Question for Short Debate
To ask Her Majesty’s Government what assessment they have made of the effectiveness of the governance of English football.
My Lords, I am very pleased to have secured this debate. The timing is quite incredible because the football club I support, Bolton Wanderers—my noble friend on this occasion, the noble Baroness, Lady Morris, supports Bolton too—faced winding-up orders in the High Court today. I will come on to that later.
Many problems surround the governance of football and many issues cause concern, such as the Premier League’s influence on the Football Association, the operation of the financial fair play rules, the FA’s response to racism, safeguarding and the operation of agents—I could go on. The Government need to be more proactive in taking a stand on these problems, which are important to so many people. Football is massively important to the UK economy but we cannot treat it simply as a business. It is much more important than that: it is part of this country’s heritage and affects the lives of millions of people on a weekly, if not daily, basis. The rules of governance are not adequate and need to be changed, particularly to recognise fans as stakeholders in the sport.
I declare my interest as a lifelong football supporter. For many years, I have received hospitality as a guest at the FA or various football clubs, but my main interest is that I am a season ticket holder at Bolton Wanderers and have been for most of my adult life, as have my husband and my children. We are also all members of Bolton Wanderers Supporters’ Trust. The experience of Bolton Wanderers at the moment is my primary concern, but I suggest that it is an example of what could befall many clubs. The structure of governance is inadequate and has made some of our problems worse.
The problems of Bolton Wanderers go some way back. We all remember the heady days of the Premiership, even European competitions, under Sam Allardyce and with fantastic stars such as Jay-Jay Okocha, Youri Djorkaeff, Guðni Bergsson and Per Frandsen. We still have a fantastic stadium—perhaps one of the best in the country. It is certainly the best in the lower leagues, and is considered by some lower-league clubs as an alternative to Wembley. We also must not forget that Bolton Wanderers was one of the founding members of the Football League in 1888.
For many years, Bolton Wanderers was fortunate enough to have the personal and financial support of the late Eddie Davies, a locally born businessman. His commitment was behind much of our success. When he felt that he had to leave after bankrolling the club for many years, our real problems started. Dean Holdsworth, one of our former players, tried to put together a package to ensure the club’s well-being. It seems that his efforts backfired when Ken Anderson took over. Since then, the club’s problems have escalated beyond belief. We have seen debts in the revenue to Bolton Council, to Greater Manchester Police, to the ambulance service, to players and to other staff mount up and go unpaid. The club’s training ground was closed because of a lack of food and power. We have heard that stock was taken from the club’s shop because of unpaid bills. The hotel, an integral part of the stadium, has been closed. The Professional Footballers’ Association has had to step in at times to pay players’ wages. Perhaps most worryingly of all, the stadium’s safety certificate was threatened because the stewards had not been paid. In the end, a strike by players led to the cancellation of our last home game and points will be deducted next season because of the failure of the present owner, Ken Anderson. It is a mess and a tragic state of affairs.
I believe that it relates directly to the problems of football governance. First, it relates to the fit and proper person test, which is neither fit nor proper and is now called the “owners and directors test”. It is supposed to protect against corruption, protect the image of the sport and keep unscrupulous people away from football. The experience of Bolton Wanderers and some other clubs is that this rule does not work—that it is either not adequate or not applied properly. I am sure that we need better, proper and stated standards, proper compliance procedures and greater transparency.
My second concern is about the English Football League. I cannot understand how the chief executive of the EFL, Shaun Harvey, could make the statements he did about the ownership of Bolton Wanderers under Ken Anderson and give the assurances he gave, for example to the Supporters’ Trust. On 14 February, Shaun Harvey said to the Bolton Wanderers Supporters’ Trust:
“Following recent discussions, the EFL remains satisfied that the club”—
“has the source and sufficiency of funds to meet its obligations as a member of the league at least until the end of the season”.
Yet within 14 days of that statement by the chief executive of the EFL, the club failed to pay its players. That was after the previous month, in January, when the chairman of Forest Green Rovers publicly reported that Ken Anderson had said to him in respect of a disputed transfer:
“You can seek a winding-up petition, you can bankrupt the club. I don’t care, I’m a secured lender. I’ll get my money back”.
Surely that report from one of its members should have set alarm bells ringing at the EFL. Shaun Harvey went on to talkSPORT and praised Ken Anderson because the club’s debt has been reduced. The club’s debt has been reduced but that is no thanks to Ken Anderson. It was reduced because the previous owner, Eddie Davies, had written off the vast amount of money that he had loaned the club. It was, to say the least, very strange to praise Ken Anderson. Today, the failure of Ken Anderson to pay those debts has led to Bolton Wanderers being in the High Court and notice has been given of the intention to appoint an administrator.
