Sport
Lord Pendry rose to call attention to the local and national role of sport; and to move for Papers.
during the course of the debate........
My Lords, I am delighted to join other speakers in congratulating my noble friend Lord Pendry on securing this debate. As others have said, he has a long and distinguished record in promoting all sorts of sport in all parts of the United Kingdom. We have benefited from his wisdom and knowledge today. I enjoyed every minute of his speech. In the time available, I intend to concentrate on just one sport. While I am tempted by some of the contributions made by other noble Lords, I shall talk about the sport that is rightly regarded as our national game, football.
This debate is timely because it is being held just two days before the summer meeting of the Football Association. At that meeting, a number of momentous decisions are likely to be taken. The most important of these relate to the implementation of the recommendations contained in the report prepared for the FA by the noble Lord, Lord Burns. It has taken the FA quite a while to get to this point, but once its shareholders had passed the necessary resolutions by a three-quarters majority at the meeting they held in Wembley last month, the way was clear for the FA to establish the level and structure of regulation which I believe the game so desperately needs. Just how much needs to be done, I shall explain in a moment.
Some of the changes are straightforward and are examples of the Football Association coming to terms with the 21st century. The FA Council has long been unfairly derided as “white middle-aged men in blazers”. The reality is that they are in the main dedicated people who have huge expertise and experience, and who give their time cheerfully and uncomplainingly for nothing, except perhaps the odd invitation to a grand event. That is rather like the Members of your Lordships’ House, who also give their time and get nothing back except the opportunity to be invited to great occasions.
Now the FA Council is being expanded to reflect better the diversity of the game, with added representation for players, managers, referees, women’s football, ethnic minorities, disability football, supporters and the senior levels of non-league football. There will be fewer committees and the FA Board will have a new independent chairman. This is a huge a step forward, and in my view it reflects very well on the current FA chairman, Geoff Thompson. He is not a flashy individual from a glamorous club, but a hardworking, decent and honest man who has devoted his life to the game. He was recently elected the British vice-president of FIFA, the world governing body. I think that he will represent the game in all parts of the United Kingdom with distinction and integrity there.
The reform by which I set the greatest store is the establishment of a new Football Regulatory Authority. This is something I supported as vice-chairman of the Government’s Football Task Force and which was a central recommendation of the final majority report. I remember that we warned then that if the game could not sort out its problems for itself, the pressure for an independent government-appointed regulator would become irresistible. That is still my view and recent events have confirmed it.
There is a desperate need for consistency in the way that the game is regulated, particularly when things go wrong. If rules are broken, or clubs are forced into administration, or the wrong sort of people motivated by the prospect of personal gain are attracted into the game, the need for there to be in place firm, fair, consistent and proportionate sanctions to deal with them is paramount.
I do not have the time today, nor indeed the information, to enter into the world apparently described by the noble Lord, Lord Stevens of Kirkwhelpington, in the report by his company, Quest, to the Premier League, on alleged corruption in transfer dealings. I say “apparently” because so far the Premier League has declined to publish the full report.
My one observation is that I hope that in future investigations such as the one conducted by the noble Lord, Lord Stevens, are commissioned by the FA’s Football Regulatory Authority and not by the individual leagues, which clearly have a conflict of interest when the investigation takes place.
The regulatory authority also needs to take on responsibility for strengthening the “fit and proper person” tests governing who should and should not be allowed to own and run football clubs. There is much concern about the increase in the number of foreign owners of Premiership clubs, now up to seven and more expected. It is not surprising that the attempted takeover of Manchester City by Mr Thaksin Shinawatra, who is accused in his native Thailand of a variety of corruption charges, is seen as particularly worrying. The now former Minister for Sport, Mr Caborn, said in the other place at Questions on Monday,
“we must make sure that the premier league does not turn into a billionaire’s playground”.—[Official Report, Commons, 25/6/07; col. 5.]
