Football Governance Bill [ Lords ] (Tenth sitting)
Debate between Stephanie Peacock and Louie FrenchTuesday 17th June 2025
(2 weeks, 3 days ago)
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The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)
It is a pleasure to see you in the Chair once again, Mr Turner. Broadly, this group deals with the first three clauses of part 9, on reviews and appeals. A key safeguard on any regulatory regime is the opportunity to challenge the regulator’s decisions. As we will discuss in subsequent groups, decisions can be appealed to the specialist Competition Appeal Tribunal, but, as a preliminary step, clauses 81 to 83 create a statutory right for anyone “directly affected” by many of the regulator’s decisions to request that the regulator conduct an internal review.
Internal reviews will involve fresh decision makers reviewing a decision. They will provide a quicker and lower-cost option than immediately pursuing litigation. That should also streamline the overall appeals process, help ensure that litigation is a remedy of last resort, and hopefully minimise burdens on all parties and on the legal system.
Schedule 10 is a list covering the majority of significant regulatory decisions the regulator will make that directly affected persons are likely to appeal. These are the decisions that can be subject to internal review and appeal to the Competition Appeal Tribunal. More operational decisions have not been captured in the list of reviewable decisions, nor have “positive” decisions, where the likelihood of appeal is negligible, such as the decision to grant a club a licence. The right to apply for judicial review still applies in the usual way to decisions not captured in schedule 10.
Clause 82 sets out that, after the regulator makes a reviewable decision, a directly affected person can request that the regulator conduct an internal review. The clause outlines the procedure for internal reviews and empowers the regulator to refuse a review request in certain circumstances, including if the regulator considers that the request is vexatious. This should ensure that internal reviews are not used as a mechanism for clubs to frustrate and slow down the regulatory process. The clause guarantees that any individual who was involved in making the original decision will not be involved in conducting the internal review. That will ensure a fair review by fresh decision makers.
Lastly, clause 83 outlines further procedure around internal reviews. The outcome of an internal review can be to uphold, vary or entirely cancel the original decision. This means that the applicable reviewer can correct a flawed or unfair decision. The regulator will have a statutory deadline of 14 days to conduct the internal review, with a maximum possible extension of a further 14 days in special cases. This should strike the fine balance between delivering a streamlined process and giving the regulator sufficient time to conduct a proper re-evaluation of the evidence. In the interests of an open and transparent appeals process, the regulator will be required to publish the outcome of any internal review.
I turn to a series of Government amendments related to appeals. Government amendment 66 will add the regulator’s decision to trigger the backstop process to the Bill’s list of reviewable decisions. This will add a statutory route of appeal for the decision. Currently, the Bill makes only a decision not to trigger the backstop a reviewable decision. Making either decision at this vital stage reviewable will strengthen the regulator’s accountability by providing competition organisers with statutory avenues to appeal.
Government amendments 67, 68 and 71 will make the board, not the expert panel, the applicable reviewer of the three distribution decisions: to trigger the backstop, to make a distribution order and to revoke a distribution order. The regulator’s board will be the regulator’s most senior decision makers and so will be best placed to make and review these momentous decisions.
Government amendments 69 and 72 will remove the statutory route of appeal for three minor procedural decisions—the decisions to conduct an investigation under clause 68, to ask questions as part of an investigation, and to not accept a commitment in lieu of an investigation. This will reduce unnecessary opportunities to hamper the regulator by appealing interim procedural steps of an investigation. It would be inappropriate to allow a club to appeal the rejection of a commitment in lieu of an investigation, as this should be entirely at the regulator’s discretion as the investigating authority.
I reassure the Committee that these changes will not limit access to justice. Affected parties will still be able to appeal the final decision—that is, the outcome of any investigation—to the Competition Appeal Tribunal. The amendments simply remove the ability to challenge and frustrate the regulator at every step of an investigation. I commend the clauses, schedule and Government amendments to the Committee.
Mr Louie French (Old Bexley and Sidcup) (Con)
It is a pleasure to serve under your chairship, Mr Turner. I will keep my comments brief, which the Committee and you will probably be pleased to hear. I have listened carefully to what the Minister outlined, and the natural questions that arose about the amendments and clauses relate to how she imagines perceived biases will be avoided from boards and the panels, given that the expertise required to review such decisions will most certainly mean that most people involved in the process will be from the football industry.
How will the regulator seek to avoid any perception of biases, so we can ensure that what looks like a stage 1 complaints process—it is easiest to compare this with a council—has the relevant transparency and process involved to avoid going to stage 2, which would be the Competition Appeal Tribunal? Secondly, can the Minister explain why Government amendment 72 removes the decision to exercise the power to ask questions in an interview from the list of reviewable decisions? Why have the Government made that decision?
Stephanie Peacock
I direct the hon. Gentleman to the regulatory principles, in terms of the individuals involved—whether that is the board or the expert panel—and schedule 10, which lists the major significant regulatory decisions. If we look again at the regulatory principles, we see that there is a requirement to be proportionate and to act in a fair way. I will write to him about his second question, on amendment 72, but I think that this refers to the three minor amendments we are making so that the system cannot be frustrated at each step of the way. But I will clarify that and write to him, in the interests of accuracy.
Mr French
I am happy to receive a response in writing.
Question put and agreed to.
Clause 81 accordingly ordered to stand part of the Bill.
Schedule 10
Reviews
Amendments made: 66, in schedule 10, page 120, line 17, column 1, leave out “not to trigger” and insert
“to trigger, or not to trigger,”.
This amendment includes a decision to trigger the resolution process in the list of reviewable decisions set out in Schedule 10.
Amendment 67, in schedule 10, page 120, line 17, column 2, leave out
“a committee of the Expert Panel”
and insert “the Board”.
This amendment provides that the applicable reviewer for a decision to trigger the resolution process is the Board rather than a committee of the Expert Panel.
Amendment 68, in schedule 10, page 120, line 19, column 2, leave out
“a committee of the Expert Panel”
and insert “the Board”.
This amendment provides that the applicable reviewer for a decision to make a distribution order under NC4 is the Board rather than a committee of the Expert Panel.
Amendment 70, in schedule 10, page 120, leave out lines 21 and 22.
This amendment is consequential on the insertion of NC4.
Amendment 71, in schedule 10, page 120, line 23, column 2, leave out
“a committee of the Expert Panel”
and insert “the Board”.
This amendment provides that the applicable reviewer for a decision to revoke a distribution order under clause 63 is the Board rather than a committee of the Expert Panel.
Amendment 69, in schedule 10, page 120, leave out lines 27 to 30.
This amendment removes a decision to conduct an investigation under clause 68 and not to accept a commitment in lieu under clause 70 from the list of reviewable decisions in Schedule 10.
Amendment 72, in schedule 10, page 120, leave out lines 35 and 36.—(Stephanie Peacock.)
This amendment removes a decision to exercise the power to ask questions under paragraph 2 of Schedule 8 from the list of reviewable decisions in Schedule 10.
Schedule 10, as amended, agreed to.
Clauses 82 and 83 ordered to stand part of the Bill.
Clause 84
Appeals to the Competition Appeal Tribunal
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
The clauses relate to the appeals of the regulator’s decisions to the Competition Appeal Tribunal. An appeals process should provide the appropriate opportunity to challenge that a regulator is acting fairly and within its statutory remit. It should also be a focused and efficient process that does not excessively delay the final resolution of decisions or hinder the regulator in achieving its objectives. Finally, while providing effective assurance of the regulator’s decision-making process and judgment, the appeals system should not unduly undermine the expert independent regulator. We believe that the appeals process, and the standard of appeals set out in the clauses, effectively balance those different considerations.
Clause 84 sets out when appeals can be made, who can bring an appeal and how they are sequenced with internal reviews. Clause 85 sets out the standard of appeal that is to be applied by the Competition Appeal Tribunal on appeal of different types of decision. The majority of decisions will be appealable on judicial review grounds, having been first internally reviewed. That will provide a streamlined process for the majority of appeals.
The regulator reviews internally to ensure that its decision is robust, and the reviewed decision can then be scrutinised by the Competition Appeal Tribunal. In judicial review appeals, the Competition Appeal Tribunal will also be able to quash flawed decisions, but not substitute the regulator’s decision for its own. That will ensure appropriate deference is given to the regulator as the expert body that is best placed to make decisions of technical judgment in the football market.
However, there are some particularly significant enforcement decisions that the regulator can take under the Bill. We expect these actions to be rare, as they are for extreme and serious circumstances only. But, if taken by the regulator, these punitive actions could have a significant impact on a person’s rights. That is why, for the six decisions, we believe that a merits appeal is more appropriate, which means that the Competition Appeal Tribunal can substitute its decisions over the regulator’s. Finally, as is standard, clause 84 also establishes an onward route of appeal of the Competition Appeal Tribunal’s decisions to the Court of Appeal.
In summary, we think that the standard of appeal, and the wider appeals process set out in the Bill, strikes the correct balance between offering appropriate scrutiny of regulatory decisions and not allowing those decisions to be constantly challenged and undermined. I therefore commend the clauses to the Committee.
Mr French
This part of the Bill is important. We have argued consistently throughout this Committee that we believe that the right of appeal will be fundamental to the clubs in the context of this Bill. But we do have concerns, as the official Opposition, that football clubs will increasingly see themselves in legal disputes rather than focusing on matters on and off the pitch.
The natural question regarding this process is really about how the Minister will help to ensure that there is a fair playing field in terms of the financial costs of going to an appeal. How will those smaller clubs have the same rights and access to such appeals when they clearly will not have the same financial means as some of the Premier League clubs?
Stephanie Peacock
My officials engaged with legal experts and senior members of tribunals while developing the Bill. That is why we have set out the Competition Appeal Tribunal process, and why we believe that it will be proportionate and appropriate for all levels of the pyramid.
Question put and agreed to.
Clause 84 accordingly ordered to stand part of the Bill.
Clause 85 ordered to stand part of the Bill.
Clause 86
Disclosure of information by the IFR
Question proposed, That the clause stand part of the Bill.
Mr French
Without wishing to sound like a broken record, the Opposition have raised concerns about scope creep for the regulator down the line, and how that may lead to unintended consequences. The obvious question to the Minister is: what consultation will take place with Members of this House so that we can scrutinise any rule changes and be confident that the regulator has not gone beyond the scope of the powers that we deem necessary at this point?
Stephanie Peacock
I make two points in response to that. Of course, there is the provision in the Bill—I believe we will come on to this, but we may have already covered it—for a five-year review. On this clause, the regulator must consult specified competition organisers and anyone else it considers appropriate before making, amending or replacing any rules. This is about future-proofing, and certainly not about scope creep.
Question put and agreed to.
Clause 90 accordingly ordered to stand part of the Bill.
Clause 91
Regulations
Mr French
Clause 91 provides the procedural backbone to the regulatory powers contained in the Bill. It sets out how the Secretary of State—whoever that may be, should this Bill become law—may make regulations under this legislation, including who may exercise discretion under them, and the form of parliamentary oversight that will apply. In short, this clause tells us how much power the Executive has in implementing the detail of the Bill, and how much say Parliament retains once the Bill becomes law.
The clause may be tucked away in the final third of the Bill, but its importance should not be understated. It governs not only the process of regulation, but the boundaries of ministerial authority. In some areas, we believe those boundaries are drawn too widely. That is why I have tabled amendment 127, which would remove the Secretary of State’s power under clause 56(2)(b) to specify, by regulation, other sources of relevant revenue that could be brought into scope of the resolution process.
Let me start by talking about clause 91. Subsection (1) allows regulations to confer discretion on a person and to vary by purpose, or to make incidental and consequential provisions. That is common enough in legislation, but it is worth nothing that that includes financial discretion, which has material implications for how the football regulator functions.
Subsection (2) confirms that all regulations must be made by statutory instrument. Again, that is standard practice. Subsection (3) provides a list of which regulations must be made under the affirmative procedure, and subsection (4) confirms that all other regulations fall under the negative procedure.
Subsection (5) removes the hybrid procedure, even if a regulation might otherwise qualify as hybrid, effectively limiting Parliament’s ability to challenge or delay regulations in which private or commercial interests are disproportionately affected. That all gives the Secretary of State wide scope to make rules that affect both her own regulator and the football industry, with only partial scrutiny by Parliament.
Clause 56 is where this becomes far more than procedural. Under clause 56(2)(b), the Secretary of State is empowered to expand, by regulation, what qualifies as relevant revenue for the purpose of regulatory intervention. Put plainly, this is a power to change what money is up for grabs.
That is a significant power. It means that the Secretary of State can decide what kinds of revenue are subject to redistribution disputes between leagues and competitions. Today, that might mean central broadcasting income, but tomorrow it could include gate receipts, sponsorship revenue, commercial arrangements specific to certain clubs or competitions, or even transfer proceeds or merchandising royalties. In theory, it could give a future Secretary of State the ability to bring any revenue stream into scope, and thereby invite the regulator to oversee, or even compel, its redistribution. This is a constitutional concern, not just a technical one. Will the Minister please confirm whether there are any limits—statutory or political—on what the Secretary of State could define as a source of “relevant revenue” under clause 56(2)(b)? If not, does she accept that that gives the Government open-ended authority to intervene in private commercial arrangements within football?
My amendment would remove this regulation-making power from the Bill. It would ensure that the scope of financial disputes eligible for regulatory resolution is fixed in primary legislation, not adjustable by ministerial diktat. We believe that is the right balance; it allows Parliament to define the guardrails and prevents future mission creep, whereby politically contentious revenue streams are dragged into disputes between the Premier League and the EFL, or any other competitions.
This is not just about the risk of interference; it is about certainty, predictability and trust in the regulatory model. We have already made clear our concerns about how English football will run into issues with UEFA and FIFA regarding their statutes. I will not repeat that again now, but we believe that, by granting the Secretary of State the power to redefine revenue categories by regulation—outside of parliamentary debate—clause 56(2)(b), as enabled by clause 91, risks violating those principles.
Such interference has one clear sanction:
“the ultimate sanction…would be excluding the federation from Uefa and teams from competition.”
As we have already discussed, that is not a risk that should be taken lightly. If football governance is to remain independent, and if the regulator is to operate with a clear mandate, the definition of revenue categories must not be subject to political discretion; it must be set by Parliament in primary legislation, not by the stroke of a ministerial pen. That is especially true when the very mechanism in question, the resolution process, is designed to resolve disputes about money. What qualifies as “relevant revenue” goes to the heart of the matter. It is not ancillary; it is foundational.
Clause 91 may appear to be about procedures, but it is in fact about power. It determines how broad the reach of the Secretary of State will be in defining, influencing and intervening in the financial affairs of English football. In particular, through the mechanism created by clause 56(2)(b), it allows new revenue streams to be brought into the scope of the Government-backed intervention without proper parliamentary scrutiny. That is not what was promised when this Bill was introduced. We were told by the Government and this Minister that their regulator would be a light-touch and targeted regulator—one designed to uphold financial sustainability and protect supporters, not one that could be weaponised by future Ministers to remake the game’s financial settlement from above.
By tabling amendment 127, we are saying that revenue boundaries must be set in statute, not in statutory instruments, that Parliament, not the Secretary of State, should decide where the line is drawn, and that the regulator should focus on its core remit and not be dragged into every financial dispute, with a “revenue” label slapped on by regulation.
Stephanie Peacock
I believe that amendment 127 is consequential on the hon. Member for Old Bexley and Sidcup’s amendment 124 regarding our changes to the Bill to include parachute payments, which we debated last week—although I think he gave a slightly more wide-ranging speech just now. Amendment 124 would have prevented parachute payments from being considered under the backstop, and it would have prevented the Secretary of State from amending the revenue in scope of the backstop in future. I will state here what I stated last week, and what has been my consistent position, even in opposition: for the regulator to make an informed decision regarding the financial state of football, it must consider all relevant factors, and that includes parachute payments.
As drafted, the “relevant revenue” in scope of the backstop expressly includes broadcast revenue, because that is the predominant source of revenue and distributions for the relevant leagues. However, there is no guarantee that that will always remain the case. As I covered in last week’s debate, the financial landscape of football is ever-changing. No one could have predicted 30 years ago just how much television broadcasting of English football would grow, and who can predict where technology may take us in another 30 years? That is why clause 56 allows the Secretary of State to specify other kinds of revenue to be included as “relevant revenue”. This will simply future-proof the backstop mechanism.
However, as I outlined in the previous debate, there are still clear constraints and safeguards regarding this power. The Secretary State must consult with the regulator, the FA and the relevant leagues before using the power, and can use the power only when there has been
“a material change of circumstances”.
Any use of the power will be scrutinised by Parliament under the affirmative procedure.
Stephanie Peacock
I appreciate my hon. Friend’s intervention; he has put an important point on the record, and it is always nice to be able to pay tribute to Richard Caborn, the former sports Minister and my former south Yorkshire colleague. He has done a lot of work in this area; indeed, I know that he has worked very closely with my hon. Friend.
This process is simply about future-proofing. Given that this Committee has already agreed to clause 56 and disagreed to the shadow Minister’s amendment 124, all that this amendment would achieve is to remove one of the safeguards, making regulations to update the definition of “relevant revenue” negative rather than affirmative. For those reasons, I hope that the shadow Minister will withdraw his amendment.
Stephanie Peacock
I thank my hon. Friend for tabling this amendment. I acknowledge its intent to fortify the provisions in the Bill for dealing with conflicts of interest. We will cover “Minor Definitions” in detail when we discuss the next group of clauses, which includes clause 92 stand part. However, I will touch on “Minor Definitions” briefly when responding to this amendment.
As we discussed at length on day one of this Committee, when we debated conflicts of interest, it is essential that the regulator can deliver its regime free from undue influence and vested interests. The Bill already makes it clear that the regulator will be free from conflicts of interest and the Government amendments made in the other place strengthen those protections even further—indeed, beyond any doubt.
We believe that the existing definition of a conflict of interest is appropriate and will capture the correct issues. That definition is any interest that
“is likely to affect prejudicially that person’s discharge of functions”.
I reassure my hon. Friend that our definition is well precedented; for example, it can be found in the Pensions Act 2008 and the Financial Guidance and Claims Act 2018.
Stephanie Peacock
The shadow Minister is making a well-rehearsed argument. As we have discussed previously, the newly appointed chair of the regulator has been fully endorsed by a cross-party Select Committee.
Returning to the amendment, we are confident that this definition and the conflict of interest protections in the Bill, supplemented by public law principles and non-legislative measures that are already in place, provide comprehensive safeguards to identify and manage conflicts of interest appropriately. For those reasons, I hope that my hon. Friend will withdraw his amendment.
Mr French
Given the concerns that His Majesty’s Official Opposition have raised throughout the passage of the Bill in this place and in the other House, we welcome the inclusion of the review of the Act. However, the clause mentions laying a copy of the report before Parliament. How does the Minister envisage Parliament being able to have its say on the benefits or non-benefits of the regulator at that point?
Stephanie Peacock
I think we discussed this earlier. It is up to individual Select Committees whether they wish to call the independent regulator before them. I will write to the hon. Gentleman on the practicalities of laying the report.
Question put and agreed to.
Clause 96 accordingly ordered to stand part of the Bill.
Clause 97
Payments into the Consolidated Fund
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
Clause 98 relates to minor and consequential amendments to other primary legislation. Those amendments are to existing Acts and are necessary for the Bill to function as intended. For example, they add the regulator to the Freedom of Information Act 2000 and enable the competition appeal tribunal to hear appeals of the regulator.
Stephanie Peacock
I believe so, but in the interest of accuracy I will double check and write to the hon. Gentleman.
Question put and agreed to.
Clause 98 accordingly ordered to stand part of the Bill.
Schedule 12 agreed to.
Clause 99
Extent
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
Clause 99 sets out the territorial extent and application of the Bill. The regulator’s scope is intended to be limited to the top five tiers of English men’s football. That is where the fan-led review identified significant harms and structural challenges that the market had failed to resolve. Five Welsh clubs compete in the English football pyramid, four of which—Cardiff City, Newport County, Swansea City and Wrexham—would be captured in the scope of the regulator. One more, Merthyr Town, which was recently promoted to the sixth tier, could be in scope in the future. To ensure that all clubs within the English football pyramid are captured and protected equally under the same regulatory regime, the legislation must extend to both England and Wales.
Mr French
I will not seek to rehash an earlier debate on the multi-club issue that the Opposition raised. However, I urge the Minister again to look closely at how that may work in the future. I fully appreciate her point about the Welsh clubs that compete in the English structure, but, as we highlighted in previous debates, a number of Scottish clubs now have multi-club ownership with English clubs and will be affected by this legislation directly or indirectly. If the Minister gave further thought to that and let me know, it would be appreciated.
Stephanie Peacock
I will make that commitment.
Question put and agreed to.
Clause 99 accordingly ordered to stand part of the Bill.
Clause 100
Commencement
Question proposed, That the clause stand part of the Bill.
Max Wilkinson
Hon. Members are all waiting for it—this was going to be the moment that we were going to force a vote, but given that the Minister has put on record the fact that this will be considered an operational and match day issue for the regulator, so fans must be consulted on it and would probably have a veto, we are content that we do not need to press the new clause to a vote. I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 17
Impact on regulator of changes in Government administration
“If the Department for Culture Media and Sport is abolished, or its functions in relation to football substantially relocated, the Government must automatically review the suitability of the continuation of the IFR and the impact that the abolition or relocation will have on the IFR.”—(Mr French.)
This new clause would require the Government to review the IFR in the instance that the Department for Culture, Media and Sport were abolished, or its functions substantially altered.
Brought up, and read the First time.
Mr French
I beg to move, That the clause be read a Second time.
We believe that new clause 17 is important, given the speculation that the Minister might soon be going somewhere else on a free transfer. On a more serious note, this is a sensible provision, given the legal requirements on the Secretary of State in the Bill. For example, there has been much speculation that if the Department for Culture, Media and Sport were disbanded, sport, for example, would end up in the Department of Health and Social Care or the Department for Education, which would mean a different relationship with the football regulator going forward. Therefore, it is important to include a review mechanism in the Bill.
Stephanie Peacock
The hon. Gentleman’s new clause suggests that if DCMS were to be abolished, or if football were to be moved out of the Department’s portfolio, that should trigger a review of the regulator. A machinery of government change should have no bearing on whether there is continued need for an independent regulator established by Parliament. Just because circumstances in the sponsoring Department change, that does not mean that the regulator should be subject to a review. Machinery of government changes are common; we saw several of them under the previous Government. We do, however, believe that the regulator should be assessed and reviewed at the right time, as part of important monitoring and evaluation of the regulation.
Stephanie Peacock
I could not possibly speculate on such a hypothetical question.
I will say that clause 96, which we have already debated, mandates a review of the Act within five years of the licensing regime being fully commenced. Among other things, the review will look into whether the regulator has been effectively achieving its objectives, or whether those objectives might be better achieved in a different way. There are also other ways in which the regulator can be scrutinised and held to account by Parliament, such as through Select Committee hearings. I therefore hope that the hon. Member will withdraw his new clause.
Mr French
I have listened very carefully to the Minister’s response and to the intervention from the hon. Member for Cheltenham. Given the point that we are making about the role of the Secretary of State in relation to some of the regulator’s powers, we think that that hypothetical question is key. I gave examples of Departments that sport or football could move to, such as the Department of Health and Social Care or the Department for Education, which we think would significantly change the perspective on the business side of football. We will therefore press the new clause to a vote.
Question put, That the clause be read a Second time.
Mr French
I beg to move, That the clause be read a Second time.
This new clause is designed to improve the transparency of the regulator, ensuring that the public, football and Parliament are aware of the risks that we have discussed at length—in particular, any issues arising from international regulators such as UEFA or FIFA. We believe it is important to have transparency, and to ensure that Members understand the risk, as can football clubs. The Opposition will look to press the new clause to a Division, subject to the Minister’s comments.
Stephanie Peacock
I thank the hon. Gentleman for his new clause. There has been a lot of debate in the House, including in Committee and in the other place, about letters received from UEFA. There have been particular concerns that the Bill and the regulator should not breach UEFA or FIFA statutes, and there is a strong feeling that we must not risk English clubs or national teams being banned from international competitions through this legislation.
Let me be clear again that the regulator will be operationally independent of the Government and will not exert an undue influence on the FA’s ability to govern the game. The extent of its statutory powers and duties will simply not allow it to do so. That is why both UEFA and the FA have confirmed that the Bill as drafted does not breach UEFA statutes. Indeed, the FA is on the record as supporting the regulator’s introduction.
The new clause would require the publication of all future UEFA and FIFA correspondence received by the regulator or the Government, or correspondence relating to the regulator. Requiring private communications to be made public would serve only to discourage honest and frank conversations with key stakeholders, and would thus stand in the way of constructive relationships with UEFA and FIFA. For those reasons, I ask the hon. Gentleman to withdraw the new clause.
Mr French
I have listened carefully to the Minister’s comments. The Committee should also be aware that the FA has warned specifically about scope creep, which is something that the Opposition have also been very concerned about. We therefore think it is prudent to ensure that there is transparency and awareness of risk going forward. If there were to be significant warnings from UEFA or FIFA about scope creep, the new clause is an important mechanism for us to understand that as parliamentarians, clubs and fans of football. We will press the new clause to a Division.
Question put, That the clause be read a Second time.
Stephanie Peacock
I thank the shadow Minister for tabling this new clause and all hon. Members for their thoughtful contributions. I gently say to him that I think that his claims to end binge drinking would probably be scope creep.
This is a very serious issue. As the shadow Minister may be aware, the legislation in question is owned by the Home Office. My hon. Friend the Member for Sheffield South East is right that this is a challenging issue, but I recognise that it is important and I will therefore raise it with my ministerial counterparts in the Home Office.
I hope the shadow Minister will appreciate that, as we have made clear throughout the Committee, the Bill seeks to ensure that football clubs are sustainable. It would not be appropriate for the Government to agree to review legislation about alcohol at football matches in the context of this Bill, given the significant public order implications, but I will reflect the comments from across the Committee to my counterparts in the Home Office. On that basis, I hope he will withdraw the new clause.
Mr French
I thank all colleagues for their contributions to this important debate on an issue that has real impacts on fans and stadiums around the country, as we have heard already. I have also seen some of the behaviours that have been referred to, such as people rushing to drink before kick-off or rushing at half-time to make sure that they can get a drink in. I have also travelled around Europe watching football. I am a big lover of sport, so I do travel and watch games when I go abroad. I have never come across many issues when I have been abroad, where the rules are different.
The Minister’s comments were interesting. I could make the usual joke about how for people to watch a team in red, they need a lot of drink—especially at the moment, given current form. However, the expressions of Committee members assure me that this is a live issue that they have concerns about. I think we should test the opinion of the Committee with a vote.
Stephanie Peacock
I appreciate the hon. Gentleman’s point, but that is a match day issue. I direct the hon. Gentleman and the rest of the Committee to the regulatory principles, which we changed under this Government to explicitly reference players. We think that that is an important change. I am afraid I cannot support the new clause.
Mr French
I have listened carefully to the Minister’s answers in response to this new clause. I fully understand the point that she is making about it being up to the sport to better govern the welfare of players, and I have great sympathy with her on that. Ultimately, however, this Bill has been brought forward because the Government believe that football has not been good at regulating itself, and so we are debating that in Committee. Given the widespread concerns around player welfare, it seems to me that on sustainability—we had a long debate about that on the first day of the Committee—and where it sits, my hon. Friend the Member for Spelthorne hit the nail on the head by saying that the sustainability of clubs depends very much on the sustainability of players.
While I am not going to get a violin out for Premier League stars who may be on £400,000 or £500,000 a week, there is a broader point here about how far that can be pushed and what happens to players’ health—particularly, as we have heard from families, when they reach retirement. As the Minister has mentioned, there are a number of problems. We would like to give some serious consideration to where this needs to sit, because there does appear to be an issue here. As such, I will not seek leave to withdraw the new clause, and I hope that we can return to the matter at a later stage as well.
Question put, That the clause be read a Second time.
Football Governance Bill [ Lords ] (Ninth sitting)
Debate between Stephanie Peacock and Louie FrenchTuesday 17th June 2025
(2 weeks, 3 days ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 17 June 2025 - (17 Jun 2025)
Mr French
It is a pleasure to serve under you again, Sir Jeremy, and I welcome back everyone else in Committee.
The clause sets out further details on the circumstances in which the specified competition organisers can apply to trigger the resolution process. The Government have moved on the mechanism within the backstop, which is welcomed by the leagues, but the amendments tabled in my name seek to correct some gaps in the clause. Amendment 130 would allow the relevant leagues to set a different period other than five years for the resolution process to be triggered. Amendments 128 and 129 would also allow the relevant parties to set the appropriate period for triggering the backstop.
The clause matters, not just because of what it allows, but because of what it delays. In particular, it creates a cooling-off period, a requirement that certain preconditions be met before the regulator can become involved in live disputes between football’s governing bodies and competitions. Of the conditions listed in the clause, condition 4 is especially significant. As the Bill stands, condition 4 is met only if the relevant distribution agreement between competitions—for example, between the Premier League and the English Football League—has been in force for at least five years.
We understand why the five-year test was included: the intention is to prevent the Government’s regulator from being dragged into every routine renegotiation, and to ensure that the resolution process is only triggered in relation to long-standing agreements that may have become outdated or contentious. Five years, however, is a long time in football. Broadcasting cycles, financial realities and competitive conditions can change quickly.
In that time, for example, a team such as Luton Town went from playing in League Two in the 2017-18 season, to competing in the Premier League in the 2022-23 season. Granted, the team have now fallen down the pyramid to League One again, but that helps prove that, even with parachute payments being handed out from the Premier League and potentially now being included in the resolution process, that does not stop a club from failing on the pitch or in the boardroom.
I therefore tabled amendments 128 to 130, which would allow the “applicable period” under condition 4 to be shorter than five years when two conditions are met: first, when the specified competition organisers have agreed a different period, either in the distribution agreement itself or separately; and, secondly, when both organisers have notified the regulator of that agreed period. In that case, the “applicable period” for the purpose of condition 4 becomes whatever period the organisers have agreed—rather than being fixed at five years by statute.
These are flexibility amendments, which an industry with businesses will benefit from, rather than having the inflexibility of fixing a date in statute. The Government argued that our earlier amendment to cap the pay of their new regulator was inflexible and too firmly rooted in the present day, so it would be unfortunate if the Minister were to oppose the amendment for exactly the opposite reasons. None of us would want that.
The amendment allows football’s governing bodies—the Premier League, the EFL, and others—to determine their own timelines for when they believe the regulator should be able to step in, if negotiations breakdown. It does not force earlier intervention; it simply allows the option where both parties agree. That is a consensual, common-sense reform that respects the autonomy of football’s existing institutions, while giving them the tools to resolve disputes more efficiently when necessary. It makes the clause more responsive, less rigid and more capable of reflecting the fast-moving dynamics of football finance and league relationships.
Will the Minister confirm why the Government chose to fix the five-year period in primary legislation, rather than allowing the competitions to define the appropriate timeline for regulatory intervention themselves? Does she agree that, if both parties are asking for an earlier resolution window, it is counterproductive for the legislation to prevent it? It would cause delays to the redistribution of money from one specified competition to another, which would entirely undermine the point of the regulator. If we do not pass the amendment, we risk locking football into a situation where, no matter how bad a deal becomes or how outdated a distribution agreement appears, the regulator’s hands are tied for another half a decade. They say that a week is a long time in politics, and the same is true for football. In half a decade’s time there could be—and I hope there is—a new Government, and Charlton could have returned to the Premier League and may even be in the Champion’s League final—I will try to keep it realistic; the sun must be getting to me.
As drafted, the Bill allows prolonged stalemates, growing financial resentment between divisions, and a continued lack of reform, even when both sides might privately want the regulator’s help to resolve matters. That is especially important given the recurring tensions between the certain specified competition organisers on financial redistribution, among other things. If both sides were willing to allow the Government’s regulator to assist earlier, we should facilitate that, not block it.
Regulation, especially in this context, should be a last resort, and football must be given the space to sort out its own affairs where possible. The amendment reflects that principle. It does not force the regulator into a situation early; it simply allows football competitions to agree that if things go wrong, the regulator can be invited in sooner rather than later. That is not interference but empowered self-governance, which is what we should be striving for when—as the fan-led review ultimately sought to do—we return the governance of English football back to the FA. The amendment gives clubs and competition organisers more ownership of the process, not less.
Does the Minister recognise that the amendment would incentivise early engagement and constructive negotiation, rather than prolonging the stalemates that have now become common place? Clause 57 is an important procedural gateway, but the current wording of condition 4 imposes a rigid five-year rule that may prevent the regulator from acting, even in cases where both sides want its help. The amendment would introduce flexibility and consent into the process. It ensures that the trigger point for resolution reflects the needs of the game, not an arbitrary statutory timescale set many seasons before it may actually be needed.
The amendment is limited, reasonable, and entirely in keeping with the Government’s desire for a targeted, proportionate, and respectful form of regulation. I hope that the Minister will accept the amendment based on the position she has taken on earlier amendments to the Bill.
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)
It is a pleasure to serve under your chairmanship, Sir Jeremy. I will use the opportunity presented by amendment 130 to talk to another of this Government’s changes to strengthen the Bill. The Opposition amendments would amend clause 57, which sets out how and under what conditions a league can apply to the regulator to trigger the backstop.
We will discuss clause 57 in more detail in the next group, but in brief, one of the conditions for triggering the backstop is that there has been no new distributions agreement between the leagues for at least five years. The amendments seek to reintroduce drafting from the previous version of the Bill that allowed leagues to reach an agreement to extend that five-year period. The Government removed that drafting when we introduced the Bill, because in our judgment five years is an appropriate period.
Our strong preference, of course, is for football to reach an agreement without any regulatory involvement. We have done everything in our power to push for an agreement and continue to urge everyone to find a solution that works for all of football. The five-year period in the Bill has been chosen to ensure the regulator can only intervene in cases where a sufficient agreement has not been reached for a significant period of time. We believe that this is the correct amount of time.
That is not to say, however, that the backstop will be triggered every five years. This is not the only threshold that has to be met to trigger the process. It is a two-stage test. The regulator must also see a tangible risk to its ability to deliver its objectives before the process can be triggered. If the leagues agreed a good deal for a period longer than five years, while a league could still apply to trigger the backstop, the threshold of jeopardising the regulator’s objectives would not be met and the backstop would not be triggered.
There is an inherent imbalance of negotiating power between the distributing leagues and the recipient league. Allowing industry to contract out of the backstop completely could inhibit agreements that appropriately finance the football pyramid while preventing involvement from the regulator. That would badly damage the regulator’s ability to protect and promote the sustainability of English football and leave it unable to address what is currently a clear issue in the industry. For the reasons I have set out, I hope the hon. Member for Old Bexley and Sidcup will withdraw the amendment.
Question put, That the amendment be made.
Mr French
I will be brief. I echo some of the Minister’s comments. His Majesty’s official Opposition welcome any efforts to ensure that the backstop process is triggered only as a last resort and we will carefully monitor how that works in future.
Question put and agreed to.
Clause 59, as amended, accordingly ordered to stand part of the Bill.
Clause 60
The mediation stage
Amendments made: 49, in clause 60, page 50, line 4, after “resolution” insert
“set out in a notice under section 59(5)(b)(zi)”.
This amendment clarifies that the question or questions for resolution subject to the mediation process are those set out in a notice under clause 59(5)(b)(zi).
Amendment 50, in clause 60, page 50, line 6, leave out
“the question or questions for resolution”
and insert
“that question or those questions”.
This amendment is consequential on Amendment 49.
Amendment 51, in clause 60, page 50, line 15, after “resolution” insert
“set out in a notice under section 59(5)(b)(zi)”.—(Stephanie Peacock.)
This amendment clarifies that the question or questions for resolution subject to the mediation process are those set out in a notice under clause 59(5)(b)(zi).
Question proposed, That the clause, as amended, stand part of the Bill.
Stephanie Peacock
Once the backstop is triggered, clause 60 requires the leagues to enter mandatory mediation as a first stage. As we have made clear, the Government’s strong preference is for a football-led solution to the financial distribution issues. I welcome the shadow Minister’s comments along those lines.
A mediation stage gives the relevant leagues an opportunity to reach an agreement with minimal intervention from the regulator. The stage is designed to facilitate meaningful negotiation and compromise between the parties. To this end, it encourages the leagues to appoint a mutually agreed mediator, but if they cannot, it ensures the regulator will appoint someone with the appropriate skills and experience.
The leagues can end the mediation process for multiple reasons. Most notably, the mediation—and the process as a whole—will end if an agreement is reached. However, the mediator can also end the process if it is not producing meaningful, good faith negotiations. The process can also end if it reaches the 28-day deadline. If the leagues are engaging in meaningful discussion but the deadline is reached, the mediator can extend the process by up to another 28 days.
We believe that process is flexible enough to encourage negotiation but concrete enough to ensure the backstop remains an effective regulatory intervention. I commend the clause to the Committee.
Question put and agreed to.
Clause 60, as amended, accordingly ordered to stand part of the Bill.
Clause 61
Final proposal stage
Stephanie Peacock
Over the course of engagement on the Bill, specifically in the other place, we have heard concerns about the risk posed by the binary choice distribution mechanism outlined in the Bill. While I have always acknowledged the merits of the previous binary mechanism in the Bill, specifically the powerful incentive it created for the leagues to come to an industry-led solution, we want to provide the industry and its investors with the certainty they need. Although the previous model had significant strengths, the uncertainty it introduced into the process made it higher risk than other options.
We want to get this policy right and we will always be open to sensible, well-made points on the design of the regime. I thank Lords Birt, Pannick, Thomas and Burns for their thoughtful scrutiny of this part of the Bill in the other place and for their comprehensive suggestions. Their engagement has been invaluable in the continued development of this policy.
In the light of that work, we are making targeted changes to the backstop mechanism, primarily through the replacement of clauses 61 and 62 with Government new clauses 3 and 4. The new clauses will move the mechanism from a binary choice mechanism to a staged regulator determination. In our new model, the regulator can impose its own solution, drawing on the leagues’ proposals, the state of the game report and other evidence in order to best deliver the regulator’s objectives. This ensures a more collaborative, data-driven solution.
New clause 3 sets out what happens if there are still unresolved questions between the leagues when mediation ends. It requires the regulator to invite proposals from the leagues and sets a framework and timeframes for the regulator and leagues to collaborate towards a solution. The Government’s strong preference is for the industry to come to an independent solution, so the proposal stage is designed to incentivise that. The regulator will have to outline clearly the expected scope of the proposals, set by the questions for resolution that we have discussed previously. It must also set out any relevant findings from the state of the game report. That will ensure that proposals remain focused on addressing the most pressing issues facing the game.