Tempting though it is, I am not asking the Government to step in and bail out Bolton Wanderers, but the issues of the lack of governance have, I believe, compounded our problems. What do we need from the Government? The first thing is a recognition that the 2017 changes to governance by the FA were not enough. Secondly, we need a recognition of the wide problems that I mentioned at the beginning, such as the role of agents, dealing with racism and the “fit and proper” rules. I believe that all of these issues should be of concern to the Government. Moreover, they need to insist that in every sport, but particularly in football, we have comprehensive rules, proper compliance and greater transparency. It is, after all, 2019.
Next, we need a greater recognition of the role that football fans can and should play in the governance of the game. I would like the Government to take this issue far more seriously because good proposals have been put forward by Supporters Direct and others. Further, I think that the frustration felt by many fans is very real. I would also like the Government to encourage the designation of more sports grounds and facilities as assets of community value. I must praise the Bolton Wanderers Supporters’ Trust and indeed Bolton Council because they have ensured that this has happened in Bolton. Without that designation of our football ground, I hate to think what the current owner might have done with that asset. All of this needs to be done with a sense of urgency. Too many of these problems are cropping up, and if you look at the number of clubs that have got into trouble recently, it is indeed alarming.
There are, of course, good owners. One such, Dean Hoyle at Huddersfield, who has just stepped down, is a great example. But too often the chairmen of football clubs—they usually are men—control the body that regulates them, and that cannot be good. UEFA recently recognised supporters as key stakeholders and Supporters Direct has been trying to push that forward, but others within football and, I believe, at the EFL, have actually been trying to stall that.
The experience of Bolton Wanderers shows that governance is inadequate. Of course that is my main concern, but football as a whole needs better governance or other clubs will end up in the same situation and suffer the same fate as Bolton Wanderers today.
My Lords, I start by thanking the noble Baroness, Lady Taylor of Bolton, for initiating this debate. It is not surprising that she is concerned about recent events involving her beloved football club, Bolton Wanderers, because football clubs are at the very heart of our communities. For many they are the subject of truly lifelong devotion. They are a source of unity and local pride, or disappointment. They inspire passions—witness the Liverpool v Barcelona game yesterday evening—that can make Brexit seem a trivial matter. Often the spirit, success or failure of towns and cities mirrors the performance of the local football club. As the Liverpool legend Bill Shankly famously observed:
“Some people believe football is a matter of life and death. I can assure you it is much, much more important than that”.
Football, the beautiful game and our national sport, provides us with much to be proud of. Our newest football league, the Premier League, founded in 1992, is one of England’s great success stories, attracting the largest crowds of any football league in Europe, and is a massive export, watched by a global audience of 4 billion people. Clearly it is imperative that we protect this vital, important, hugely influential and lucrative industry and all who work in it. But while we are successful innovators—women’s football is on course to double participation by 2020—we are old hands at the game too. The English Football League, founded in 1888, is the longest established professional football league competition in the world, while the Football Association, which dates back to 1863, is the oldest football association anywhere. It is also the overall governing body of the sport, involving 12 million players of all ages, with a staff of more than 800 and an annual turnover exceeding £375 million. We can see that it is more than adequately resourced to execute its important governance function effectively and without compromise.
Football in the UK is clearly big business and growing, and we should be mightily concerned with who owns our football clubs and how responsibly they are run. From time to time, the view that there should be greater control over who can own and run a football club and views about how best to monitor and evaluate clubs’ efficacy, solvency and outcomes are strongly expressed. It is absolutely vital that football authorities are eternally vigilant, constantly striving to improve and promote the best possible governance of clubs. Debates such as this command attention and, importantly, raise the governance profile.
None the less, it is my firm, carefully considered and informed belief that the football authorities absolutely recognise their responsibilities and the challenges, and are already doing all they reasonably can to have in place the rules and regulations to protect the game, clubs, staff and supporters. They certainly give every indication of taking governance very seriously by focusing substantial financial and human resources and time on the issue. After all, it is in their best interests to do that.
