history—it then has to apply to become regulated, but if it does not have that licence by the beginning of the next season, the Minister just said that it can play. Where should I look in the Bill to understand the latitude that clubs have to play in the English Football League without regulation?

[Mr French]

I thank my hon. Friend for making that point. That is not my understanding of how the Bill works, but the Minister may want to clarify that.

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[Stephanie Peacock]

The granting of a provisional operating licence will act as a first step towards a club gaining a full operating licence, and will allow the club to operate for a time-limited period. That will be up to three years initially, although it could be shortened or extended depending on the circumstances. This provisional period will allow the regulator time to assess the current standing of the club and determine what steps will need to be taken to attain a full operating licence, as well as giving the club the time to take those necessary steps. The club will provide a personnel statement and a strategic business plan as part of the application process, providing an overview of the club’s operations and financial information.

Once a club has a provisional licence, it will be required to meet basic requirements set out in the mandatory conditions, as well as to comply with the free-standing duties contained in the Bill. This will help to safeguard the club’s sustainability and heritage. There are three aspects to the test that the regulator will apply when deciding whether to grant a provisional operating licence. First, the club must operate a team in a specified competition, which effectively means that the club must be in scope of the regulator. Secondly, the club will comply with the mandatory licence conditions that will be attached to the licence by the regulator; full details of the mandatory licence conditions are in schedule 5. The third aspect is that the club will comply with the duties on clubs, as set out in part 5.

If the regulator is not satisfied that the club meets all the elements of the test, it must let the club know and give it an opportunity to engage with the regulator to rectify the issues identified before the regulator takes a decision. That collaborative approach will aim to ensure that clubs are given every opportunity to meet the requirements and gain a provisional operating licence.

The test for a provisional licence has been carefully designed to get clubs into the regulatory system as quickly as possible, and then to give them a transition period to raise standards, if necessary, and obtain a full licence.

[Lincoln Jopp]

The Minister said that clubs would still be allowed to play in the absence of a provisional operating licence. How long would they be allowed to play for before being granted such a licence?

[Stephanie Peacock]

We do not anticipate that happening. Enforcement would take place, but we do not want the regulator to stop clubs being able to play. I am outlining how the regulator will do everything it can. The information is fairly basic, and the aim is to move as quickly as possible, so we anticipate clubs being able to receive that provisional licence.

Clause 18 establishes the second step of a two-step licensing process designed to ensure a smooth transition to regulation. Being granted a full operating licence should be the aim of all clubs in scope of the regulator. The full licence means that the regulator is satisfied that the club meets all relevant requirements, including the threshold requirements. For a club to pass the test for a full licence, the regulator must be satisfied that the club

“meets the threshold requirements set out in Schedule 4”

and is complying with and

“would continue to comply with the mandatory licence conditions”

and the free-standing duties on clubs set out in part 5. Finally, the regulator must not have determined

“that any person who is an owner or officer of the club is not suitable”

for the position they hold.

The clause also details the power that the regulator has to extend the provisional operating licence for a club. That will be done only if the regulator believes that the club does not meet the bar for a full licence at present, but will do if given more time. Clubs will have had time and support, while provisionally licensed, to ensure that they can meet the higher bar for a full licence. Once the club has a full licence, it will not have to be periodically reviewed. Instead, the regulator will continue to monitor and supervise the club. There will be an annual touchpoint in the form of an annual declaration, in which the club will notify the regulator of any relevant changes. That will minimise burdens while still ensuring that the club continues to adhere to the necessary requirements, including requirements that ensure that fans’ best interests are at the heart of the club’s decision-making process. I commend the clauses to the Committee.