League proposals must be shared both with the regulator and between the disputing leagues themselves. That will allow for a more fruitful negotiation, as the leagues will be more informed about each other’s position on core issues. Leagues will also be able to submit revised proposals, ensuring both sides have the best chance possible to outline their position to the regulator, and allowing the regulator the opportunity to request additional relevant information.
That structure will ensure the regulator is in the position to make the best and most evidence-based decision possible while driving the leagues closer together, encouraging them to come to their own agreement. For those reasons, I hope hon. Members will support the new clause.
Mr French
I will not repeat the comments the Minister has made, but we also believe that this new mechanism is an improvement on the previous one, in line with feedback from the other place and from the leagues. The new clause would allow modified proposals to be submitted to the football regulator and for more of a negotiated settlement rather than a binary one. The only question we have at this stage, because we will have to see how this works in practice, is about the criteria the regulator would be looking to apply when selecting one party’s proposals over another. What does the Minister envisage that will look like?
Stephanie Peacock
I am grateful to the shadow Minister for his general support for this change. He is absolutely right to acknowledge that it comes from the other place, but also from working with various stakeholders, in particular the leagues, which have welcomed it.
The regulator must follow its objectives and duties at all times and criteria that simply restate those obligations are unnecessary. We did consider more specific criteria but did not want to be overly prescriptive, so I draw the attention of hon. Members back to the regulatory principles in the Bill and the state of the game report.
Question put and negatived.
Clause 61 accordingly disagreed to.
Clause 62
Distribution orders
Stephanie Peacock
No, I am afraid I am not in a position to do that. It is a one-year period from the end of the first season to where the order applies. We think that is a balance. It is obviously a challenging issue, with strong feelings, but formulating this part of the Bill is about striking a balance. We believe we have the right one, but I acknowledge my hon. Friend’s concerns.
Mr French
Given the previous debate, the Minister will be pleased that I am willing to withdraw amendment 125, so she gets a win out of that one. I listened carefully to her comments on removing that subsection (1)(c), and, in the light of that and in a spirit of goodwill, I will withdraw the amendment.
It would be helpful if the Minister would explain what checks and balances there will be surrounding the football regulator’s final determination. The legislation will leave it entirely up to the football regulator how best to determine the questions of resolution, with the only guardrail seemingly being that the distribution order should not place an undue burden on the commercial interests of any specified competition organiser, and the distribution order should not result in a lower amount of relegation revenue being distributed to a club during the relevant period than would have been distributed to the club during that period had the order not been made. It would also be helpful if the Minister could outline whether either of the parties would be offered the right of appeal, following a distribution order from the regulator.
Stephanie Peacock
We will come to about appeals and challenges shortly, so we might be able to explore that in further detail. I have a detailed breakdown of the process; in the interests of time, I will not read it out, but I will send a copy to the hon. Gentleman, because I think it will answer his question.
Stephanie Peacock
It is important to build safeguards into the backstop process, and clause 63 outlines what happens if circumstances arise in which a distribution order made under clause 62 is no longer viable or necessary. To provide clarity to the leagues, any distribution order will need to specify when it comes into force and how long it is in force. In ordinary circumstances, an order will remain in force until the specified period ends, but clause 63 allows the regulator to revoke an order in exceptional circumstances. The regulator might choose to do that if there was an unexpected change to the broadcast market that meant an order was no longer fit for purpose. It is important that the Bill provides that flexibility to prevent a scenario in which an unsuitable arrangement is left to stand.
Similarly, the clause ensures that the regulator will revoke an order if a league subsequently strikes a distribution deal covering the same seasons as the order. That again demonstrates the Government’s commitment to prioritising and encouraging industry-led agreements wherever possible. Whenever the regulator revokes an order, it will need to notify the parties and set out the reasons for its decision, continuing the underlying commitment to transparency at every stage of the process. I urge that the clause stand part of the Bill.
Mr French
I have only a brief question for the Minister in the light of her comments: how frequently does she envisage distribution orders being reviewed by the regulator, and is there a risk that clubs or competitions may face financial instability due to short-term changes to distribution orders?
Stephanie Peacock
Not very often, is the short answer to the hon. Gentleman’s question, and it might be helpful if I give a brief example. If there was a very significant reduction in broadcast revenues, complying with an order might actually threaten the sustainability of clubs in the distributing league. It is not a measure we expect to be used frequently.
Question put and agreed to.
Clause 63 ordered to stand part of the Bill.
Clause 64
Review of distribution orders, payment of costs, etc
Amendment made: 54, in clause 64, page 54, line 18, leave out “62(8)(b)” and insert “(Distribution orders)(10)(b)”. —(Stephanie Peacock.)
This amendment is consequential on the insertion of NC4.
Question proposed, That the clause stand part of the Bill.
Mr French
The clause requires the regulator to periodically review distribution orders and monitor compliance. It also gives the regulator power to determine who should bear the costs of the resolution process, including mediation and the final proposal stages.
I have the following questions for the Minister. First, who is liable for the cost of reviews, and is there a cap on the expenses that can be passed on to clubs? Secondly, what criteria will determine how costs are apportioned between parties? Lastly, will the regulator be independently audited on its cost management in conducting such reviews to minimise the costs for clubs?
Stephanie Peacock
I am grateful for those questions. As I said, the clause sets out the rules for how costs associated with the backstop are paid. It could, although it does not have to, allow for the costs of mediation to be passed on to the leagues. If it is helpful, I am happy to write to the hon. Gentleman with more detail. The clause sets out the regulator’s ability to pass the cost on to the leagues if it feels it is appropriate, but I reiterate the regulatory principle of proportionality.
Question put and agreed to.
Clause 64, as amended, accordingly ordered to stand part of the Bill.
Clause 65
Power to require information
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
Clause 65 is the first clause in part 7 of the Bill, which covers the regulator’s investigatory powers, and relates to information gathering. It gives the regulator a power to require specified information and sets out the associated procedures for obtaining the information.
Accurate, reliable and timely information will be central to the regulator’s regime. Without a full and up-to-date picture of clubs and the market, it would not be able to regulate effectively. It would be reliant on voluntary disclosures or publicly available information, which could be incomplete, outdated or selectively presented. That is why the power in the clause is important to the regulator’s regime. The clause gives the regulator the power to issue an information notice to a person, requiring the person to give the regulator specified information that it considers necessary in exercising its functions. For example, the regulator may require information in order to monitor clubs and investigate possible non-compliance with the regulatory regime.
The ability to request information is not a unique or controversial power for a regulatory body. It is common practice among regulators to seek information from the regulated industry and from those subject to investigation. For example, the Competition and Markets Authority, the Financial Conduct Authority, Ofcom and many more all have information gathering and investigatory powers, which they use regularly. Such powers are regulators’ bread and butter, without which they would be unable to effectively regulate. I commend the clause to the Committee.
Mr French
Clause 65 allows the regulator to require persons, including clubs and their officers, to provide information that may be needed for the exercise of the regulator’s functions.
I have the following questions for the Minister. First, what are the limits on the volume or sensitivity of information that the regulator can demand from clubs? Secondly, could the clause lead to regulatory overreach if requests are too frequent or expansive? Lastly, how will the cost of compliance be managed, especially for smaller clubs?
Stephanie Peacock
We acknowledge that this is a new regime for football clubs to be operating under. They already submit information to the football authorities, and we expect that submitting information to the regulator should not be any different.
As with anything it does, the regulator should act proportionately. In this context, that means that it will consider the burden that an information request might place on a club. For example, the burden might be higher for a smaller club, so the regulator might also consider the nature of the information request. For example, the volume and nature of the information required might differ depending on the circumstances of the club.
Question put and agreed to.
Clause 65 accordingly ordered to stand part of the Bill.
Clause 66
Reports on clubs by expert reporters
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
The clause gives the regulator the power to appoint a person to prepare a report on a regulated club. The person is referred to as an expert reporter, and they must have the necessary skills and expertise to prepare the report. The regulator will have expert staff and the ability to request the information it needs, but this power will allow it to draw on specialist third-party expertise and resources. For example, the expert reporter might be a firm with audit experience, where the regulator thinks that it would benefit from the firm’s ability to synthesise and analyse information gathered from the club at first hand. That could enable the regulator to exercise its functions more effectively.
The report can be on any matter that the regulator considers appropriate in order to carry out its functions. For example, the report might deal with a specific issue or with the club’s circumstances and operations more generally. The expert reporter will have the ability to require information from as many persons as necessary for the purpose of preparing the report.
The clause also covers other procedural matters relating to the appointment of the expert reporter, including rules on expenses incurred in the appointment of the reporter and requirements to co-operate with and assist a skilled person once appointed. There is precedent for such a power: the Financial Conduct Authority, for example, has the power to appoint a skilled person to a firm.
We expect that the regulator will find the power useful when it would benefit from the expert reporter’s skills to combine and interpret information gathered at first hand or on a more continuous basis over a period of time. Based on a report, the regulator may be better informed to determine whether it needs to take action on a club, or which action to take—for example, whether to impose a discretionary licence condition or to take enforcement action. I commend the clause to the Committee.
Mr French
As the Minister outlined, the clause gives the regulator the power to appoint an expert to prepare a report on a club. I have three questions for her. First, who will select the expert reporters and how with their independence be assured? Secondly, will there be cost limits or reimbursement rules in place to prevent financial strain on clubs that are required to co-operate? For example, without naming any individual companies, over the years we have seen many examples of excessive costs being applied by certain accountancy firms for such reviews. I am sure that we would not want those overburdening small clubs. Lastly, will clubs have a right to comment on or challenge a draft of the report that the expert provides before action is taken?
Stephanie Peacock
The regulator will be able, if it is thought appropriate, to provide for the club concerned to cover the costs associated with the expert reporter. That is because it will not be a commonly used tool and the cost will be specific to a single club, so, rather than all clubs picking up the cost through the levy, where possible, the regulator can ensure that the regulated party pays. However, the regulator will have discretion, and it might be the case that the club’s financial means are low and the regulator does not think it appropriate to impose additional costs on it.
Question put and agreed to.
Clause 66 accordingly ordered to stand part of the Bill.
Clause 67
Meaning of “relevant infringement”
Question proposed, That the clause stand part of the Bill.
Mr French
The provisions in this group all relate to infringement and the enforcement of infringements. Schedule 7 sets out the detailed definition of what constitutes a relevant infringement for the purposes of parts 7 and 8 of the Bill. It provides clarity on the types of conduct that may lead to investigation and enforcement action by the football regulator, including failure to comply with a duty under the Bill, a condition of a licence or a direction issued by the regulator. The schedule also enables further types of infringement to be specified through regulations. The intention is to provide a clear and comprehensive basis for the regulator’s investigatory and sanctioning powers.
Does the Minister think there are sufficient limits in schedule 7 to prevent the scope of relevant infringement from expanding over time without parliamentary scrutiny? Could broad definitions allow the regulator to pursue cases not originally envisaged by Parliament? How will consistency in interpretation be maintained across different clubs and cases?
Clause 68 allows the regulator to investigate whether a relevant infringement has occurred. It sets out the procedure to be followed and the types of action the regulator may take during an investigation, including seeking information and issuing notices. The clause forms part of the regulatory enforcement framework. What procedures are in place to prevent investigations from becoming unnecessarily protracted or burdensome? Could smaller clubs face disproportionate challenges in dealing with investigations due to limited resources?
Schedule 8 outlines the investigatory powers available to the football regulator in relation to relevant infringements. It includes the power to ask questions, require documents or information, and apply for a warrant to enter premises where necessary. The schedule also sets out the circumstances in which those powers may be used and the procedural safeguards that apply. The powers are designed to assist the regulator in establishing the facts of a case and determining whether enforcement action is appropriate. The provisions reflect standard regulatory practice and are intended to ensure that investigations are conducted in a proportionate and lawful manner. Does the Minister believe that there are sufficient safeguards to ensure that investigatory powers are not used disproportionately? Could the powers result in unnecessary costs or disruption to the day-to-day operations of clubs?
Clause 69 covers the outcomes of investigations. The clause sets out that the football regulator may find that there has been no infringement or, if it finds that there has been an infringement, that it may decide to take no action —possibly because the person had a reasonable excuse for committing the infringement. In what circumstances does the Minister envisage there to be a reasonable excuse, and does she worry that this risks setting a dangerous precedent? If an individual is found to have had a reasonable excuse, will that encourage others in the leagues to consider using that excuse if they are investigated? How will the outcome of an investigation be communicated to the relevant club or individual? Will the outcomes of investigations be publicly available? Once again, clause 69 raises important questions about consistency. If closure notices or outcomes are not published, what mechanism will there be for ensuring that investigations by the regulator are consistently applied?
Clause 70 sets out that the football regulator may accept an appropriate commitment from a person during the course of an investigation into certain relevant infringements. Does the Minister anticipate that that will be a regular feature? If so, what effect will that have on the football regulator’s ability to conduct an investigation? The clause clarifies that accepting a commitment does not prevent the regulator from continuing an investigation into different behaviour in relation to the same or a different relevant infringement, or starting a new investigation in relation to the same behaviour to which the commitment relates. It is therefore for the regulator to determine whether to continue the investigation. What criteria will be used to determine whether a commitment should defer or withhold investigation? Does this leave scope for inconsistencies in the approach of the regulator? If a commitment does not prevent the regulator from starting a new investigation into the same behaviour, it raises the question: why add another layer of bureaucracy when the ultimate result may be the continuation of said investigation?
Clause 71 adds provisions to clause 70. For example, it sets out that the football regulator must give the person a notice as soon as reasonably possible after it decides to accept, or not to accept, a commitment in lieu of investigation, and sets out what the notice should state. Can the Minister clarify how this notice will be given to individuals at a club? It also clarifies that the football regulator may accept a variation to a commitment, provided the varied commitment would still be appropriate. What is the process an individual would need to go through to amend or vary a commitment? Furthermore, it sets out that the football regulator may release a person from a commitment and must give the person a notice as soon as possible after deciding to do so. Many of the factors that the football regulator must consider are at its discretion, such as reviewing the appropriateness of a commitment. That raises further questions about consistency and the importance of making unbiased decisions.
Clause 72 places a duty on individuals under investigation to preserve information. The clause is key, but how will a person suspect they are subject to an investigation? Furthermore, the clause does not provide a date range up to and from when an individual must preserve relevant information. Will the football regulator adjudicate on whether information has been disposed of on purpose or accidentally? Likewise, will the regulator determine whether a document is falsified or authentic? The phrase “relevant” is broad, and it is open to interpretation by the regulator.
Clause 73 ensures that privileged communications are to be protected from the football regulator’s requirements. That is extremely important, as it covers communication between a professional legal adviser and their client to do with legal proceedings. However, will the football regulator have any powers to challenge claims that a communication is privileged? I would appreciate if the Minister could clarify whether that is a possibility. Furthermore, who will verify that a communication is privileged? Could the football regulator seek voluntary waivers of privilege in exceptional circumstances? What assessment has been made of the potential of the clause to inadvertently delay or obstruct investigation?
Clause 74—you will be pleased to know that this is my last point, Sir Jeremy—requires the football regulator to publish a notice where it has given a person an investigation notice under clause 68 or a closure notice under clause 69. Is there a timescale for such publication? How will the notice be communicated or published? Will it be publicly available? If so, will full details of the investigation be published, or will some material be redacted or withheld? Will there be an opportunity to appeal before publication to avoid reputational damage? Will clubs or individuals have the right to respond with advance warning prior to publication, if that is the case?
Stephanie Peacock
I am grateful to the shadow Minister for his questions. I noted as many down as I could, but I will endeavour to check Hansard if I do not cover all of them. First, he spoke about scope creep. I draw his attention to my comments earlier about how any conduct that is not listed in schedule 7 as a relevant infringement will not warrant enforcement action, and how we believe a closed list of possible relevant infringements in legislation provides clarity to the regulated industry and other persons as to what conduct is not permitted. The scope therefore cannot expand. I absolutely agree that things should be done in a timely fashion. In debates on the Bill, we have talked continually about proportionality, and we would expect cost and disruption to be kept to a minimum.
On the shadow Minister’s point about reasonable excuse, I draw his attention to my previous comments that it is not about sidestepping responsibility, but about being collaborative throughout. We expect the regulator will publish some information about investigations that it undertakes. It is required to publish an investigation notice issued to a person under clause 68, as well as an investigation closure notice under clause 69. However, the Bill allows for certain information to be withheld from publication if the regulator believes the disclosure or publication would significantly harm a person’s personal or business interests. The regulator is not required to publish revenue and customs information or information that might contravene data protection legislation or prejudice the prevention of crime.
Question put and agreed to.
Clause 67 accordingly ordered to stand part of the Bill.
Schedule 7 agreed to.
Clause 68 ordered to stand part of the Bill.
Schedule 8
Investigatory powers
Amendment made: 65, in schedule 8, page 109, line 14, leave out “a period of three months” and insert “so long as is necessary in all the circumstances”.—(Stephanie Peacock.)
This amendment provides that information obtained by the IFR under a warrant may be retained for so long as is necessary in all the circumstances.
Schedule 8, as amended, agreed to.
Clauses 69 to 74 ordered to stand part of the Bill.
Clause 75
Sanctions
Question proposed, That the clause stand part of the Bill.
Mr French
Sir Jeremy, you and the Committee will be pleased to know that I will not seek to repeat word for word everything that the Minister has said on each of the clauses, but I will pose a number of questions to her on each of them.
As we have heard, clause 75 gives the football regulator the power to impose sanctions in response to relevant infringements. How is proportionality assessed when deciding between different types of sanction? What is the estimated administrative cost of monitoring, imposing and reviewing sanctions? What legal protections are in place to prevent sanctions from being used punitively?
Clause 76 requires the regulator to issue a warning notice before imposing a sanction. The notice must set out the proposed action and give the person an opportunity to make representations, which is welcome, but is there an independent review mechanism if a club believes that a warning notice is unjustified?
Clause 77 requires the regulator to issue a decision notice, following a warning notice, if it decides to proceed with a sanction. The decision notice must explain the reasons for the decision and the right of appeal. Is there a process to allow clubs to challenge decision notices before they are published? What legal advice and support will be available to smaller clubs facing regulatory action?
I will move on to schedule 9, regarding sanctions overall. This schedule sets out further details on the sanctions available to the football regulator. Part 1 deals with sanctions related to information failures, including financial penalties and censure statements. Part 2 concerns infringements of substantive duties and conditions and includes suspension or revocation of licences and the appointment of a skilled person. Part 3 contains further provisions regarding financial penalties, including about daily rate calculations and enforcement of penalties as civil debts.
The schedule supports the enforcement powers in clauses 75 to 78 and provides the operational framework for sanctions. How are the levels of financial penalties determined in order to ensure fairness across clubs of different financial sizes? What checks exist to prevent excessive reliance on fines as a primary enforcement tool? Could any of the sanctions—for example, licence suspension—create unintended consequences for fans and local communities?
The Minister will be aware that I have pointed out in previous sittings the sporting competition impacts of any removal of a licence and how that may or may not affect relegation. We are interested in the Minister’s comments on how licence conditions would work when sanctions are applied.
Stephanie Peacock
The minimum period for representations on a warning notice is 14 days. A warning notice is an important procedural safeguard on the regulator’s enforcement process that ensures that the person in question can make their case. For example, that might be to explain that there was a reasonable excuse for non-compliance. We will talk about appeals in a moment. We have said throughout Committee and other proceedings on the Bill that appeals can be made.
On the hon. Gentleman’s point on cost, as well as the ability to impose significant financial penalties, including fixed penalties of up to 10% of a club’s revenue, the regulator will be able to hold a club’s senior management accountable for the club’s compliance where relevant. That means that, where appropriate, the regulator can take enforcement action against individuals as well as, or instead of, clubs. Targeted enforcement of that kind will be effective in changing behaviour, deterring non-compliance and aligning the incentives of those calling the shots with the club itself. It will also mean that sanctions do not need to unduly punish a club, and so indirectly hurt its fans, when not appropriate.
Question put and agreed to.
Clause 75 accordingly ordered to stand part of the Bill.
Schedule 9 agreed to.
Clauses 76 and 77 ordered to stand part of the Bill.
Clause 78
Offences
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
Clause 78 backs up the regulator’s information-gathering powers by creating information offences, including offences relating to the destruction or concealment of information and the provision of false or misleading information. The possible penalties for a person guilty of those offences include a fine or even imprisonment. The ability for the regulator to impose strong sanctions for what are clear offences should deter any person from information-related misconduct that would hamper the regulator. Information offences and sanctions are well precedented among other regulators, and their existence acts as a powerful and necessary deterrent. I commend the clause to the Committee.
Mr French
Again, I will not seek to repeat the Minister’s words. Clause 78 creates specific offences for destroying and falsifying information, providing false or misleading information, and obstruction. On summary conviction, a person who is guilty is liable for imprisonment for a term not exceeding the general limit in a magistrates court, for a fine, or both. On conviction or indictment, a person who is guilty is liable for imprisonment not exceeding two years, for a fine, or both. In relation to those offences, what evidentiary threshold must be met before a criminal offence would be pursued? Could the clause deter voluntary disclosure for fear of criminal liability? What is the projected cost to the public purse of enforcing those offences through the criminal justice system?
Stephanie Peacock
The effect of the clause is that it is a criminal offence to destroy, dispose of, falsify or conceal relevant information; to permit the destruction, disposal, falsification or concealment of relevant information; to provide false or misleading information to the regulator or an expert reporter; to give to another person information that is false or misleading, knowing that the information will be given to the regulator; and to obstruct an officer of the regulator exercising a warrant.
We are talking only about information-related offences, so it is fairly unobjectionable that persons should not be able to conceal or destroy information that the regulator asks for. The potential for criminal sanctions is normal for offences of that kind at other regulators. Those regulators tend not to have to ever use criminal sanctions, but having them available sends a clear and strong message that misconduct related to information will not be tolerated.
Question put and agreed to.
Clause 78 accordingly ordered to stand part of the Bill.
Clause 79
Urgent directions
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
Clause 79 will enable the regulator to give urgent directions to respond quickly to a risk of serious harm. These are directions to a person, such as a club, to take or to cease a certain action within a specified timeframe to bring an infringement to an end. Urgent directions will give the regulator a strong tool to intervene quickly where serious, ongoing non-compliance jeopardises the regulator’s objectives.
We expect compliance to be the norm and that, if necessary, most cases of non-compliance can be addressed using the sanctions set out in schedule 9. However, urgent directions will provide a more direct enforcement option to bring the most serious and potentially harmful issues to an end swiftly. Given the urgency, the regulator will not be required to give the person an opportunity to make representations. There is precedent for that among other regulators. The Financial Conduct Authority has similar “voluntary requirement” and “own-initiative requirement” powers. If a person fails to comply with an urgent direction, the regulator can apply to the courts for an injunction.
Clause 80 will require the regulator to publish certain notices and directions related to enforcement. This will ensure complete transparency around enforcement proceedings for fans, the industry and the wider public—something that has been lacking in the industry to date. I commend the clauses to the Committee.
Mr French
I have some brief questions for the Minister. On clause 79, what criteria will the regulator use to justify issuing an urgent direction? Is there a risk of overreach if urgent powers are exercised without immediate oversight? Will clubs have a right to appeal or review such directions after the fact?
We believe that clause 80 mirrors clause 74 in providing a general duty for the regulator to publish various notices and statements issued under the Bill. Are there exceptions where publication could be delayed to prevent market disruption or reputational harm?
Stephanie Peacock
An urgent direction will be used only in response to non-compliance that is ongoing and of sufficient seriousness. That is reflected in the statutory threshold for the use of an urgent direction. The threshold—that the infringement must jeopardise or risk jeopardising the regulator’s objectives—is used in multiple places in the Bill as a high bar for more severe actions, for example revoking an operating licence.
A person can appeal against an urgent direction, although, as per the appeals provisions in the Bill, the urgent direction would be binding while the outcome of the appeal was being decided.
Question put and agreed to.
Clause 79 accordingly ordered to stand part of the Bill.
Clause 80 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Vicky Foxcroft.)
Football Governance Bill [ Lords ] (Eighth sitting)
Debate between Stephanie Peacock and Louie FrenchThursday 12th June 2025
(3 weeks, 1 day ago)
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Mr Louie French (Old Bexley and Sidcup) (Con)
I hope that everyone is appropriately refreshed after the lunch break. I will not seek to go to VAR to rehash any of the debates we had before lunch, but we have great sympathy with the points made by the hon. Member for Sheffield South East. We also believe that fans should have a strong say if clubs seek to move ground, as we have debated. The obvious questions, which we will come to in the next set of debates, are about what fan consultation and approval would look like. I know that that will be part of our heritage discussion in a moment, so I will not proceed on that now.
In thinking about some of the hon. Gentleman’s examples—Wimbledon being the most obvious one—I recall that as a teenager, or a bit younger, I would watch Wimbledon play at Crystal Palace, at Selhurst Park. They were the Crazy Gang in south London at that point, and they would often play there. So I understand his point, especially about the move to Milton Keynes and the controversy that that caused. As he highlighted, thankfully, we have not had too many examples that are similar to the American franchise system, where, in the National Football League, the Raiders have moved a number of times over the years, to different cities, depending on the financial attraction of each state.
Beyond the Man United and Everton examples, which we have discussed, there are other clubs who have moved. The one I first think of, which is closest to where I am from, is the Arsenal move a number of years ago from Woolwich Arsenal in south-east London to Islington. It is an interesting point, because a lot of the fans in south-east London are still strong supporters of Arsenal because of their generational links. For example, my brother-in-law’s grandfather was an Arsenal fan, so he is an Arsenal fan. The London example is probably not the best one, because it is simple to argue that fans can get across London fairly easily. It would be more dramatic if a club were being moved to the other end of the country, which is the point he is making—he is nodding in agreement.
I will be interested to know how the Minister and the Government view the amendments and how this issue might impact the regulator’s operations. I have a lot of sympathy for the amendments, and I will listen carefully to the Minister’s response.
Stephanie Peacock
Welcome back to the Committee after lunch, Ms Butler. I thank my hon. Friend the Member for Sheffield South East for tabling the proposals, which seek to strengthen the protections on club heritage. The safeguarding of football heritage will be a key priority for the regulator, and there are a number of provisions in the Bill to uphold that key objective. It is vital that fans can have their voices heard at their clubs, especially regarding key heritage assets that can play a significant role in community identity and history.
That is why, as we will discuss in relation to clause stand part, clause 48 requires clubs to consult their fans and have regard to their views on a proposed relocation of a home ground. It is also why the regulator will determine whether the relocation will result in significant harm to a club’s heritage. This is not a binary decision, however, and in lots of cases will require a holistic approach and for the regulator to consider a number of factors, including not just the views of current fans, but the club’s history and the ability of fans to get to the ground. We would expect the regulator to engage and consult fans of the club, because it would be necessary to do so to ascertain the impact on club heritage. As the shadow Minister touched on, we will discuss this further in a little bit.
Amendment 91 would require the club to take reasonable steps to establish the views of the majority of supporters, rather than allowing the regulator to take the multifaceted approach that the Government think is best suited to the nuanced issue of club heritage. The importance of fan voices being heard is why the regulator spells out a number of protections for heritage assets, such as the home brand and home shirt colours, among others. Any breach of these duties would qualify as a relevant infringement by the club. Although we expect that the regulator will take an advocacy-first approach, a range of sanctions will be available.
Although the Government understand that the intention behind new clause 14 is to further entrench these duties, this legislation has been designed so that the duties apply across the clubs, with the regulator ensuring compliance. Amending articles of association can be resource-heavy and require shareholder agreement. It also does not guarantee that there will be compliance. This is not something that the Government see as an appropriate or necessary step to require all clubs to take. Instead, the Bill will protect fan consultation through other means. For those reasons, I am unable to accept the amendments.
Stephanie Peacock
We will come on to enforcement, but a range of enforcement options will be available to the regulator, if it feels that a club is not doing what it asked the club to do.
Mr French
To add to the point made by the hon. Member for Sheffield South East, if a club—the Minister gave the example of Hull—decided that it wanted to go ahead and change its name to “Hull Tigers”, but the regulator felt that the fans had not been consulted thoroughly enough, could the regulator deduct points from a club?
Mr Betts
I hear what the Minister said, but I want to think about that. I know what her good intentions are, but I also know there may be some people out there with bad intentions; it is about making sure that they come in line with the Minister’s good intentions. I am holding back to see what further discussions we have, but this is really important. It is a wider issue: there are so many clubs with so many disparate fan groups, and owners will pick and choose if there is not certainty. That is why I raised the issue, which I think we ought to come back to, of a clear role for the Football Supporters’ Association, the body that oversees fan groups in this country. It has a neutral view of which groups are the most important and relevant in different clubs, and it can help the regulator enormously in what, in some cases, will be a challenging process of trying to identify the fan groups who really speak for fans in those clubs.
Mr French
I will not put the hon. Member for Sheffield South East at risk with his own side by talking too fondly about the comments he just made—I will not make it sound like we are trying to do a double act—but we have heard a lot of concern in our debates on the clause, and the amendments tabled to it, about how it will work. The hon. Member mentioned that some club owners—one would hope only a minority of them—would seek to expose loopholes in the Bill. That is why we tabled amendment 111, which would introduce a safeguard by requiring a clear vote and the approval of the majority of fans.
There are a number of risks for the Government with this Bill, but one of the biggest is this: if it does not protect the things it is designed to protect—in this case, the heritage of a football club and a say for fans—what is its purpose at all? If one of the examples we have discussed plays out in future, that question will be asked of the Government. In our future debates on the Bill, perhaps they can provide more clarity about their thinking, and perhaps they will incorporate some of the arguments we have made today.
Stephanie Peacock
I am grateful to hon. Members for their contributions. We believe that we have strengthened measures in the Bill to put fans and communities back at the heart of the game and to protect football heritage. All regulated clubs will now be required to have an effective framework in place to meet and consult regularly a representative group of fans on the specified relevant matters, including any proposal to relocate the home ground and some of the issues we have just discussed. We expect that the regulator will be best placed to understand the circumstances of individual clubs across the country. It will produce guidance to support clubs in meeting its requirements, and it will take into account things like precedent and ensuring proportionality.
Question put and agreed to.
Clause 49 accordingly ordered to stand part of the Bill.
Clause 50
Duty to notify of changes in circumstances relevant to the IFR’s functions
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
The clause places a duty on all regulated clubs to notify the regulator of any material change in circumstances that is relevant to the regulator’s functions, as soon as reasonably practicable. The regulator will need a complete picture of each club in order to effectively regulate. Full transparency and timely updates will allow the regulator to stay up to date on any relevant changes in real time.
The duty to notify in the clause is an ongoing duty on regulated clubs. By contrast, the annual declaration mandatory licence condition applies to licensed clubs only. The annual declaration is about creating an annual touchpoint for clubs as part of the licensing regime, rather than requiring an annual licence renewal. It will allow clubs to declare a summary of any matters that they notified, or should have notified, over the past year.
Mr French
I will not rehash the Minister’s description of the clause, but it raises a number of questions about the interpretation of the clause and the requirements on clubs. What guidance will be provided to clubs to determine what constitutes a “relevant” change in circumstances, because that is very open to interpretation? What might such a change look like? We are not trying to micromanage, but we think clubs might find it helpful to understand, even if it is via a list of frequently asked questions from the regulator, what constitutes a change of circumstances so that they do not accidently fall foul of well-intentioned drafting.
Could the duty to notify a change in circumstances be accidentally disproportionate to lower league clubs? We have discussed at length that those clubs generally do not have the same administrative resources as the big clubs. Will the regulator look to have a more flexible approach to clubs lower down the pyramid that may not have the ability to notify as quickly as those at the top?
Stephanie Peacock
We expect the regulator to look at this on a case-by-case basis. As we have said throughout, we very much intend for the regulator to be proportionate depending on where a club sits in the pyramid.
Question put and agreed to.
Clause 50 accordingly ordered to stand part of the Bill.
Clause 51
Duty to keep fans informed of insolvency proceedings
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
The clause places a duty on all regulated clubs in relevant insolvency proceedings to keep fans informed of the progress of the proceedings. Any fan that has experienced their club going into administration can attest that it is a worrying and often confusing time. Although the regime will look to best protect clubs, it cannot be zero-failure. However, the clause is intended to make the process more transparent for fans when the worst happens. The duty will apply only as far as is reasonable and will not fall on the administrators or any body not regulated by the football regulator. The clause was added to the Bill in order to mitigate unnecessary worry and confusion for fans.
Mr French
I have a few questions. How will the regulator assess whether a club has sufficiently fulfilled its duty to keep fans informed? Could the requirement to disclose information during insolvency proceedings create additional reputational or financial risks for clubs? How will the clause be applied consistently while respecting confidential obligations to creditors? We have spoken a lot about insider information. If the Minister does not have the answers today, it would be helpful to get them in writing in order to understand how some of these complex legal matters might work.
Stephanie Peacock
I am happy to write to the shadow Minister. I appreciate that we added this clause; it was not in the previous iteration of the Bill. That is why I was keen to talk about reasonability. We appreciate that insolvency is a complex, fast-paced, changing and challenging situation, but we also appreciate—Members have talked about different clubs that have gone into administration—the worry for fans, so we want to keep them as informed as reasonably possible. The shadow Minister asked me for something further in writing and I am very happy to provide that.
Stephanie Peacock
The clause requires licensed clubs to prepare a personnel statement and submit it to the regulator for approval. Alongside the statement, clubs must provide an explanation as to why they consider it to be accurate. The owners and officers who control and run football clubs are vital to their sustainability. Therefore, the regulator needs to know who is running the show behind the scenes in order to implement its regime effectively.
A personnel statement must outline each of the club’s owners and its ultimate owner, as we have discussed; its officers, with a job description for each; and its senior managers and their roles. Once the statement has been submitted, the regulator will review it and decide either to approve it or to modify it. Any modification to the statement must be made in consultation with the relevant club to ensure that the statement is accurate. Once the statement is approved by the regulator, the club must publish it online, increasing transparency and accountability in football. Subsequent statements must be submitted to the regulator if an old statement becomes out of date—for example, after the departure or hiring of an officer.
Let me also highlight the role of the Secretary of State’s guidance in providing clarity to owners about who meets the definition of someone who exercises significant influence or control. We committed in the other House to producing the Secretary of State’s guidance before clubs are required to identify owners who meet that definition to the regulator. I commend the clause to the Committee.
Question put and agreed to.
Clause 52 accordingly ordered to stand part of the Bill.
Clause 53
Duty to pay a levy
Mr French
I beg to move amendment 133, in clause 53, page 42, line 3, at end insert—
“(1A) But the IFR may not require a club with fewer than 10 full time equivalent employees to pay the IFR a levy in respect of a chargeable period during which the club is a licensed club.”
This amendment would exempt clubs with fewer than 10 full time equivalent employees from having to pay the levy.
Stephanie Peacock
I am grateful to the hon. Gentleman for taking the words out of my mouth, because I was going to conclude by drawing the Committee’s attention to a letter placed in the Libraries of both Houses when the Bill was in the other place. The letter, dated 6 March, was sent by Baroness Twycross, who took the Bill through the Lords. I will not detain the Committee by reading out the letter—Members can look at it—but it breaks down the proportions. Obviously, costs are based on the impact assessment and are indicative, so they are not meant to be prescriptive; it is meant to be an indicator. The letter may be helpful if the Committee would like more detail.
Mr French
I have listened carefully to the Minister’s arguments, and she has made some helpful clarifications. However, due to the lack of a cap, as my hon. Friend the Member for Spelthorne said, it is difficult to rely on the letter for what club certainty might look like in the future. We have discussed at length how well-intentioned plans can easily spiral, which is why we believe amendment 133 is important in helping to safeguard the clubs with the smallest means and those lowest down the pyramid.
Question put, That the amendment be made.
Mr French
I listened very carefully to the Minister’s explanation of these amendments, which have been introduced at a fairly late stage. I hope she can provide some clarity on a number of questions.
First, was it always the Government’s intention to have these separate streams of funding, as she has described, or is this a way of expanding the IFR’s powers to charge the levy? I am unclear about why the change has happened now, because we have obviously been through a lot of consultation and the Bill has been in the other place for some time. It is not necessarily clear why these changes have come about at this stage, so I would appreciate an answer.
Lastly, when the Minister described the charges as non-leviable, the natural question was, “Who picks up the bill?” Are we talking about taxpayers, and if we are, what are those costs? Exposure to risk would obviously be a major concern for taxpayers and, I suspect, a number of Government Departments following the spending review. I appreciate her comments about how the Government believe that the functions may not be used or required, but there needs to be an answer about the risk of those non-leviable payments and what that might look like in the future.
Stephanie Peacock
I am grateful to the shadow Minister. First, it is certainly not about expanding, and we have been very clear that we do not want scope creep. He asks “Why now?” We have always maintained that we want the best legislation and the best outcome. We very much listened to the debate in the other place. We reflected on that, and we believe that this is just a simpler, less complex way of going about it.
On his last question, I can very much assure him that it is quite the opposite. By making these changes, the costs will not have an impact on taxpayers. We are clear about that.
Mr French
I am still unclear on that point, but I am happy to have the answer in writing. Who will pick up the bill when the levy cannot be charged to clubs, and what will that bill look like? I am not at all clear about how that will play out in practice. I am not sure whether I am misunderstanding the Minister, and I am happy to have it in writing, but I am not clear what it means.
Stephanie Peacock
I say gently that I think the shadow Minister is misunderstanding, and I am happy to write to him. The amendment means that all functions can now be covered by the levy, whereas previously there were two funding mechanisms in the Bill. It is a technical change.
Stephanie Peacock
Yes, that is the intention.
Amendment 18 agreed to.
Amendments made: 19, in clause 53, page 42, line 13, leave out “leviable functions” and insert “functions under this Act”.
This amendment is consequential on Amendment 22.
Amendment 20, in clause 53, page 42, line 14, leave out “leviable functions” and insert “functions under this Act”.
This amendment is consequential on Amendment 22.
Amendment 21, in clause 53, page 42, line 19, leave out “leviable”.
This amendment is consequential on Amendment 22.
Amendment 22, in clause 53, page 42, line 26, leave out subsection (4).—(Stephanie Peacock.)
This amendment removes the definition of “leviable functions” so that the IFR may charge a levy for all of its functions under the Act.
Mr French
I beg to move amendment 105, in clause 53, page 42, line 42, at end insert—
“(6A) Once the IFR has established a levy under subsection (1) and made the required payments under section 96, the IFR must only fund its functions under this Act through its own revenue streams.