Some feel we should impose a sort of test for proposed owners of clubs, perhaps akin to a cut-of-the-jib test, but we just cannot introduce that kind of subjective test in a country legendary for the fairness of its legal system, founded on equality before the law. The three football authorities I mentioned each have an owners’ and directors’ test, but it is quite rightly an eligibility rather than a suitability test. Grounds for rejecting a proposed owner need to comply with criteria that would stand up in a court of law—for example, being disqualified as a company director, having a specific type of criminal conviction, being bankrupt or similar. The owners’ and directors’ test has been continually extended and enhanced. Clubs’ financial performance is rigorously monitored and reviewed annually by the leagues. But we still operate a free market economy in this country, so if someone wishes to buy a football club, is not subject to disqualifying conditions and can prove they have the funds to acquire and run the club, they must be allowed to. Action taken on the basis of suspicion and prejudice would be contrary to natural justice and as unacceptable in football as in any other area of life.
History demonstrates clearly how each and every type of business can fail, regardless of controls, tests and supervision. You have only to look at the high street over recent times to recognise that. An owner of a football club may well be able and skilled, have the best intentions in the world and be well funded, with capable management, but if the team fails to perform on the pitch and plummets down the league, ending up relegated to a lower division, the financial consequences can very quickly be disastrous. It is key to act promptly and positively when problems occur and take all steps to protect the reputation and integrity of the game, the club in question and all impacted.
Overall, while I am by nature far from complacent on this or any other issue, I am totally convinced and wholeheartedly believe that the football authorities are onside and doing all they can to protect their big business, our national sport. Of course, governance can always be improved—the improvements can be improved on as well—but I personally have confidence in the football authorities and their vigilance, focus, commitment and professionalism. I believe we can be assured and confident that the game is effectively governed and in good, safe hands.
My Lords, I begin by congratulating my noble friend Lady Taylor of Bolton on raising this important topic, which has been in the throes of debate for many years. I anticipate that she—and indeed the noble Baroness, Lady Morris of Bolton—are feeling sorrowful tonight at the plight of their club. Over 30 years, in this House and outside, I have heard my noble friend bellow the needs and virtues of this club. Along with my noble friend, Nat Lofthouse—a great man and a great footballer—always reminds me of this club. I hope this debate might bring a bit of comfort to both noble Baronesses if we can take some constructive approaches to this problem. I declare my interest in this matter as the current president of the Football Foundation, which is very much part of the football family.
I think it is a universal view that the governance of English football, particularly the structure presently in place at the Football Association, is in need of further reform. It was only after a great amount of public and parliamentary pressure that we saw any significant reforms made to the FA’s governance in 2017 to bring it into compliance with UK Sport’s governance code. While these reforms have provided positive moves in the right direction—particularly with three out of 10 members of the board now being women and a number of specific representatives for black, Asian and minority ethnic communities and disability, youth and women’s football now added to the council—the need for reforms is still strong. More energy and action is needed if we are to address the gaping holes that still exist in football’s governance. The vast majority of the increasingly large FA Council remains white, male and aged over 60—hardly representative of the great diversity among our fans and, indeed, players. Our eminent House of Lords Library has informed me that as of 2018 the FA’s equality, diversity and inclusion plan shows that only 5% of leadership roles are currently held by people from BAME backgrounds.
It is therefore clear that we continue to need more diverse management of the FA, particularly so that it is better equipped to handle the unacceptable growth of racism we have seen in recent months in and around our stadiums; we all know that. I hope noble Lords agree that the terrible handling of discrimination cases we have all heard of recently must not be repeated.
Equally important is the need to address the lack of female representation at the top levels of the game. I remember only too well going to women’s soccer events over the years—even to cup finals—to find only a small crowd of supporters. Now, the women’s game is flourishing, with talented players and crowds to follow them. They must be represented at the top levels.
I declared my association with the Football Foundation, and I am proud of the part that this body plays in meeting some of these challenges. As the nation’s largest sporting charity, the Football Foundation’s focus on the funding of grass-roots sports facilities saw an increase in football participation of 11% at foundation-funded facilities last season, with an increasing percentage of these being female users and players.
To be fair, in recent times we have seen a more enlightened approach to supporters’ representation, and these steps should go much further. Fans must be at the very centre of decision-making. As Labour first recognised in its 1997 charter for football:
“Fans are central to the development of football, which would wither and die without them. Supporters invest heavily in the game and they have a right to be consulted”,
and represented at the highest level. The numerous issues that our fans face—not least continuing to be ripped off by train companies with inflexible tickets, the lack of choice over safe standing spaces in their stadiums and many other issues—are best spearheaded by fans themselves at the top level, to ensure that they are properly addressed.
