Football Governance

Thérèse Coffey Excerpts

Thursday 9th February 2012 Westminster Hall

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

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

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

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

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

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

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

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

[Steve Rotheram]

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

[Dr Coffey]

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

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

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

[Damian Collins]

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

[Dr Coffey]

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

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

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

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

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

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

Coming on to other things such as the proposal for term limits, I understand that many felt that that was an attack on people who are very good for football. To be blunt, such people have been there in all weathers, painting the lines, coaching the young kids and running the teams, out there in the freezing cold, and they will be thinking, “Why is a bunch of MPs telling us that we can’t stay on our council?” It is not about that. Absolutely, those people deserve full recognition; I have been out with Suffolk FA and local community clubs, and football would not survive without them.

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

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

[Several hon. Members]

rose—

--- Later in debate ---

[The Minister for Sport and the Olympics (Hugh Robertson)]

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

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

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

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

[Dr Thérèse Coffey]

The Minister will have plenty of volunteers to help.

[Hugh Robertson]

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

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

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

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

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

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

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

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

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

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

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

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

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