(6B) For the purposes of subsection (6A) the IFR’s ‘own revenue streams’ are any amounts payable to the IFR from regulated clubs under subsection (1).”
This amendment requires the IFR to be self-funding through the industry levy, but after it has paid its initial costs and the Secretary of State’s establishment costs to the Treasury.
The amendment would require the Government’s new regulator to be self-funding through the industry levy, but after it has paid its initial costs and the Secretary of State’s establishment costs to the Treasury, so that it is entirely self-sustaining. That is not unreasonable; taxpayers are already being squeezed by this Government, so it would be ludicrous to suggest that they should foot the bill for the Labour Government’s regulator. That is why I tabled the amendment, which seeks to place a clear financial obligation on the regulator to ensure that, after covering its start-up and establishment costs, it becomes entirely self-funding through the industry levy.
The principle behind the amendment is simple: if we are to create an independent regulator for football, its independence must extend beyond structure to include financial independence from the taxpayer. The clause gives the Secretary of State discretion to determine the mechanics of the levy, but it leaves unanswered an essential question: who ultimately pays—we have had a bit of discussion about that—and for how long? The amendment provides a clear and reasonable answer: the taxpayer may support the regulator’s launch, as might be expected, but once that is done, the regulator should stand on its own two feet.
Let us not forget the purpose of the Bill: the regulator is intended to be arm’s length, neutral and shielded from political interference. However, the Government have gone to great lengths to compromise that independence through their appointment, as we have discussed, and the principle would be fully compromised if the regulator remained financially reliant on the Department for Culture, Media and Sport, or the Treasury for that matter. Independence is not just about who makes the appointments, but about who signs the cheques.
If the regulator is to carry out its duties credibly—overseeing financial discipline, enforcing ownership standards and planning across the football pyramid for the long term—it must operate free from any perception of ministerial influence. That means being self-funding. The idea that the British taxpayer should continue to fund the ongoing operations of this new body is simply not justifiable, particularly at a time when families are feeling the squeeze and public services are under pressure. If clubs need a regulator—and the Government have decided that they do—then clubs, not pensioners in Bexley or shop workers in Barnsley, should pay for that regulator.
The amendment would also introduce discipline into the regulatory model. It would ensure that the Government’s regulator lives within its means, plans sustainably and operates efficiently, just as it will expect clubs to. We must avoid the slow drift we have seen with other public bodies, where what begins as temporary state support gradually hardens into permanent public subsidy with no sunset clause or accountability.
By requiring the regulator to repay its start-up costs and then operate independently, we would make a clear distinction between initial public investment and long-term industry responsibility. It is not unreasonable to ask that football, having accepted the need for regulatory oversight, for which many have lobbied, now contributes to that oversight on a permanent and self-sustaining basis.
That gives rise to a number of questions for the Minister. Is there a timeline for when the regulator is expected to be self-funding, or will it continue to draw on the public purse for a number of years? What provision, if any, has been made to recover the taxpayers’ outlay once the regulator begins to collect levy income? I would be grateful, as would taxpayers across the country, for reassurances from the Minister that those issues are being addressed, and that the taxpayer will not be left to subsidise the industry without a clear exit plan.
My amendment would protect the principle of independence. It would safeguard the public purse and ensure that those who arguably benefit from oversight are the ones who pay for it. Football is told that it will get a strong, credible and financially sound regulator, but taxpayers deserve clarity, discipline and fairness in how that regulator is funded. I therefore urge the Committee to support the amendment and make the regulator accountable to the industry it oversees, not dependent on the Government that created it. Let us build something that is self-sustaining, responsible, and fit for the future.
Stephanie Peacock
During our debate on the technical changes proposed by the Government, we discussed the removal of the non-leviable functions. That means that everything will be levy-funded, so there will be no cost to the taxpayer. We absolutely agree with the hon. Gentleman’s points about the regulator being self-sustaining and self-funding. The Government also agree that the regulator should not be able to borrow money at its own discretion, which is why it is already prevented from doing so in paragraph 37(2) of schedule 2, which sets out that the regulator cannot borrow money unless explicitly permitted to as part of the financial assistance from the Secretary of State. We expect that that would occur only if absolutely necessary and in extreme circumstances, and would be provided only subject to conditions set by the Secretary of State.
There is no need for the restriction to be duplicated. We absolutely agree that the regulator should be fully funded through the levy, and that is exactly what the levy is designed to do. I will come on to that in more detail when we discuss the levy under clause 53 stand part. The Bill ensures that the regulator’s source of funding for all regulatory functions is the levy. Any financial penalties it imposes through enforcement action can also be used to offset any litigation costs and reduce the burden on compliant clubs.
Mr French
I appreciate that the Minister said that she will come on to that subject in a later debate, but can she be clear about start-up costs and their recovery for taxpayers? How is it envisaged that those costs will be repaid? I appreciate the point she makes about levy contributions, but how will the start-up costs that have been incurred now, along with the cost of the shadow football regulator, be recovered, if at all?
Stephanie Peacock
I would like to address that later, if possible. I have heard the question, and will make sure the hon. Gentleman gets an answer. For the reasons I have set out, I hope he will withdraw his amendment.
Stephanie Peacock
Before I speak on clause 53, I draw the Committee’s attention to a procedural matter. In preparing for the debate, officials identified some inconsistencies in the impact assessment published on the Bill’s parliamentary web page and gov.uk. It appears that as figures were updated during the development of the impact assessment, they were not reflected in the summary of costs on one page at the beginning of the paper, which was related to the compliance cost and operational cost. The figures are correct in the main body of the impact assessment, and the total cost that those figures added up to is still correct. The inconsistencies also featured in the version submitted by the previous Government. For full accuracy and transparency, we have now corrected it, and the impact assessment on gov.uk was updated last night. We have notified the Public Bill Office to ensure the parliamentary website is updated as soon as possible, and there will be an updated version in the Library shortly.
Having provided that clarification, I will now discuss clause 53, which enables the regulator to charge a levy to licensed clubs that covers the regulator’s running cost. That follows the precedent of other regulators such as the Financial Conduct Authority, the Competition and Markets Authority and Ofcom. The levy methodology is an operational assessment that the regulator is best placed to make independently. By making football clubs more sustainable in the long term, the regulator will be providing a service to the industry. It is only fair that as a wealthy industry, football, as opposed to the taxpayer, should cover the cost of regulation, as has been well discussed by the Committee this afternoon.
The cost of regulation would represent just a tiny fraction of football’s more than £6 billion annual revenue. The industry will also benefit from regulation, which will deliver a more stable pyramid of sustainable and resilient clubs, and so help protect the commercial value of English football. The legislation puts robust checks and balances on the regulator. It will be limited to raising funds to meet a set of tightly defined costs that are necessary for regulatory activity only. It is clear in the clause what the levy covers and how the money will be used, ensuring the regulator’s transparency. As I alluded to in the discussion on Government amendments 18 to 26, all costs can now be funded through the levy.
However, the regulator will not have a blank cheque. It will be subject to numerous safeguards including annual auditing by the National Audit Office, and its annual accounts will be laid before Parliament. That and other safeguards, such as the Department for Culture, Media and Sport’s responsibility as a sponsor, will provide the necessary transparency and scrutiny to deliver value for money.
In addition, as I set out when we discussed the previous group of amendments, the clause also requires the regulator to have regard to a club’s individual financial position when setting the levy charge. Specifically, that covers the financial resources of a club and the league in which it plays. That should ensure a proportionate approach where no club, big or small, is asked to pay more than what is fair and affordable. That will be aided by the requirement for the regulator to consult all licensed clubs, which I will speak to in more detail in the debate on the next group of amendments. In addition, once operational, the regulator will have a legal requirement to set out its levy charges annually and consult all regulated clubs on its methodology.
Question put and agreed to.
Clause 53, as amended, accordingly ordered to stand part of the Bill.
Clause 54
Section 53: consultation and publication
Stephanie Peacock
I appreciate the hon. Gentleman’s point, but refer gently to my earlier comments. We are talking about typos and very minor changes. I give that example to show that the regulator is accountable for what it considers minor.
On amendment 103, requiring the regulator to publish the information on costs laid out in clause 54(4) six months before the chargeable period would create an operational challenge and would simply not work in practice. The regulator would have to estimate its costs for a chargeable period, having only half a year’s costs to base it on. That could lead to inaccurate levy charges, which could see the regulator underfunded or clubs needlessly burdened. The current requirement to publicise charges as soon as reasonably practicable strikes the right balance between adequate notice for clubs and operational flexibility for the regulator to ensure an accurate and appropriate levy charge.
For the reasons I have set out, I cannot accept the amendments.
Mr French
I listened carefully to the Minister’s response, which was fairly limited. I do not have enough confidence in her replies to withdraw the amendments. We are concerned about the impact on clubs and about the loophole in the interpretation of minor changes. I am not clear on the regulator’s accountability to stop scope creep. I suggested a number of options that the Government might look to adopt instead and did not hear any response to them. On that basis, and linked to some of the comments made by my hon. Friend the Member for Spelthorne, I wish to press the amendments to a Division.
Question put, That the amendment be made.
Stephanie Peacock
To achieve its objectives, which include a club financial soundness objective, a systemic financial resilience objective and a heritage objective, the regulator will need information from the relevant competition organisers. The clause places a duty on the competition organisers to provide that information, and in the event that they do not, they would be liable to be sanctioned.
A competition organiser must notify the regulator if there is a risk that the regulator may not fulfil its objectives. That is with regard to the club financial soundness objective or the regulator’s systemic resilience objective. In addition, the organiser will need to notify the regulator if it is in breach of a commitment it made as an alternative to a financial discretionary licence condition, or if a club has breached the rules of a specific competition run by the organiser.
The organiser will also have to consult the regulator if it proposes to change its own rules. That is necessary given the interaction between the regulator’s regulation and that of a specified competition organiser. The regulator wants its own regulation to be necessary and proportionate and not to overburden the clubs. It is therefore important to understand any changes in other rules that clubs need to abide by, given that they may increase or decrease the financial risk of clubs.
In all cases, the relevant information will act as an additional source of data to inform the regulator of risks within the industry and whether the regulator needs to impose additional regulation or proceed to enforcement and sanction to ensure the long-term financial sustainability of the industry. I commend the clause to the Committee.
Mr French
The clause sets out a series of duties that require various football stakeholders, including leagues and governing bodies, to notify and consult the Government’s new regulator in certain circumstances. At its core, the clause is intended to improve co-ordination and to prevent regulatory surprises, which in principle is reasonable. We all agree that where the governance of the game affects financial sustainability or club integrity, the Government’s regulator should be aware and engaged.
I will focus on subsection (6), which is a far more consequential provision than it might first appear. I believe it strikes at the very heart of one of the most sensitive and important issues in football governance: the independence of sport from Government control. Subsection (6) imposes a statutory duty on specified competition organisers to consult the regulator when they either add or remove a relevant rule of a specified competition, or vary a relevant rule of a specified competition. I note the comments of the hon. Member for Sheffield South East about when the regulator is involved in a competition and when it is not, with regard to the FA Cup. Some clarity on that would be much appreciated.
In short, the provision means that competitions such as the Premier League, the EFL and the FA Cup would be required—based on the wording of this part of the Bill—to consult the Government’s football regulator every time they change or amend a rule deemed to be relevant by the regulator itself. That might sound innocuous, but let us be clear about what it means in practice: for the first time, a politically appointed regulator, accountable to the Secretary of State, who has received donations from that regulator, would be given a formal, statutory role in the internal rule-making processes of English football competitions.
This is not a light-touch oversight mechanism; we fear it might end up being a direct institutional influence. As we know, it is not compatible with UEFA’s requirements on the non-interference of Government. UEFA statutes are clear that national football associations and their affiliated leagues and competitions must be free from political or Government control. The relevant rule is article 7bis (2) of the UEFA statutes, which states:
“Member Associations shall manage their affairs independently and with no undue influence from third parties.”
Article 9 goes on to state:
“A Member Association may in particular be suspended if state authorities interfere in its affairs in such a significant way that...it may no longer be considered as fully responsible for the organisation of football-related matters in its territory”.
It is pretty clear that the FA will no longer be considered fully responsible for the organisation of football-related matters in its territory should the Bill pass with this provision. Moreover, FIFA echoes that approach in its regulations, particularly in article 14 of the FIFA statutes, which ensures that member associations, such as the FA, remain autonomous and free from governmental or political influence. Article 15 of the FIFA statutes further requires members to be neutral in matters of politics and religion, to be independent, and to avoid any forms of political interference.
Subsection (6) brings us dangerously close to the line, if not across it. Unfortunately for the Minister, the Government seem to be on the wrong side of that line. I will press the Minister on that point, because however carefully the clause may have been worded in terms of consultation, in reality it inserts the Government’s new regulator into the core rule-making processes of the football pyramid. Once that principle is established, the scope can grow.
We know that there are international concerns about scope creep, as I mentioned when speaking to amendment 97.
“UEFA is concerned about the potential for scope creep within the IFR. While the initial intent of the IFR is to oversee the long-term financial sustainability of clubs and heritage assets, there is always a risk that, once established, the IFR may expand its mandate beyond these areas”.
Those are not my words.
Will the Minister confirm whether UEFA has been consulted on the drafting of the clause, and whether the Government have received written assurances that this level of regulatory involvement is compatible with UEFA’s independence rules? If she has, will she place a copy in the Library? If she has received any correspondence to the contrary, will she also place that in the Library so that the Committee has confidence ahead of Third Reading and can scrutinise the provision properly? What safeguards are in place to prevent this from being interpreted—either in Brussels or somewhere else—as a breach of sporting autonomy?
This is not theoretical—it is a real and dangerous risk for English football. Let us remember, in recent years, that other countries have faced disciplinary threats or warnings for perceived interference in football. We have seen federations sanctioned before. National teams and clubs have been threatened with exclusion from competitions. For example, Greece was briefly suspended from international football in 2006 after the Greek Government passed a law that interfered—that was the term used—with the autonomy of the Greek football federation, in violation of UEFA and FIFA regulations. In 1999, Moldova’s clubs and national team faced a ban from UEFA competitions, after it was deemed that there was political interference in the running of its football federation. In 2002, FIFA suspended Zimbabwe and Kenya from international competitions due to perceived Government interference in the football administrations of those countries.
Mr French
I recognise the hon. Gentleman’s experience with Derby, and I understand his point. That is why I said there are a number of opinions, and this a very controversial subject. I have engaged with EFL clubs as part of this process, and we get a variety of opinions, even before we get to asking the Premier League clubs for their opinion, so I absolutely understand his point. This amendment is about trying to exclude parachute payments from this part of the Bill, rather than trying to take a decision on what parachute payment levels should be in any shape or form. That is the distinction we seek to make with the amendment, and I commend it to the Committee.
Stephanie Peacock
I thank the shadow Minister for the amendment, as it gives me the opportunity to speak to one of the key changes made in the new version of the Bill that this Government introduced. The amendment would take parachute payments out of the scope of the backstop, as they were in the previous Government’s Bill. The regulator needs to be able to consider all relevant revenue sources as part of the backstop process to get an accurate picture of any proposal’s impact on financial sustainability. That is why it was right to amend the definition of “relevant revenue” to ensure parachute payments could be considered as part of the backstop if necessary.
The shadow Minister pointed out that I supported the Bill when in Opposition, but I draw his attention to an amendment I put down then to this effect. We have had a clear and consistent view on this issue throughout the passage of both Bills through Parliament. We believe that allowing the regulator to make more informed decisions, rather than restricting what it can consider, will help to achieve the best possible outcome for the future of the game.
Stephanie Peacock
I begin by acknowledging the comments from my hon. Friend the Member for Sheffield South East. I appreciate him putting that on the record. Of course, we will have a fuller debate on the broader change later, so as I said, I will reserve my wider comments till we get to that point.
The backstop aims to ensure that where the industry cannot resolve the issue, revenue is distributed between the leagues in a sustainable way that furthers the regulator’s objectives. As I will set out in more detail when we debate clauses 57 and 58, it allows the leagues to apply to the regulator to intervene and help them to resolve specific issues that are in dispute between them. The issues that need resolving are referred to in the Bill as the “questions for resolution”. We will further discuss the process for triggering the backstop when we come on to debate clauses 57 to 59.
Put briefly, the triggering process requires a league applying to the regulator, showing that certain conditions listed in clause 57 are met, and putting forward a set of proposed “questions for resolution”. The other relevant league has a chance to respond to that proposal. The regulator will then consider the application and the response, and will decide whether to trigger the process. If it decides to trigger, it also decides exactly which questions must be taken forward and resolved through the backstop process. Therefore, the questions for resolution are set out at the very beginning and carry through, determining the scope of the whole process. They are the questions that the leagues discuss in mediation, as we will see when we debate clause 60, and they limit the scope of any regulator distribution order—something that we will discuss further when we come on to debate Government new clauses 3 and 4—to issues of financial sustainability.
Setting the questions for resolution is therefore a very important step that demands a clear statutory process and a rigorous approach by the regulator. That is even more important in the light of the proposed changes that Government new clauses 3 and 4 will make. Those new clauses propose a new model for the backstop—a staged regulator determination. They move away from the binary, winner-takes-all, final-offer model and increase the regulator’s discretion to devise its own solution for distributions. Because of that increase in discretion for the regulator, it is important that the scope of the distributions process is well defined from the outset, so that all parties are clear about what the regulator will and will not rule on if the leagues ultimately cannot agree to an industry solution themselves.
These amendments therefore strengthen and clarify the process for—[Interruption.]
Stephanie Peacock
I have indeed—clearly.
These amendments therefore strengthen and clarify the process for setting the questions for resolution. They highlight the importance of a league proposing specific questions for resolution when it applies to the regulator. They emphasise that if the regulator agrees to trigger the backstop, it will not take a sweeping approach and try to rule on every possible aspect of distributions. It must set out specific questions that it will resolve, and its powers are then restricted to resolving those questions.
These amendments make it clear that questions must meet certain tests in order to be resolved through the backstop. Those tests are twofold. First, the regulator must consider that leaving the questions unresolved presents an apparent threat to the regulator’s objectives. Then they must consider that the questions could not be resolved within a reasonable time by the regulator exercising any of its other functions.
The amendments clarify that the regulator need not take forward all the questions proposed and that the regulator can modify the proposed questions. They will also require the regulator to take into account representations from the other league that accompany the application. That will give the regulator the flexibility to pick out which questions it is appropriate and within its remit to address, without forcing it to either accept every element of an application or reject the whole application outright.
The amendments also set out procedural requirements. They require the regulator to consult the FA before setting the questions for resolution, ensuring that the national governing body has a chance to raise any views about the scope of the backstop process. They will also ensure that the regulator transparently sets out what questions it has chosen and how it made that decision. The questions for resolution will then be taken forward into the mediation phase. That will ensure that all parties understand the specific aims of the mediation stage.
Football Governance Bill [ Lords ] (Seventh sitting)
Debate between Stephanie Peacock and Louie FrenchThursday 12th June 2025
(3 weeks, 1 day ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 12 June 2025 - (12 Jun 2025)
Mr Louie French (Old Bexley and Sidcup) (Con)
I beg to move amendment 110, in clause 37, page 28, line 28, at end insert—
“(fa) whether the individual is a member of a proscribed organisation as per section (3) and schedule (2) of the Terrorism Act 2000.”
This amendment requires that IFR, in determining whether an owner or officer has the requisite honesty or integrity, to consider whether the person is a member of an organisation proscribed under the Terrorism Act 2000.
It is a pleasure to serve under your chairship again, Ms Butler. I welcome all Committee members back for day four. Amendment 110, tabled in my name, requires this Government’s regulator, in determining whether an owner or officer has the requisite honesty or integrity, to consider whether the person is a member of an organisation proscribed under the Terrorism Act 2000.
Clause 37 sets out the framework under which the Government’s football regulator must assess whether an owner or officer of a football club meets the required standards of honesty, integrity and competence. This is an important part of the Bill. Football clubs are not like ordinary businesses, as we have discussed; they are institutions rooted in community, tradition and even national identity. Those who control them must be held to the highest standards and supporters quite rightly expect that clubs should be fit to uphold those responsibilities.
The Government’s regulator’s task in clause 37 is to ensure that persons in positions of influence over our national game are financially sound and professionally competent. However, the clause as currently drafted leaves the test for honesty and integrity open to interpretation—arguably too open. That is why we have tabled amendment 110, which provides a clear and unambiguous requirement that, in determining whether a person has the requisite honesty or integrity, the regulator must take into account whether that person is or has been a member of an organisation proscribed under the Terrorism Act 2000.
Let me be clear: this is not about political views, past associations or guilt by implication, but about having a national minimum standard of moral fitness. It should be inconceivable that a person with demonstrable ties to a terrorist organisation could pass the fit and proper person test to own or operate a football club in this country. Football clubs are part of the fabric of British civil society. They are symbols of local pride and national values, and they have international reputations. To allow a person associated with a proscribed group, many of which pose active threats to our national security, public order and democratic way of life, to take a controlling interest in such an institution would be not only morally indefensible, but deeply dangerous.
This is not a hypothetical concern. We live in an increasingly globalised football economy and genuine questions have been raised in recent years about the sources of funding, ownership and political influence across the game. My amendment does not attempt to legislate morality in broad terms; it simply anchors the Government’s regulator’s assessment in existing law, specifically the Terrorism Act 2000, which provides a clear, publicly available list of proscribed organisations that Parliament has already determined pose an unacceptable risk to our way of life.
By incorporating that into clause 37, we do two things. First, we clarify the threshold for what constitutes a failure of the honesty and integrity test, giving both clubs and the regulator a clear reference point. Secondly, we send a signal to not just fans and communities here at home, but investors and foreign Governments abroad, that English football will not be compromised by individuals whose allegiances lie with organisations committed to violence, extremism or the subversion of our national interest.
Football is a global sport, but it must still reflect and uphold our national values. It is not alarmist or over-zealous to say that those who control our clubs must have a character as close to unimpeachable as possible. We are asking them not to be saints—unless, perhaps, they own Southampton FC—but to be the pillars of the community that we already expect them to be.
Mr French
I have woken everyone up there.
Clause 37 is an important safeguard, but without amendment 110, it lacks a clear and necessary line in the sand. Parliament has already determined that proscribed organisations represent a threat to public safety and national order. That same logic must apply here. I urge the Government to accept this modest but essential amendment and, in doing so, to help to ensure that our clubs are not just well run and financially sustainable, but led by people whose values are consistent with the country, communities and traditions that they are entrusted to serve.
Stephanie Peacock
It is a pleasure to serve once again under your chairship, Ms Butler. I echo the welcome back from the shadow Minister, the hon. Member for Old Bexley and Sidcup, to Committee members.
I will respond to amendment 110. I reassure the shadow Minister that the intent of his amendment is already achieved within the current drafting of clause 37, which lists the matters that the regulator must take into account when it conducts its owners and directors test. We will discuss that in more detail when we consider the next group of amendments, but I will summarise briefly now.
When assessing an owner or officer’s fitness, the regulator must have regard to any criminal convictions and proceedings, in particular those included in schedule 1 to the Serious Crime Act 2007. Membership of a proscribed organisation is an offence under the Terrorism Act 2000, and that offence is included in paragraph 2A of schedule 1 to the Serious Crime Act 2007.
The regulator will seek information and expertise from relevant organisations to help it to stay alive to both national and international concerns. The shadow regulator is already building a strong relationship with the National Crime Agency and law enforcement in general to ensure that the regulator is in a strong position to gather the information it needs.
I also reassure Members that the regulator and its staff will have the requisite measures and security clearance to be able to receive information relevant to their functions. Consequently, the current provisions in the Bill deliver the intent of the amendment. On that basis, I would be grateful if the shadow Minister would withdraw it.
Mr French
I appreciate the Minister’s comments with regard to amendment 110, which I tabled. I have listened carefully to her arguments, but it is still unclear to those of us on this side of the Committee why consideration of the Terrorism Act 2000 was not included in the list of factors set out in clause 37. We believe that is an oversight and, consequently, that the clause lacks the clarity that the amendment seeks to deliver in the Bill and that those who refer to it will seek going forward—in other words, the regulator. We will therefore press the amendment to a vote.
Question put, That the amendment be made.
Mr French
I thank the hon. Member for that valuable contribution and for telling us his experiences as a Derby fan. There are many examples that have been drawn on in various aspects of the Committee’s debates, and I suspect that there will be more going forward. Just to be clear, we are not seeking to press the provision to a Division. The point we are making is that we want the strongest owners and fittest people to run clubs, but we also want to ensure that the regulator is seen to be acting lawfully and in a balanced way at all times, to avoid any issues of impartiality. I understand the point the hon. Member makes, which is why I have always supported strengthening ownership tests, even in the previous Parliament.
We do not believe that exclusion based on reputational judgment or politics should come into these kinds of judgment. The Government must not forget that they are regulating not just football clubs, but people’s lives, reputations and livelihoods. That demands humility, caution and a presumption in favour of freedom and innocence, unless the case for restriction is absolutely clear and overwhelming. Where there is doubt, the Government’s regulator must not fill in the blanks with its own qualifications or prejudices.
The Opposition support the need for disqualification in serious cases, but we continue to press the Government to ensure that the clause is not open to abuse, and that football remains a competitive, plural and fair environment, rather than one policed by the regulator, acting as judge, jury and executioner in uncertain circumstances.
Clause 39 empowers the regulator to give a removal direction in requiring an unsuitable owner to take all reasonable steps to cease being an owner by the end of a specified period. The exception to this requirement is when an owner did not have prior regulatory approval, and the regulator can exercise its power to make an ownership removal order within three months, starting from the determination day. The clause requires the football regulator to inform the owner of the club and relevant competition organiser before giving a removal direction. It also requires the football regulator to notify the owner and the club of the possible enforcement action for not complying with the direction.
It is because of powers such as these that the regulator must be seen as independent. If a Government regulator is to order the removal of incumbent owners, this could be seen by competition organisations as clear interference, which as we have discussed at length, and could cause many issues for English clubs, especially when competing in UEFA and FIFA competitions. I would be interested to hear some assurances from the Minister about how that might work in practice. If the Government’s regulator is to tell clubs that they must change ownership, how confident is the Minister that that will not breach the rules that we have discussed?
This goes back to a point I made in a previous sitting about something that is a theme of the clauses in this group. Giving the owner or officer of a club notice of a regulatory action that is coming will hopefully allow them the rights of representation and challenge, if they feel that they have been handled wrongfully, but it also opens up issues around insider information, particularly with regard to a club’s valuation. I suspect that all hon. Members appreciate that such a change, particularly at the top levels of ownership, will have a dramatic impact on the valuation of a club. We want to understand how the regulator will deal with that issue to ensure that insider dealing, in particular, does not become a widespread issue where the regulator is trying to enforce its actions, as provided for by these clauses. We want to understand how that will work in practice, to ensure that these clauses do not have unintended consequences.
Clause 40 empowers the regulator either to issue a removal direction to an unsuitable officer, requiring them to take all reasonable steps to cease being an officer by the end of a specified period, or to give such a direction to the relevant club, or both. It requires the independent football regulator to inform the owner, club, and relevant competition organiser before giving a removal direction. It also requires the IFR to notify the owner and the club of the possible enforcement action for not complying with the direction. I have the same question about this clause as for the previous one: how will the risk of inside information be managed?
Clause 41 empowers the regulator to prohibit an unsuitable owner or officer from carrying out specified activities or exercising specific rights and/or to issue a direction to the club requiring it to ensure that the unsuitable owner or officer does not exercise specified activities or rights. The clause provides a non-exhaustive list of such activities and rights, including any right
“to vote on any matter relating to the…club’s activities”;
appointing, terminating or changing the terms of appointment or responsibilities of any officer or employee; changing the corporate structure; and undertaking any specified actions without obtaining prior approval from the independent regulator.
Clause 41 also requires the IFR to notify the owner and the club of the possible enforcement action for not complying with the direction. Such action could seriously impair the ability of a club to function while it seeks a new owner or officers, as ordered by the regulator. As we all know, it takes a significant amount of time to find a new owner, and many may be deterred by perceived interference in English football, compared with other nations without a state regulator. Clause 41 may cause more damage to a football club than the owner, who the regulator cannot dismiss. How will the Minister ensure that the regulator uses these powers only if and when deemed strictly necessary?
Clause 42 relates to situations where directions under clause 41 would impede a club’s ability to operate effectively or comply with regulatory requirements. It empowers the IFR to temporarily appoint an officer to carry out a specified function, or redistribute functions among existing officers. It stipulates that those functions must be specified, must be for a specified amount of time, and can be revoked or varied by another order. It specifies that an interim officer is not subject to the duties and requirements placed on officers by the Bill. It also requires the IFR to notify the owner and club of the possible enforcement action for not complying with the direction.
Clause 42 adds to the fear that the regulator could erode the independence of English clubs and how they operate. It empowers the regulator to effectively govern a club while seeking to remove unsuitable officers or owners. Given the time that it takes to find new ownership, that situation could last for a considerable period and cause massive issues on the pitch with regards to investment and transfers—as we discussed in a previous sitting—and how the club functions. It would also leave the regulator wide open to criticism if its actions lead to relegation, for example, for a particular club. Does the Minister think that there is a risk that such a club could be barred from international competitions—as I suggested earlier—or that the Government’s regulator could be left wide open to legal challenge if it directly impacts a club’s performance on the pitch, or its financial performance off the pitch while such considerations, or changes of ownership, take place?
Stephanie Peacock
I thank the shadow Minister for his points, to which I will respond briefly. There are no changes in the bit of the Bill that we are talking about compared with the previous Bill, other than—as I referenced in my previous contribution—the removal of the requirement for the regulator to
“have regard to the foreign and trade policy”
of the Government. We think that removal strengthens the independence of the regulator, and I reiterate that we do not have any concerns in relation to UEFA.
The shadow Minister asked some specific questions. There are no thresholds in the Bill, but the regulator will need to act fairly and proportionately. There are robust appeals processes through the Competition Appeal Tribunal. The shadow Minister made points about the publication of information. In order to ensure that sufficient protections are in place, relevant parties will be able to express their views before the regulator makes a decision. Once the decision is made, it will take these views into account, and the regulator must publish a notice of that decision, including the rationale behind it.
Question put and agreed to.
Clause 38 accordingly ordered to stand part of the Bill.
Clauses 39 to 42 ordered to stand part of the Bill.
Clause 43
Ownership removal orders
Stephanie Peacock
As set out previously in the debate on clauses 38 to 42, the regulator will be able to direct an unsuitable owner to leave the club in a specified timeframe and to prohibit them from undertaking certain activities at the club in the interim. However, there is a risk that an unsuitable owner does not comply with these directions. For instance, they may refuse to leave the club or continue to use their position as an owner to damage the club. In these situations, the regulator will need sufficient powers to directly remove the unsuitable owner from the club. That is why clause 43 gives the regulator broad discretion in such cases.
The regulator can make an order containing such provision as the regulator considers appropriate to secure the unsuitable owner’s removal. For example, that could include appointing trustees, empowering the trustees to sell the club and requiring the unsuitable owner, or any other person, to comply with the trustees’ directions. However, the regulator can use this power only against unsuitable owners who have demonstrated that they are willing to flout regulatory requirements, or if they fail to comply with the directions that the regulator has made to protect the club from harm. As set out previously, in certain situations the regulator will have the power to make an ownership removal order containing whatever provision is appropriate to ensure that an unsuitable owner leaves a club.
To ensure that there are sufficient safeguards in place, clause 44 sets out the process that needs to be followed by the regulator. In particular, before issuing an ownership removal order, the regulator must publish a notice that it intends to issue the order and allow a period for interested parties to express their views. After this, the regulator must decide whether to make the order, and must publish a notice of its decision including its rationale. This helps to ensure that the views of those affected are taken into account in the decision-making process. Separately, the regulator may make rules requiring unsuitable owners to pay costs associated with an ownership removal order, such as costs incurred by a trustee appointed by an order. This power helps to ensure that the costs are borne by the unsuitable owner.
Mr French
Clauses 43 and 44 set out how ownership removal orders are to be made, and the legal consequences of non-compliance. Clause 43 matters hugely because it allows the regulator to force an individual to sell their ownership stake in a club. That is a serious and intrusive power, so we must ensure that it is used sparingly, lawfully and with robust safeguards. On process and fairness, we welcome the requirement in clause 44 to notify the person and allow representations to be made before an order is issued. However, is that enough? Will representations be meaningful, or will this just be a procedural tick-box exercise?
I have some questions for the Minister. Will the regulator be required to give full written reasons for the proposed removal? Will the owner have access to the evidence relied upon? Is there a statutory right of appeal or review, and if not, why? Secondly, on liability and legal exposure, clause 44(6) imposes the liability for costs incurred by non-compliance with an order on to an owner. What types of loss are envisaged for owners? Are they just financial, or reputational and contractual? Who decides whether a loss is caused by the non-compliance, and is causation clearly defined? Could this lead to vexatious or opportunistic claims in the future? How will this work with ownership groups, when there are multiple owners of a club?
On commercial realities, forcing the sale of a football club is not simple; in most cases, these are not liquid assets. The value depends on market conditions, the timing of the economy and sale, and obviously buyer availability and demand to purchase a football club. I therefore ask the Minister: will the regulator have a duty to ensure fair market value is preserved during a forced sale? What happens if the regulator’s actions or any delays cause the value of a club to fall? Could we see a situation where the regulator is frequently appearing in court on such claims? Fourthly, on the broader principle, the clause is in effect a power to force the sale of a privately-owned business. That is a major constitutional step. Property rights in this country matter, due process matters, and so does the rule of law. We need real safeguards, not just procedural gestures.
We want to keep football in safe hands, but the clause needs to be clearer, fairer and more restrained in its use. It must not give the regulator quasi-judicial power without necessary oversight of Parliament. That is not regulation; we believe it would be overreach. I would be interested to hear the Minister’s comments on my questions.
Stephanie Peacock
I echo the shadow Minister’s comments about the power being used clearly, robustly and fairly. I think all of us on the Committee can agree that that is absolutely right. On his question about whether the reasons would have to be written, the regulator will have to give the owner enough reasons for its decision to enable them to understand why it has been taken. That has one of the strongest appeal routes in the Bill; it can go directly to the Competition Appeals Tribunal and be heard on its merits. We think there are robust protections in place here already.
Question put and agreed to.
Clause 43 accordingly ordered to stand part of the Bill.
Clause 44 ordered to stand part of the Bill.
Clause 45
Duty not to operate a team in relation to a prohibited competition
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
I am grateful to Members for their contributions and will take their points in turn.
The clause applies both to existing and to new competitions. If any competition breaches the criteria, it can be prohibited, but matters such as scheduling are for competition organisers.
On shadow Minister’s points, we will come on to player welfare, to which we are all very sympathetic, just as we are sympathetic to the 3UP campaign, but it is outside the Bill’s scope and is for organisers. He asked some specific questions on the criteria; that will be for the regulator to determine. It is expected to do so based on a predetermined, proportionate, objective and transparent framework based on factors listed in the clause. For example, if a competition is not merit-based, jeopardises the sustainability of existing domestic competitions, and is not supported by the fans, we would expect it to be prohibited.
Mr French
My hon. Friend the Member for Spelthorne and the hon. Member for Newbury highlighted the issue of friendlies. The Minister has indicated that she will come to that, but I do think we need some clarity as to what that might look like in practice. The end-of-season competitions are normally internationally designed, and although they may be endorsed by UEFA or FIFA, they would breach some of the conditions under the definition the Minister just gave. We need clarity about how this will work, because we do not want to put English football on a collision course with international football.
Stephanie Peacock
No, of course we do not. I totally agree. I was coming to that point. As I understand it, friendlies would be out of scope, but I am happy to write to Committee members if they would like greater clarity.
We have discussed the appeals and representations several times. The relevant competition organiser will be given a period in which they can make representations. If the organiser has concerns about the regulator’s decision to prohibit the competition, it will be able to appeal the decision. As has been discussed, the organiser can also appeal to the competition appeal tribunal.
Mr French
I thank the Minister for those remarks. I suspect that a letter of clarity would be helpful for all Members. There is a risk that FIFA, or UEFA, as we have seen with the Nations League in recent years, looks to introduce a new competition, whether at club or international level, that would contradict the regulator. As we have spoken about at length, and as the hon. Member for Sheffield South East has described, the different governing bodies of UEFA and FIFA are often in competition with our national competitions. We have to ensure that clubs are not forced to choose between a licence in the English game and partaking in international competitions. We fear that could drive acceleration toward a breakaway league, rather than prevent one.
Stephanie Peacock
I completely appreciate the shadow Minister’s comments. As I said in my opening remarks, we do not ban all international competitions automatically. We are mindful of enabling innovation in the market. I am happy to supplement my comments with a letter to Committee members.
Question put and agreed to.
Clause 45 accordingly ordered to stand part of the Bill.
Stephanie Peacock
I thank my hon. Friend the Member for Sheffield South East for tabling his amendments. Prior to speaking to them, I would like to let him know that I have raised his points on a similar issue—on assets of community value—with the Under-Secretary of State for Housing, Communities and Local Government, my hon. Friend the Member for Nottingham North and Kimberley (Alex Norris). I spoke to him following our Committee session on Tuesday, and he has committed to write to my hon. Friend as swiftly as possible, so I will follow up with him in a timely fashion.
Turning to my hon. Friend’s amendments, I hope I will be able to reassure him on the development of the reform. I understand the intention of his amendments, but I will explain why we intend to resist the changes to include specified properties. On extending the scope of clause 46 to include training grounds, among other properties, the legislation has carved out specific protections to safeguard home grounds against risky financial decisions or sales of the grounds. I will speak specifically to the mechanism of clause 46 and the approval process later, but the focus on the home ground is to reflect that it is often the most financially significant asset at the club. That does not mean that other assets such as training grounds or office space are not also important to the club, but that there is a specific consideration necessary for the home ground.
I understand that my hon. Friend’s amendments are likely in response to instances where owners have intended to asset strip or make reckless decisions. Members on the Committee have shared some examples, and we are all familiar with recent ones. I wish to reassure all that there are protections elsewhere in the Bill to safeguard against this. That includes an enhanced owners and directors test that will ensure that owners are prepared to be appropriate custodians of their club and its assets, as we discussed on part 4 of the Bill. If it were to become evident that an owner’s actions were likely to worsen the financial position of the club, the licensing regime gives the regulator power to place licensing conditions on the club. The regulator can also take enforcement action where such a condition has been breached or the financial plan has not been followed. Additionally, the regulator will have oversight of the financial plans and balance sheets of the regulated clubs, ensuring that the club is not putting itself in a risky position unnecessarily.