By way of conclusion, in a debate so ably opened by my noble friend, time is limited for us to make all the points that we might like to make. But in any criticism of the FA, we must remember that it is historically organised differently from almost all other football governing organisations in the world. By definition, being the first, it will find it difficult to adapt to some of the measures necessary today—but it must be capable of so doing. All of us wanting change must recharge our batteries and make positive suggestions for the coming years, for the good of the game we all cherish.
My Lords, I thank the noble Baroness, Lady Taylor of Bolton, for tabling this debate tonight. Sport often thinks of itself as different because of the role it plays in people’s lives. However, this does not mean that it can behave differently. Sport is entertainment; it engages people; it changes our lives; and it provides volunteering opportunities, where children can learn about risk-taking in what should be a safe environment. It is that safe environment that will be the basis of my contribution.
Football is a huge business and holds in its hands the hopes and dreams of many young men and women. That is why the whole sport—and all sports—needs good governance. I know from my time in sport that football has been the bane of many a Sports Minister’s life. My personal view is that some of the national governing bodies have had to be dragged kicking and screaming into the modern world of good governance. That there are good parts of sport does not give it an excuse to not behave in a transparent, open and ethical manner. Governance in football is not a new issue. Over many years there have been repeated calls for, among other things, better representation for women and fans.
I am delighted that Sport England recently launched a talent plan which has strong links to duty of care issues. However, it is only the girls’ game that is publicly funded in England, not the boys’ game, and I would like to ensure that both sides have to take the matter seriously.
It is a shame that the noble Baroness, Lady Brady, is not in her place at the moment. I would have loved to congratulate her on the West Ham women’s team making the FA Cup final. Sadly, they were beaten by Man City, but they are an exemplar of how football can be used to develop women’s sport in an incredible way. The Women’s FA Cup final was watched by more than 2 million people.
I have spoken many times in your Lordships’ Chamber about disabled fans at football matches, and while it is true that many clubs have improved, some are still taking their time to truly engage and make adequate seating available for wheelchair users. Wrexham AFC is one club that has grasped the idea.
While the sports governance code was published in 2017, it was merely a step forward. At the time, the FA’s Greg Clarke said that he did not want to “just be compliant”. We have to continually work to ensure that there is not tick-box compliance for major issues and that major issues are not hidden within sport. I believe that part of good governance is a duty of care to everyone involved.
Back in December 2016, the then Sports Minister, the right honourable Tracey Crouch, asked me to review duty of care in sport in the UK. I was asked to look at grass-roots sport in England, elite level, where lottery funding kicked in, and also professional sport. Football as a sport was incredibly helpful: several areas submitted information in different ways, and representatives attended meetings. As far as I am aware, the Premier League is the only governing body that has an action plan against each of the recommendations I made in the report.
When I was asked to do this—and I need to be clear that it was not someone from football who said this—I was told that there was nothing to see and that the duty of care towards those in the system was great. The turning point in my work, however, was November 2016, when those brave footballers waived their right to anonymity and talked publicly about being abused by former coaches and scouts in the 1970s, 1980s and 1990s. I have no doubt that some of that is still happening now.
We have to understand how hard it is for any athlete to raise such issues, then and now, even when there are policies in place. A young person in sport may be making a complaint against the very person who holds the key to the door of them representing their club or country, or it could be the coach’s best friend. What happened in football highlighted that some unscrupulous people will go where there are young people—in this case sport—and that there are horrible people holding positions of trust. Although I do not believe that every adult in sport is vulnerable, the very nature of being involved in a sports pathway gives a certain sense of vulnerability. We need legislation to protect young people who have reached the age of consent. The current legislation is limited to schools, hospitals and care homes, and that is not good enough.
Through my work on duty of care, I work closely with the CPSU. The following was taken from its briefing:
“While a relationship may well not be a breach of the criminal law, and the young person involved may not always view it as abusive or exploitative, the existence of a significant power differential between an adult with authority, control or influence over a significant aspect of the young person’s life always raises the possibility that the relationship is unequal and constitutes an abuse of the adult’s position of trust”.
Any breach of trust needs to be clearly defined as a breach of the organisation’s code of conduct, but that code also has to have weight and penalties, and not just be written on a piece of paper that athletes and players are unable to access. Yes, we do have DBS checks, but it is merely a moment in time. It is at times like this that I miss the sensible approach taken by the much-missed Lady Heyhoe Flint, who did so much to campaign on not relaxing legislation in this area.