The lack of transparency in the financial affairs of Premier and Football League clubs is the subject of an Early Day Motion tabled by Phil Willis, the Liberal Democrat MP for Harrogate and Knaresborough, in the other place. Mr Willis and his co-signatories are particularly concerned about the goings on at Leeds United, whose problems and failings are so complicated that they would take an entire debate—possibly even a Select Committee inquiry—to describe and unravel. The EDM makes a number of very serious allegations and effectively criticises the administrator, KPMG, for failing to discover who are the beneficiaries of two overseas companies which agreed to write off more than £15 million in debt between them, and then voted to keep the people who had taken the club into administration in control on the basis of a payment to creditors of just one penny in the pound. The club was able to avoid any Football League sanction for going into administration—normally a deduction of 10 points—by doing so right at the end of the season when relegation was certain, and so the 10-point deduction was meaningless.
Even more contentious, and very much part of this debate, is the football creditor rule, the arrangement by which all money owed to those in the game, such as players and other clubs, has to be paid in full, whilst all other creditors must take their chance in a creditors’ settlement. So in the case of Leeds United, for example, former players were able to claim almost £850,000, while creditors such as Leeds City Council, Leeds Metropolitan University, the West Yorkshire Ambulance Service, a window cleaning company, gas, water and electricity utilities, local schools, hospitals and even the St John Ambulance Brigade, which gives its services free and only claims expenses, will all get no more than one penny in the pound.
HM Revenue and Customs is owed almost £7 million in unpaid tax and VAT. Up until 2002 and the passing of the Enterprise Act, the Revenue would have been a preferential creditor. But the Act changed that and the Revenue has to take its chance along with everyone else—except those in football, of course, who have retained this super-creditor status. The all-party football group, on which I served, brought out a report in 2004 which proposed that this special creditor status should be removed. It commented:
“the best antidote for a club going into administration is a chairman and a board that prudently refuse to spend more than they can afford”.
I suspect that the game will need more common sense like that and I hope that the FA’s new regulator will be able to provide it.
© Lords Hansard 28 June 2007
during the course of the debate........
My Lords, I am delighted to join other speakers in congratulating my noble friend Lord Pendry on securing this debate. As others have said, he has a long and distinguished record in promoting all sorts of sport in all parts of the United Kingdom. We have benefited from his wisdom and knowledge today. I enjoyed every minute of his speech. In the time available, I intend to concentrate on just one sport. While I am tempted by some of the contributions made by other noble Lords, I shall talk about the sport that is rightly regarded as our national game, football.
This debate is timely because it is being held just two days before the summer meeting of the Football Association. At that meeting, a number of momentous decisions are likely to be taken. The most important of these relate to the implementation of the recommendations contained in the report prepared for the FA by the noble Lord, Lord Burns. It has taken the FA quite a while to get to this point, but once its shareholders had passed the necessary resolutions by a three-quarters majority at the meeting they held in Wembley last month, the way was clear for the FA to establish the level and structure of regulation which I believe the game so desperately needs. Just how much needs to be done, I shall explain in a moment.
Some of the changes are straightforward and are examples of the Football Association coming to terms with the 21st century. The FA Council has long been unfairly derided as “white middle-aged men in blazers”. The reality is that they are in the main dedicated people who have huge expertise and experience, and who give their time cheerfully and uncomplainingly for nothing, except perhaps the odd invitation to a grand event. That is rather like the Members of your Lordships’ House, who also give their time and get nothing back except the opportunity to be invited to great occasions.
Now the FA Council is being expanded to reflect better the diversity of the game, with added representation for players, managers, referees, women’s football, ethnic minorities, disability football, supporters and the senior levels of non-league football. There will be fewer committees and the FA Board will have a new independent chairman. This is a huge a step forward, and in my view it reflects very well on the current FA chairman, Geoff Thompson. He is not a flashy individual from a glamorous club, but a hardworking, decent and honest man who has devoted his life to the game. He was recently elected the British vice-president of FIFA, the world governing body. I think that he will represent the game in all parts of the United Kingdom with distinction and integrity there.