Mr French
On the point about risky situations and the risk-averse nature the Minister is describing, the Bill is clearer on disposable home grounds. I am intrigued to see how the regulator would deem a club either selling its freehold and then having a leaseback option, which we have heard has happened, or looking to move to a ground or stadium that it did not own and pay rent going forward. Would that be seen as a bad financial move or a good one by the regulator? It is not quite clear how it would work for non-disposable treatment of assets.
Stephanie Peacock
I do not want to get drawn into hypotheticals. As we previously discussed, there might be a perfectly legitimate reason for a club to move—or to move temporarily, such as for flooding. It is not an absolute power. We want to give the regulator discretion when clubs may need that for legitimate reasons. The amendment speaks to where we think clubs are asset stripping or acting in bad faith.
We would expect the power to include assets remaining in the club’s ownership and any plans to change its financial arrangements. It would be at odds with the sustainability of a football club for there to be no home ground or location to train. It is therefore implicit that the regulator would address that.
Mr French
I will not dwell on this point too much, but the implications of this amendment and the ones that we were just discussing are not hypothetical; we have seen real-life examples of where this issue has become a real one for football clubs. So, we seek some clarity from the Minister about how the regulator would act in such scenarios in the future.
As I said in my previous comments, I think the disposal of a ground is probably slightly clearer than the relocation of a ground. However, I will use the example of Coventry City football club. When they moved to the Ricoh Arena, I believe that the stadium was jointly owned by the local council and another group. I assumed that the club moved to a new stadium with the best interests of the club at heart. I had the pleasure of going to Coventry’s old stadium when Charlton played Coventry in the FA Cup, but that is a bit by the by. It was in need of improvements; most people would have thought that.
How would this measure work? We know that Coventry ran into a number of issues with the Ricoh Arena, which I believe is now owned by the Frasers Group. At that point in time, when the club moved, would that move have been deemed to be in the regulator’s purview of an inappropriate action by the previous owners? I ask that question because this is a real-life example of where it is not clear how this legislation would apply. As Parliament, we have to be clear how we intend the regulator to behave in such situations, because, as I say, that was a real-life example of how football clubs might seek to improve their stadia when they do not have the assets to do so themselves.
Stephanie Peacock
I am grateful to the hon. Gentleman for his comments. I draw his attention to the discretionary licensing addition that I have referred to: the regulator can react to different situations. I do not want to be drawn on individual cases, nor do I want to pre-empt the actions of the regulator.
Stephanie Peacock
I appreciate that point, but the sale of home grounds is a primarily financial decision, separate from the decision about where the club actually plays its games. That is why there is currently no requirement to consult or obtain approval. If the club has not actually relocated, it would be caught in clause 48 and would be required to consult fans. We will come on to discuss that later.
Mr French
I must admit that—like other members of the Committee, to judge from their facial expressions—I am slightly confused by the reasoning the Minister has given in response to the hon. Member for Sheffield South East on this clause, and where the distinction lies between the ultimate decision to relocate the ground and the sale of the ground. The decisions are clearly interlinked, and I would argue that fans would have strong concerns if a club owner was seeking to sell the ground, which would in a number of instances lead to either a relocation or an impact on the club’s heritage. The sale, for example, could lead to the renaming of a stadium, and the fans would clearly have a view on how that would impact their support for the club.
I ask the Minister to reflect on the hon. Gentleman’s points, because the clause seems to lack clarity on how that distinction is being made. I understand the point she is making about the financial considerations of owners, but the Government should reflect carefully on the argument against this clause, because it is not very clear to members of the Committee.
Stephanie Peacock
I appreciate the comments that have been made, and I will take them away and reflect on them, but I ask my hon. Friend the Member for Sheffield South East at this point to withdraw his amendment.
Stephanie Peacock
This clause sets out the duty on regulated and formally regulated clubs not to appoint an administrator without approval from the regulator. This is to ensure that administration is transparent, acts in the best interests of the club and its creditors and avoids any perceived or actual conflicts of interest. This will give all stakeholders, especially fans, confidence in the administration process.
As with clause 46, this applies to regulated and formally regulated clubs to avoid any risk of circumvention of the rules. The regulatory framework is not a zero-failure regime, so it is possible that football clubs may enter administration despite the best efforts of the regulator. There is already a legal framework for companies, including football clubs, to enter into administration, which is detailed in the Insolvency Act 1986. In many cases, the existing framework has enabled clubs to go into administration and re-emerge as solvent.
However, there are occasions where the administration of a club is not initiated by the creditors but the club itself, so it does not require a court to sanction the appointment in advance. In these circumstances, there have been occasions when some have had cause to question a relationship between the insolvency practitioner appointed as administrator and the football club. This is why, in specific circumstances, the appointment of an administrator requires the regulator’s approval to ensure that the process is transparent, and to avoid conflicts of interests or perceived bias in the appointment. By doing so, all stakeholders, particularly fans, should have more confidence that the outcome is the best one available in the circumstances for the individual club.
Mr French
Clause 47, as the Minister has just outlined, creates a new legal duty on clubs not to enter administration without the prior approval of the regulator. This is an unprecedented intervention: a regulator potentially blocking access to what is, in most sectors, a standard insolvency mechanism. We understand the intent to prevent abuse of administration as a means of dodging financial responsibility and to help protect club continuity. However, this clause raises serious concerns about the balance between corporate law and football regulation going forward.
As drafted, subsection (1) says,
“as soon as reasonably practicable after the body considers that there is a reasonable prospect of an administrator of the body being appointed”.
I would therefore naturally ask the Minister: what constitutes “reasonably practicable” and “a reasonable prospect”? We all appreciate that, in most examples, an owner’s wealth is generated not by the club itself but other business interests. It may become very difficult to determine what is “a reasonable prospect” if we are looking at business interests far from football.
Administration is recognised as part of UK insolvency law, which the Minister referred to, and it exists to help distressed businesses rescue viable parts and protect creditors where possible. Blocking access to administration could make things worse, not better, specifically if it delays actions or deters future buyers. Why are the Government confident that the regulator is better placed than insolvency professionals to determine when administration is appropriate?
On some of the practical risks, insolvency situations often develop quickly, and clubs may need to act fast to avoid a complete liquidation of assets. A duty to obtain the regulator’s approval would therefore add delay and could risk total collapse where speed might be essential. We have seen that in a number of club takeovers over the years. Will there be an emergency approval process for an administrator? Within what timeframe does the Minister expect the regulator to respond? Is there a default route if it does not respond in a quick enough time?
On consistency with company law, clause 47 effectively overrides the Companies Act 2006, creating a two-tier insolvency regime for football clubs. That is not a small step. It sets a precedent for sector-specific interference into commercial law. What discussions has the Minister’s Department had with the Insolvency Service and the Department for Business and Trade on this specific clause and mechanism going forward? Are there any comparable sectors in the UK where companies would be forbidden from entering administration without the regulator’s consent?
Lastly, on unintended consequences, could this provision make distressed clubs less attractive to investors who fear regulatory delays? I fear that it may. It may also push clubs to delay taking action, making outcomes worse for creditors, fans and staff in the longer term. It could also expose clubs to legal risks, if creditors challenge a failure to act promptly to directors. The Opposition support strong oversight, but clause 47 must not become a regulatory roadblock in moments of crisis. Football clubs must be able to act swiftly to protect their future. The football regulator should be a safeguard, not a barrier to survival. We urge the Minister to have a close look at some of those questions and hopefully provide some answers today. We fear that this clause, as drafted, may have a number of unintended consequences.
Ordered, That the debate be now adjourned.—(Vicky Foxcroft.)
Football Governance Bill [ Lords ] (Sixth sitting)
Debate between Stephanie Peacock and Louie FrenchTuesday 10th June 2025
(3 weeks, 3 days ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 10 June 2025 - (10 Jun 2025)
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)
It is a pleasure once again to serve under your chairmanship, Mr Turner. I thank the hon. Member for Old Bexley and Sidcup for his amendment. He made some important points in his contribution, including his reference to the Kicks programme. He also pointed out an event in his area where he was able to see the Premier League trophy; that is a fantastic tour involving lots of grassroots and other clubs. I was really pleased to visit one such club in Mr Speaker’s Chorley constituency, and I will take this opportunity to wish Mr Speaker a very happy birthday. I am sure that other Committee members will join me in putting that on the record.
We do not believe, however, that the change in amendment 137 is necessary. I will outline why and respond throughout my speech to some of the hon. Gentleman’s points. As drafted, the Bill gives flexibility to a club to detail what action it is taking to contribute
“to the economic and social well-being of the local community with which it is associated”.
This provision was introduced through a Government amendment made in the other place to allow the regulator to include clubs’ community contributions in its corporate governance code. The regulator will work with the industry to design the code to ensure that it is relevant to clubs, the challenges they face and the unique nature of the responsibilities associated with custodianship of a football club.
If a club details, in its statement, its work with or through its official charity, that would of course be accepted by the regulator. That is the opposite of what the hon. Member for Old Bexley and Sidcup said. He referred to scaling back charity work, but that is absolutely not what we will see as a result of the proposals.
Let me detail some of the specifics. If a club is donating to or funding bodies that are not its official charity, that is also a contribution to the community and could be included. We have tried to keep this as broad as possible. To share something from my constituency and town, Barnsley FC Community Trust is a great example of a charity that is closely connected to a club. The community trust held its conference on Monday, and I was pleased to send them a message. One purpose of that conference was to raise the charity’s profile across Barnsley. It helps between 10,000 and 15,000 people each year, who range in age from two to 100 years old. I will not detain the Committee by outlining the work that the trust does, but it ranges from education to health, social inclusion and sports participation, not just in and around the centre connected to Oakwell, but across the whole of Barnsley and my Barnsley South constituency.
Barnsley FC could use their work with the trust to show how they contribute to the economic and social wellbeing of their community, and I put on record that they very much do that in my area. But it is not just Barnsley FC that do such work; many clubs carry out great work in their communities, whether through their official charities or not. Portsmouth FC’s Pompey in the Community and the Sheffield Wednesday FC Community Programme are just two examples; I am sure that hon. Members across the Committee have examples from their communities. It is important to shine a light on those contributions to the local community, and that is why a club’s report on their corporate governance will be published online to allow public scrutiny, so that they can be held accountable for their actions, or inaction. We believe that this will encourage transparency and, as with the approach to corporate governance more widely, encourage greater action in this space.
Above all, that approach will allow flexibility for each club to comply in accordance with their resources and size in a way that is suited to the needs of their local community. Additionally, when the regulator publishes its corporate governance report on clubs, best practice can be shared with the industry. We therefore believe that the Bill, as drafted, sufficiently allows clubs to demonstrate the actions they contribute to their communities. I hope that the hon. Member for Old Bexley and Sidcup will withdraw his amendment.
Mr Louie French (Old Bexley and Sidcup) (Con)
It is a privilege to speak again under your chairmanship, Mr Turner. I congratulate you and the city of Hull on the Challenge cup victory at the weekend, which probably does not please Mr Speaker on his birthday, but such is sport.
Moving back to football, before the lunch break, I explained why the Opposition felt the need for amendment 137. It is a technical amendment that would make it very clear that the official charities and trusts of the clubs would count towards the corporate governance structure. I have listened carefully to the Minister’s comments and appreciate the feedback that she has given. However, we would still like to see the amendment made to provide clarity to clubs, so we will press it to a Division.
Question put, That the amendment be made.
Stephanie Peacock
I thank the hon. Member for Old Bexley and Sidcup for his amendment 131. Football is a worldwide industry, and the activity of football agents continues to be a significant contributor to the financial pressures on English football, as well as internationally. We recognise that this is a key issue, which is frequently raised by the industry. Agent fees are a significant cost pressure, particularly on clubs in the Premier League and the Championship. The largest fees are often paid in international transfer activity, where regulation is especially difficult without a global framework. There are also concerns about dual representation and conflicts of interest, which can further inflate costs.
However, the regulator cannot be the solution for all of football’s woes. The Bill establishes a club licensing regime with a tightly defined scope, in which agents are not included. The fan-led review recognised that and recommended pursuing an international and game-wide solution to football agents, rather than trying to address the issue in isolation. Acting unilaterally may end up being disadvantageous to English football. It is right that we follow the review’s recommendation not to try and address the issue in isolation, which reflects the unique scale and complexity of English football’s place in the global game.
I want to make it clear that the Government acknowledge the importance of this issue, and will continue to work with the industry on agents and fees. We will work closely with governing bodies to support full compliance once legal proceedings conclude in the courts, and to drive forward our shared ambition for transparency, integrity and best practice across the game. We will keep this issue under review, but for those reasons, I ask the hon. Member to withdraw the amendment.
Mr French
I have listened carefully to the Minister’s comments and acknowledge a number of the points that she made. The purpose behind the amendment was to have the discussion about the impact of fees on the game. I accept some of her points about the international nature of the transfer market. I would like to continue discussing this with her and the regulator once in situ, because I think there is something we can do here, either formally or informally, to move the game along so that it stops losing so much money to agents’ fees. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Stephanie Peacock
I beg to move amendment 64, in schedule 5, page 103, line 18, after “specified” insert
“from time to time by the IFR”.
This amendment clarifies that the IFR may specify certain elements of the mandatory licence conditions from time to time.
The regulator will attach four mandatory licence conditions—the financial plan, the corporate governance statement, a fan consultation and an annual declaration—to the operating licence, both provisional and full, of each club. This means that all licensed clubs will need to comply with those requirements.
While the mandatory conditions are basic requirements that apply to all licensed clubs as standard, elements within them can be varied. For example, the regulator can specify when a club must submit and update a financial plan, or require that a plan contains additional information. As another example, the fan consultation condition can require that clubs consult plans at specified periods, which speaks to a point that my hon. Friend the Member for Sheffield South East raised earlier.
Government amendment 64 simply makes it explicit that the regulator can respecify these elements to the mandatory licence conditions from time to time. The licensing regime is designed to be flexible and proportionate, and the mandatory licence conditions are no different. For instance, a Premier League club’s financial plan is likely to be more detailed than one for a National League club. If a club’s circumstances change—for instance, if it gets promoted or relegated—the regulator should have a chance to respecify the mandatory licence condition to ensure that it remains proportionate.
The regulator also needs to be able to keep pace with developments in the industry and changes in best practice —for example, if there are innovations in financial plans or mechanisms for fan engagement. Government amendment 64 simply makes that explicit in the Bill.
Amendment 64 agreed to.
Question proposed, That the schedule be the Fifth schedule to the Bill.
Stephanie Peacock
The clause relates to the discretionary licence conditions. Where needed, the regulator will use discretionary licence conditions to bring a club up to the required level of compliance with the threshold requirements. That will mean that the regulator is satisfied that the club can currently operate sustainably, and will be able to continue to continue to do so, in the financial, non-financial and fan engagement areas. Those conditions will be in addition to the standardised mandatory licence conditions. When applied, they will be tailored to the club’s specific circumstances and identified financial risk.
If a club is already meeting the threshold requirements set by the regulator, there will be no need to attach any discretionary licence conditions to that end. That means that the regulator can be light touch where appropriate, and that it does not need to directly intervene if a desired outcome is already being met.
Discretionary licence conditions could also be used to protect and promote the financial resilience of the football system. They will be used to resolve risks that might not threaten any one club significantly, but whose aggregated, correlated or multiplied effects may pose a significant risk to large parts of the football system or the pyramid as a whole. I commend the clause to the Committee.
Mr French
The clause formally sets out the regulator’s powers to attach, amend or remove discretionary licence conditions, which could bring a club toward meeting a threshold requirement or mitigate financial risks. It raises some concern about mission creep, so I hope the Minister will assure us that the regulator’s powers do not extend beyond those objectives. Should the regulator use the powers to effectively create new burdensome regulatory requirements, that would significantly change the purpose of the regulator.
Will the Minister please clarify what engagement the regulator will have with clubs to ensure they are aware of the discretionary licence conditions? Will there be any consultation or engagement with clubs prior to attaching or amending a discretionary condition? Will clubs have the ability to request a variation or removal of a condition? In what timeframe will that be processed?
If a club feels that a discretionary licence condition has been placed arbitrarily or punitively, how can it appeal or challenge the condition? What will the process look like, and what timescales will be used? Will the timescales be standardised, or will they be at the regulator’s discretion? Although some larger clubs may have the resources and budgets to appeal a condition, what support will be given to smaller clubs? Have the Government considered the potential merit of a tiered application based on the club’s size?
Aside from the concern about mission creep, it is important that these powers are exercised proportionately and based on evidence. Will there be any oversight of their use to ensure that happens? Subsection (4) states:
“The IFR may vary a discretionary licence condition where…the IFR considers that the condition is no longer effective, or…there has been a material change in circumstances”.
However, it fails to define what constitutes a material change in circumstances. The lack of such a definition leaves the door open for the Independent Football Regulator to vary conditions without sufficient reasons or evidence.
We ask those questions now because we are concerned about future legal cases if there is a lack of consistency and transparency surrounding how the conditions are applied. I would appreciate some answers from the Minister.
Stephanie Peacock
I am grateful to the shadow Minister for those questions. Throughout this process, we have been keen to reiterate that discretionary conditions must be proportionate to the club’s size and the league it plays in. We absolutely expect the regulator to engage thoroughly with a club before applying any discretionary licence conditions. Perhaps I could just draw on the conversation that we had in the previous debate in terms of fan engagement: I am hesitant to get into hypothetical scenarios, but it might be that, if a club is not effectively engaging with fans, that could be a discretionary licence condition if there is an obvious gap in what the club is doing. If the club does not believe the regulator has made a correct decision, it does have recourse through the appeals process, which is set out in part 9.
We want this to be a flexible regime so it can be light touch where appropriate. If the regulator does not need to attach extra conditions, it will not, but it will have that ability to make sure that all clubs are meeting the conditions they need to.
Question put and agreed to.
Clause 21 accordingly ordered to stand part of the Bill.
Clause 22
Scope of powers to attach or vary discretionary licence conditions
Mr French
I rise to speak on clause 22 of this important Bill, which provides the Independent Football Regulator with powers to attach, amend and remove discretionary licence conditions for individual football clubs. At face value, this clause offers the regulator flexibility to respond to particular risks or circumstances on a case-by-case basis. However, as with all regulatory discretion, the true implications lie in how such powers may evolve over time, be interpreted, or be expanded.
In this Committee, it is our role to ensure that what begins as a sensible framework for tailored intervention does not become the thin end of a wedge that risks overreach, centralisation and, ultimately, the erosion of club autonomy. I believe strongly that English football does need reform in certain areas, but I also believe in restraint, clarity of purpose and fidelity to the principle that football clubs, however commercial they may have become, are civic institutions first and foremost. They belong to their communities, not to Whitehall, not to arm’s length bodies, and certainly not to ministerial discretion.
Clause 22, as drafted, gives the Independent Football Regulator a wide and open-ended ability to impose additional conditions on individual clubs—conditions that are not part of the baseline threshold requirements in the Bill, but which the regulator may, in its own judgment, decide are appropriate. We should acknowledge that there are circumstances in which such powers might be necessary. For example, where a club has narrowly avoided insolvency, has a particularly opaque ownership structure, or is operating under unusual financial pressures, the regulator may wish to impose temporary conditions to help safeguard the public interest, protect creditors or ensure better transparency.
That flexibility has its place. However, it must be anchored in the principles of proportionality, accountability and predictability. It is for that reason that I want to speak to three amendments that have been tabled in my name, each of which I believe would help materially improve the Bill by preventing mission creep, protecting the distinct role of the leagues, and ensuring that Parliament, not the Executive, retains the ultimate authority over the scope of regulation.
The first amendment would prevent the regulator from imposing discretionary conditions relating to a club’s internal controls—that is, the systems and procedures by which a club governs itself, monitors risks, approves spending and safeguards assets. These are matters properly for the board of directors, who have legal duties under company law, are accountable to shareholders and fans, and must answer to independent auditors.
To allow the regulator to second guess those internal arrangements and dictate how a club structures its finance team or risk-management processes would be a significant intrusion into corporate governance territory. Let us be clear: there is a distinction between requiring that a club has adequate systems and mandating the precise nature of those systems. The former is reasonable; the latter, we believe, is excessive.
We must also be mindful of the danger that the regulator could, perhaps with good intentions, begin to substitute its own preferred model of governance over the perfectly legitimate models that clubs themselves decide to adopt. For example, what works for a large Premier League club with international operations may not be appropriate or affordable for a League Two club or a community-owned side. Discretionary licensing conditions must not become a one-size-fits-all instrument that penalises innovation, tradition or diversity in club structures.
I support this amendment because it would help ringfence those areas of internal decision making that are rightly matters for the club’s board—subject to transparency and good practice but not for centralised prescription.
The second amendment that I have tabled would prevent the regulator from imposing licensing conditions relating to a club’s overall expenditure. Amendment 108 would prevent the regulator from imposing licence conditions relating to a club’s overall expenditure. This is a fundamental issue. English football operates within a competitive ecosystem, as we have discussed. Decisions about how much to invest in players, infrastructure, academies or commercial operations are matters of strategic importance for clubs. They should be driven by ambition, fan demand and commercial opportunity, not by the regulator’s view of what is appropriate spending.
We must not fall into the trap of conflating good financial regulation with financial central planning. The role of the Independent Football Regulator should be to monitor solvency, ensure robust business plans, enforce transparency and intervene when there are clear risks of harm. It is not the regulator’s job, and it should never become its job, to determine how much a club is allowed to spend. There is a world of difference between assessing whether spending is sustainable and attempting to control outright the volume of that spending.
Let us remember that the leagues themselves already impose cost controls. The Premier League has profit and sustainability rules. The English Football League enforces squad salary caps and financial fair play frameworks, and now has the new financial review panel. The regulator is not meant to replace those roles. It is not a shadow competition authority, nor should it seek to override club investment decisions, which often have complex justifications and long-term returns.
Amendment 108 would help to ensure that the regulator cannot use its discretionary power to micromanage investment levels. Such a step would go beyond the spirit and the letter of what the Bill intends to achieve. The goal is to protect clubs from existential risk, not to homogenise them or stifle ambition.
Amendment 109 would remove the Secretary of State’s power to amend the list of discretionary licence conditions by regulation. This is not a technical point; it goes to the constitutional heart of the Bill. The Independent Football Regulator must be just that: independent. Its scope, duties and powers must be defined by Parliament and subject to oversight. We cannot accept a model in which future Secretaries of State, by regulation and with minimal scrutiny, can expand the areas the regulator may interfere with. That would allow a future Government of any colour to alter the regulatory perimeter at will. Today, it might be internal controls; tomorrow, it might be club ticket pricing, political messaging or hiring policies. The clause must be narrowed to ensure that any expansion of discretionary licence conditions comes through primary legislation that is debated and approved by both Houses.
Regulatory stability is vital not only for clubs but for fans, leagues and the broader football economy. Clubs, particularly those in the lower leagues, need to be able to plan over multiple seasons. Uncertainty about what new regulatory burdens might be imposed, or fears that the regime could be altered mid-season by ministerial decree, will have a chilling effect on investment, sponsorship and ambition. Regulation must be predictable and principled, not politicised or ever-shifting. Amendment 109 would safeguard its integrity.
Clause 22 presents a risk of regulatory overreach, however well-intentioned it may be. The amendments would not strip the regulator of useful tools. They would simply place guardrails around its discretion and ensure that decisions of fundamental importance to club governance, financial independence and regulatory scope remain where they belong: with clubs, fans and Parliament.
We need a regulator that enforces minimum standards, upholds transparency and ensures financial resilience. What we do not need is a regulator that micromanages club affairs or displaces the judgment of boards and owners. Football clubs must remain free to compete, to innovate and to fail or succeed on their own merits—within a fair framework, yes, but not under constant intervention.
The amendments reinforce that principle. They are not ideological; they are practical, measured and consistent with the values that underpin the Bill. I urge the Committee to support them and, in doing so, to send a clear signal that we are legislating not to control football but to support it firmly, fairly and with the long-term interests of the game at heart.
Stephanie Peacock
I thank the shadow Minister for tabling the amendments, which I will take in turn in responding to the points that he made.
Broadly, amendments 107 and 108 concern integral powers for a financial regulator. Limiting those powers by reducing the scope of the regulator’s discretionary licence conditions would jeopardise its ability to achieve its objectives. On internal controls, the conditions cover areas such as the completeness and accuracy of reporting and information from a club, and continued compliance with the rules and regulations. If the regulator had no power to intervene to improve those areas where it was deemed necessary, it would not be able to bring a club up to its non-financial threshold requirement, and therefore the club would be unable to obtain a full operating licence.
Similarly, not allowing a financial regulator to require a club to limit its future expenditure to a sustainable amount, for example, would be self-defeating. This is a financial regulator, and it should have the power to intervene in a club’s finances if necessary, but—to respond directly to one of the points made by the shadow Minister —while it can direct the club to reduce expenditure, it cannot specify exactly how that is done, which is for the club to decide.
The regulator may only set licence conditions in such areas if a club is not meeting its threshold requirements. Any condition must be proportionate to the issue identified. The regulator must also have regard to whether the requirement or restriction is necessary and to whether a similar outcome could be achieved by a less burdensome means, as per the principles.
Stephanie Peacock
Clause 23 sets out the procedure for attaching or varying financial discretionary licence conditions on clubs, which ensures that clubs and competition organisers are notified and given the appropriate opportunity to engage in advance when the regulator considers that a discretionary licence condition is needed. Where appropriate, the regulator will look to allow the relevant club and league to address identified issues and risks, so that the regulator does not have to formally intervene itself. That will allow the potential for the football industry to respond to issues, reducing regulatory intervention and producing a better regulatory response and outcome. The industry may be best placed to address specific issues within the overall context of a league’s own regulatory framework.
Before any action is taken by the regulator, there will be a period in which leagues and clubs are able to make representations, and the competition organiser will also be able to give a commitment to take action in lieu of the condition being attached or varied as proposed by the regulator. Clause 24 explains in further detail the mechanism for commitments in lieu of discretionary financial licence conditions. It is a final, formal opportunity for competition organisers to offer a self-regulatory solution to a problem identified by the regulator, so that the regulator does not have to step in. It is another important aspect of the regulator’s approach, which emphasises engagement and working with the industry to minimise formal intervention where possible. The regulator will still have powers to step in if the issue is not resolved, but the mechanism will give a competition organiser the chance to present a football industry-led solution to an identified risk.
The regulator can accept a commitment if it concludes that it should achieve the same results as the proposed discretionary licence condition and it does not conflict with the regulator’s objectives. The regulator does not have to accept the commitment, although, if it does not, it must provide reasons why. If a commitment proposed by a league will not achieve the regulator’s desired outcome, the regulator can reject it, and it will retain the power to intervene directly by imposing a discretionary licence condition on a club where any accepted commitment proves ineffective.
Schedule 6 expands on clause 24 by outlining the procedure where a competition organiser gives a commitment that the regulator is minded to accept, or requests a variation to a commitment in force, in lieu of the regulator’s attaching a financial discretionary licence condition to a club. The intention, as I referenced earlier, is for commitments to provide a less burdensome solution for all parties and still address the identified risk. However, for that to be the case, it is important that there is a clear procedure for interaction between clubs, the relevant competition organisers and the regulator, and the schedule sets out that procedure in further detail. Clubs can make representations to the regulator before accepting a commitment from a competition organiser, as well as before a competition organiser is released from a commitment.
Clause 25 sets out the procedure for the regulator to attach or vary a discretionary licence condition relating to the non-financial resources threshold requirement or the fan engagement threshold requirement. The regulator must notify the club and give it a period of no less than 14 days to make representations, but the clause allows the regulator to take more immediate action in situations that are more urgent and serious: if it thinks that giving a club notice and allowing a period for representations will jeopardise or risk jeopardising one of its objectives, it can apply the discretionary licence condition immediately and without prior notice. I commend the clause to the Committee.
Mr French
Clause 23 sets out the process that the Government’s new regulator must follow when it wishes to attach or vary a financial discretionary licence condition, which are by definition additional obligations that the regulator may impose on clubs that go beyond the mandatory licensing framework. In doing so, the clause confers on the regulator considerable further discretion. As with other discretionary powers in the Bill, the risk is not merely that the regulator uses its discretion, but that it does so inconsistently, unpredictably or in a way that strays beyond its core remit. Given that the powers provided by the clause relate directly to the financial obligations of clubs, the implications for competitiveness, investment and long-term planning are significant.
Although it is welcome that the clause does not set out a consultative process for how the financial conditions are imposed or amended, the process must not be a box-ticking exercise. Clubs should be able to challenge unreasonable conditions, and the regulator should be required to justify in clear terms why any new financial burden is necessary to meet the threshold requirements. It cannot become the case that discretionary conditions are routinely imposed as a back-door method of raising standards in areas for which Parliament has not explicitly legislated.
The risk of regulatory mission creep is particularly acute in a sector like football, in which the boundaries between finance, governance and culture are easily blurred. That is why we will be looking closely at whether there are sufficient checks, balances and transparency mechanisms in the clause to protect clubs from arbitrary financial conditions. Will the regulator issue any guidance on financial discretionary licence conditions, and will that guidance be made public? Will the Minister consider requiring an annual report to Parliament detailing how many clubs have had such discretionary financial conditions imposed, varied or removed, and on what grounds those decisions were made?
Without such checks, there is a real risk of an unequal competition taking place without fans and Parliament knowing, until it is too late and UEFA and FIFA have ejected us from their competitions. That is what I most fear may happen by accident. As we have discussed at length, the Bill is already flawed in this respect, and UEFA and FIFA would intervene if the regulator caused any impact on competitiveness. I only have to highlight the example of Crystal Palace, which is currently in the press, to demonstrate that UEFA and FIFA will stick to their rules rigidly, whether we like them or not. As I said when speaking to my amendment 97, any new licensing requirements introduced by the IFR must be meticulously aligned with existing UEFA and international frameworks.
Does the Minister accept that clubs, as entities directly impacted by licensing regulations, must have a voice in the development and implementation of these requirements? As the clause stands, her new regulator will be able to attach or vary financial licence conditions that would that mean one club becomes more competitive than another. She has said that she intends for the regulator to be able to adapt to the circumstances of each club. However, we must be mindful that that would mean changing the level of competitiveness between clubs. That is the key risk. That is not a political point; it is sadly a risk and a fact of which we have to be mindful.
Let me stress-test that with a hypothetical question for the Minister on the Bill’s impact. Brighton & Hove Albion and Aston Villa will both compete in the Premier League next season, both have been in that league for a number of years, and both also compete for European football. If her regulator decided, for whatever reason, that Brighton required stricter or simply more financial licensing conditions than Aston Villa, there would be a competitive imbalance between the teams. Does she accept that fact, which is plainly obvious, and recognise that such club-by-club tailoring of rules and licence conditions is potentially a violation of UEFA and FIFA rules on fair competition? To give her a bit of time, I ask her to respond to that concern after I have spoken about the other provisions in the group.
Mr French
I thank the hon. Member for speaking to the new clause on behalf of his colleague, the hon. Member for Wokingham. The point that he made is very interesting and I have great sympathy with fans of Reading football club, who he referred to, and with fans of other clubs around the country that have fallen foul of their owners, who, I think it is fair to say, did not have the club’s long-term interests at heart. I say that as someone who has already referred to Charlton a number of times in this Committee—been there, done it, got the T-shirt. As I say, I have a lot of sympathy with fans of Reading and I hope that the future looks brighter for that club.
Even before the election, I publicly supported strengthening ownership tests. I believe them to be part of one of the most fundamental roles that the regulator should play. We should ensure the consistency of those tests between the leagues, and we should ensure that up and down the country we have the best people in charge of such community assets, and that they have the long-term interests of clubs at heart, as I believe the overwhelming majority of club owners do.
Those examples of where problems came to a head and caused significant damage to communities have proven that there is a difference in some of the tests applied by the leagues historically, with gaps and loopholes that individuals have looked to exploit. Such examples have also highlighted the need for ongoing review by the regulator about how it manages the information that comes to light. An owner might be deemed an appropriate and fit person to run a club in 2025, but changes to their financial circumstances—assuming that they have other business interests—could mean that they become more stretched, and they might be involved in other activity that comes to light, so it would be right for the review to take place as early as possible to minimise the potential damage to clubs.
My hon. Friend the Member for Isle of Wight East posited a number of important legal challenges around this point of duty. I have sympathy with the broader objective of new clause 15, but this issue of duty poses a number of risks for people who are not board-level employees or in significant roles of influence. I think that all Members would seek to avoid a situation where people disengage from a process because they are concerned about that word “duty”, and what that could leave them exposed to legally if they were to come across information, for example, but did not feel confident in passing it on. That might arise in a variety of circumstances, but I am interested to hear the Minister’s comments on new clause 15 in particular and on how we can seek to deliver the broader objective of strengthening ownership tests, without having to go down the rabbit hole of this duty element.
Stephanie Peacock
I thank the hon. Member for Wokingham for tabling new clause 15 and the hon. Member for Newbury for speaking to it, but it is already open to anyone, including all those listed in the new clause, to share relevant information with the regulator. That is in addition to the existing requirements on clubs, owners and officers, which the new clause unnecessarily duplicates.
I assure the Committee that the regulator will take credible reports about unsuitable owners or officers very seriously, whether they come from a whistleblower inside the industry or any other source. We do not need to create a separate obligation in the Bill for individuals to report information to the regulator. In fact, new clause 15 would place regulatory obligations on new individuals and organisations, thereby extending the effect of the regulator’s regime. It would take things a step further and create a duty—beyond the relevant owner, officer or club—for club employees, competition organisers, supporters trusts, the FSA and Fair Game to notify the regulator. As matters stand, anyone including owners, officers, club employees, competition organisers, the Football Supporters’ Association, trusts and supporters can notify the regulator if they have information regarding an individual’s suitability to be an owner or an officer. There is no need for any specific legislative provision to enable that. As the regulator will only regulate clubs, owners, officers and competition organisers, we believe that it would not be appropriate to obligate other persons to report any changes to the regulator. The new clause would extend the scope of the regulator.
The key point is that we do not think that that should be a duty. It is of course open to all those whom I have listed, and indeed any others, to approach the regulator, which as I say will take any reports seriously.
Stephanie Peacock
The regulator’s owners and directors test has been designed to prevent unsuitable custodians from running or owning clubs. Therefore, the regulator needs to know who a club’s prospective new owners and officers are before they buy or join a club so that they can be tested.
Clause 27 places duties on a person to notify the regulator when there is a reasonable prospect of them becoming a new owner or officer of a regulated club. This will ensure that the regulator receives advance notice that an application should be coming, and it will help the regulator prepare to act quickly when it receives the application. The clause also places the same duty on regulated clubs themselves, as another means of ensuring that the regulator will be notified.
The regulator needs to know a person’s role at the club so that it can prepare to assess whether they are suitable to be an owner or officer of that club. That is why, where the notification relates to an officer, the notification must state their proposed job title or job description, and any senior management functions they will carry out.
Enforcement measures, such as censure statements or financial penalties, are available to the regulator should it determine that this requirement has not been complied with without reasonable excuse. That will deter those who do not wish to comply with the regime. I commend clause 27 to the Committee.
Mr French
As the Minister just outlined, clause 27 requires regulated clubs to notify about prospective new owners and officers if there is a reasonable prospect of such a change. It also requires an officer’s proposed job title, job description and senior management functions. If the football regulator is not notified before the change, the club must notify as soon as practically possible.
I am slightly concerned that this could be a burdensome requirement on some clubs. Any large organisation, such as a football club, will often cast a wide net when considering such appointments, with people on the radar long in advance. I therefore ask the Minister to enlighten us on what she believes constitutes “a reasonable prospect”. For example, would media speculation that the right hon. Member for Houghton and Sunderland South (Bridget Phillipson) might move to the Minister’s Department be considered “a reasonable prospect”? There are non-political examples of how that might work too, but it would be interesting to hear what the Government believe to be a reasonable prospect.
Stephanie Peacock
I am grateful to the hon. Gentleman for his contribution. As with everything throughout this Bill, we would expect the regulator to act proportionately. Where there is a reasonable prospect, it is obviously very helpful for the regulator to be informed of that, because that will, of course, allow them to move as speedily as possible. We therefore think this is an appropriate provision. The hon. Gentleman tempts me to get into other examples, but I will resist that, if he does not mind.
Question put and agreed to.
Clause 27 accordingly ordered to stand part of the Bill.
Clause 28
Determination of suitability required for new owner
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
As we have heard throughout the passage of the Bill, football clubs hold unique importance to their fans and local communities, and it is these fans who lose out when clubs are exploited or mismanaged by unsuitable owners and officers. Clause 28 prohibits a person from becoming a new owner of a club unless the regulator has determined they are suitable to own that club beforehand. Prospective new owners will be required to provide an application containing information about how they propose to run a club and where club funding will come from. This will better ensure that prospective owners are clear from the outset about how they would deliver their plans for a club.
Once a complete application has been provided, the regulator can only pass the individual owner if the following requirements are met. First, the individual must meet the individual ownership fitness test. This means that they have the requisite honesty and integrity and are financially sound. Secondly, they must have sufficient financial resources. Finally, the regulator must not have grounds to suspect that the individual has any source of wealth that is connected to serious criminal conduct, including crimes such as drug trafficking and fraud. This will better mitigate against illicit finance in the game by requiring new owners to undergo the regulator’s test. Clause 28 will prevent unsuitable custodians from ever becoming owners.
Clause 29 prohibits individuals from becoming a new officer of a regulated club unless the regulator has determined that they are suitable beforehand. Once the prospective officer has provided a complete application to the regulator, it will assess them to ensure they meet individual officer fitness criteria. That means they must possess the requisite honesty, integrity and competence, and be financially sound. If the regulator is satisfied that the individual meets those requirements, it must find them suitable to be an officer of the club; otherwise, it must find them unsuitable. When making this determination, the regulator will take into account the matters listed in clause 37. By requiring new officers to undergo the regulator’s test, this clause will stop unsuitable individuals from becoming officers.
It is possible that someone might take up a position at a club without first having undergone the owners and directors test. That may be a blatant and deliberate breach of the requirement to undergo the test before joining the club. A prospective owner may act in bad faith, hoping that once they are “in”, the regulator would be more hesitant to fail them. However, in some circumstances a person may fall within the definition inadvertently or have some other relatively innocent reason for the breach. This may occur, for example, when a person inherits significant equity in a football club. Alternatively, a person may dispute in good faith whether their actions bring them within the Bill’s definition of an owner.