My personal preference is not just to look at 16 and 17 year-olds but to expand legislation to anyone who is on a player pathway, because that abuse of positions of trust is possible for anybody who is involved in sport and has the ambition to compete at the highest level. A young person in sport should never feel that they have to say that the abuse they suffered was the price they paid for competing at the top level, or be told that the person in the position of trust is “just that way”. I have heard both those things said to me in this very House. CPSU research in 2011 of young athletes’ experiences of sport found that 29% of respondents had experienced sexual harassment. The Ministry of Justice has requested a meeting with me at the end of the month, which I am very much looking forward to. I wonder whether the Minister would support legislation that covers position of trust in sport.
Currently, NGBs are left to deal with issues such as poor practice and breaches of code of conduct. They have to have their internal processes, but there should be an external, independent one. Fundamentally, I believe that sport should not be marking its own homework.
One of the main recommendations in my report called for a sports ombudsman who could deal with issues such as this. What is Her Majesty’s Government’s current thinking in this area? Another recommendation is to have an induction process at each stage of squad development. Many governing bodies had or now have this in place, but we need to check whether that actually works. It is an important part of the process and should include educating young people on the relevant rules, assuring them of their right to enjoy and engage in sport freely and without pressure to comply with adults’ sexual requests.
Finally, does the Minister agree that this is a sensible approach not just for the good of football but for the wider good of sport and society?
My Lords, it is a pleasure to support my good friend and fellow Boltonian, the noble Baroness, Lady Taylor, and to congratulate her on having secured this debate—a debate which, as we have already heard in the noble Baroness’s excellent speech, is for us and all our fellow Bolton Wanderers fans timely and poignant. Who would have thought, 15 years ago to the day since Bolton Wanderers, a club rich in football history, secured its first top eight Premier League finish, that this 8 May would see us in the High Court with a request for a statement of intent to put Bolton Wanderers Football Club into administration? We now have two weeks to start the process of unravelling the misery of the last few years, and to hope that somewhere in the system good sense will prevail and we will have a credible and competent owner who cares about the staff, the players, the fans and the wider community in which football operates.
I have had the privilege—not always the pleasure—of being a Bolton Wanderers fan all my life; I declare that I too am a season ticket holder. Technically, I became a fan before I was born, as my mother—herself a staunch fan along with my father—did not let being heavily pregnant stop her attending matches, home and away. As a former trustee of UNICEF and a proud president of Bolton Lads & Girls Club, I have witnessed at first hand the transformative nature of football and the importance it plays at grass-roots and community level.
But as football fans, you live with the ups and downs, as my noble friend Lord Kirkham said, and at times it can seem all-consuming. Last year, in an interview entitled “Football and Society”, Phil Neville, speaking of his family’s love of football, said:
“If we won, it would make our week, if we lost, it would spoil our week—it was that important to my father, to me, to my brother and my whole family”.
That was my family too, and for that privilege of spending your week either elated or miserable, of hours spent mulling over “if onlys” and calculating how many points you need to win promotion, make the play-offs or escape relegation, football fans pay a lot of money. The least they can expect for their financial and emotional investment is that the club they support is well managed, well resourced and shares their values.
Most of the recent debate in football has centred on the governance and restructuring of the institutions that themselves oversee the governance of the game: the Football Association, the Premier League and the English Football League. The reforms were much needed and as far as they have gone are welcome, but I believe that alongside further internal reforms the EFL and ultimately the FA need to look closely at their vetting procedures for ownership, their overview of good governance and stability of a club, and the actions and sanctions taken when things go wrong.
It is imperative when the EFL deems owners and directors of football clubs to be fit and proper that it goes beyond a checklist of who they are and what they have achieved, including in some cases time served for past demeanours. I agree with my noble friend that bankruptcy should not mean disqualification, because lots of entrepreneurs have been bankrupt in their time, but we do need to look at their values. Surely, in assessing suitable ownership, the values and ethos of potential owners and their vision for the club beyond winning everything in sight should be part of the regulator’s decision-making.
I readily acknowledge that some of the hard-and-fast commercial rules of business are difficult to apply in football, especially if clubs are not to price their supporters out of watching or make that special purchase of kit for their children out of reach, and it may be necessary to inject more funds than had been originally envisaged. But where a potential owner shows proof of funds, or if more money is needed, you should at least expect those funds to be invested in the club and not remain in the owner’s pocket, to be dished out whenever they feel like it.
