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Football Governance White Paper

Volume 728: debated on Thursday 23 February 2023

I wish to inform the House that the Government have today published their White Paper, “A sustainable future—reforming club football governance”.

Football lies at the heart of our nation and it touches the lives of so many of us across the country. Football brings people together, whether at times of national sporting success, or through football clubs that form a vital part of our lives not just for fans, but for their local communities too. Football fosters a sense of belonging and supports local economies.

Many of our clubs are well run and are exemplars of good practice, prudence, and a willingness to play by the rules. However, for too long, we have seen some of our oldest and most historic clubs put in danger by those who do not see a football club as the community and heritage asset that it is. Too many see a football club as something that can be gambled with for short-term gain, with little thought for the history or future of the club, or for its fans. It is fans who have been there long before any owner, director, manager or player, and who will be there long after they have gone. This has been forgotten all too frequently, and as a result communities have been devastated by the losses of clubs across the country.

This Government want to see a positive future for all our football clubs, and for English football to continue to thrive as the best in the world. That is why we committed in our manifesto to a thorough review of football governance with fans at its very heart. The fan-led review—so ably chaired by my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch)—heard evidence from across football, from fans, and from experts on the problems facing our national game.

The review identified a number of issues that need resolving in football and—alongside my Department’s own conversations with fan groups, clubs, football authorities and football—demonstrated that fundamental reform is needed to protect English football and safeguard its future.

English football is world-leading and that global success needs protecting. Our White Paper sets out how we will deliver reform by taking proportionate action that maintains the Premier League’s position as the strongest league in the world, and safeguard clubs across the entire football pyramid. On a strong, stable foundation of sustainable and resilient clubs, “the beautiful game” in England will continue to thrive for the benefit of its fans at home and abroad.

The White Paper outlines a comprehensive plan to introduce a new independent regulator, backed by legislation, which is free from the vested and conflicting industry interests which have hindered progress in the past. The industry has been given more than ample opportunity to reform itself and has repeatedly failed to do so. Independent regulation for football will make the game more sustainable, and mean fewer fans and communities have their clubs put at risk.

The regulator’s aim will be to make sure clubs are financially resilient, to help guarantee fans a voice in their own clubs, and ultimately, to protect cherished parts of our footballing and cultural heritage. This is reflected in its primary strategic purpose—to ensure that English football is sustainable and resilient for the benefit of fans and local communities football clubs serve—as well as the three specific duties underpinning this purpose:

Club sustainability—the financial sustainability of individual clubs;

Systemic stability—the overall stability of the football pyramid; and

Cultural heritage—protecting the aspects of clubs that matter most to fans.

The regulator will also have secondary duties to have regard to impacts on competition and investment.

The regulator will operate a licensing system, whereby all clubs in the top five tiers of the English men’s football pyramid will need a licence to operate as professional football clubs. The legislation will establish four threshold conditions of the licence. These will be:

Appropriate resources and governance: improving financial resilience through a requirement for clubs to have appropriate financial resources and to comply with a new proportionate “football club corporate governance code”.

Fit and proper custodians: new tests for prospective owners and directors of clubs: a fitness and propriety test (for owners and directors), enhanced due diligence of source of wealth (owners), and a requirement for robust financial plans (owners). The regulator will take an objective and evidence-based approach, and apply tests so as not to disproportionately deter desirable investors.

Fan interests: implement a minimum standard of fan engagement and protections around club heritage, to make sure fans at any club have their voice heard.

Approved competitions: clubs will only be able to compete in competitions that are approved by the regulator, to prevent “breakaway” competitions that do not meet predetermined criteria.

In addition, the regulator will have a targeted power of last resort to intervene in relation to financial distributions if football fails to come to a solution. The Government’s strong preference is for football to agree on its own resolution to this important issue without regulator intervention, so this power acts purely as a backstop. The process will be designed to empower and encourage football to find a solution first. However, if football fails to deliver a solution, this backstop means the regulator will deliver one.

The regulator is designed to be the specialist in its area, with a tight scope through its licensing system focused on the issues of financial sustainability. The regulator will not intervene in, for example, on-pitch rules or ticket prices.

Equally, it is a regulator that will be proportionate, rather than take a “one size fits all” approach—where clubs are already well run, the regulator will not look to intervene unless necessary. Wherever possible, it will aim to use constructive engagement rather than formal intervention, but it will have the ability and the mandate to intervene swiftly and boldly when necessary.

With this White Paper, the Government are taking the next step on the journey towards reform that started with my hon. Friend the Member for Chatham and Aylesford’s groundbreaking fan-led review. It is a journey that has shone a light on the serious issues threatening the very future of English football as we know it. However, it has also shown the path towards a more enduring future for our national game. The measures set out in this White Paper detail that path, and we are fully committed to working with fans and football to make them a reality.