Therefore, where a person becomes a new owner or officer without the regulator having determined their suitability, clause 30 gives the regulator the power to respond decisively but flexibly. When the regulator becomes aware this has happened, it has two options: to either notify the new owner or officer that they are automatically treated as unsuitable, or require them to submit an application as though they were a prospective applicant. The regime cannot be allowed to be abused; the regulator must have the discretion and the teeth it needs to address harm to the sector. Clause 30 is an important step to achieving this aim.
If the regulator is minded to fail a new or prospective owner officer, clause 31 requires the regulator to give that person and the relevant club the opportunity to make representations. This must take place before the regulator makes its final decision. That will allow a new owner, officer or relevant club an appropriate opportunity to argue their case before the regulator finds them unsuitable. This ensures the regulator has all relevant information available to it, allowing it to make better decisions so that the regime is more effective.
Football is a fast-paced industry where clubs operate within constraints such as league seasons and transfer windows. Timely decisions about the suitability of new owners and officers is important for clubs’ financial sustainability. Without deadlines, we have seen league determinations drag on, unable to reach a decision. The regulator will need to conduct a thorough level of scrutiny of new owners and directors, but it also needs to make decisions in an appropriate timeframe to ensure clubs are not unnecessarily impacted.
That is why the regulator will be subject to a statutory deadline when it tests the suitability of new prospective owners and officers, which clause 32 sets out. When a complete application is provided, the determination period starts. By the end of that period, the regulator must find an applicant suitable or unsuitable. As well as providing certainty to the industry, the deadline will incentivise new owners and officers to provide the necessary information the regulator needs to assess suitability in a timely manner.
If the regulator cannot decide before the initial deadline is met, it can extend the determination period, and this will provide it with the necessary flexibility to gather more information to make well informed but timely decisions. The determination period, including the maximum amount of extra time, will be set by the Secretary of State in secondary legislation. This will ensure the regulator is bound by it—but there is still flexibility for the deadline to be amended in the future. If the regulator cannot make the decision before the period expires, the person is automatically determined to be unsuitable. This means that only owners or officers that the regulator is confident are suitable will be allowed to get involved with clubs.
The measures set out in the group of clauses will form a key part in ensuring our clubs have suitable custodians, which in turn will help to safeguard the financial sustainability of football over the long term. Therefore, I commend the clauses to the Committee.
Mr French
Clause 29 prohibits any person from becoming an owner of a regulated club without first applying to the independent football regulator and being determined suitable for that role. It requires any applicant to provide information on the proposed operation of the club, estimated costs, how those costs will be funded and the source of funding, which is a point that is been raised already in this Committee.
The football regulator must make an affirmative determination regarding the application if the potential owner is considered to have sufficient financial resources and meets the individual ownership fitness criteria. I already spoken about why I believe it is important that these fitness tests are strengthened wherever possible, but there are a couple of questions I would like to ask the Minister on this clause first.
What assurances can the Minister provide that this process will be completed swiftly and will not unnecessarily delay any ownership changes which, as we have already discussed, may need to happen very quickly when a club is under significant financial stress—to ensure wages are paid and to prevent further hardship when seeking a change of ownership?
Clause 30 sets out what should happen in the event that a person has become an owner or an officer of a regulated club without first obtaining the suitability determination from the football regulator. The clause assumes that the football regulator “becomes aware”; is the expectation that there is a disclosure from the club, or will the IFR be probing clubs, looking at news reports, Companies House and so on? It would be helpful for Members to have an insight into how that might look, because this clause does not offer a specific timeframe within which the football regulator must act at once if it becomes aware of an unauthorised appointment at a club.
It also seems that the football regulator can indefinitely extend the deadline for submitting such an application; the clause fails to clarify how many times and under what conditions. I therefore wonder whether the Minister has considered the potential effects on the stability of the club of the football regulator deeming an individual unsuitable: would that open clubs to legal or operational risk, and would there be financial consequences of those risks? It is vital that decisions taken by the regulator are independent and impartial, as already discussed, so what safeguards will there be to ensure that neither media nor political pressure is exerted on the football regulator to deem an owner unsuitable?
Clause 31 states that the football regulator must “have regard to” representations from affected clubs or individuals. What does that constitute in reality—a response, or simply a consideration? Must the football regulator provide written reasoning if it rejects the arguments made in the representation? Does this clause not lack basic safeguards and, without a framework for how representations should be made or evaluated, does it not risk leading to inconsistent decision making? Again, I fear there would be various legal challenges, given the financial implications of such decisions.
There is also no requirement, it appears, for the football regulator to consider other external stakeholders, which could include other directors or supporters’ trusts involved with the running of a club. Should an individual receive a negative determination, the legal and financial resources to make a strong representation within a specified timeframe might be considerable. Does the Minister envisage many applicants seeking legal aid or other advisory support mechanisms in such a scenario?
Clause 32 outlines several points about the football regulator’s determinations after an individual makes an application under clauses 28 and 29. The IFR seems to be able to extend its determination periods several times, but the clause fails to outline for what reason an extension might be justified and how long it should or could be. Can applicants, for example, challenge or appeal those delays, if the reason for them lay with the regulator rather than the individual club? A delay by the regulator would risk unfairly penalising applicants who were not personally at fault for it. Will there be an obligation on the football regulator to inform applicants of approaching deadlines, to ensure that they know when the determination period is nearing its end, and what oversight will there be to ensure that extensions are not routine?
Lastly, will there be monitoring of how often extensions are used and how long determinations typically take, so that clubs can start to plan for such instances where they occur? That would also give greater certainty to the leagues because, as I highlighted earlier, it is not just individuals, but clubs themselves at risk. If we think about not just the financial penalties imposed, but the points that can be deducted, there are major implications for the competitive nature of the league. I look forward to the Minister answering a few of those questions.
Stephanie Peacock
I am grateful to the shadow Minister for those questions. I reiterate, as I said in an earlier intervention, that the licensing is separate from the ownership. On some of his points about the extension, we have talked throughout proceedings about being collaborative and working with owners and clubs; if the regulator needs more information, it has the ability to provide an extension. Of course we would expect it to provide appropriate information of approaching deadlines or expected timelines. I will not repeat what I said in my main contribution on this group, but I did try to set out some examples where a breach is a genuine accident or someone has inherited equity, versus somebody trying to circumvent the regime. The regulator has that flexibility and a regime with teeth so that it can respond to both scenarios.
The shadow Minister posed a number of questions, so I will double-check Hansard and, if I have not answered them all, I will write to him.
Question put and agreed to.
Clause 28 accordingly ordered to stand part of the Bill.
Clause 29 to 32 ordered to stand part of the Bill.
Stephanie Peacock
Yes, absolutely. That goes back to the discussion that we had earlier on new clause 15. The regulator will take credible information seriously.
Clause 34 provides the regulator with the necessary powers to test incumbent owners—those already in place—of clubs, where there is a concern about their suitability. It will allow the regulator to tackle any risk to clubs from unsuitable owners within the industry, while recognising that there are suitable owners already in the system who do not need to be tested. We want to ensure that the approach is not overly burdensome for the regulator, and we do not want to deter investment in the game. Incumbent owners can be assessed to ensure that they have the requisite honesty and integrity, and are financially sound enough, to own a club. If the regulator has information that gives it grounds for suspicion, incumbent owners can also be tested on their source of wealth. The regulator will need to establish if wealth is connected to serious criminal conduct, including crimes such as drug trafficking or fraud. The regulator will not remove incumbent owners because of a mere suspicion about their source of wealth. Rather, an incumbent owner must be treated as unsuitable if the regulator is more sure than not that their source of wealth is connected to serious criminal conduct. The clause will ensure that the regulator has the appropriate powers to test incumbent owners where a risk of harm arises.
Clause 35 provides the regulator with the necessary powers to test incumbent officers—those already in place—of clubs, where a risk of harm arises. As with the provisions for owners in clause 34, testing of officers is limited to cases where there is concern about suitability. It allows the regulator to tackle any risks to clubs from unsuitable officers already in the industry. Incumbent officers can be tested to ensure that they have the requisite honesty, integrity, competence, and are financially sound enough, to continue in their role.
The Government are aware that finding an incumbent owner or officer unsuitable would bring about significant consequences for that person, and may cause concern for clubs or fans. That is why, when the regulator is minded to fail an incumbent owner or officer, clause 36 gives the individual and the club concerned an opportunity to make representations before the regulator makes its final decision. That allows an officer or owner an appropriate opportunity to argue their case before the regulator finds them unsuitable. The regulator has the ability to test or re-test incumbent owners and officers, which will prevent unsuitable custodians from harming clubs over the long term, not just at the point of entry. That will help to ensure the sustainability of clubs over the long term, benefiting football now and into the future. I therefore commend the clause to the Committee.
Mr French
Clause 33 places a duty on clubs to notify the Government’s new regulator of any change in circumstances relating to the current owner or an officer that could impact their suitability under the regime set out in part 4 of the Bill. On one level, it is an understandable provision. To fulfil its statutory duties, the regulator must be kept informed of material changes, as ensuring the fitness and propriety of owners and officers is a core part of its remit. However, the clause as drafted raises a number of serious and practical concerns about how such a duty will be defined, interpreted and enforced.
The first issue with the clause is its vagueness. What exactly constitutes a “change in circumstances”? The explanatory notes prepared by the Government give a small indication of what such circumstances might include, stating that
“Relevant material changes could include, for example, an officer becoming subject to criminal proceedings or regulatory action”.
That is somewhat clear, but what qualifies as “regulatory action”? Could it be an Ofcom investigation, for example? The explanatory notes add that
“new information coming to light regarding whether an owner’s source of wealth is connected to serious criminality”
also qualifies as a material, relevant change. What qualifies as “new information”? Does it mean a full-blown criminal investigation or spurious claims, potentially made by activist groups against foreign owners? How the provision will work needs to be clarified.
The Government and the new regulator must be up front, open and honest with fans and Parliament as to what those terms actually mean. We fear that the Government are deliberately muddying the waters around what the regulatory environment would look like under the Bill, and around the rules that the regulator will seek to apply. The Minister must answer whether a “change in circumstances” is limited to formal legal developments, such as bankruptcy, a criminal conviction, or something as small as a parking fine. I hope not the latter. Could the definition extend to more subjective matters such as personal, reputational issues, media allegations, or ongoing investigations? If so, I fear that the Government and their regulator would be on very shaky ground, not just because clubs would find themselves in the near-impossible position of having to second-guess what the regulator might later deem to be relevant, even when no formal wrongdoing has occurred, but because it would open up the regulator to spates of judicial reviews. As we see already, the wealthiest clubs would be able to hire the best lawyers, and those clubs that are already struggling would be subject to the personal diktats of the chairman of the Government’s regulator. That is not a sustainable, appropriate or moral way to regulate, and it is totally incompatible with the principle of legal certainty that should underpin any new statutory regime.
Furthermore, clause 33 requires that the Government be notified
“as soon as reasonably practicable”
after a change has occurred. Again, the language is open to wide interpretation. What is “reasonably practicable” for a large Premier League club with extensive legal support may be entirely different for a National League side with minimal back office capacity. We must ensure that smaller clubs are not disproportionately penalised because they lack the administrative infrastructure to track and report such changes with the same immediacy as those international brands that sit atop the English football pyramid. We must also ask whether the sanctions for failing to report, which could be very serious, potentially leading to licence revocation, are proportionate to each breach. Clubs cannot become the regulator’s enforcement arm, expected to carry out continuous due diligence on their own officers and owners, with the threat of regulatory action hanging over them if they get it wrong.
Clause 33 touches on a sensitive area: the relationship between clubs and their owners, and the role of the state in policing suitability. It is right to expect clubs to act responsibly and keep the regulator informed, but the duty must be clear, proportionate and fairly enforced to avoid lower-level staff being put in extremely difficult situations. We do not want to create a culture of regulatory paranoia, where clubs feel compelled to notify the Government’s regulator of every minor development just in case it is later deemed relevant, nor do we want smaller clubs punished for failing to meet standards that are de facto only achievable for the top tier. The Government must ensure that the clause is not a trapdoor for arbitrary enforcement, and that it supports predictability, stability and confidence in the regulatory framework. We understand the underlying principle, but we will continue to press the Minister to ensure the practical operation of the clause does not give rise to legal ambiguity, unjust outcomes or unaccountable discretion.
Before moving on, I have a number of questions on clause 33. Could the Minister clarify what sorts of events would qualify as a “change in circumstances” under clause 33? Will guidance be issued by the football regulator to ensure consistent interpretation? Will the definition be limited to formal, objective legal changes? What level of evidence or certainty will clubs be expected to have before reporting a change? Will clubs be required to report allegations or media speculation? Will the football regulator consider good-faith failures to notify or take a strict liability approach? How will the regulator account for differences in club size, structure and resourcing when judging what is “reasonably practicable”? Will there be any threshold or scaling in terms of compliance expectations for clubs of differing means?
What appeal or review mechanisms will be available to a club if the football regulator finds that it failed to notify as required? Will there be a formal process for representations or challenge before any enforcement action is taken? How does the clause interact with the broader principles of legal privilege and privacy? Will clubs be expected to disclose internal HR issues or ongoing internal investigations, even if there is no conclusion yet? Have the Government assessed whether the clause is compatible with UEFA and FIFA expectations of non-interference in the running of football clubs? I had a written response from the Minister this morning regarding her last meeting with UEFA and FIFA, which was 1 November. A lot of water has gone under the bridge since then, so we are still concerned about the broader point regarding UEFA. I would appreciate a response to that point today.
Moving on to clause 34, it empowers the football regulator to determine whether an incumbent individual owner meets the fitness criteria or has wealth associated with serious criminal conduct, if the regulator has information that raises grounds for concern. It requires the regulator to inform the owner and club before making a determination and then notify them of the outcome. If passed, more than 100 English football clubs will be subject to the regulation. It is not specified in the Bill what level of information would raise grounds for concern regarding incumbent owners. If the bar is set too low, the regulator may be immediately burdened by reviewing multiple existing owners, causing unease in English football. What level of information is required to qualify as grounds for concern? There is also no time limit for the regulator to make its assessment, so how will the regulator ensure that the threat does not needlessly hang over existing owners?
Clause 35 empowers the football regulator to determine whether an incumbent officer meets the fitness criteria if the regulator has information that raises grounds for concern. It requires the regulator to inform the owner and club before making a determination and then notify them of the outcome. As I said regarding the previous clause, more than 100 English football clubs will be regulated if the Bill passes. It is not specified in the Bill what level of information would raise grounds for concern regarding officers, of which there are even more to consider. If the bar is set too low, the regulator may be immediately burdened by the need to review multiple existing officers for each club. I ask the Minister again: what level of information will be required to qualify as grounds for concern? There is also no time limit for the regulator to make its assessment, so how will it ensure that this threat does not needlessly hang over existing officers?
Lastly—you will be pleased to know, Mr Turner—clause 36 requires the football regulator to give advance notification to an incumbent owner or officer if it is minded to find them unsuitable. Before making a final decision, the clause requires the person and club in question to be allowed to make representations, which must then be taken into account. The clause stipulates that the regulator must inform incumbent owners and officers only that it is minded to find them unsuitable, not of the reasons why. Given the vital importance of these representations, should there not be a requirement for the regulator to disclose the reasons to the person and club so that they can fully engage? I would appreciate the Minister picking up the point about the reasons, because it is important.
There is a broader point here about clubs that may be listed on the open market. My understanding of this clause is that, before a final decision is taken, the club would effectively become an insider from a trading perspective. It will be interesting to see how the Government will seek to manage that risk in terms of financial compliance, given that an issue with a particular owner or officer could have significant financial implications for a club and therefore potentially leave individuals inside that loop at risk of being involved with inside information from a dealing perspective. As we all know, if anyone is found to be in breach of inside information, it has very serious consequences. It will be interesting to see how the mechanism in this clause to inform clubs and individuals first will work with the broader notifications in the market where clubs are listed.
Stephanie Peacock
I will begin with the subject of UEFA. Once again, I can reassure the shadow Minister that UEFA is content with the Bill as drafted. He will note that, in answer to his written question, I detailed my last meeting with UEFA, which was after the Bill was published, and said that we continue to engage with officials on a regular basis.
The shadow Minister asked a long list of questions to which I will respond in writing to ensure accuracy, as I did not get a chance to note them down. We have spoken about some of the points he touched on around appeals and enforcement and will come on to debate them in further detail.
I draw the shadow Minister’s attention to the fact that, as I said in answer to my hon. Friend the Member for Sheffield South East, the bar is set differently for existing and new owners. I outlined points on new owners, grounds to suspect, incumbent owners, the balance of probabilities and the higher bar given existing owners’ property rights.
The shadow Minister also asked a number of questions on what information would be relevant. A parking ticket, certainly, would not be relevant, but serious legal issues or an investigation or action by a regulator—things of that nature—would be relevant. The regulator will not immediately test information in every case just because it comes in. It will make its own decision about whether the information reaches a high enough threshold for it to take action.
Information that gives the regulator grounds for concern could come in lots of forms. It does not need to be new information, as I outlined in my response to my hon. Friend the Member for Sheffield South East, but it has to call into question whether the individual is still suitable to be an owner or officer of a club. The information may be relevant if the club gets into difficulty or fails to comply with the regime. Information that is in the public domain or held by external organisations about incumbent owners could be considered grounds for concern to test an individual. It will be up to the regulator to decide whether the information meets the threshold for the incumbent to be tested.
Question put and agreed to.
Clause 33 accordingly ordered to stand part of the Bill.
Clauses 34 to 36 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Vicky Foxcroft.)
Football Governance Bill [ Lords ] (Fifth sitting)
Debate between Stephanie Peacock and Louie FrenchTuesday 10th June 2025
(3 weeks, 3 days ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 10 June 2025 - (10 Jun 2025)
Mr French
I thank my hon. Friend for making that point. I must admit, as a long-term football fan, that I have never heard a player say that he kissed the crest of his club when celebrating a goal. The footballing term is as accurate as the legal one, as he highlights.
This may seem a modest amendment, but it speaks to something bigger: the importance of precision, respect for history and an understanding of football not just as a product but as a tradition. If we are going to regulate the game, let us do it properly with the right words and the right respect.
Stephanie Peacock
The hon. Member’s amendment follows the extensive debate regarding heraldic terminology in the other place. I can reassure him that the Government have worked closely with the College of Arms to ensure that the term “crest” is used consistently with heraldic law, and with the FA to ensure accuracy and cohesion with industry norms, as the term “crest” is the key term within its existing heritage rules. The Government amendments made in the other place make sure the legislation remains in step with both the FA and heraldic law, and that is in addition to changes to the explanatory notes, to further clarify the point.
Although the word “crest” is used colloquially in the industry, “crests” have a very specific meaning in heraldic law. Crests can only be granted by the College of Arms and only a select few clubs have been granted one. For that reason, the legislation refers to crests, but also needs to capture other clubs and circumstances. That is why the Bill uses “emblem”.
When making these changes, the Government explored the use of “badge” instead of “emblem”. However, it was felt that “badge” would risk unintentionally only capturing the image on shirts. In examples such as Arsenal or Liverpool, the shirt features only one element of the club’s emblem, such as the cannon or the liver bird. In those instances, “badge” might capture only those elements and thereby not deliver on the policy intent of protecting the heritage associated with the entire emblem. Given those comments, I ask that the hon. Member for Old Bexley and Sidcup withdraw the amendment.
Question put, That the amendment be made.
Stephanie Peacock
The two I mentioned are the basic points. The regulator has the ability to ask for further information should they want it. I think I gave the example that if the regulator is unsure about the source of funds, or whether there is enough, it could ask for more information. That will be at the discretion of the regulator—we had a well-rehearsed debate on that point last week.
We think that the requirements for a provisional licence are basic requirements that any club should be able to complete. As I was really keen to stress in the debate last week, the regulator will be keen to work with clubs to do everything it can to help them to meet those requirements.
The regulator needs to be satisfied that a club will be able to meet the mandatory licence conditions and duties on clubs once it has been granted a licence. This is a forward-looking “would comply” test. The expectation is that the provision of information and documentation, as well as the engagement with clubs as part of the application process, will be sufficient to satisfy the regulator. It should be straightforward for all clubs to obtain a provisional licence. Once they are in the regulatory system, a club will have time to improve standards up to the necessary requirements for a full licence, with the support of the regulator as needed.
Mr French
One of the points we were slightly unclear about when we had the discussion of provisional licences before was what would happen if a club decided it did not want to apply for a provisional licence. There are several clubs that are very publicly concerned about the regulator. What would happen if they were to form, say, a union and go against the regulator and refuse to apply for a provisional licence? How would that work in practice? Would they be kicked out of the league?
Stephanie Peacock
My hon. Friend makes an important point; it will be proportionate. I have met with all the leagues a number of times, and this was of particular concern to the National League. It will be proportionate, and the regulator will take that approach when dealing with the different clubs and leagues.
Mr French
I appreciate the Minister’s comments about proportionality; we will look to review that as the Bill goes forward. One question I have is about how the regulator will interact with the existing rules. The most obvious ones that come to mind are the financial fair play rules that are already in existence in the Premier League. What analysis of, and crossover with, the existing league investigations and restrictions to clubs will there be?
Stephanie Peacock
Those will be an issue for the leagues; where the leagues have rules, clubs will continue to comply with them. That is not something that the regulator will be involved with. Where there are league rules, that is for the leagues to enforce. I am happy to write to the hon. Gentleman to outline that further.
Mr French
If the Minister could outline that further, it would be really helpful. At the end of the day, we are keen to ensure that there is no confusion in the regulations for clubs, nor any duplication of purpose for the regulator. We would like to understand how that will work in practice, and I would appreciate that in writing.
Stephanie Peacock
I appreciate that point. We will come on to discuss that in relation to schedule 5, and I will give a fuller response then.
Question put and agreed to.
Schedule 4 accordingly agreed to.
Clause 19
revocation and cessation of operating licence
Mr French
I beg to move amendment 106, in clause 19, page 13, line 19, at end insert—
“(c) inviting the club to make representations about the proposed revocation, and
(d) specifying the means by which, and the period within which, such representations must be made, which must be a period of not less than one month beginning with the day on which the notice under subsection (3) is given.”
This amendment allows clubs to make representations about the proposed revocation of their operating licence.
Clause 19 concerns the revocation and cessation of an operating licence granted to football clubs. That is understandably a crucial provision that goes to the heart of how the Government’s new regulator will exercise its most serious power, the ability effectively to remove a club from the regulated football pyramid by taking away its licence to operate. Let me clear from the outset that we support an independent regulator that can intervene when standards are seriously breached but, as with all powers of this kind, the devil is in the detail. Our task in this Committee must be to ensure that the regulator’s powers are proportionate, transparent and accountable.
Clause 19 provides that the regulator may revoke a licence if the club in in breach of licence conditions or if there are grounds to believe that the licence should never have been granted. In principle, that is entirely reasonable, but the consequences of revocation, for clubs, fans and communities, are potentially devastating. This is not the revocation of a licence to sell alcohol or to host events late into the night; it is the revocation of a licence to participate in the life of a community—in many cases, the cultural soul of a town or city. That power should not be exercised lightly, so I must raise several matters with the Minister.
First, what thresholds and safeguards are in place to ensure that revocation is used only as a last resort? Will the Government’s regulator be required to consider less draconian alternatives—such as conditional compliance periods, fines or a change in ownership—before resorting to the total revocation of a licence? Secondly, what procedural protections exist for clubs facing this threat? As it stands, there is no right of appeal, which is why I tabled amendment 106, which would allow clubs to make representations about the proposed revocation of their operating licence.
These are serious matters. The Government’s regulator is empowered to act in the interests of the game and to uphold high standards of governance, transparency and financial responsibility. But with such powers must come robust safeguards, and that is where the clause as drafted falls short. As it stands, there is no explicit requirement for the regulator to notify a club of its intention to revoke the licence, or to invite the club to make representations, before such action is taken. In effect, the regulator could move straight to revocation, without a formal process that allows the club to defend itself, explain its actions or offer remedial steps. That is not due process, it is not natural justice, and in any other regulated sector such an approach would be wholly unacceptable.
Mr French
The Minister has outlined the initial process before revocation is determined by the regulator. As I explained in my lengthy speech, which I will not seek to repeat, the amendment would give clubs a say if they believed a decision reached by the regulator was wrong. The Minister was clear about the tribunal approach if a club is not happy with a decision, but as I have outlined previously, my fear is that clubs will end up spending more time in court than they will focusing on the pitch and on the game. The official Opposition believe that an appeal process at that point would be more beneficial than a legal route.
Stephanie Peacock
As I said, clubs can make representations to the regulator and ask the regulator to look again, and beyond that there is the appeals process. As with all aspects of appeals process, the key considerations are the expertise of the judiciary, the tribunal’s experience and familiarity with the policy, speed and cost. We think the Competition Appeal Tribunal is the best option for balance. It is an internationally well-respected tribunal which offers time and cost-efficient options, with flexible case management to expedite urgent cases and bring in appropriate expertise. We believe that that avenue and the internal review process make adequate provision in the Bill and that the hon. Gentleman’s amendment simply is not needed.
Stephanie Peacock
Clause 19 details revocation of a club’s provisional operating licence for failing to progress to a full licence, and a licence ceasing to have effect. For the revocation to occur, the regulator must satisfy itself of three things: first, that the test for a full operating licence is not met; secondly, that the club in question has persistently and without reasonable excuse failed to take reasonable steps to meet the test; and finally, that there is no reasonable prospect of the club meeting the test within a reasonable period, even if given more time. The regulator should engage with the club throughout this period. We expect that, through constructive dialogue, a solution can be found that avoids this drastic step in all but the most serious of cases.
The regulator must notify the club of its decision and provide its reasoning. Revocation must not take place before the end of the current season, to reduce as much as possible the impact on ongoing sporting competitions. A licence automatically ceases to have effect only when a club stops operating a team in specified competitions, the most likely cause being that the club is relegated from the specified competition and is therefore no longer in scope of the regulator.
Mr French
I am trying to get clarity. Again, I will happily accept it in writing if the Minister does not have the answer today. Waiting until the end of the season before revoking a licence is entirely sensible, but what would that mean for relegation and promotion? For example, if a club is mid-table and the regulator decides its licence should be revoked, that will have a direct impact on the competitive nature of the league. Has any thought been put into whether, for example, that may mean only two teams are relegated that season, because one has lost its licence? How might it work in practice?
Stephanie Peacock
Where possible, we want to reduce any impact on ongoing sporting competitions. The hon. Gentleman presents me with a hypothetical scenario. I think it would be best if I respond in writing to him.
Regarding the circumstances when a licence automatically ceases to have effect, it will only happen when the club stops operating a team in specified competition. The most likely cause of that is a club having been relegated and therefore no longer being in scope. I commend the clause to the Committee.
Mr French
I will not rehash the debate we have already had on the amendment. We were seeking greater transparency and a greater say for clubs at risk of losing their licence, which, as I have explained, is the ultimate sanction and would cause enormous damage to clubs and the communities in which they operate through job losses, and impact on the game and on fans. I would appreciate the Minister giving more clarity on how this will work in practice. These situations are hypothetical, but realistic, and would have serious consequences for not just the individual clubs, but the leagues and how they operate.
We believe strongly that promotion and relegation should be based on competition on the pitch. However, in the extreme example of a club breaching the licence so significantly that it is revoked, which might more realistically happen at the lower end of the pyramid, we need to have a greater understanding of what that means for relegation. All clubs deserve transparency in that regard. We have seen much speculation in recent years around change of ownership—I will not mention the clubs involved as some of the legal cases are ongoing—what that might mean for relegation and the significant financial consequences it may have for other clubs. It would be greatly appreciated if the Minister provided guidance on that in writing so that all Members can have a greater understanding of how it will work in practice.
Baggy Shanker (Derby South) (Lab/Co-op)
Will the Minister say whether a good licensing regime and, if necessary, revocation of licences would prevent clubs from going into full administration—as in the example of Derby County that my hon. Friend the Member for High Peak described—and the knock-on effect of that on supporters, suppliers and the local community? A licensing regime should prevent full administration and be able to deal with problem clubs at a much earlier stage.
Stephanie Peacock
My hon. Friend raises an important constituency point. I do not want to comment on particular clubs and predict the action the regulator may or may not take. We hope that the Bill will raise the bar across the board and prevent clubs from getting into difficulty, but I do not want to be drawn on the specifics.
We have been clear that this is not a zero-fail regime. I will endeavour to write to the shadow Minister regarding the complex, but important, hypothetical situation he has proposed.
Mr French
I appreciate the Minister committing to that. The example just mentioned by the hon. Member for Derby South needs fleshing out as well, because clubs get into financial difficulty as a matter of course; points are therefore deducted mid-season, as we have seen, or, in the worst cases, the club goes into administration. The tests for the licence are about financial prudence and sustainability, so the hon. Gentleman makes a fair challenge.
What would happen if a club went into administration? Would the regulator seek to change the owner to allow the operating licence to continue, for example, or would the club, having lost the licence, then reapply via a new owner? The consequences would be dramatic. One would automatically assume that a club that no longer had a licence would have to start at the bottom of the football pyramid and come back up again, as we have seen in the past. Can the Minister add clarification of that important example to her letter?
Stephanie Peacock
Absolutely. We will come on to the owners and directors test later in the Bill Committee; perhaps we can explore this further at that point. The one point I would make to the shadow Minister and to my hon. Friend the Member for Derby South is that the aim of the regulator is always to minimise disruption to ongoing sporting competitions. I will add clarification on that when I write to the shadow Minister about the complex scenario he proposed.
Question put and agreed to.
Clause 19 accordingly ordered to stand part of the Bill.
Clause 20
Mandatory licence conditions
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
The clause requires the regulator to attach full mandatory licence conditions to the provisional and full operating licences for all licensed clubs. These are basic and fundamental requirements of the whole regime and so apply to all licensed clubs, regardless of their individual circumstances.
The mandatory conditions vary in their aims. They are set out in schedule 5, so we will cover them in more detail, but to summarise briefly, the conditions on financial plans and annual declarations are about ensuring that the regulator has the relevant and timely information it needs to regulate effectively. That includes financial risk assessments, plans for managing financial risks, details on income and expenditure, and contingency plans in the event of a shock such as relegation.
The corporate governance condition introduces basic requirements to report against the club corporate governance code of practice published by the regulator. This reporting mechanism will mean that clubs are transparent about board structures, decision making processes and equality, diversity and inclusion.
The fan consultation condition establishes a baseline level of fan engagement that requires clubs to consult fans on specified matters. This will ensure that clubs have a framework in place to regularly meet and consult a representative group of fans on key strategic matters at the club, and on other issues of interest to supporters. This will work in tandem with the freestanding duties, such as those protecting club heritage and other key areas.
The annual declaration condition requires the club to submit a declaration on any matters that should have previously been notified, or to confirm that there are no such matters. I commend clause 20 to the Committee.
Mr French
As outlined by the Minister, clause 20 requires the IFR to attach four mandatory licence conditions to the each club’s operating licence, whether provisional or full. This includes a requirement for the club to submit a financial plan, either annually or at more frequent intervals. I would be interested to hear the Minister’s views on how frequent she believes is reasonable; is that semi-annually, for example?
The club must also submit and publish a corporate governance statement explaining how it is applying the IFR’s corporate governance code, and regularly consult its fans. I think we need some clarity about how that will work in practice. The hon. Member for Sheffield South East raised the example of Sheffield Wednesday and multiple fans’ groups claiming to represent the club. I think that that needs some fleshing out so that the regulator is clear about what that consultation looks like. Obviously, that will be different for each individual club, which should, hopefully, know its fans better than anyone else.
Last, there is a requirement to submit an annual declaration of any material changes in circumstances affecting the club. Again, we would argue that that needs to be very clear to clubs, particularly if there is any—
Stephanie Peacock
I thank my hon. Friend for tabling the amendments. I know we have discussed this issue a number of times; it has always been a pleasure to do so, and I recognise its importance. Home grounds are often the most important asset that a club owns, so that is why I want to thank my hon. Friend for placing a real focus on them.
The significant financial and heritage value that grounds hold is why the Bill has strong protections to prevent home grounds being sold, used as collateral or relocated without the necessary considerations. Asset of community value status is another mechanism that a number of clubs and supporter groups have obtained for their home grounds. We would expect the regulator to welcome any club that wishes to gain community value status for an asset as another way to protect their home ground.
However, we are confident that the legislation will provide the necessary protections to address fan concerns and keep these important assets protected without mandating this status. Additionally, while assets of community value have proven beneficial for many clubs where no other protections have been in place, these amendments may place an unnecessary burden on clubs. As currently drafted, they would require clubs to either go through what can be a lengthy process with the relevant authority or make structural changes to the constitutional document of a club. Given that significant protections are already in place in the Bill that deliver the necessary safeguards, it is difficult to justify any additional measures for all regulated clubs, especially as a mandatory licence condition.
I really want to reassure my hon. Friend, as I know that home ground protections are of particular importance to him, that the Government have already committed to asset of community value reform in our manifesto, and this is something that the recent English devolution White Paper from the Ministry of Housing, Communities and Local Government commits to.
Mr French
I have a lot of sympathy for the amendment tabled by the hon. Member for Sheffield South East. The Minister argues that this does not need to be addressed through the regulator, but will guidance be published for those fan groups who are keen to ensure the long-term future of their grounds? What guidance will be published to ensure that any fans in this situation have clear advice from the Government on the best routes to protect their ground?
Stephanie Peacock
I am saying that I am confident the legislation will provide the necessary protections to address fan concerns, but I also draw the Committee’s attention to the work of the Ministry of Housing, Communities and Local Government on the specific issue of assets of community value. Of course, that does not fall into my portfolio, but I am very happy to commit to speaking to my relevant counterpart and adding to the letter that I have earlier committed to writing. This is something that I am sympathetic to, but I do not have the ability to make that commitment today. I believe that the work the Ministry is doing is very interesting and relevant to what we are discussing. For that reason, I am unable to accept my hon. Friend’s amendment, and I ask that he withdraws it.
Mr French
As I have made clear, we believe that some of these issues are important, but we believe that they should be addressed on a voluntary basis, which is what has driven progress in the game. We do not believe that it should be mandated in statute at arm’s length by the Government. I have been clear in making that distinction in my comments.
Requiring clubs to report annually on their EDI action is not a proportionate or effective way to achieve those broader aims. It amounts to moral licensing, encouraging clubs to go through the motions rather than to take meaningful steps to foster a welcoming culture in ways that make sense for them.
My amendments would restore clarity to the regulator’s remit. They would ensure that schedule 5 is focused on what really matters: clear lines of accountability, proper oversight of directors and owners, and a robust governance structure that protects clubs from the kind of catastrophic mismanagement that we have seen in the past. Football has always been about community; it is in the dressing rooms, on the terraces and in the shared heritage of our towns and cities that the game’s values are lived. Let us not fall into the trap of thinking that they can be legislated for by line item in a regulator’s reporting requirements. It is for that reason that I tabled these amendments. I urge the Minister to reflect seriously on whether this part of schedule 5 is truly consistent with the aims of the Bill and the traditions of our national game, which is inclusive by default.
Stephanie Peacock
I thank the hon. Gentleman for the amendments, but I disagree with the attempts to remove the references to EDI from the Bill. I will outline why and then, towards the end of my contribution, I will respond to his specific questions.
The Government believe that equality, diversity and inclusion is a key part of good corporate governance. As my hon. Friend the Member for Great Grimsby and Cleethorpes outlined, it is common practice. Research shows that diversity on boards and in organisations promotes better governance, decision making and transparency, all of which, in turn, contribute to improved financial sustainability. The relationship between diversity and better corporate performance is recognised by the Financial Reporting Council and the Association of Chartered Certified Accountants.
The industry is already taking action in this space, and the shadow Minister shared some examples, which I will not repeat. In November 2024, the FA published its four-year equality, diversity and inclusion strategy, titled “A Game Free from Discrimination”. It set out a long-term commitment to celebrate and promote diversity in English football, as well as an ambition to tackle all forms of discrimination in the game.
At a club level, in May this year, Chelsea’s incredible work in that area was recognised, with the Premier League awarding them the advanced level of its equality, diversity and inclusion standard—the highest level that can be awarded. All clubs in the Premier League, and some that have since been relegated from it, engage with the Premier League equality, diversity and inclusion standard initiative.
The Bill does not put EDI in football—it is already there and it is being celebrated by the industry. It is therefore right that, as a regulator that will be introducing a corporate governance code and requiring clubs to report against that, it covers EDI. The regulator will look to work co-operatively with stakeholders, draw on the expertise of the sector and add industry initiatives.
As with fan engagement, this will be a statutory baseline. Clubs that already champion equality, diversity and inclusion will not have an additional burden placed on them, other than having to periodically report on those things. Under the corporate governance code, clubs will simply be required to explain how they are applying the code and what actions they are taking to improve equality, diversity and inclusion—and nothing more. That is not onerous; it is a very helpful transparency measure, and it speaks to the question that the shadow Minister posed. I want to be very clear: the regulator is not going to prescriptively micromanage each club’s board or set targets and quotas on EDI. That is simply not the role of the regulator and would cause a significant burden to both the regulator and clubs. Ultimately, this is only a reporting requirement that all clubs should be able to meet.
Mr French
I appreciate the clarity provided by the Minister in outlining what she believes the regulator should or should not do. On quotas, can we be absolutely clear that the Government’s intention is not for there to be a mandated quota for clubs to have certain elements and different parts of the community on the board? Is that the clear intention in what the Minister is saying?
Stephanie Peacock
Absolutely. I will repeat the wording I just used in the Committee: to be very clear, the regulator is not going to prescriptively micromanage each club’s board or set targets or quotas on EDI. We will have that in Hansard twice now, so the intention should be very clear. Therefore, I hope that the hon. Member will seek to withdraw his amendment.
Mr French
I appreciate the clarity that the Minister provided on quotas, because that particularly concerns Opposition Members. As I have mentioned—I will not seek to repeat my comments—we are concerned about mission creep and scope creep of the regulator and what the Bill is designed to do. I made it clear earlier that I believe that football is inclusive and that it has done amazing work, when we compare the state of football 20 or 30 years ago with where we are today. We see that on the terraces at most clubs every single week, and we certainly see that with the national team, which most of the country comes together to support, particularly in big tournaments.
Mandating EDI reporting and turning it into a bit of a tick-box exercise—that was highlighted in some of the Minister’s comments—moves away from what we believe to be the valuable part of this work, which is to drive forward inclusivity in clubs and increase the fan base, which is good for clubs, by expanding beyond some of the traditional support of the game. We fear that having this provision in the corporate governance code, in the way it is written, will lead to unintended consequences. It will drive certain agendas, and we fear that clubs will walk into a number of traps accidentally.