The reform by which I set the greatest store is the establishment of a new Football Regulatory Authority. This is something I supported as vice-chairman of the Government’s Football Task Force and which was a central recommendation of the final majority report. I remember that we warned then that if the game could not sort out its problems for itself, the pressure for an independent government-appointed regulator would become irresistible. That is still my view and recent events have confirmed it.
There is a desperate need for consistency in the way that the game is regulated, particularly when things go wrong. If rules are broken, or clubs are forced into administration, or the wrong sort of people motivated by the prospect of personal gain are attracted into the game, the need for there to be in place firm, fair, consistent and proportionate sanctions to deal with them is paramount.
I do not have the time today, nor indeed the information, to enter into the world apparently described by the noble Lord, Lord Stevens of Kirkwhelpington, in the report by his company, Quest, to the Premier League, on alleged corruption in transfer dealings. I say “apparently” because so far the Premier League has declined to publish the full report.
My one observation is that I hope that in future investigations such as the one conducted by the noble Lord, Lord Stevens, are commissioned by the FA’s Football Regulatory Authority and not by the individual leagues, which clearly have a conflict of interest when the investigation takes place.
The regulatory authority also needs to take on responsibility for strengthening the “fit and proper person” tests governing who should and should not be allowed to own and run football clubs. There is much concern about the increase in the number of foreign owners of Premiership clubs, now up to seven and more expected. It is not surprising that the attempted takeover of Manchester City by Mr Thaksin Shinawatra, who is accused in his native Thailand of a variety of corruption charges, is seen as particularly worrying. The now former Minister for Sport, Mr Caborn, said in the other place at Questions on Monday,
“we must make sure that the premier league does not turn into a billionaire’s playground”.—[Official Report, Commons, 25/6/07; col. 5.]
The lack of transparency in the financial affairs of Premier and Football League clubs is the subject of an Early Day Motion tabled by Phil Willis, the Liberal Democrat MP for Harrogate and Knaresborough, in the other place. Mr Willis and his co-signatories are particularly concerned about the goings on at Leeds United, whose problems and failings are so complicated that they would take an entire debate—possibly even a Select Committee inquiry—to describe and unravel. The EDM makes a number of very serious allegations and effectively criticises the administrator, KPMG, for failing to discover who are the beneficiaries of two overseas companies which agreed to write off more than £15 million in debt between them, and then voted to keep the people who had taken the club into administration in control on the basis of a payment to creditors of just one penny in the pound. The club was able to avoid any Football League sanction for going into administration—normally a deduction of 10 points—by doing so right at the end of the season when relegation was certain, and so the 10-point deduction was meaningless.
Even more contentious, and very much part of this debate, is the football creditor rule, the arrangement by which all money owed to those in the game, such as players and other clubs, has to be paid in full, whilst all other creditors must take their chance in a creditors’ settlement. So in the case of Leeds United, for example, former players were able to claim almost £850,000, while creditors such as Leeds City Council, Leeds Metropolitan University, the West Yorkshire Ambulance Service, a window cleaning company, gas, water and electricity utilities, local schools, hospitals and even the St John Ambulance Brigade, which gives its services free and only claims expenses, will all get no more than one penny in the pound.
HM Revenue and Customs is owed almost £7 million in unpaid tax and VAT. Up until 2002 and the passing of the Enterprise Act, the Revenue would have been a preferential creditor. But the Act changed that and the Revenue has to take its chance along with everyone else—except those in football, of course, who have retained this super-creditor status. The all-party football group, on which I served, brought out a report in 2004 which proposed that this special creditor status should be removed. It commented:
“the best antidote for a club going into administration is a chairman and a board that prudently refuse to spend more than they can afford”.
I suspect that the game will need more common sense like that and I hope that the FA’s new regulator will be able to provide it.
© Lords Hansard 28 June 2007