We have tabled these amendments because we believe that EDI reporting, especially in certain areas where it is contested, should not be put on clubs in this way. The voluntary scheme in football has worked much more powerfully over the years, and that is proven in the experiences at football grounds around the country.
Football Governance Bill [Lords] (Fourth sitting)
Debate between Stephanie Peacock and Louie FrenchThursday 5th June 2025
(4 weeks, 1 day ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 5 June 2025 - (5 Jun 2025)
Mr Louie French (Old Bexley and Sidcup) (Con)
It is a privilege to serve under your chairship, Ms Butler—a half-time substitute in today’s proceedings. I will speak briefly to the amendment. I completely understand the objective that he is seeking to nudge the Government towards, which he explained well. The obvious question for the Minister is whether more frequent reporting—three years rather than five years—would mean additional costs. I await the Minister’s response, but I understand that the hon. Member is not seeking to press his amendment to a vote.
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)
It is a pleasure to see you in the Chair and to serve under your chairship this afternoon, Ms Butler. I thank my hon. Friend for his amendment.
The state of the game report will be a key study into the structure and dynamics of the industry. It will help to build an evidence base to inform the regulator’s approach and decision making. I therefore recognise the intent behind my hon. Friend’s well-meaning amendments.
The state of the game report needs to be produced promptly, but it also needs to be a robust study. The timeframes set out in the Bill balance the importance of a timely first report with giving the regulator time to undertake the necessary in-depth analysis. The regulator will need to publish its first report as soon as possible or, as my hon. Friend outlined, within 18 months of the competitions in scope of regulation being specified by the Secretary of State, as an absolute maximum. For subsequent reports, a maximum of five years between publications will encourage the regulator to take a more long-term look. That should minimise unnecessary burdens on the industry and better align with the timelines for existing industry processes, such as commercial agreements. The regulator will still have the discretion—as my hon. Friend anticipated—to publish subsequent reports sooner if it considers it appropriate to do so.
I cannot accept my hon. Friend’s amendments to reduce the timings further. He asked me to go away and reflect on them, but I do not want to give him any false hope. We have put careful consideration into the time limits, which were changed from the previous Bill. They are an absolute maximum. We have had a number of conversations with the various leagues and stakeholders, and we are confident that they are the right time limits. We have made it clear that the regulator has the power and discretion to publish sooner, and we would very much hope that that would be the case for the first report in particular. For those reasons, I cannot accept his amendments.
Stephanie Peacock
The state of the game report will allow the regulator to better understand the finances and economics of the industry and its individual clubs. This, in turn, will inform the regulator’s approach and decision making across the regulatory framework.
Clause 10 requires the regulator to publish the report and sets out the topics that it must cover, including an overview of the main issues affecting English football and whether any features of the industry are jeopardising the regulator’s ability to deliver its objectives. These are deliberately broad and non-specific topics, affording the regulator some discretion as to what to cover. In essence, this means that the regulator can cover any matter that it considers relevant at the time, providing it relates to the functions of the Bill.
I would like to take this opportunity to provide further reassurance to my hon. Friend the Member for Sheffield South East on his earlier amendment. We would expect at this stage for it to include distributions, and powers lie within the Bill for the regulator to do that. I want to put that on record once again, further to our earlier debate. It will depend on which issues and features of the market are relevant to its objectives and the regulatory regime at any given time. However, the report is still constrained by its link to only matters relevant to the regulator’s function, so I reassure the Committee that this cannot be an avenue for scope creep.
The clause also requires the regulator to publish its first report no longer than 18 months after the competitions and scope of the regulation have been specified by the Secretary of State, as we have discussed. Subsequent reports must be published at least every five years after this but, as we have just debated, they could be more frequent if the regulator considers it appropriate. These timeframes balance the importance of a timely first report with giving the regulator time to undertake the necessary in-depth analysis.
Finally, the clause sets out clear consultation requirements, including an open process of inviting suggestions about the issues to be included in the report, as well as targeted consultation on a draft report, which I hope speaks to some of the comments from the hon. Member for Newbury on his previous amendment.
Mr French
I do not want to rehash the debate we had before the lunch break. We will press amendment 122 to a vote under a future clause, but we are disappointed that the Government are not willing to accept amendment 123. As we explained before the break, Conservative Members are very concerned that the regulator may impact ticket prices even further. We were calling for transparency in the state of the game report for fans and for Parliament so that they could understand the impact of the regulator on ticket prices for fans. We are disappointed that that amendment was not accepted. I appreciate the further comments that the Minister made, but I would like her to consider that in the future.
Stephanie Peacock
The hon. Gentleman said that he would not rehash the debate, but somewhat did. I have made my argument clear: ticket pricing is a commercial decision, and the Government have gone further by adding a consultation. We have nothing more to add on that topic; it has been fully debated.
Question put and agreed to.
Clause 10 accordingly ordered to stand part of the Bill.
Clause 11
Football governance statement
Mr French
I beg to move amendment 113, in clause 11, page 7, line 41, at end insert—
“(7) No football governance statement may have effect unless approved by resolution of both Houses of Parliament.”.
This amendment would require the football governance statement to be approved by Parliament before it could have effect.
As we know, clause 11 makes provision for the Secretary of State, whoever that may be in the coming months, to issue a statement on issues related to football and, specifically, to the Government’s regulator. While the statement is not a binding one, it walks a very fine line and could be interpreted as political interference in the governance of football. As we have already heard when deliberating on clause 7, that is a very real issue with real-life implications for English football and English clubs.
I do not want to get bogged down in the earlier debate, but I ask the Minister to accept the fact that, aside from the context of the Bill, if UEFA or FIFA deem the Government to be exerting influence on how football is run in a way that compromises the independence of football associations and clubs in line with their statutes, they can, and perhaps will, take action to exclude the nation’s teams and clubs from competition. Irrespective of the Bill, if FIFA or UEFA believe that there is Government interference in football, there is a risk that clubs could be kicked out of European competitions.
Stephanie Peacock
No one is disputing that. We are clear that the Bill does not stray into that. As I said to the hon. Gentleman, in his Government’s iteration of the Bill, the regulator had to have due regard to foreign and trade policy. We took that out, further strengthening the independence of the independent football regulator.
Mr French
I genuinely thank the Minister for clarifying. We have to understand the context in which the Bill is operating. As I said earlier, the Bill is being made not in isolation, but in a complex international football ecosystem. We have to be mindful of that in everything that we do in this Committee and in the legislation that goes forward. Will the Minister therefore accept that, even if she does not believe that it will happen, if her regulator is perceived to be exerting influence and undermining the independence of English football, both international governing bodies will exclude English teams? I want to confirm that the Government understand those risks.
Much like the Secretary of State’s failure to declare her interests in relation to her appointee to the chairmanship of the regulator, who we know donated to her, this is about the perception of undue influence and the impact that will have on how the independence of English football is viewed internationally. If UEFA and FIFA perceive that there is undue influence from whoever the Government of the day may be, they will act, as I explained already with the example of Greek football in 2006. I hope that, as the Secretary of State has now done, the Prime Minister will make sure to declare any relevant interests, as we know that the chairman also donated to his campaign.
I believe that the Minister confirmed that she understands that there is a real risk that we have to be mindful of and that if the regulator breached independence, the entirety of English clubs’ participation in Europe, and the jobs and significant revenues that come alongside that, would be at stake. That is why I have tabled amendment 113, which would require the football governance statement prepared by the Secretary of State to be approved by Parliament before it could have effect. That is a vital safeguard to prevent the perception that any Government of any colour have direct influence over the regulator.
Mr French
I thank the hon. Gentleman for the intervention, but I am speaking very clearly about the interference of Government in football. That is very different from how Parliament acts in creating this statute and being able to check that the regulator is not putting clubs at risk, as I have said before. It is about Parliament having its say, rather than just delegating powers to the Secretary of State of the day.
By requiring that Parliament approve the statement, my amendment would ensure two things. First, there will be proper scrutiny of the Government and their policy. Mr Speaker has recently had to remind the Leader of the House, because of the way the Government have continued to ignore it, of paragraph 9.1 of the ministerial code, which states:
“When Parliament is in session, the most important announcements of government policy should be made in the first instance in Parliament.”
The amendment would require the Government to come the House to present and defend their policy, instead of hiding behind media briefings or social media posts.
Secondly, the amendment would help to mitigate UEFA’s and FIFA’s concerns about the direct influence of Government over the independence of English football. Accepting the amendment and inserting Parliament into the equation would make the regulator much more palatable for the international governing bodies.
I hope that members of the Committee will accept the amendment for what it is: an attempt to ensure that no Government of any colour can be the cause of English football’s exclusion from European or international competitions. There will come a day—the sooner the better, in my opinion—that the Labour party is no longer in government. Labour and Liberal Democrat Members must therefore be realistic, practical and honest about the situation. When there is a different Government in place, will they accept the risk of that Government being the reason that the Three Lions cannot play in the World cup, or the reason that English clubs—from Cheltenham to Barnsley or Welling, or perhaps Sheffield Wednesday —cannot compete in European competitions? That might seem a remote prospect at the moment, but it is the ultimate aim of every club to be in such competitions. That is at risk without this amendment.
If hon. Members are being honest with themselves, their constituents and football fans across the country, the answer will be clear, and they should support my amendment to help to protect English football and give Parliament a greater say.
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.
Stephanie Peacock
I am grateful to the hon. Gentleman. He was new to this place at the election, so he perhaps is not familiar with the previous Bill, but as I have said, this Bill is the same as the Conservative version. On the specifics of the statement, I do not want to pre-empt what may be in there, but it could be, for example, the idea that the Government focus on growth; we have that in the objectives. I do not want to anticipate what could be, but let us be clear: this is about broad objectives, not specifics or operations, and any statement that is not consistent with Parliament’s intention in passing the Bill, as set out in the regulator’s statutory objectives and in the purpose clause of the Bill, could be challenged legally. Similar discussions have taken place in both the House of Lords—the other place—and the House of Commons, and we expect the statement to reflect the Government’s position on the regulator’s use of its powers.
Mr French
I stand to be corrected; we will look at Hansard, but one of the votes that we have had already in Committee was on an Opposition amendment to make sure that growth was clearly defined in that objective in the Bill, and it was rejected by the Government, so I am slightly confused. My hon. Friend the Member for Spelthorne has asked for clarification of what might be in the report, and the Minister seems to be contradicting a vote that has already happened. Could she clarify what she means?
Stephanie Peacock
I can absolutely. I said I did not want to be drawn on the specifics of the statement; I do not want to pre-empt what is in there, but I tried to give an illustration without being drawn into the specifics. If, say, there is a general election and a new Government take power, a new Secretary of State may want to give broad direction. We as this new Labour Government have made it very clear that growth is a focus. We know that is in the Bill, so that is why I thought it was a sensible illustration to give in answer to the question from the hon. Member for Spelthorne, but I want to be very clear that I do not want to be drawn into specifics, because this could cover the approach with regulation in, for example, minimising burdens on clubs, which would tie in with that.
I simply do not think this amendment is necessary. For that reason, I ask the hon. Member for Old Bexley and Sidcup to withdraw it.
Mr French
I must admit I am slightly confused by the answer that was given. I expected the Government to refuse my amendment, but I am genuinely confused about the direction of travel now. I explained the causes of the amendment. The answer that the Minister has just given to my hon. Friend the Member for Spelthorne seems to contradict—other Members are nodding—votes that have already taken place on this Bill. Without rehashing the whole exchange, we wanted to put in as an objective of the regulator economic growth and growing the game of football, for very plausible reasons. The debate was around the word “sustainability”—I appreciate that you were not in the Chair at that point, Ms Butler. To hear the Minister describe the objective that was voted down by the Labour party as a key part of Government policy—that was the argument we made earlier; we could not understand why the amendment was voted against—is confusing. We are genuinely confused, so I will press the amendment to a vote.
Question put, That the amendment be made.
Stephanie Peacock
To ensure that the regulatory regime is as effective and efficient as possible, the football industry needs to understand what is expected of it. That is why this clause empowers the regulator to prepare and publish guidance on the exercise of its function. The guidance will be crucial to translate the legal framework in the Bill into a detailed and practical explanation of the regulator’s regime. It will ensure that the industry understands the regulatory system, what to expect from the regulator and what is expected of it. Not only will that reduce burdens, but it should improve compliance.
The clause sets out that the regulator must publish guidance about the exercise of its functions under specific sections of the Bill. It also commits the regulator to publish guidance about the exercise of any of its other functions. The regulator must consult any persons that it considers appropriate before publishing guidance for the first time and before revising guidance in the future, unless the revisions are minor. This will ensure the regulator is taking into account the views of all relevant stakeholders and experts when preparing its guidance.
Clause 13 permits the Secretary of State to prepare and publish guidance on the regulator’s functions. If needed, this guidance offers an opportunity to provide some additional detail on the regime that was not included in the Bill.
The industry and fans alike have been clear that they do not want to see ongoing Government involvement in football, as we have debated in this Committee. That is why the regulator must have regard to the Secretary of State’s guidance, but is not obliged to follow it. That is also why the Secretary of State may not revise this guidance any more frequently than every three years. This will deliver an appropriate arm’s length role for the Government, but avoid any risk of the regulator becoming a political football. The Secretary of State must consult both the regulator and anyone else they consider appropriate before publishing or revising any guidance, and must lay the guidance before Parliament. I beg to move that these changes—I mean clauses—stand part of the Bill.
Mr French
The Minister will be pleased to know that I will not pick her up on that slip of the tongue, given I made a few of my own this morning with some of the tongue twisters that my assistant put into my speeches.
As we have just heard, clause 12 requires the Government’s regulator to publish guidance about the exercise of its functions as set out in clauses 21 to 25 and the outcomes it seeks to achieve, and to consult appropriate persons before publishing that guidance.
I have a few questions. Will the Minister clarify when she expects her regulator to have translated its powers and duties into a detailed, cohesive and practical explanation of the IFR regime, and what she believes detailed and practical mean for the clubs, so they can understand that?
Clause 13 permits the Secretary of State to prepare and publish guidance on the Government’s regulator’s exercise of its functions under the regulatory regime. This guidance would aid the Government’s regulator in interpreting the intention of legislation when designing and implementing its regulatory regime. It would be non-binding, but the Government’s regulator must have regard to it when exercising its functions.
There was an interesting debate between two lawyers on this Committee about where those lines are drawn. They have both made their arguments for the record, so I will not go back into that, but the clause does stipulate that revisions to guidance may not be made
“more frequently than every three years”
unless there is a revision to the Bill, or the revision is pre-agreed upon between the Secretary of State and the Government’s regulator. It also requires the Secretary of State to consult both the Independent Football Regulator and any appropriate persons before publishing or revising any guidance and laying it before Parliament, unless the revisions are minor.
The Minister will be aware that in the previous sitting I pressed her about that parliamentary role; I will now do so again. Might we have some insight into where, when the reports come back to Parliament, the Government plan to publish them? On Tuesday I asked the Minister whether that would be the role of the Culture, Media and Sport Committee, or of the Public Accounts Committee, given the financial aspects and the costs, and the role of the Comptroller and Auditor General, or whether that would be on the Floor of the House. We really would appreciate, as the official Opposition, some guidance on where the Government plan to publish those reports, so that everyone in the House may have a clear understanding of the direction of travel and where those reports will be available to be read.
While the guidance may not be binding, the clause highlights the blurred lines between Government and regulator, particularly when the appointee was a political appointee, as we know. How will the Minister ensure that any guidance published by the Government is not interpreted as Government intervention, and that the regulator remains free to act independently while not bringing in those risks that we have discussed today?
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.
Mr French
We tabled the amendment because, as my hon. Friend the Member for Isle of Wight East explained, it is in the interest of driving transparency for fans and clubs, and for Members to see the effectiveness and impact of the regulator. As my hon. Friend the Member for Spelthorne explained, it is highly likely that most clubs captured by the top five leagues of the regulator will have reports in their board rooms that explain the costs of regulation and compliance costs. As I said earlier, they have to report on a variety of functions for their league credibility, so it is not unusual to expect them to be able to account for how much this extra regulation will cost, nor is it unusual to expect us to have transparency on the impact of the Government’s football regulator on the football pyramid from the bottom to the top. We will press the amendment to a Division.
Question put, That the amendment be made.
Stephanie Peacock
Clause 14 requires the regulator to report annually to Parliament on its activity for that year. As with all public bodies, the regulator must arrange for the report to be laid before Parliament by the Secretary of State for purposes of transparency and scrutiny. The Secretary of State will have some flexibility to direct additional material to be included with the annual report. That will help ensure that the regulator captures all relevant information in a year, and allow the Government and Parliament to properly scrutinise its performance.
Stephanie Peacock
I do not believe so. I have written to the shadow Minister and will double-check the correspondence. The report will help to ensure that the regulator captures all relevant information in a year, thereby allowing the Government and Parliament to properly scrutinise its performance. I commend the clause to the Committee.
Question put and agreed to.
Clause 14 accordingly ordered to stand part of the Bill.
Clause 15
Operating licences
Question proposed, That the clause stand part of the Bill.
Mr French
That was a strange intervention.
New clause 2 and new clause 6 would require the independent football regulator to provide assistance to regulated clubs seeking to obtain a provisional licence, clubs with a provisional licence seeking a full licence, and unregulated clubs that are reasonably likely to become regulated in the next football season. The new clauses would also require the independent football regulator to provide reasonable and proportionate assistance to regulated clubs in their efforts to continue to comply with their licence conditions.
The sentiments behind both arguments are not bad ones. We have made strong arguments already about our concerns regarding costs for clubs lower down the pyramid. I do, however, question the contradiction of being concerned about clubs in National League South and North, but wanting to get them in the scope of the regulator—we disagree with that. I have a few questions about the new clauses that I hope either the hon. Member for Sheffield South East or the hon. Member for Cheltenham might be happy to answer, just so the Committee can understand.
Given that the new clauses would require the independent football regulator to provide reasonable and proportionate assistance, we would be interested to know what assistance those hon. Members think might be reasonable or proportionate for clubs to require, and whether the independent football regulator is to provide them in the different instances covered by the new clauses. How would the independent football regulator’s liabilities towards clubs under the new clauses be determined and enforced? How would it be funded? That would be a question that all clubs would ask.
In a feedback loop that I am sure the hon. Member for Sheffield South East is aware of through his chairmanship of the football all-party parliamentary group over many years, one of the arguments that a number of clubs make is, “Why should I pay for someone else to come and try to take my place in the league that I am in?” That is part of the competitive nature of football. Although there is cross-club working in a number of areas trying to help clubs, often, the same clubs are competing against each other. We would need a bit of clarity on how the additional provision of help would be paid for. Would the cost be passed on to other clubs? Leaving aside those questions about what that may look like in the future, we understand the sympathies expressed in the new clauses to try to help clubs further down the pyramid, so that they are not excluded based on the fact that they cannot afford to apply for a licence.
Stephanie Peacock
I thank my hon. Friend the Member for Sheffield South East and the hon. Member for Cheltenham for tabling new clauses 2 and 6. The Government recognise the intent behind them, and we agree that the regulator should help clubs to comply with regulation as much as is reasonably possible. It is in everyone’s interests for clubs to become compliant quickly and with as little additional burden as possible. It is vital that the regulator helps clubs get to grips with its regulatory regime, which is why we have been very clear that the regulator will operate an advocacy-first approach, and why provisions for a collaborative approach are already in the Bill.
For example, the regulatory principle of clause 8(b) encourages the regulator to co-operate and constructively engage with clubs. Regulatory principles (c) and (d) encourage the regulator to ensure that any action is proportionate to the benefits expected from it.
In relation to the specifics of the new clauses, we disagree with any provision that would require the regulator to provide financial assistance to clubs to comply with requirements imposed by the regulator. That would amount to redistribution by the back door, given that the Independent Football Regulator would be levying some clubs in order to provide financial assistance to others. That is not the regulator’s role, and we do not believe it should be. On training, the regulator can work with clubs to ensure that they fully understand the regulation and what is expected of them. Of course, in cases where this is necessary, the regulator can appoint a skilled person to assist the club in resolving issues in respect of a relevant infringement. For the reasons that I have outlined, I am unable to accept the new clauses and I hope that they will be—
Mr French
The Minister is trying to suggest that everything is the same, but the Secretary of State has literally nominated a Labour donor who donated to her and the Prime Minister to chair the regulator, so the situation has clearly changed. The appointment is now the subject of independent inquiry; they are under investigation for the appointment. The Minister has been landed the role because the Secretary of State has recused herself, so the situation has clearly changed and it is clearly a political appointment.
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.
Stephanie Peacock
Indeed, a number of Conservative Members are on record as supporting this policy; it is just sad that the ones sitting opposite seem to have forgotten the manifesto they stood on.
Stephanie Peacock
I am grateful, Ms Butler. I completely appreciate the point the shadow Minister is making, but he seems to be missing the point I am making that this part of the Bill has not changed from the previous one. I will now outline why we do not think amendments 99 or 100 are appropriate.
We do not think it is right to remove the ability of the regulator to require additional information from clubs during the application process for a licence. It is only right that the regulator can specify any further information or documentation it may need in order to properly assess whether a club needs the test for a provisional operating licence. It may require further information to assess a club’s circumstances and whether it will need to tailor any mandatory licensing conditions, or attach any initial discretionary licence conditions to the club.
Specifically on amendment 100, the criteria listed in the Bill are non-exhaustive, and the regulator should have the flexibility to request additional information from a club regarding its business plan when necessary. In line with the regulator’s principles, any request for information will, of course, be proportionate, and the regulator will co-operate and engage practically with the club. The regulator will not be asking for any information that is not in the scope of the provisional licence; there would be no reason for it to do so. However, there is an appeals process.
To end with an example, if a club puts forward a business plan and something seems out of the ordinary, the regulator may wish to ask where the funds are from. We think that that is perfectly reasonable, and it was in the previous iteration of the Bill.
Mr French
I appreciate the points that the Minister is making. Another point that I made—this is not political—was about the standardisation of requests, which would allow clubs to prepare on the basis of what they expect the regulator to ask and ensure consistency between clubs. Will the Minister tell us how that might work?
Stephanie Peacock
Standardisation is not appropriate in this context, because the extra information may relate to discretionary licence terms, which will be tailored to a club. It is therefore not relevant.
For the reasons I have given, I hope that the hon. Gentleman will withdraw the amendment.
Mr French
We are concerned about unchecked powers, as we have explained at some length, and believe that the House should be able to check those powers. We are concerned about the lack of standardisation. I fear that, by treating clubs differently depending on their circumstances, the regulator will be left open to legal challenge. Some clubs have the financial resources to challenge a league, and will have the resource to challenge a regulator. We have seen that with certain clubs in the Premier League—I will not mention the cases, for legal reasons. Some football clubs are willing to challenge their regulation in court. We fear that, without standards for what is asked of clubs, there could be more legal challenges down the line. For those reasons, we will press the amendment to a Division.
Question put, That the amendment be made.
Mr French
I thank the hon. Member for that point. Transfers are a key aspect. If a club is in limbo, it could arguably be at a much bigger disadvantage when the season starts if it had not been able to make transfers because it was uncertain about whether it could compete in the competition. The point is well made.
Secondly, the absence of a defined period creates a lack of accountability within the regulator itself. As we have discussed, the regulator cannot be scrutinised in the way that we would have hoped. We know that the Government do want it to be strong, but with strength must come accountability and transparency. If it is to command the trust of fans, clubs and local communities, it must be seen to act with purpose, not with delay.
We know from numerous examples across different industries that when regulators are left without timetables, backlogs just build up. I will not name examples because I am conscious of time, but we know that it happens. My amendment proposes a time limit of one month—a full 30 days—for the regulator to determine whether a provisional licence should be granted. That is not a rushed timetable; we believe that it is a reasonable one, especially considering that when a club applies for a provisional licence, the key facts will likely already be known by the regulator. Again, this is not designed to be a forensic financial autopsy, but a short-term stabilising mechanism.
Let me also be clear that the time limit does not bind the regulator to approve an application within a month; it simply requires a decision one way or another within that time. That allows the Government’s regulator to reject unsuitable applications if needed—hopefully not—but it removes the damaging uncertainty of a process that otherwise could drag on indefinitely. We must not forget who bears the cost of delay. It is not just the club executives and directors, but the fans, players and staff. We have just heard about transfers, which are a great example. It is about the people who turn up on a Saturday afternoon come rain or shine, the people who run the club shop and the ticket gates, and the people whose local economies benefit from having a club that is alive, operating and secure.
The amendment also supports the broader aim of stability in football. A system without timelines invites inconsistency and subjectivity. One club might be processed in a week, and another in six. That cannot be right. We owe it to clubs at all levels, from the top of the Premier League right the way down to the National League, to create a system that is predictable and fair.
Finally, good regulation is not just about the rules but about responsiveness. It is about a regulator that can act promptly, efficiently and in partnership with the people it is overseeing. Our amendment does not weaken the regulator; it makes it better. It strengthens the trust between the regulator and the regulated. It gives clubs the certainty that they need to plan, invest and survive. After all, that is what the Government say is the intention of this regulator. I hope that hon. Members will support the principle behind the amendment. We have heard some of the issues that may arise if not.
Stephanie Peacock
I thank the shadow Minister for tabling amendment 101. I will outline the reasons why we will not accept it, and then I will respond to some of the questions that he raised.
The Bill ensures that the regulator has the necessary flexibility to ensure that all clubs that meet the test for a provisional licence will be given one. Introducing an arbitrary statutory timeframe of one month for the regulator to make a decision on a club’s application would remove that flexibility. Only the regulator can know what the process of assessing applications might entail or how long it might take, so it should have the ability to set in rules the period within which it will make a decision, the period of any potential extension and the circumstances in which an extension will be granted. The regulator will engage with all clubs prior to the application for a provisional operating licence to ensure that the process is as smooth and efficient as possible, and its regulatory principles encourage it to act in a timely manner.
I turn to some of the specific points that the hon. Member made. There will be no requirement to restructure the board to get a provisional licence. As I outlined in my opening remarks, the regulator will take an advocacy-first approach. Clubs will be asked to submit basic information and documentation, and to show a readiness and willingness to work with the regulator. I draw the hon. Member’s attention to clause 17(4)(b), which says that if, for whatever reason, the regulator does not give a licence, it would have to give reasons. Even in that scenario, which I highlight is hypothetical, enforcement might take place, but it would not prevent the club from playing. For these reasons, I ask him to withdraw his amendment.
Stephanie Peacock
Of course. The shadow Minister referred more than once to clubs not being able to play. As I said, this is an advocacy-first approach; the regulator will work with clubs to make sure that they can reach the provisional licence requirements. It is a basic set of requirements, and they do not have to meet it to receive the provisional licence; they just have to show a willingness and an ability to do that. In the hypothetical scenario that they do not, enforcement may happen, but they will not be prevented from playing. However, we do not anticipate that happening, because at the provisional stage, the regulator will work with them to make sure that they can do that. I want to be very clear—perhaps the hon. Member for Spelthorne misunderstood what I said—that the regulator will work with teams to make sure that they can get that provisional 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.
Mr French
The Minister has outlined clauses 17 and 18 at some length. We had a lengthy debate on clause 17 in relation to our amendment 101. We are naturally disappointed that the amendment, and the time limit that we seek for the provisional licensing, was not agreed to. However, in the interests of time, I will move on to clause 18.
Clause 18 sets out the process by which the Government’s regulator may grant the full operating licence to a club, which is a crucial stage in the proposed licensing regime, with significant long-term implications for the structure, stability and future of the English game. This clause is where the Government’s regulator transitions from assessing provisional eligibility to giving a formal stamp of approval for a club’s longer-term competition and compliance. However, the clause raises several questions that the Committee must interrogate, and that I hope the Minister will be able to answer—not least whether it achieves the right balance between regulatory assurance and operational flexibility.
Under the clause, the regulator may grant a full operating licence only if satisfied that a club meets the relevant conditions of eligibility. That is right and proper, and clubs should be expected to operate on a stable financial footing, meet appropriate governance standards and protect the game’s integrity. But I am concerned about the breadth and, in some respects, the open-ended nature of what those conditions of eligibility might come to mean in practice.
We must be alive to the risk of regulatory overreach, as the Opposition have highlighted, and we should all recognise that bad regulation is worse than no regulation at all. If clubs are to be subject to vague or ever-changing thresholds, with little recourse or clarity on what is required, we risk imposing a level of uncertainty that could deter vital investment, discourage long-term planning and undermine the very sustainability that the regulator seeks to ensure. That is why the Opposition will—as we already have done in Committee—continue to press for greater transparency around the costs and cumulative burdens that flow from the action of the regulator; and it is why we believe that the regulator should not have unfettered discretion to shift the goalposts without clear parliamentary scrutiny and approval. As I have said, we should not write blank cheques to a politically led regulator.
Another issue with the clause is timeliness. As we have explained, clubs will need to plan ahead, financially, structurally and operationally. If the licensing process drags on, it risks becoming a bottleneck and not a safeguard for clubs around participation. We tabled amendments that would ensure timely decision making on provisional licences, and the same principle must surely also apply to full licences. However, we appreciate the different context within which a full operating licence will exist. That is why we have not tabled an amendment to this clause with a specific deadline. We understand that full licences will take slightly longer.
Moreover, there is a danger that the full licence becomes a tool for undue influence. We have spoken about our concerns about the impact that that may have on the statutes of UEFA and FIFA—in the interests of time, I will not go into that again. If clubs feel under pressure to comply with this new licensing regime to be able to play in English football, there may be a concern about them breaching other regimes, such as UEFA and FIFA, and, again, they may fear expulsion from those competitions.
One club asked me this question, although it was a tongue-in-cheek comment, so I will not name them. If a Premier League club decided not to apply for a licence, would the Government look to exclude it? There is the risk that, if a club feels that it will not be able to compete in Europe, for whatever reason, it may choose what this Bill was originally intended to stop: the European breakaway league.
I am not sure that the club would do that, as it was a tongue-in-cheek comment, but what would happen if a club says, “We are not going to meet these conditions, and therefore we will not apply for a licence”? Would the Government or regulator be willing to kick that club out of the Premier League? Even though that question is hypothetical, we need to know where this might lead, because we are talking about a regulation that will have an impact. If the Minister can answer where she thinks that club might go, I would be particularly interested in that.
We are also concerned about the future interpretation of eligibility and how that may veer into what we believe to be subjective decisions, or where the Government’s regulator will take on new powers as it enters mission creep. As such, I would appreciate it if the Minister will confirm that there will be no demands, for example, on clubs to provide diversity quotas, net zero targets or enforced political campaigns, all of which stray beyond the regulator’s core remit of financial sustainability and good governance. Let us not forget that football clubs are not franchises, as they are in the American sport system. Our clubs are community institutions with long histories and unique identities. They are not all cut from the same cloth.
Mr French
I thank the hon. Lady for her intervention, but that is not the point I was making. I am talking about quotas, which is a slightly different thing. We do not think that the regulator should be insisting on quotas, and that is very different from Kick It Out, which has made incredible progress for football over the years. The hon. Lady has raised a very different point, so I will not go down that rabbit hole.
I am sure that the Minister would agree that what is best for Barnsley FC is not necessarily best for Bromley FC or Bristol Rovers. Each club has unique characteristics and should be treated as such. However, we feel that the Bill, as drafted, could lead to clubs being lumped in the same direction. We believe in the equalisation of treatment, but each club should not be treated exactly the same when there are clear differences, whether that be in league structures or financial positions.
We are concerned about parts of clause 18, but we believe that it is an important part of the licensing structure that must be implemented with care, proportionality and consistency. It is essential that the Government’s regulator operates with discipline, sticking to those statutory objectives, resisting the temptation to micro-manage and always keeping front of mind the importance of stability, continuity and respect of football’s unique heritage. We support the principles of the clause, but I would appreciate it if the Minister answered some of my questions about what may come in the future and what the Government would do if a club decided not to apply for a licence.
Stephanie Peacock
I am grateful to the shadow Minister for his comments. A number of the points that he made have been well debated over the last few days in Committee, so I will not be engaging in them. I will not be engaging in hypotheticals either. We have been very clear that we simply do not want scope creep. The two-step process of the provisional and full operating licence means that clubs do not need to make substantial changes in a short space of time. We absolutely appreciate that it could be difficult for some clubs to meet threshold requirements, and the regulator will very much work with them. The regulator will have a balanced and proportionate approach, centred around advocacy first.
Mr French
I appreciate that I was asking about a hypothetical situation, but it is an important hypothetical. We are talking about a structure going forward in which clubs will be required to have a licence, and we have had some exchanges on that. This is a serious question: what would the football regulator do if a club said that it did not want the licence, and it did not believe it had to have one? Where would that legally leave the club and regulator? Even though it is hypothetical, it is very important to what we are debating in the Bill.
Stephanie Peacock
I disagree that it is an important hypothetical. We can come on to talk about enforcement later on, but we are talking now about the regulator’s approach, which will be balanced, proportionate and centred around advocacy.
Question put and agreed to.
Clause 17 accordingly ordered to stand part of the Bill.
Clause 18 ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Vicky Foxcroft.)
Football Governance Bill [ Lords ] (Third sitting)
Debate between Stephanie Peacock and Louie FrenchThursday 5th June 2025
(4 weeks, 1 day ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 5 June 2025 - (5 Jun 2025)
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)
It is a real pleasure to serve under your chairmanship, Mr Turner. I thank the hon. Member for Old Bexley and Sidcup for his amendment. I understand that its intent is to put beyond any doubt that the Bill and the regulator will not breach UEFA or FIFA statutes, and so will not risk English clubs or national teams being banned from international competitions. I will set out why we do not think the amendment is necessary, and then I will respond to some of the questions that hon. Members posed during the debate.
I assure the Committee that the amendment is not necessary. UEFA and FIFA statutes require that the FA manages its affairs without undue influence from third parties and remains independent of political interference. The regulator will be operationally independent of the Government and will not exert undue influence on the FA’s ability to govern the game.
The shadow Minister asked about consultation. Through the observer role on the regulator board, there is an explicit requirement to consult the FA. The extent of its statutory powers and duties will not allow it to undermine FIFA’s or UEFA’s statutes. That is why—to answer the question from the hon. Member for Spelthorne—UEFA has confirmed in writing to the Secretary of State that the Bill as drafted does not breach UEFA statutes. The FA has also confirmed that directly to Members of both Houses, and it is of course publicly supportive of the Bill.
Rather than protect English football, I am afraid that the amendment would have serious unintended consequences. It would put the regulator in a position of deference to a private international organisation—a point the hon. Member for Cheltenham made eloquently a number of times. That would not only undermine the sovereignty of Parliament, but leave English football in a very weak position. UEFA has confirmed that the amendment is not needed, and it would undermine parliamentary sovereignty; for those very straightforward reasons, I ask the hon. Member for Old Bexley and Sidcup to withdraw his amendment.
Mr French
Although I do not doubt the Minister’s sincere belief in the assurances she has given, I am afraid that unless we have evidence that gives the Opposition certainty about them, we will not withdraw our amendment. We are very concerned about the future participation of English clubs in Europe and of the national team in European and world competitions for reasons that I outlined in my speech—in the interest of time, I will not repeat them now.
I note that the Minister was very careful in her wording when she talked about what was said in the letter from UEFA. She talked about the Bill “as drafted”. The Opposition are extremely concerned about scope creep from the regulator, and much of our contributions have focused on the fact that the future regulator may take a decision that is not in conformity with the rules of FIFA and UEFA, which this House would then have few means to change. That would put at risk clubs, investment and jobs in clubs up and down the country. That is why I will press the amendment to a vote.
Question put, That the amendment be made.
Mr French
I understand the Lib Dem spokesman’s point, but in my understanding, that would be the responsibility of the leagues. That is not what we are trying to block with this amendment; we are trying to block club-to-club forced redistribution. That is an important distinction, and I will come on to explain why.
I do not believe that this is a theoretical concern. The regulator’s objectives include financial sustainability. One can easily imagine a future regulator interpreting this objective to mean that it should balance resources across the pyramid, effectively redistributing funds to prop up weaker clubs. Without this amendment, nothing in legislation explicitly prevents such a scenario.
Some may argue that redistribution is needed to make the game fairer—I understand that point—but fairness in football has always been earned through competition, not imposed through central control. We must be very cautious about importing the language and logic of equalisation into a sport that depends for its vitality on aspiration, competition and merit. Sporting competition is a hill that I am willing to die on.
It is also worth noting that forced redistribution between clubs would create perverse incentives. It would reward financial mismanagement and punish prudence, and it would create a moral hazard where clubs are less motivated to balance their books if they believe that the regulator will require others to bail them out. That is not a path to sustainability; it is a recipe for mediocrity, or worse, disaster.
The principle at stake is clear: the role of the regulator is to set standards, ensure compliance and uphold integrity, and not to act as a central accountant deciding who deserves what. If clubs wish to strike revenue-sharing deals through their leagues, they may do so. The amendment draws a line: it protects club autonomy and supports continued investment in the game, and it ensures that the Government’s regulator—whatever its remit ends up being—respects the rights of clubs to manage and retain their own finances.
Stephanie Peacock
It is a pleasure once again to serve under your chairmanship, Mr Turner. I thank the shadow Minister for the amendment and the chance to clarify the Government’s position on the redistribution of revenue. Let me be clear: the backstop process will apply only to revenue received by the leagues. That is already explicit in the definition of “relevant revenue” in clause 56. It does not allow the regulator to include individual club revenue that is not relevant for distribution agreements—for example, shirt sales. The amendment is not necessary to ensure that. It would call into question the regulator’s powers under the backstop process. Although that process is about resolving distribution disputes between the leagues, not individual teams, the money received by the leagues is ultimately distributed to their member teams.
Stephanie Peacock
The clause sets out the general duties of the regulator to define when and how it can act. The regulator must act in a way that, in so far as is reasonably practicable, is compatible with the purpose of the Bill—to protect and promote the sustainability of English football—and that advances one or more of its objectives. As part of that, the clause requires the regulator to, where appropriate, take certain things into consideration when it acts. As the regulator is required only to “have regard to” these things, it is not strictly bound by them, and so its operational independence is not undermined.
The regulator must consider some key outcomes in the football market, beyond its primary objectives. Specifically, where possible, it should have due regard to the desirability of avoiding indirect impacts on: the sporting outcomes of regulated clubs; the competitiveness of regulated clubs against other clubs, which includes overseas competitors; and investment into, and growth of, English football. That recognises that there are other features of the market that should be protected. We want a sustainable football pyramid, but not at the expense of the exciting, competitive product that continues to attract so many viewers and investors. We have explicitly added growth to this provision. The regulator will not actively pursue these outcomes, but it will be mindful of unduly harming them while it advances its statutory objectives.
The regulator must also have regard to five further things when exercising its functions. They include its regulatory principles, which guide how it should operate, its own guidance and the guidance from the Secretary of State, the most recent state of the game report, and the most recent football governance statement from the Secretary of State. We will discuss some of those points later today. I commend the clause to the House.
Mr French
It is disappointing that our amendments, which were tabled in a constructive manner, not a political one, have not been accepted. We remain concerned about some of those risks to the future of English football, but we will not seek to divide the Committee on this clause.
Question put and agreed to.
Clause 7 accordingly ordered to stand part of the Bill.
Clause 8
The IFR’s regulatory principles
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
The regulatory principles outlined in this clause are designed to guide the regulator to exercise its functions appropriately and in the manner intended by Parliament. The regulator must have regard to those principles when acting. The first principle encourages time and cost efficiency in everything that the regulator undertakes, encouraging swift action and value for money. The second principle encourages the regulator to co-operate with both those it regulates and those who will be impacted by its decisions. That reflects that the ideal regulatory environment is one where all stakeholders are working towards the same goals. Therefore, where the Bill says that the regulator should consult other relevant persons, we would expect that those affected by its decisions, such as fans, players, and representative groups, would be included when appropriate.
The third principle encourages the regulator to consider, before acting, whether the intervention is necessary, and if the same outcome could be achieved in a less burdensome way. That steers the regulator to take a light-touch approach to regulation where appropriate. The fourth principle encourages proportionality. The regulator should always look to choose the least restrictive action that still delivers the intended outcome, and be able to justify why any burden is worth it for the benefits expected. The fifth principle encourages the regulator to acknowledge the unique sporting context in which it is regulating. For example, it should consider the existing rules and burdens that clubs are subject to, and that market features such as transfer windows impose unique constraints on clubs.
The sixth principle encourages the regulator to apply regulation consistently, while still ensuring that requirements are appropriately tailored to a club’s specific circumstances. A Premier League club and a National League club operate in very different ways and face very different risks, and the regulator should and will take that into account when regulating, as I heard when meeting representatives of the Premier League, the EFL and the National League. The seventh principle encourages the regulator to hold the individuals responsible for making decisions at a club accountable for the actions and compliance of the club. For too long, clubs and fans have suffered the consequences of bad actors and mismanagement by the individuals calling the shots.
The eighth and final principle encourages the regulator to be transparent in its actions. It is important that the regulator and its regime are open and accessible to the industry, fans and the general public. I commend the clause to the House.
Mr French
I will not seek to repeat all the objectives that the Minister outlined for clause 8, but I will make some comments on each principle, and pose some questions to which I hope she can provide answers.
As the Minister described, clause 8 outlines the eight operating principles that guide the regulator’s approach. First, the Government’s regulator should be on time and cost-efficient, which is why I have tabled amendment 101 to clause 16. Secondly, the Government’s regulator should take a participative approach to regulation, helping to co-ordinate and co-operating with clubs and competition organisations, as well as engaging with players, fans and others. That relates to an amendment that we will come to shortly.
Thirdly, the Government’s regulator should be light touch in its approach to regulation, wherever possible. Sadly, we Opposition Members believe that that is now highly questionable due to some of the new parts of the Bill, which we raised concerns about in the first day’s sitting. Fourthly, the Government’s regulator should be proportionate in everything it does. Again, we have concerns about that and we have outlined some of those already.
Fifthly, the Government’s regulator should acknowledge the unique sporting context in which it is regulating, aiming to minimise any potential disruption to sporting competitions. I will not go through the debate we just had around UEFA international competitions, but I again highlight some of my earlier questions that I put to the Government on Tuesday about how this regulator is benchmarked against other regulators, because, in a sporting context, it is the first of its kind. It is very difficult for us to understand where the Government are moving towards, whether that is about resources, the size of the regulator, or the future direction, and we would like some clarity on that.
Sixthly, the Government’s regulator should apply the regulation consistently. We all hope that the regulator will do that in the future. Seventhly, the Government’s regulator should, where appropriate, hold individuals responsible for the actions of the club. That is absolutely right. There are clauses that seek to do that, and, as we have heard, to identify the appropriate officers and senior directors for different components of the club.
Eighthly, the Government’s regulator should be as transparent as possible in everything it does. Disappointingly, Government Members voted against the transparency amendments that we tabled, which, again, were not political; they were aimed to future-proof the transparency regarding how the regulator operates. I fundamentally believe that Members, regardless of what party they belong to, should be able to have all the information to make informed decisions on the benefits to their constituents.
Many of the principles in this clause are generally welcome, but I seek clarity from the Minister on a few matters. Does she think that these principles are strong enough to prevent the regulator from jeopardising the future participation of English clubs, particularly abroad? The fifth principle states that the regulator “should” aim to minimise disruption. Surely—we believe—it “must” avoid disruption, because of the risks that I outlined in previous amendments.
Lastly, none of the principles reference or reinforce the regulator’s independence. Why is there no principle regarding the regulator’s independence from the Government and politics at large, for the reasons we have outlined?
Stephanie Peacock
I thank the shadow Minister for broadly welcoming the principles. I will address a couple of those points, but without rehearsing this whole debate. Independence runs throughout this Bill; it is very clear that it is an independent football regulator, and we will talk about some of the safeguards for that in future debates.
The principles that we are debating are the same as they were under the previous Bill, with one exception: the third principle has been added, which is about making this less burdensome and which steers towards a light-touch regulator. I think that Members across the House would welcome that.
I will not rehearse the conversations we had on the make-up of the regulator—on staffing and so on, which we spoke about that the other day—but the shadow Minister touched again on UEFA. I gently remind him that we removed the need for the regulator to have regard to Government’s foreign and trade policy when considering club takeovers. We took that out of the previous Bill, and that is clearly welcome in the context of that UEFA debate. We are therefore confident that these are the right principles to guide the regulator to do a good job.
Question put and agreed to.
Clause 8 accordingly ordered to stand part of the Bill
Clause 9
Transfer schemes
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
We are committed to establishing the regulator as quickly as possible post the passing of this Bill. To that end, the regulator is currently operating in shadow form in the Department for Culture, Media and Sport in parallel to the passage of this Bill. This is a precedented approach; for example, the Trade Remedies Authority was run as a shadow function out of the Department for International Trade before it was formally established by the Trade Act 2021.
The shadow football regulator has started work to develop the regulator’s policy and guidance, engage with stakeholders, and undertake the necessary corporate activity to build an organisation, such as recruitment and procurement. That will enable the regulator to hit the ground running once it is legally established. The shadow regulator, of course, was established by the previous Government, as they clearly also recognised the importance of the regulator being ready to operate as soon as possible once the Bill receives Royal Assent.
On the creation of the regulator, it will be necessary for the property, rights, liabilities and staff held by the shadow regulator within DCMS to be transferred to the regulator. The most appropriate vehicle for effecting these transfers will be a statutory transfer scheme, as has been used in similar situations involving the transfer of assets following the transfer of functions between public bodies. The details of such transfers will be determined at the point of transfer.
Mr French
As we heard from the Minister, the clause relates to the transfer of staffing, resources and property to the Government’s regulator in the future. I would like to ask her—this goes back to an earlier conversation on the potential direction of travel, size and scope—how many staff will be transferred? What resources or properties are we talking about, so that taxpayers can understand, and what cost will there be to the taxpayer? Hopefully, those are fair questions.
We did seek to put an employee cap into the Bill to help to maintain value for money for taxpayers. I think that was a fair proposal, but Members did not agree with it or with the number of 50 that we put forward. However, the principle of trying to cap the size of the regulator is fair, especially given the size of some of the regulators that were described in comparison—I believe one had 900 members of staff. Most members of the public would be alarmed if the football regulator ended up anywhere near that, let alone a tenth of it. We are concerned, so I ask the Minister again, given the impact on costs to football clubs linked to the regulator, how big the Government expect it to grow. Can she also answer the questions that were raised about what will be transferred on day one?
Stephanie Peacock
I am grateful to the shadow Minister for those questions, which somewhat rehearse the previous debate on the staffing of the shadow regulator. He should have received an answer to the written question, and we spoke about this last time; as of 1 June, it has 42 staff. I cannot comment on exactly how many staff there will be at the point of Royal Assent. In my remarks, I said that upon the creation of the regulator, property rights, liabilities and staff will be transferred. I am happy at that point to write to the shadow Minister, but I will not speculate now.
Question put and agreed to.
Clause 9 accordingly ordered to stand part of the Bill.
Schedule 3 agreed to.
Clause 10
State of the game report
Stephanie Peacock
The amendments from the hon. Member for Old Bexley and Sidcup regarding ticket pricing touch on an important issue that I recognise is very important to fans. I reassure fans that the Bill will increase clubs’ overall accountability, including on this important issue. However, the annual report is not an effective place to address ticket prices.
Ticket pricing is fundamentally a commercial decision, and it would not be appropriate for the regulator to interfere with the commercial decisions of a private company. That is why the regulator will not intervene on this issue, aside from ensuring that clubs consult their fans on ticket pricing. It may well be that the regulator chooses to look at ticket pricing as part of the state of the game report, but mandating that it reviews the effect of its regulatory activities on ticket pricing as part of the report would be unnecessarily prescriptive.
Ticket pricing is ultimately a matter for clubs and is driven by many factors, but we do think it vital that fans are consulted and can have their voices heard. That is exactly why this Government amended the previous Government’s Bill to add an explicit requirement that clubs must consult their fans on ticket pricing and take their views into account as part of fan engagement. That is the way to ensure that fans can have their voices heard on such an impactful issue.
The amendment seems to assume that the cost will be passed on to fans in the form of higher ticket pricing. I want to be clear, as I was on Second Reading, that that would not be a proportionate response by clubs. If clubs increase ticket pricing, it will not be because they cannot otherwise afford to pay the regulator’s levy. As mentioned before, the cost of the regulator will be tiny compared with the vast revenue of the game, and the cost of the levy will not be among any club’s top area of expenditure.
Every measure has been taken to ensure affordability. No club will be charged to the point of needing to increase ticket pricing, and no fan will be subject to price rises without having their voice heard—I associate myself with the comments of the Liberal Democrat spokesperson, the hon. Member for Cheltenham. For those reasons, I urge the hon. Member for Old Bexley and Sidcup to withdraw his amendment.
Mr French
It is rather disappointing that the Liberal Democrats and Labour seem to be against the principle of transparency for fans of the impact on ticket prices, given that the issue is so pertinent to fans across the country. As Conservatives, we want to stick up for those fans. We understand the costs of going to a game, as my hon. Friend the Member for Spelthorne said—I will not criticise his choice of club. Going to games and season tickets cost a lot of money for the average fan, and we have seen the impact of that. One example was the cost for Man City fans of coming down to the semi-final. Part of Wembley was empty because fans were saying that they could not afford the costs, because of the times of fixtures, although that is a slightly different point. We have to be mindful of the impact on ticket prices.
Football Governance Bill [ Lords ] (Second sitting)
Debate between Stephanie Peacock and Louie FrenchTuesday 3rd June 2025
(1 month ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 3 June 2025 - (3 Jun 2025)
Mr Louie French (Old Bexley and Sidcup) (Con)
Thank you, Sir Jeremy. I appreciate your work and that of the Clerks to get some further information on the point. Just so that all Members are aware of the part of “Erskine May” to which I was referring, it says that
“a document which has been cited by a Minister ought to be laid upon the Table of the House, if it can be done without injury to the public interest.”
I appreciate your comments, but I think that the spirit of the House is quite clearly outlined there. I would like the Minister to publish the document so that Members can have a view.
I would also argue strongly on your last point, although I appreciate that this is a point of debate rather than one of fact, because I believe that the document in question is not a private letter but a piece of correspondence from a key international regulator to His Majesty’s Government. I believe that Members of this House deserve to have all the information available to make informed decisions about a regulator that will be of the utmost importance to football, as well as to this House.
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)
I know that there have been requests to see the letters that UEFA has sent to the Government. As a matter of course, the Government do not share private correspondence, as it would undermine the ability to have open, honest and frank discussions with key partners. It is worth stating that we wrote to UEFA asking whether it would be content for it to be published, but it confirmed that it would rather communications were kept private.
Paragraph 21.26 of “Erskine May” states:
“A Minister who summarises a correspondence, but does not actually quote from it, is not bound to lay it upon the Table. The rule for the laying of cited documents does not apply to private letters”.
“Erskine May” is fairly clear that the Government are not bound to publish the letter, as I have not quoted from it. I refer the House to my earlier comments on the letter.
Mr French
I thank the Minister for her confirmation of her position. I appreciate her clarification of her perspective, although obviously I disagree with it; that is why I raised the point. I am concerned about this, and I will pick up the point with Mr Speaker afterwards, because there is a general theme here. This is not aimed at the Minister—I have a good relationship with her, and I respect her—but there is an ongoing issue, which has been expressed in this House in recent days, about the Government not being open and transparent with the House in other announcements that have been made.
Stephanie Peacock
I say gently to the hon. Member—this is a point that has been made by my hon. Friends behind me—that his Government did not publish any private correspondence from UEFA. There will be letters in existence similar to the one to which he refers. The right hon. Member for Daventry (Stuart Andrew), whom I like a great deal—indeed, I respect both gentlemen—did not publish those, so I am a bit confused about why the hon. Gentleman is making this very well-rehearsed argument, which is contrary to what his Government did.
Mr French
It is not well rehearsed—it is not in my speaking notes at all. It is just a general point of principle that this House should be able to hold the Government to account with full information. I appreciate that I am testing your patience, Sir Jeremy, so I will get back to the amendments. [Hon. Members: “Hear, hear!”] I have lots of support from Government Members.
Schedule 2 sets out the constitution of the Independent Football Regulator for an initial period when it is first being established, and for subsequent periods thereafter. It contains detailed provisions about the appointment of the chairman, deputy chairmen and non-executive members of the board, and the rules by which somebody may be appointed to the board in relation to conflicts of interest. On conflicts of interest in particular, the Government have left much to be desired, so we seek to correct some serious omissions.
As we have seen in recent weeks, the Labour Government have politicised what was supposed to be an independent football regulator by appointing a crony. That is nothing short of a disgrace—such a disgrace, in fact, that the Secretary of State has been forced to recuse herself from any further part in the appointment of the chair. As I said this morning, that is now a point of independent inquiry, so it is not just my opinion. There is clearly a concern, which is why the Commissioner for Public Appointments will be looking very closely at it.
That is why I tabled amendment 117. As we know, although only because of his revelations at the Culture, Media and Sport Committee, the Government’s appointee donated to the Secretary of State’s leadership campaign. We believe that she did not declare that in line with the ministerial code. We also believe that it was not disclosed earlier. Does the Minister think it acceptable that the Secretary of State concealed that information from Parliament? We believe that there was no reference to that donation on Second Reading. Did the Minister know that the proposed chairman had donated to both the Prime Minister and the Secretary of State? Will she confirm whether she or any other member of this Committee has received any donations from the chairman of the regulator? Is she concerned about what the independent inquiry that was announced yesterday might mean for the future of the regulator, if it is found that the process has been breached?
Those are really fundamental points, because a breach of the process will have direct consequences for a lot of what we are discussing today. It will throw English football up in the air and bring it into disrepute if the first chairman of the regulator is found to have been appointed without the Government following due process.
Stephanie Peacock
I have heard the points that the hon. Gentleman has quoted. I do not have the quote in front of me, so I will paraphrase, but I believe that the Select Committee also praised, or acknowledged, Mr Kogan’s candour and transparency—the fact that he was open with them—and of course the Committee did endorse him. I will heed your yellow card, Sir Jeremy.
Mr French
The amendment is quite clear that it is not about the individual but the process going forward for transparency on donations. I will not mention the gentleman, but the other question that the Minister was answering before the intervention related to the rules and duties on Ministers and Members of this House. She made the point about disclosure thresholds within the code, but the spirit of the rules makes it quite clear that any perceived conflicts of interest must be disclosed. It is my understanding that that had not happened, which is the point that I was trying to make.
Stephanie Peacock
The hon. Gentleman gets ahead of himself; he is somewhat excited this afternoon. That was my second point—I have numbered my points one and two, and I have a third to make. He asked about members of the Committee. It is for hon. Members to declare relevant interests, and when we began the sitting this morning hon. Members did indeed refer to their entries in the Register of Members’ Financial Interests. I do not want to be drawn any further on the details of the process as that would not be appropriate. I have made all the comments I can within the confines of the topic and the yellow card you very kindly gave, Sir Jeremy. I will therefore move on to talk briefly about the amendments.
I will explicitly state that the independence of the regulator is paramount. The Bill is, as the hon. Gentleman said, designed to create an independent football regulator free from any undue political or industry influence. That has always been and continues to be our aim. In the service of that, we have already strengthened the Bill further, now requiring the regulator to establish and maintain a register of relevant interests of members of the board. That already includes the chair, so any further amendment is not necessary.
The definition of relevant interests in the Bill is already broad enough to include political donations if they are relevant to the regulator’s functions. The appointment of the chair is subject to the governance code on public appointments, which clearly sets out that any political activity
“should not…be a bar to appointment”,
as well as the requirements in relation to the declaration of political activity. That point has been well rehearsed; indeed, the Liberal Democrat spokesman made it earlier, as have other hon. Members.
The chair of the regulator is already required to undergo a pre-appointment scrutiny hearing, which we have debated at length. Pre-appointment scrutiny is reserved for the most significant roles, including those where demonstrable independence from the Government is required. The chair and other non-executive members of the board would also be bound by the code of conduct for members of public body boards, which sets clear expectations around political impartiality once in a role. I reassure the Committee that the Bill is robust in ensuring the independence of both the chair and board members more widely. The amendments would not in any substantive manner increase the level of protection in the Bill against undue political influence over the chair.
I turn to the amendments 118 and 119 about conflicts of interest for the board and the expert panel. I reassure the Committee that the Bill, supported by public law principles and non-legislative measures already in place, already sufficiently makes certain that the regulator will be free from conflicts of interest, irrespective of sector. It is also important that the widest possible range of people are encouraged to apply to contribute their skills and experience so long as any and all conflicts of interest are managed appropriately. That point was well made by my hon. Friend the Member for Portsmouth North.
Government amendments made in the other place have strengthened those protections even further, and beyond doubt. Paragraph 17 of schedule 2 requires members of the board to declare their interests in any matters that fall for consideration by the board, and for that declaration to be recorded. The board member would not be permitted to take part in any discussions related to a matter if they have a significant direct or indirect interest in it.
With specific regard to the expert panel in amendment 119, the Bill already places an onus on the chief executive officer to check for conflicts of interest at the point of making an appointment to the expert panel and on an ongoing basis from time to time. The Bill sets out that the chief executive officer must ensure that the expert panel has all the relevant range of skills, knowledge and experience. The amendment might limit the ability of the chief executive officer to do that, as it would restrict the pool of potential members of the expert panel. It may well be appropriate for the expert panel to have expertise in media or broadcasting, but the amendment would outright preclude that, and so might hinder the regulator’s ability to fulfil its objectives.
All in all, the Bill contains comprehensive safeguards to examine and manage genuine conflicts of interest appropriately. I therefore urge the hon. Gentleman to withdraw the amendment.
Mr French
I have heard the Minister’s comments clearly and I am afraid that I am not filled with confidence, not necessarily because I doubt what she says or her intentions but because of the proven experience of the situation in which we find ourselves. I appreciate the yellow card, so I will not go fully back into that, but it does bring into question the judgment of Ministers and individuals and whether we can have certainty in these steps and measures. The Opposition think these amendments are not party political at all. We want to ensure that we have transparency and absolute security that whoever is appointed to these positions will act with complete neutrality and independence, and avoid any perception of bias. I will not repeat the arguments of why that is so important for sport and the independence of sport. We will press our amendments to a vote.
Question put, That the amendment be made.
Mr French
I beg to move amendment 138, in schedule 2, page 88, line 37, at end insert—
“(1A) But the number of persons in the employment of IFR (including any persons seconded to the IFR) must at no time exceed 50.”
As always, you are keeping me on my toes today, Sir Jeremy; I thought we were about to vote on amendment 119. We always learn something new in Bill Committees. Amendment 138 raises a serious and growing concern, so I will be very clear about what the amendment would do. We seek to limit the number of employees of the Independent Football Regulator to a maximum of 50. We think that is quite fair. I could have proposed 20, 10 or some other number, but I thought 50 was fair, based on the conversations that we have had with the football world.
Our serious and growing concern is about not just what the legislation says, but the consequences of the way this Government have chosen to structure the regulator. The amendment uncovers and seeks to prevent the key problem with the Government’s regulator, which we believe is purely that it will ultimately put up prices for fans. This morning, the Minister said that her Government have not claimed that the regulator will solve all the problems, and while that may be true, we believe that her regulator will actively create more problems for clubs and for fans. I will come on to the problems that we believe it will cause for clubs later in the Bill, but, to be clear, we put fans first and that is what this amendment seeks to do.
The creation and operation of the Government’s regulator and the burdens it generates will impose a very real cost on clubs. I suspect that will not have a massive impact on the billionaire owners of the big clubs, or the executives, consultants and lawyers employed in the football industry, but it will significantly affect clubs that are already subject to serious financial constraints and those lower down the pyramid.
Let us begin with the principle. I do not believe that anyone here disputes the need to protect the long-term sustainability of English football and the need for English football to be sustainable, even if definitions of “sustainable” differ. However, if the Government genuinely intend to safeguard the game for future generations, creating a vast and costly bureaucracy is not the way to do that—yet that is what this regulator will do. It will increase the costs on clubs, which will ultimately have no choice but to pass them on to fans. That view is accepted by those in the industry that I have discussed this with. This Government have chosen bureaucracy over the beautiful game and its fans. It is the ever-present home and away supporters who will end up bearing the brunt of the costs of this regulator.
Turning to the specifics of amendment 138, last week I submitted a written question to the Secretary of State to ask how many appointments had been made to the shadow football regulator already and how many of those appointed were previously employed in her Department. I know from conversations I have had with the EFL, the National League, the Premier League and the FA that the shadow regulator has already begun to scale up. When my noble Friend Lord Moynihan asked the Lords Minister a similar question in the other place in December, the answer, which was received in January, stated that the number of IFR employees already stood at 38. As it happens, the answer to my written question is due today. Can the Minister save me the trouble of waiting for that response to come through online and tell us here and now how many full-time equivalent staff are currently working on the shadow regulator and how many of those were previously employed in her Department as employees, advisers or appointees?
Stephanie Peacock
There were 42 employees as of 1 June; 11 joined having previously been employed by DCMS and two joined having formerly advised DCMS. The answer is due by 6 o’clock today and I will make sure that the hon. Gentleman receives it in writing by then.
Mr French
I must admit that I am surprised to get a concise answer from a Minister; I thank the hon. Lady very much. There are 42 employees and a number of those were already in roles in the Department. That is very important because it highlights the size of this regulator already.
Stephanie Peacock
I thank the hon. Member for Old Bexley and Sidcup for his amendment. I note the irony of him saying he does not want to oppose the Bill for the sake of it, given our discussion today and the fact that the Bill began its life under his Government. I completely understand the intent to ensure that we do not end up with an overstaffed regulator that is not delivering value for money. That is exactly why there are appropriate controls over the regulator’s expenditure.
Proportionality is key to the point about costs. We will have a further debate today or on Thursday about the regulatory principles, which are really important, but the operational cost estimate is between £77.4 million and £106.8 million over 10 years. That was based on the impact assessment signed off by the previous sports Minister, the right hon. Member for Daventry. Those costs have not changed—with the caveat, of course, that that is an estimate.
Stephanie Peacock
We do not believe that the changes are significant enough to lead to a significant increase in costs.
Stephanie Peacock
I am not going to be drawn on figures. I will say that we think that the regulator should be as light touch and slim as possible. We do not think that it should be unwieldy and we do not think there should be staff for staff’s sake. It is not for me as the Minister to prescribe a specific number. I do not agree with that. For those reasons, the hon. Member for Old Bexley and Sidcup should withdraw his amendment.
Mr French
I have listened very carefully to contributions from hon. Members on both sides of the Committee and to the answers provided by the Minister. I am concerned that the Government will not publish a refreshed impact assessment because, as I have highlighted, the costs to businesses and football clubs around the country have increased since the impact assessment was published. The regulator designed by the current Government also differs from the previous Government’s. We believe that it is bad practice for Members not to have all the information to hand for a live discussion about the expected costs of the regulator or concise information about what the size of the regulator may be.
Stephanie Peacock
I absolutely agree, and the Liberal Democrat spokesperson puts an important point on the record.
We expect a significant benchmarking exercise to be undertaken in determining the appropriate level of remuneration for the CEO of the regulator. That should be consistent with other regulators of a similar size and regulatory remit. We believe that an arbitrary constraint would be problematic. Safeguards are also in place already requiring approval for any public sector salary that exceeds £150,000, as per the senior pay controls process.
Mr French
I thank the Minister for her comments, and I am listening carefully. On the point about markets, we are not talking about the market dictating the level, but Members of Parliament. The hon. Member for Cheltenham is in for a rude awakening if he believes that this is what the market looks like, if he goes down to the City of London. But on the argument that the Minister is making about the size of the regulator, what is that comparable size? We have tried to get an answer on what size the Government are looking at. So on the point that she just made about the salary being appropriate and reflective of other representative regulators, what is the size of the regulator? My hon. Friend the Member for Isle of Wight East made the point about the salary that has been advertised only being a part-time salary, so what are the expectations in relation to that compared with the size of the regulator? That is fundamental to the Minister’s point.
Stephanie Peacock
As I have outlined, a benchmarking exercise will be done thoroughly on that. I am intrigued by the mock outrage from the Conservative party, who did not in any way put in a staffing cap or a salary cap when we were in this room previously. To take some examples of other salaries, they are much higher: at the Financial Conduct Authority, the salary is £400,000, at the Competition and Markets Authority, it is £200,000, and at Ofcom, it is £350,000. This is the current salary now but it was not wildly different under the last Government. I did not see them making these amendments to their Bill.
Mr French
Again, there is this deliberate conflation regarding what I am asking. The Government are arguing that this regulator is light-touch and different from those other regulators, and that the salary has been benchmarked against those at other regulators of a similar size and nature. This is the question I am asking the Minister: what is that other regulator, and how big is it? That determines what is an appropriate level of salary. This is about not only the Government’s arguments and our understanding, but the cronyism argument. I will not go into this but the reality is that a Labour donor is in the process of being appointed to a part-time job on a six-figure salary. Members of the public have a right to know what analysis the Government have done to determine that level of salary on a part-time basis.
Stephanie Peacock
I do not know if the hon. Member is wilfully misinterpreting what I am saying or not. I have made it very clear that there will be a benchmarking exercise. I have given a number of examples of other regulators whose salaries are much higher and were so under the previous Government.
Senior pay controls allow the Government to ensure that senior pay is set at an appropriate level to enable the public sector to recruit, retain and motivate the best people, while also ensuring value for money for the taxpayer. That means that if the regulator sought to set the CEO’s salary above £150,000, it would need approval from the Chief Secretary to the Treasury. For the reasons that I have set out, I hope that the hon. Member will withdraw his amendment.
Mr French
I appreciate the Minister’s comments, although I think they were more confusing than they were an answer to the questions. We have tried to be clear, and I do not mean this disrespectfully. I am not wilfully misunderstanding; I am asking a really clear question about the comparison the Government are making. What does the benchmark look like? That is not a theoretical question; we already know that someone has been appointed, and they used a benchmarking exercise to make that appointment. That is the point I am trying to make: a benchmarking exercise must have already been carried out, if the Government have done their due diligence in making that appointment.
Mr French
As the Minister set out, Government amendments 61 and 63 are consequential on the insertion of new clause 3, so I will limit my comments on this part, because I agree with her that it would be better placed at that point. However, I want to ask her about a couple of points. My understanding is that new clause 3 replaces what was clause 61, which set out the final proposal stage under the resolution mechanism. Again, I will save my substantive comments on that for later.
Government amendment 62 provides that the board may only delegate the functions of deciding whether the resolution process should be triggered under clause 59 or of making a distribution order under new clause 4 to another committee of the board. I would like to ask the Minister the rationale for making this change at this stage in the process, given that the Bill has gone through the other place. We had a discussion on Second Reading and, as she just acknowledged, the leagues were not happy with the mechanism as it was designed previously. It is a fair question to ask why the Government are seeking to change this part of the Bill now. Why does the Minister think that the decision on whether to trigger the resolution process or to make a distribution order should be delegated to a committee rather than taken by the board itself?
Stephanie Peacock
I am grateful to the shadow Minister for his questions. On the broad question of why we are making the change, to be quite blunt, it would be easier not to. We have a big majority in this place, but we spoke earlier about parliamentary scrutiny and we genuinely listened to the debate in the Lords, where there was quite a lot of discussion around the mechanism of the backstop.
It is important to make it clear right now that the backstop is a backstop. I often quote Dame Tracey Crouch, to whom we all owe a huge debt of gratitude. In the previous Bill Committee, she made a very succinct speech—it is worth reading—about how the backstop should be a backstop. Understandably, a lot of the debate has focused on the backstop—that is not a criticism—but it is genuinely meant to be a backstop. To be quite blunt, it would be easier not to make the change, but we think that it is the right thing to do. I could understand the previous Government’s pendulum arbitration and why it could be successful, but it was more risky, and that prompts more nerves from stakeholders. I am straying into debating the backstop, which I do not want to do because we will debate it later on.
On the question about specifying that the board can delegate these decisions to a committee, hon. Members will correct me if I am wrong, but we are not changing the way that the backstop can be triggered— again, we are straying into the backstop. There is a set of criteria for when the backstop can be triggered by a league, and the state of the game report must have been written and the regulator must agree with that. That stays the same.
I am straying into a future debate, but I think that the hon. Gentleman was saying—he can correct me if I am wrong—that under the previous mechanism it was pendulum arbitration, where party A would put forward a proposal, as would party B, and an expert panel would decide on one or the other, in a completely binary way. This changes it so that there is informal mediation and then a proposal stage. Because the regulator is more involved in saying, “We like that but go and speak a bit more about this,” or, “Seek some more evidence on that,” it makes sense that they do not then delegate that decision. That is the point that I am making, though it is quite difficult to debate this outside the backstop, as I acknowledged in my remarks. I am happy to take his comments away, and when we come to part 4, I believe, and we debate the backstop and the changes more thoroughly, I am really happy to go into more detail.
Amendment 61 agreed to.
Amendment made: 62, in schedule 2, page 91, line 41, at end insert—
“(da) the function of deciding whether the resolution process should be triggered under section 59;
(db) the function of making a distribution order under section (Distribution orders);”—(Stephanie Peacock.)
This amendment provides that the Board may only delegate the functions of deciding whether the resolution process should be triggered under clause 59 or making a distribution order under NC4 to another committee of the Board.
Amendment proposed: 119, in schedule 2, page 93, line 2, at end insert—
“4A No member may be appointed to the Expert Panel if they currently have any broadcast or media interests or any role in a television or media broadcast that relates to football.”—(Mr French.)
This amendment prohibits any person who currently has any interests or roles in a television or media broadcast that relates to football from being appointed to the Expert Panel.
Question put, That the amendment be made.
Mr French
I beg to move amendment 121, in schedule 2, page 94, line 34, at end insert—
“31A (1) The Expert Panel must publish any decision that it makes relating to any of its functions under this Act.
(2) Any decision published by the Expert Panel must include—
(a) the number of members of the Expert Panel who supported the decision;
(b) the number of members of the Expert Panel who did not support the decision;
(c) the reasons for the decision;
(d) the reasons why those who did not support the decision decided not to.
(3) The Expert Panel must publish any records of its committee proceedings as recorded under paragraph (30).”
This amendment requires the Expert Panel to exercise its functions transparently.
The amendment seeks to ensure that the panel must publish any decision that it makes relating to any of its functions under the Bill, and that any decision published by the expert panel must include the number of members of the expert panel who supported the decision, the number of members of the expert panel who did not the support the decision, the reasons for the decision, and the reasons why those who did not support the decision decided not to. The expert panel must also publish any records of its committee proceedings as recorded under paragraph 30 of schedule 2.
The amendment is all about transparency of the decisions made by the expert panel. As it stands, paragraph 30 requires that the expert panel
“must act independently of the Board”
when exercising its functions, without preventing the two-way exchange of information between the board and the expert panel. It is clear, however, that that needs to go further, which is why we tabled amendment 121, which requires the expert panel to exercise its functions transparently. I hope that the Committee agrees that no regulator should hide behind closed doors, and the Government’s football regulator should be no different.
That being said, the Bill lacks detail on the expert panels, and I would like to ask the Minister to clarify the following. How many people does she expect to be on the panels? How many of the panels does she expect to be needed in the first year of operation, and then in subsequent years? What is the cost expected per panel, and is there a specific cap on the cost that can be incurred by an expert panel to the regulator? Finally, how will each member of the panel meet the qualifications of the experience, skill and knowledge we have discussed already, while not incurring a conflict of interest?
To be clear, amendment 121 seeks to ensure that the regulator, a world-first in sports governance, and not in a good way for many of us, will maintain transparency with the fans it is intended to protect and support. We in this House have a great many tools at our disposal to hold the Government to account. It is only right that fans who do not have such tools can see what those deciding the future of their clubs and English football are doing. Sunlight is the best disinfectant and my amendment seeks to let the sun shine on the Government’s regulator.
Stephanie Peacock
I will address some points on amendment 121 and then respond to the hon. Gentleman’s questions. The Government recognise it is vital that the regulator is transparent and able to be held accountable by Parliament and others. That is why, for the expert panel, the legislation already sets out a number of requirements to publish decisions and give reasons for them.
Transparency in decision making is important, but it is also important that individual panel members can act without fear or favour and that ultimately the regulator as a whole stands behind the decisions it makes. It will also be necessary in some instances for details to remain private for commercial, personal or other sensitive reasons. We absolutely agree that transparency around the regulator’s processes and decisions is important, particularly in football, where fans often complain of being out of the loop. That is exactly why the Bill already contains extensive publication and consultation requirements and the regulatory principle encouraging the regulator to be transparent. However, the amendment goes further and risks undermining the operation of the expert panel. Some details may be commercially sensitive, as I have outlined. Equally, individual panel members should not necessarily be singled out for their contributions to decisions; the panel as a whole makes decisions and is held accountable as a whole.
I am at risk of comparing apples with oranges, but we spoke earlier about the Select Committee. In this place, we will have minorities on Select Committees, and I do not believe that those Members who do not agree have their names published. I acknowledge that I am not comparing like with like, but I make a gentle point about how members should be able to make decisions without fear or favour.
The hon. Member asked some specific questions about the expert panel. For the panel to take a decision, it must form a committee of at least three members. If that decision is appealed, three new members will be needed to form a committee to take a new decision, so the minimum number of members required for the expert panel is six. There is no cap on the maximum number of members as the regulator should have flexibility to react in the event of a high workload. Obviously, different panels may be required for different issues. For those reasons, I ask the hon. Member to withdraw his amendment.
Mr French
Unfortunately, based on the earlier deliberations, I do have something to say. I will try to be succinct and not rehash the debates we have had already, although I am happy to carry on taking interventions, as I have done all day.
I will set out why the Conservative party will be opposing schedule 2. The Government have missed the opportunity to tighten up the transparency of the regulator. Instead, they have allowed it to operate under a shadow, and they have not ensured that it will be transparent to fans, who are the ultimate stakeholders in this process. There is a lack of transparency in the decision-making processes. The regulator is granted broad discretionary powers with limited obligations to publish detailed reasoning for its decisions, as we discussed in the debate on amendment 121. Clubs and stakeholders may be left unclear about how rules are interpreted and applied, undermining confidence in regulatory fairness.
A number of times today, I have made the point that there is to be limited parliamentary scrutiny. Because of the amendments that have not been accepted, there are limits in the Bill on how Members of Parliament can have their say on what the regulator will look like. The regulator’s rules and standards are not subject to the affirmative procedure or meaningful parliamentary oversight.
I know that the Minister did not wish to make any comments, but I am interested in her view and the Government’s view on where reports on the regulator will end up. Will it be at the Culture, Media and Sport Committee or, given the costs involved, at the Public Accounts Committee? It is important that Members understand whether they will be at least able to see the reports, even if the Government are not willing to make votes available. There is no requirement to consult publicly before issuing or revising key regulatory frameworks, which again limits external input. We have already brought up the issue of some people not being consulted and others being consulted.
On the opaque appointment and governance structures, we have highlighted the Opposition’s concerns about how the selection process has taken place and how it will take place in the future. We need strong safeguards to ensure that political interference does not impact the perceived and the realised work of the independent regulator. It is a fundamental risk to the future of football and the future of sport.
We believe that the duty to disclose key information is insufficient and that the regulator should be disclosing information on a regular basis, so that Members of Parliament and fans can have clear sight of what it is doing. That is a completely fair thing to ask for. It is not a political request; it is about transparency.
On costs, which we have discussed at length, the Opposition are concerned that we do not have transparency about the cost of the regulation. We are unclear on what the Government’s end goal is for the regulator. We have heard different arguments about what its size may be in the future and comparisons with regulators that I think would scare most of us. Hearing the cost of 900 members of staff should scare all football fans, if that is the direction of travel the Government are going down with the regulator, which is supposed to be light touch.
I have a couple of questions for the Minister, just to give her a bit more time. How will Parliament scrutinise the regulator’s spending, as set out on page 96 of the Bill? Can she tell us whether scrutiny will come from the Culture, Media and Sport Committee or the Public Accounts Committee? There is also mention of financial assistance being provided, based on the Secretary of State’s judgment. Can the Minister tell us what the Bill means by “appropriate” and whether taxpayers will be bailing out failing clubs or even the regulator?
Stephanie Peacock
I am grateful to the hon. Gentleman for his comments. To take the final one first, taxpayers will not be bailing out failing clubs. This is not going to save every single club; to make it very clear, it was never intended to do that.
The provisions in the schedule ensure that the regulator has the necessary structures in place to function effectively and efficiently, with appropriate accountability as a public body, which is an issue that we have debated extensively. It ensures that an agreed and transparent process is adhered to when establishing a governance framework, including its board, committees and expert panel. We have made provision for the regulator to appoint a board observer from the Football Association, and as the national governing body for English football, they will get an insight into the operation of the regulator without having voting powers. Ultimately, the regulator will be accountable to Parliament. As we have spoken about throughout this debate, it will be operationally independent and free from undue political or industry influence. The provision in this schedule is central to creating that framework, and I commend it to the Committee.
Mr French
As I referenced in the question, I was deliberately trying to be specific because we have not really got into what part 4 of the schedule says. The Minister has just made a point about scrutinising the spending of the regulator. How will Parliament be able to scrutinise the regulator going forward? I am happy to have it in writing, if the Minister does not have the answer on her today. Will it be the role of the Select Committee on Culture, Media and Sport, the Public Accounts Committee or both? Will reports be laid on the Floor of the House, for example, for hon. Members to look at, or in the House of Commons library? That is the question that I am trying to ask the Minister today, and I would appreciate it if the hon. Lady gave us a bit of certainty on that.
Stephanie Peacock
I am absolutely happy to do that. It is obviously up to the Select Committees, and they can scrutinise if they want to—it will be up to individual Select Committees to decide. The IFR has to publish an annual report, and there is a review clause in there, too. We are happy to write to the hon. Gentleman with more detail if that would be helpful.
Question put, That the Schedule, as amended, be the Second schedule to the Bill.
Mr French
I will make my comments brief, because the hon. Member has made a number of excellent points that need to be addressed by the Minister rather than by me. The objectives under clause 6 are the promotion of the financial soundness of regulated clubs; protecting and promoting the financial resilience of English football; and the safeguarding of heritage assets, which is the main point the hon. Member for Sheffield South East just made. He spoke well about how those different issues interlink between clubs of different sizes, and the impact it has on lower league clubs that value the financial benefits of a replay.
I remember, as a Cheltenham fan, when we were in what was League One then, but now is the Championship, going to Bolton, where we lost in Bolton’s new stadium, and going to Coventry where we beat a Premier League team. It is incredible for fans to go to grounds that they would not normally get to experience. We must not lose that aspect of this. There is also the financial impact of the smaller club getting a replay, which is absolutely crucial. Welling United, one of my local clubs, has sadly just been relegated from the Conference South. I remember—I think they had got to round two in the cup a few years ago—Carlisle had come to visit. Welling United fans would never normally have had the opportunity to watch them play that club, or to visit their stadium and see all the characteristics of stadiums at that level and professional players perform there. That is an important part of the fabric and the love of the FA cup, which we all share.
I am talking about the EFL cup as well, but the FA cup in particular is incredibly powerful. I spoke about the soft power asset of English football around the world—people understand the value of the FA cup and what that means for competition across the whole pyramid. We know clubs in the lower leagues play a number of qualifying rounds to try to get to round three when the Premier League clubs normally come in. We must not lose sight of the impact of replays, and I would be genuinely interested to see what the Minister says in response to the point made by hon. Member for Sheffield South East on those.
We had a long debate earlier about what we thought were good ambitions to try to expand the scope of the objectives of the IFR in clause 6, and I appreciate that Committee members have had their say already on whether that is the wrong thing to do. I encourage the Minister, again in good faith, to consider the point about the growth of the game. We are concerned that, as drafted, the objectives of the regulator do not fulfil the potential it could have to try to look at the growth of the game. In other Departments I know the Chancellor has urged Ministers to write to their regulators to ask for growth examples, but at this point in the Bill we can mandate that to be a part of the regulator’s considerations. I urge the Minister to think about that point.
Stephanie Peacock
It is a pleasure to once again, and possibly finally for today, serve under your chairmanship, Sir Jeremy—but we will see. I am grateful to my hon. Friend the Member for Sheffield South East for all his work in the all-party group and for his long-standing interest. I completely appreciate his points. I would say that the regulator will have a number of ways to safeguard heritage, including to be able to prohibit competitions, and require consultation on matchday operations. Clause 8 encourages the regulator to engage with both players and fans on relevant matters. The regulator has a tightly defined scope and purpose focused on protecting and promoting the long-term financial sustainability of the game for the benefit of fans and local communities. It will not intervene on sporting competition matters, such as the footballing calendar.
To address the point by my hon. Friend for Sheffield South East about the FA cup and replays, I remember that just as the previous Bill was published, it was in the news and a real debate. I completely appreciate that one could argue that it is very much part of the heritage of the game, but it is also a competition matter, and therefore it is out of scope of the Bill. I will take away the comments by my hon. Friend, and I appreciate Members from across the House for putting theirs on the record.
Question put and agreed to.
Clause 6 accordingly ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Vicky Foxcroft.)
Football Governance Bill [ Lords ] (First sitting)
Debate between Stephanie Peacock and Louie FrenchTuesday 3rd June 2025
(1 month ago)
Public Bill CommitteesRead Full debate Football Governance Bill [HL] 2024-26 View all Football Governance Bill [HL] 2024-26 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 3 June 2025 - (3 Jun 2025)
Stephanie Peacock
It is a pleasure to serve under your chairmanship, Sir Jeremy. I begin by welcoming the Committee; it is a real pleasure to be here. It is just over a year since I was sitting on the other side of the room debating the Bill’s previous iteration. I look forward to working with Members from all parties. The Bill was in both the Labour and Conservative party manifestos. It is an important piece of legislation and we will spend a lot of time on line-by-line scrutiny.
I thank the hon. Member for Old Bexley and Sidcup for tabling amendments 95 and 96. I will also respond to some of the points made by the hon. Member for Isle of Wight East and my hon. Friend the Member for Dartford.
Amendment 95 was debated at length in the other place. Unsurprisingly, the Government’s position on it remains the same. We do not agree with its intent to narrow the purpose of the entire Bill specifically to financial sustainability, or to add to its purpose the vague and undefined words “success of English football”. I was a little confused by the contribution from the hon. Member for Isle of Wight East. He said he was concerned about “narrow financial metrics”, but the amendment in the shadow Minister’s name actually would narrow the purpose simply to financial sustainability. I will outline why we do not agree with that.
The Bill’s purpose is sustainability, as defined in clause 1. It is about the continuation of service. I draw Members’ attention to subsections (3) and (4), which say that sustainability means continuing to serve the interests of fans and to contribute to the wellbeing of the local communities that regulated clubs serve. Of course, financial sustainability is an important part of that. If a club suffers financial collapse, it cannot continue to serve its fans and the community. However, we believe there is more to it. If a club’s balance sheet remains healthy, but it ups sticks and moves 60 miles away, or changes its name, badge and shirt colours, that is not continuity of service. That is precisely why the Bill covers aspects such as fan engagement and heritage, as well as financial issues, and why the Bill’s purpose needs to be overall sustainability, not just financial sustainability.
I understand the desire to ensure the continued success of English football as one of this country’s greatest exports—Members from throughout the House have outlined the huge contribution that it makes globally —but that is already achieved in the Bill. As part of its secondary duties, the regulator must have regard to avoiding impacts on important outcomes in football. That includes domestic sporting competitions, the competitiveness of our clubs against international clubs, financial growth, and investment in football. Rather than the undefined concept of “success”, those specific elements represent the building blocks on which English football’s success has been built. Actively pursuing those outcomes will remain the responsibility of the industry, rather than the regulator, but the regulator will avoid unduly harming them while it strives for sustainability.
If, as part of the Bill’s purpose, the regulator were required to protect the success of English football as well as its sustainability, there would be a significant widening of its scope. The regulator would need to be actively involved in anything that relates to the success of English football, such as the commercial and sporting sides of the game. Government Members have been clear that we do not want scope creep, which brings me to the question from the hon. Member for Isle of Wight East about the National League’s three up, three down campaign. I have met representatives of the National League a number of times and I am completely sympathetic to their aims, but that does not fall within the Bill’s scope. I think we can all agree that it is not something that we, or organisations such as the Football Association, UEFA and FIFA, want the regulator to interfere in.
Amendment 96 seeks to add further detail to the definition of “sustainability” for the purposes of the Bill. I thank the hon. Member for Old Bexley and Sidcup for largely copying and pasting the Government’s explanatory notes to clause 1; however, the purpose of the explanatory notes is to provide that sort of additional, illustrative detail about the intention behind the legislation that is not appropriate for the face of the Bill.
The amendment also seeks to add criteria on TV viewership, match-day attendance and international competitiveness to the definition of “sustainability”. We have significant concerns that that would expand the scope of the regulator and put in place a much more interventionist regime than this Government propose and, indeed, than the previous Government proposed. The regulator would be required to concern itself with issues such as match-day attendance and TV viewership, as my hon. Friend the Member for Dartford mentioned. It would not be able to have a direct impact on those issues without actively intervening on issues such as ticket prices and broadcasting. At best, we would have a regulator without the powers to achieve its purpose, and at worst, we would have mission creep into areas that do not warrant statutory regulation. For those reasons, I ask the hon. Member for Old Bexley and Sidcup to withdraw his amendments.
Stephanie Peacock
The clause sets out the Bill’s purpose, which is to promote and protect the sustainability of English football, as well as summarising what each of its parts provides for. It explains that English football is sustainable if it continues to serve the interests of fans of regulated clubs and continues to contribute to the economic or social wellbeing of local communities with which regulated clubs are associated. The Bill’s purpose is crucial as the regulator will be obliged to act in accordance with it at all times, so far as is reasonably practical.
The fan-led review made clear that the pre-eminence of failure in the market is unsustainable, with football clubs unable to continue to provide their service. It is unacceptable that fans and local communities could witness their clubs no longer operating. We know the huge impact and contribution that clubs make to communities up and down the country, which is why we are making good on our manifesto commitment and have introduced the Bill.
The clause defines “sustainability” for the purpose of this legislation as the continuation of service in the interests of fans and for the wellbeing of local communities. We will debate and explore the Bill’s purpose in detail over the course of the Committee. At a basic level, the Bill asks clubs to consult their fans, to be a fit and proper owner and to have a business plan. In essence, clubs should continue to belong to their fans and communities now and in future, which means there should not be financial collapse, relocation of stadiums or new breakaway competitions.
Mr French
It is an honour to speak again under your chairmanship, Sir Jeremy—I promise the Committee that I will not say that every time.
The Opposition do not disagree with much of the sentiment as we are all passionate about football and understand the role of clubs in our communities, as I acknowledged earlier. Our concern, which is why we tabled the amendments, is that the opaque definition of sustainability could have significant unintended consequences for the regulator’s direction of travel.
The Minister said of our amendments that the considerations we were trying to put in the Bill were secondary—or words to that effect; I apologise if I have slightly misquoted her—but my concern is that those considerations are primary in their focus. It will take many months to get the new regulator up and running, but if it does not understand the message that the House is sending it—that it should be focused on trying to improve football—it could be a lost cause before it has even got started.
Our concerns are clearly articulated in our amendments. We accept that we have lost the vote—the Government have a massive majority, so that is not surprising—but we urge Ministers, in their work going forward, to be clear with the regulator and the people who work for it that the ambition of this House is not to limit the scope of the regulator to just the clauses before us today.
Stephanie Peacock
I thank the shadow Minister for his comments, but I simply do not recognise their premise in terms of the definition of sustainability being vague. In the Bill’s previous iteration, the Government did not make the amendment that the hon. Gentleman proposed. I will not repeat my previous speech. We think that sustainability is much broader than simply finances. There is a procedural issue around not necessarily secondary considerations; the explanatory notes provide additional illustrative detail, and obviously what we say in Committee will give a clear indication to the regulator, and indeed to clubs.
Question put and agreed to.
Clause 1 accordingly ordered to stand part of the Bill.
Clause 2
Key definitions
Mr French
I beg to move amendment 132, in clause 2, page 2, line 31, leave out subsection (3) and insert—
“(3) For the purposes of this Act a ‘specified competition’ includes—
(a) the Premier League,
(b) the English Football League, and
(c) the National League.
(3A) The Secretary of State may by regulations made by statutory instrument subject to approval by both Houses of Parliament amend the competitions specified in section (3).”
This amendment would specify the leagues that are to be classed as “specified competitions” under Act.
Stephanie Peacock
I thank the hon. Gentleman for his contribution; I will come to debate some of the points that he has made later in the Bill. We are very clear that UEFA and FIFA have no issue with the Bill and that the England national team do not fall foul in any way of this legislation.
I move on to the amendments. I understand the desire for up-front clarity in the Bill about which competitions will initially be in scope. There is a sound policy rationale for the approach that we have taken in clause 2. By delegating to secondary legislation, we are merely following the precedent established by other, similar, sport-related legislation, including the Safety of Sports Grounds Act 1975 and the Football Spectators Act 1989. The delegated power ensures that the competitions in scope can be amended in a timely manner and that the scope of the regime remains relevant. It future-proofs for future innovation and protects against circumvention by ensuring that clubs and competition organisers cannot simply reconstitute, rename or establish new competitions to avoid the regulator’s regime.
As mentioned, the intended scope of the regulator is well known and has involved extensive consultation with the clubs and leagues that will be in scope. Any changes in the future would again require consultation and would be subject to appropriate parliamentary scrutiny under the affirmative procedure.
Mr French
I have listened carefully to the Minister’s comments about why she believes we should not specify the leagues, but what is unclear in her language is whether she believes that the Committee should have the opportunity for scrutiny; these measures have been scrutinised in the other House and by a previous Parliament. I believe passionately that when it comes to future-proofing the Bill it is the role of elected Members on the Committee to scrutinise and have a proper debate. I appreciate that the issue has been debated elsewhere, but we need to have a proper debate here, and that is what I am trying to do. I am trying not to be too political in my comments.
My other point is about the consultation exercise with clubs. From the feedback we have had from clubs, it is unclear why they were not invited to give evidence to the Committee. Will the Minister explain why the Government did not want clubs to give evidence to the Committee?
Stephanie Peacock
I thank the hon. Gentleman for those points. I very much welcome parliamentary scrutiny, and hon. Members will know that we intend to make some changes to the Bill following the debate in the House of Lords. Of course, it is the role of the Committee to scrutinise the legislation, but we must recognise that calls for change date back to 2011 in this place, with the cross-party Select Committee report and the fan-led review. We had extensive evidence sessions a year ago where we heard from clubs, fans and lots of different stakeholders, and indeed over the last year as the sport Minister I have done extensive consultations. The Bill remains largely the same as the one we previously debated. We believe that we have made some changes to strengthen it, and that is what we are here to debate.
Stephanie Peacock
No, I will make some progress and then take another intervention in a moment.
On the point about consultation and it being appropriate for parliamentary scrutiny—this comes to the point made by the Liberal Democrat spokesperson—currently, National League North and South are not in scope, but clearly it would not be feasible for the regulator to oversee the entire pyramid and place requirements on clubs all the way down to grassroots.
On the basis of extensive consultation, we believe that the top tiers are the most sensible and proportionate place to draw the line; below that, the regulatory burden would outweigh the potential benefits. However, if circumstances change and the Secretary of State feels that the National League North and South might benefit from being within scope of the regulator, the Secretary of State could conduct an assessment and make regulations to include them.
Mr French
I might have jumped the gun, particularly given what the Liberal Democrat spokesman said, but I want to understand the Government’s thinking about that exact classification and the difference between the National Football League and the National Leagues South and North. What are the Government fundamentally looking at in defining what leagues should be in scope of the regulator?
Stephanie Peacock
It is a fair question, but there was exactly the same cut-off under the previous Bill.
Stephanie Peacock
I am going to answer the question. It is largely—not exclusively—about where teams tend to be full time. It is not a perfect cut-off, and the Liberal Democrats have made a perfectly clear argument, but there has to be a cut-off somewhere and we believe, as the shadow Minister’s Government did, that the top five tiers is the best cut-off.
I want to respond to the shadow Minister’s points about the women’s game and how it could be brought into scope. Karen Carney’s review of women’s football recommended that it be given the opportunity to grow and self-govern rather than move immediately to statutory independent regulation. We are not saying in any way that it should be brought into regulation; we are simply giving that option so that we would not have to return to primary legislation. For those reasons, I ask the shadow Minister to withdraw the amendment.
Mr French
I have listened carefully to the Minister’s comments, but in the feedback we are receiving there seems to be inconsistency not only about what leagues should be under the powers of the regulator to ensure certainty and clarity, but about the powers of the Secretary of State. As I said, there is a massive issue about the role and power of Parliament to hold the Government of the day to account, which we all should believe in regardless of what party we represent.
I note to Labour Members that their party will likely not be in power for ever—I am not making a point beyond that—but this legislation will be in place until another Parliament seeks to change it. Whatever the colours of the Government of the day, Members should have an opportunity to scrutinise what they bring forward. Our amendment 132 seeks to ensure that that happens, by giving hon. Members a clear ability to have a vote whenever the Secretary of State wishes to expand powers.
Stephanie Peacock
This clause, as is standard procedure, sets out the key definitions used throughout the Bill. It gives the Secretary of State power to make a statutory instrument to specify competitions, as we have just debated. Those specified competitions can then define the regulated population.
Defining the scope in this way is an important part of future-proofing the Bill, as was seen when the old First Division became the Premier League in 1992. Before making any changes to the specified competitions, the Secretary of State must carry out an assessment on whether it would be appropriate to do so. In carrying out that assessment, the Secretary of State must consult the regulator, the FA and any other stakeholders who the Secretary of State considers relevant. A report of that assessment must also be laid before Parliament. I commend the clause to the Committee.
Mr French
I will pick up on a couple of my previous comments that have not been answered by the Minister, as we will shortly conclude debate of this clause. Why have the Government decided to specify the FA in the clause but not the other leagues? That point has been raised with me by those other leagues. Why are the Government not specifying the other regulatory bodies involved in football? I am interested to hear the Minister’s response, and will happily give way if she would like to give it.
Stephanie Peacock
As the hon. Gentleman will know, the FA is the national governing body of the English Football League, and that is why it is specified.
Mr French
I welcome that comment, but the FA has a quite different role than the leagues themselves, which are currently responsible for various regulatory aspects of English football—whether in the Premier League, the EFL or the National Football League. The FA’s role is alongside those bodies. That is why—these are not my words—there is uncertainty about why the Government have decided to only specify the FA, given that there are clearly other governing bodies involved in English football. That is currently a bit of a mystery.
On the Minister’s other comments, the Government are unclear on the direction of travel of English football and on what the Bill will and will not do. It has been suggested that the regulator will be able to solve all problems, but we have to be honest with the public and say that that is not going to be the case. If a club is badly managed—and I know we are about to discuss ownership—there is little that the regulator will be able to do to stop a club from going bankrupt, as an extreme example. We all have to acknowledge that that is a real risk for football, regardless of what the regulator looks like. I will end my comments there.
Stephanie Peacock
As I said in my intervention, the FA is the national governing body: there is only one governing body, and that is why it is specified. We expect the regulator—this provision is in the Bill—to consult all relevant parties, including leagues and fans. In the previous debate, we were clear that the leagues will be specified by statutory instrument.
The shadow Minister just said that it has been claimed that the regulator will solve all problems, but that absolutely has not been claimed, either by this Government or the previous one. We are debating the purposes of the Bill this morning; it is about the sustainability of the football game, having not been able to do that itself over the last decade. There have been calls for change in this place dating back to 2011—the ill-fated super league, the fan-led review and his Government’s previous Bill. This Bill will not solve all problems, but we hope it will put football on a sustainable footing.
Question put and agreed to.
Clause 2 accordingly ordered to stand part of the Bill.
Clause 3
Meaning of “owner” etc
Question proposed, That the clause stand part of the Bill.
Stephanie Peacock
Clause 3 is about the owners of football clubs, who play a pivotal role in the sport. Without their efforts and investment, English football would not be the success it is today. Owners have an immense responsibility to not just their club, but fans, local communities and businesses in the surrounding area. Although current league rules outline a requirement to declare who controls a club, there are concerns with their application. That applies particularly when clubs are owned or controlled by offshore entities or complex company structures.
Fans have also expressed concerns about the opaque nature of who owns their clubs. They deserve to know who has ultimate responsibility for the club they support, and the clause ensures just that. The clause signposts to schedule 1, which defines when a person is an owner of the club. The clause also defines a club’s ultimate owner or owners. The ultimate owners of a club are those who have the highest degree of influence or control over the activities of the club. When a club applies for a provisional operating licence, it has to identify its owners and ultimate owners to the regulator in a personal statement. Defining the ultimate owners of a club and requiring clubs to declare them will be a crucial step to improving transparency and accountability in the game.
Schedule 1 defines owners for the purpose of the Bill and equips the regulator to apply that definition in different real-life circumstances. It is crucial that owners are suitable so that the sport is placed on a more sustainable footing. An ownership chain may be long and complex, with many links; to ensure clubs have sustainable custodians, the regulator needs to identify the human being with actual control at the very end of the chain—rather than the holding companies or other legal structures, which are just links along the way. That is why, under the Bill, the definition of an owner focuses on identifying individuals, except where clubs are owned by registered societies.
Registered societies are specific legal structures defined in clause 91; they must be run as co-operatives or for the benefit of the community. When used for ownership of football clubs, they are typically one-fan-one-vote organisations where control is split equally among hundreds or thousands of members. That is why ownership chains can end with registered societies, without needing to identify named individuals behind them.
The Bill’s definition of an owner draws heavily on precedent from other legal regimes where ownership can be complicated or opaque, including the “persons with significant control” regime in the Companies Act 2006. The Bill’s definition is designed to capture those who have significant shares or rights, or other forms of significant influence or control over the club. It also includes owners who meet one of these conditions at arm’s length, such as via a trust or a similar body. That approach means that owners cannot simply evade regulation by creating ever more complicated ownership structures. Having a clear definition of an owner means that owners can be identified, tested and held to account as custodians of the club.
Clause 4 is about officers and senior managers. The Bill will introduce two key things: transparency for fans and accountability for decision makers at clubs. The clause defines an officer and a senior manager of a club for the purpose of the Bill. Those definitions have been drafted in recognition of the existing legislative precedent, including the Companies Act 2006 and the Financial Services and Markets Act 2000, as well as the definitions currently used in the football industry. The clause’s purpose is to appropriately define the people who run, or have a significant level of direct influence, over the day-to-day running of a club.
Officers of a club are subject to legislative requirements, including the owners and directors test. The regulator may take enforcement action against a senior manager— a subset of officers who carry out specific management functions at the club. If a club commits a relevant infringement connected to a senior management function carried out by that individual, the individual can be held liable. I commend the clause to the Committee.
Mr French
I will start with clause 3, which deals with the broad definitions of an “owner” within the context of this legislation, as the Minister has just set out. While it may appear technical on the surface, this clause lays the groundwork for the regulator’s ability to properly identify and engage with those who hold real power and influence within our football clubs. Getting these definitions right is absolutely essential. For too long, fans have felt that football governance has been undermined by opaque ownership structurers, shadowy investment vehicles and individuals who exercise effective control without proper scrutiny or accountability.
The clause also ensures that the regulator is not hamstrung by narrow or outdated definitions of ownership. It gives clarity on who can be held responsible, whether through legal ownership, executive authority or de facto control. That clarity is vital if we are serious about improving transparency and strengthening the fit and proper person test regime. At the same time, it is right that this is done in a proportionate and legally precise manner. We must avoid unintended consequences that could dissuade responsible investment or penalise legitimate business structures. Definitions must be robust but not overly broad.
On that point, I will pause for a second. As Members, we have to recognise the international nature of club ownership, both in the EFL and the Premier League. We are talking about English football, but there are only four or five clubs in the Premier League that have an English majority owner these days. We have to be very clear in our work, and in our discussions on the Bill, that we do not want to deter inward investment in the game. We need to understand that there is increasing international competition for these owners to effectively move their assets into other countries. In particular, there is the rise of the Saudi league, which is growing in competition versus the more traditional heavyweights of the European sector.
In seeking to strengthen the ownership test, which I support, we have to be mindful of not deterring investment. Could much of this work on ownership structures and tests have been done appropriately through the current governance structures of English football? Yes, I think it could have been done better already, and I personally would have preferred that to be the direction of travel, rather than through the Bill. However, we are where we are, and I will not oppose clause 3 for the sake of it.
Clause 4 defines the roles of an “officer” and “senior manager” within football clubs, and again seeks to improve transparency on accountability, roles and responsibility. This provision, as outlined by both the Minister and the Premier League in some of its comments, seems to mirror banking regulations, which I was familiar with before coming to Parliament nearly four years ago—time flies when you’re having fun.
The language used in this provision is similar to that used by the Financial Conduct Authority. When the Minister speaks again, I would be quite interested to understand why the Government have chosen banking regulations as the model for football, because I want to understand their thinking on the future of the regulator and football. We are talking about both a business and a sport that differs in many ways to financial services and in the positive impact that it has on this country. While football creates many jobs, it also has an impact on communities around the country and grassroots clubs, where we like to see young boys and girls participating in football.
Schedule 1, like clause 3, is foundational to the Bill and thus to the future of English football in providing a detailed meaning of an “owner”. Where the clause provides the broader meaning of an “owner”, this schedule details the conditions for being an “owner” and rightly looks beyond just legal shareholders. It captures those who influence clubs through formal or informal control, whether that is through a boardroom presence, financial influence or complex ownership structures.
The inclusion of the 25% ownership threshold is rooted in established legal standards, but equally important is the provision to capture those who may fall below that line but wield significant power. We have seen far too many clubs come to harm because of murky ownership arrangements and a lack of transparency. I am confident that other hon. Members will speak to the goings-on at Reading in recent months and years, if previous debates are anything to go by. I know more about Reading than I ever thought I would, as a football fan, but a lot of hon. Members have mentioned the example already.
That said, I must also raise the example of Charlton Athletic, a proud and historic club just outside my own constituency of Old Bexley and Sidcup. It operates in the Greenwich borough next door to mine, with the training ground literally on my constituency boundary and the home ground, the Valley in Charlton, a bit further away.
Stephanie Peacock
I will attempt to respond to the various questions from the Opposition spokesperson, my hon. Friends the Members for Portsmouth North and for High Peak, and the hon. Member for Isle of Wight East. The Opposition spokesperson broadly welcomed the provisions, but he asked some specific questions. He made points on financial regulation, and I think he used the word “banking-style”. The Bill draws on precedent from a range of previous regulation. Some elements are from financial regulation. A previous amendment of his dealt with financial sustainability, and the Bill, as drafted, is all about that. We would not term it as “banking-style”, but it does draw on previous legislation and existing regulation.
The hon. Gentleman broadly welcomed the provisions on owners and directors. He mentioned that it has been four years since he was elected to this place, and in 2023, he asked the then Sport Minister to strengthen the ownership test, so I am really pleased that he welcomed the changes that we have made. He also said that he would prefer this to have been implemented without legislation. Of course, we all would, but we are where we are, and that is why both parties stood on a manifesto to introduce a football regulator Bill.
The Opposition spokesperson made some broad points on the owners and directors test, and we will have a further debate on that when we come to part 4. ODTs have to be applied clearly and consistently. If the owner has appropriate financial resources and meets other aspects of the test, our ODT would not prevent multi-club ownership. Concerns around multi-club ownership are to do with conflicts of interest and competition, which is why the leagues and UEFA have rules around multi-club ownership. Clubs competing in those competitions will be required to abide by any applicable rules, but we can come back to that point on part 4 when we will debate this issue at length.
Mr French
I want to flesh out the point that I tried to make, although I appreciate what the Minister said about coming to this later. Why this is not defined at this point is key, because, as I am sure all Members will agree, we do not want to accidentally create an open goal for wealthy clubs to get around the Bill. There is a real risk coming through from the football community that, if we do not tackle the issue of multi-club ownership up front, the Bill will create just that open goal.
In the comments from across the Committee today, there has been a consensus about what we hope the future of football will look like and around fairness; I think that that is all we can seek to achieve as a House. However, I am concerned that we are not putting the multi-club issue in the Bill. It is difficult to understand the reason why, because it is so pertinent to the ownership test. I accept that the Minister has said that she does not want to block it—that would not be wise, given that a number of clubs have that structure already—but I urge her to address the point about the risks to football. There are major risks, as we have seen already. The Minister’s reference to leagues and competitions was pertinent; we saw the press story yesterday about Crystal Palace and its European future. How will the Minister define the multi-club issue and how will it interact with the Bill?
The Chair
Before the Minister responds, I remind all hon. Members that interventions should be brief. There are plenty of opportunities to make longer speeches.
Stephanie Peacock
This clause formally establishes the regulator as an independent corporate body and refers to schedule 2, which contains further details on the structure, set-up and governance of the regulator. I commend the clause to the Committee.
Mr French
The clause formally establishes the Independent Football Regulator as a statutory body, providing the legal foundation for the IFR’s existence and marking a significant moment in English football governance and our constitution. The clause gives the Independent Football Regulator its own legal personality, allowing it to operate independently of Government and the football authorities.
We will come to the issue of independence, so I will not hold up the Committee too much on the point. I will not make this personal to the Government’s proposed choice of chair. It is rather about the structural integrity of independence, which is crucial to what we do as a House and how sport operates across this country, as it has done successfully for a number of years. The last thing that sport fans want is politicians involved in the regulation of football. We all welcome being supporters—a number of Members are supporters of clubs—but we must be clear that there should not be political interference in the running of the game.
The clause ensures that the regulator can exercise powers conferred elsewhere in the Bill, including around licensing, enforcement and oversight functions. We have a number of concerns about how the details in schedule 2 will work in practice, and the rules around making the independence of anyone involved in football regulation clear as we move forward.
More broadly, I seek clarity from the Minister on a few matters. Does she believe that clause 5 provides sufficient clarity and authority for the IFR to act decisively and independently when enforcing breaches of licensing conditions or financial rules? What safeguards are in place to ensure the Independent Football Regulator’s independence from political or industry pressure when taking enforcement action against powerful clubs or owners?
Will the IFR have the necessary investigatory powers from the outset to underpin robust enforcement, or are those powers dependent on secondary legislation or guidance? How will the IFR balance its role as a regulator with the need to maintain constructive relationships with clubs, especially when initiating enforcement proceedings?
On that point, I again highlight the importance of independence—not just independence from this place, but independence from other leagues and experiences that might bring into question any judgment that the IFR makes. That is a concern I have around the choice of chair, which I know we will come on to. I have concerns about leagues and any bias—known or unknown—in decision making, and the questioning of that. Going forward, that would generally be very unhelpful for the game.
Lastly, to what extent will the IFR be held accountable for the consistency, transparency and proportionality of its enforcement decisions under the powers established in the clause?
Stephanie Peacock
I will deal with the comments specifically on the chair in the next group—I am not avoiding the question, but I think we are going to have a more substantial debate on the next group. Let me answer some of the other specific points that Members have made. The shadow Minister asked about finance, and the levy will be proportionate to the size and level of the club. We absolutely value the independence of the regulator. That means all sorts of different things in terms of leagues, Governments, clubs and so on.
On how the independent regulator operates and what will guide them, I draw Members’ attention to clause 8 in part 2 on the regulatory principles. We will go through those later so I will not go into any detail now, but they are a useful guide to help the independent regulator in their functions and in carrying them out. I will pause there, because I think we will have a more substantial debate in a moment.
Question put and agreed to.
Clause 5 accordingly ordered to stand part of the Bill.
Schedule 2
The Independent Football Regulator
Mr French
I beg to move amendment 117, schedule 2, page 87, line 12, at end insert—
“3A Any political interests of, and political donations made by, the prospective chair of the Board, must all be declared as part of the appointments process, and published before the chair’s pre-appointment hearing with the Culture, Media and Sport Select Committee.”
This amendment would ensure that the political interests of the Secretary of State’s preferred candidate for the Chair are made public before the appointment is confirmed.
Mr French
I thank the hon. Gentleman for his question. He is a very well-respected Member of this House and of the football APPG. Obviously I was not a Minister in the previous Government, so it would not be possible for me to publish correspondence. I can speak only on my own behalf, and I do not have any UEFA correspondence. Again, I understand the basis of the hon. Gentleman’s question, but, on the question of what I have urged the Minister to do, I am happy for that to be done on a private basis, so that we can have those reassurances as Members of this House.
This situation is clearly pertinent to the Bill, because, as Members of this House, and as football fans—a number of people have outlined their local clubs and who they support—we surely have to have confidence that what we are putting into law through this House does not conflict with the ability of English clubs to participate. This is not me trying to scaremonger; I just need to know the information.
Stephanie Peacock
I am interested about the shadow Minister’s idea of “publishing” something privately; that is a new concept to me. I have said in this House more than once—in this Committee, on Second Reading and in Westminster Hall—that the letter from UEFA to the Secretary of State makes it very clear that there are no concerns with this Bill. I am obviously confidently saying that in Parliament; I am very much not going to mislead Parliament. As my hon. Friend the Member for Sheffield South East pointed out, the shadow Minister’s Government did not publish any correspondence. I sat in a room like this with the right hon. Member for Daventry, and he did not publish it, so why is the shadow Minister asking us to when he knows that Governments do not publish private correspondence?
Mr French
I recognise what the Minister is saying, and I understand the comparison she is making, but my understanding is that, if a Minister refers to a letter between the Government of the day and an international body that has important structures, there are rules within “Erskine May” that would allow—and sometimes force—the Minister to table that letter in the House of Commons Library for all Members to see, so I would urge the Government to do that.
Sir Jeremy, because this is very important, I seek your advice on whether, now that the Minister has referred to that letter, it should now be published under the rules of “Erskine May”. Can the Clerks clarify that, because the Minister has referred to it in her comments? It is in “Erskine May”—I checked on Second Reading—but I just want the guidance of the Clerks on whether that letter should now be published so that Members of this House can have an informed discussion about the risks to English football linked with the independence of the football regulator, because that is critical to all the work that we are going to do today.
English Football: Financial Sustainability and Governance
Debate between Stephanie Peacock and Louie French(3 months, 4 weeks ago)
Westminster HallRead Full debate Read Hansard Text Read Debate Ministerial Extracts
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Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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Stephanie Peacock
My hon. Friend is right: the Government are on the side of football fans. That is why we have introduced the Football Governance Bill: to put fans back at the heart of the game.
Mr French
Given the last intervention and the ongoing auditions for Parliamentary Private Secretary roles among Labour Members, I must push the Minister: at what point will introducing a regulator and the measures that she is discussing lower ticket prices for football fans?
Stephanie Peacock
The hon. Gentleman should know that that is a commercial decision, but we have made a change so that fans will be consulted. We think that it is the right change. Our Football Governance Bill will put fans back at the heart of the game. It will protect club heritage, take on rogue owners and secure the financial sustainability of English football.
Gambling Harms
Debate between Stephanie Peacock and Louie French(4 months, 4 weeks ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
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Mr French
The Minister will be well aware that the reason that we voted against the levy was not the principle of it—as she just acknowledged, it was designed by the previous Government—but how it has been changed by the new Government and the risks that I outlined in both my questions today.
Stephanie Peacock
I will come on to answer some of those points, but in the interests of time, I will endeavour to get the Minister for Gambling to write to the hon. Member with a full response.
The shadow Minister also asked about operators paying more in the first year. That is simply not correct. The levy is charged at a flat rate based on previous years’ profits. We believe that is the fairest and most sustainable way forward. Operators’ first levy payment will be based on profits reported to the Gambling Commission via regulatory returns. The commission changed the returns process for non-lottery licences last July. As such, operators’ first levy payment is based on three quarters’ worth of data multiplied by 1.33 to get the full year.
On the assessment the Government have made about anyone losing out on treatment in the transition period, we are clear that operators must maintain the level of contributions to the National Gambling Support Network to ensure that it has the funding it needs. We have received reassurances from the industry that that will happen. As I have just said, I or the Minister for Gambling will write to the shadow Minister. In the interests of time, I will move on to make some progress on the question before us.
We know that the vast majority of people who gamble do so safely—indeed, half of adults gamble each month. The shadow Minister and my hon. Friend the Member for Easington (Grahame Morris) spoke about the contribution the industry makes economically and in terms of jobs, and I will not repeat those comments. However, 300,000 people in Great Britain are estimated to be experiencing problem gambling. It is clear from today’s debate that many of us share the commitment to do more to protect people who are suffering that harm, especially given the significant changes that we have seen in the sector in recent years.
In that context, the Government are committed to taking forward White Paper measures such as new protections on marketing and bonuses, financial risk checks to prevent unaffordable gambling, and allowing consumers to seek redress from gambling operators via an ombudsman, which has been discussed today. We will continue to work with the industry, the third sector and the Gambling Commission to ensure that the reforms are proportionate, targeted and effective.
Draft Gambling Act 2005 (Operating Licence Conditions) (Amendment) Regulations 2024
Draft Gambling Levy Regulations 2025
Debate between Stephanie Peacock and Louie French(5 months ago)
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Stephanie Peacock
This has been a useful debate. The statutory levy has previously had cross-party support. I will respond to some of the shadow Minister’s questions, and then I will respond to the right hon. Member for Chingford and Woodford Green. In response to the shadow Minister’s opening point about the Minister for Gambling sitting in the other place, I think it was unkind to refer to her as working part time; she merely sits in the other place, and I gently remind him that the previous Government’s Foreign Secretary did the same. Perhaps we could put the political point scoring to one side.
Mr French
I was the Parliamentary Private Secretary to the former Foreign Secretary, so I understand what the Minister is trying to say. I am not questioning the motives of the Minister for Gambling; the point is that she is tied up, as we all know, on the Football Governance Bill, because the Government have decided to put the Bill through the other place first. Hence, she can only work part time on the gambling reforms. That is the feedback we are getting consistently, and that is the challenge I am trying to make.
Stephanie Peacock
I do not recognise the logic of that argument. I do not believe the hon. Gentleman served as a Minister. He perhaps does not know that a Minister has to juggle a number of pieces of legislation, and a number of different issues. The Baroness is committed to being the Minister for Gambling, and she engages with a range of the sector, and as indeed did I when I was the shadow Minister, and I continue to speak to the sector when appropriate.
As for the economic picture, I will take no lessons from the official Opposition, given the state they left the economy in. Now I want to move on to discuss the actual statutory instrument.
Oral Answers to Questions
Debate between Stephanie Peacock and Louie French(5 months, 2 weeks ago)
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Mr Louie French (Old Bexley and Sidcup) (Con)
The previous Conservative Government invested over £400 million to support grassroots sport, recognising the vital contribution of sport to our communities across the country. The Minister will already be aware of our concerns about the impact of Labour’s national insurance hike, and the impact that the schools tax will have on community access to sporting facilities. Equally concerning is Labour’s decision to quietly cut the £57 million opening school facilities programme from March. Does she understand why grassroots sport organisations are so concerned about access to school facilities, and schools potentially having to close them to the community? Has she raised those concerns with Cabinet colleagues, and what measures are her Department taking to support access to grassroots sport for the more than 200,000 people who previously benefited from Conservative programmes?
Stephanie Peacock
I think that was six questions rather than one. I will take no lectures from the hon. Gentleman on the state of the economy and the inheritance that we received. The Government are a huge champion of grassroots sport, and will continue to be one.