The EFL says clearly that it is in the interest of all clubs and the game that clubs adopt and can demonstrate good governance, so you would also expect that good governance would be the watchword of any club, as it should be in any business. That means a properly constituted board, with not only executive directors but non-executive directors, preferably with nothing to do with the club. Under the ownership of Eddie Davies, who truly cared for Bolton Wanderers, there was such a board. Our current owner Mr Anderson is—hopefully soon to be was—the sole director at Bolton. No one, absolutely no one, was there to question or challenge his decisions and behaviour, and the consequence was the appalling behaviour to staff and players: their wages were unpaid and they were not told what was happening, with all the anxiety that brings. We have already heard from my noble friend that the hotel, which forms part of the complex, closed because it could not guarantee health and safety. The players were striking, the club was not fulfilling our league obligations, and a proud club was brought to its knees. As my noble friend Lady Taylor said, it is a tragic state of affairs.
How can that be allowed to happen? Throughout all this, the EFL said that everything was okay and there was money to see us through to the end of the season. What support did they give us when this did not prove to be the case and everything came tumbling down? It was the potential imposition of sanctions. Sanctions can only handicap a new owner trying to rebuild a wounded football club and leave supporters and the wider local community feeling unfairly punished for what they see as irresponsibility entirely outside their control. It must be the part of the EFL, the FA and the Premier League to have responsibilities to supporters and the wider community of football clubs, responsibilities which now so clearly require greater and more effective oversight from the footballing authorities.
My Lords, I must first thank my noble friend Lady Taylor of Bolton not only for securing this debate but for the way in which she introduced it, and it is a joy to follow my friend the noble Baroness, Lady Morris of Bolton. The terrible story of Bolton Wanderers should be a salutary lesson to all of us as football fans, and none of us would want this situation for any club, let alone our own.
At its core, this is a debate about corporate governance including but recognising the circumstances peculiar to football. Football is a big business. According to Deloitte, Premier League and Football League clubs annually generate £5.5 billion-worth of revenue and contribute £1.9 billion in taxes. This needs good governance just in business terms alone. Today, I looked up a definition of corporate governance:
“The framework of rules and practices by which a board of directors ensures accountability, fairness, and transparency in a company's relationship with its all stakeholders (financiers, customers, management, employees, government, and the community)”.
Note the “transparency” with “stakeholders”, and here we go to the peculiarity of football: the fans.
Business management generally took a wrong turn in the 1980s when the dominant thinking emerged that shareholder value was paramount. Prior to that, business was much more run to deliver customer value, and shareholders would benefit as a consequence, but since the 1980s managers have down-played the other stakeholders: staff, society and customers.
In football’s case, the customers are the fans. They drive the demand for football, either live or on TV. The club owner benefits from one of the most inelastic demand curves imaginable. I continue to pay £1,200 to £1,300 for a season ticket at Arsenal to watch the home games of the men’s first team. I have therefore missed the glories of Arsenal winning the FA Women’s Super League this season. Instead, we have had a mixed time on the pitch at the Emirates Stadium, just in the last week winning a Europa League semi-final 3-1 and then having a terrible draw to Brighton at the weekend.
Yes, I am a stereotypical Arsenal fan with an inflated sense of entitlement, but I am also typical of very many football fans. If I do not like my supermarket service at, say, Sainsbury’s, I can easily switch to, say, Lidl, but me switching my custom from Arsenal to Spurs is simply not possible. It is way more likely that I would leave the Labour Party, after so many years of membership and service, than stop supporting Arsenal. Fans are fanatics, and we deserve a special status as stakeholders in the governance of football.
This last year has been a troubling time for us Arsenal supporters, not just on the pitch. Late last year, Stan Kroenke took over the entire club, taking it private. Mr Kroenke, according to Wikipedia,
“is the owner of Kroenke Sports & Entertainment, which is the holding company of English Premier League football club Arsenal, the Los Angeles Rams of the NFL, Denver Nuggets of the NBA, Colorado Avalanche of the NHL, Colorado Rapids of Major League Soccer, Colorado Mammoth of the National Lacrosse League, and the newly formed Los Angeles Gladiators of the Overwatch League”—
I gather the Overwatch League is something to do with e-sports. He is not really a football fan, let alone an Arsenal fan.
As part of this takeover, he forcibly acquired the shares owned by the fans, including in bodies such as the Arsenal Supporters’ Trust, or its vehicle Arsenal Fanshare, of which I was a board member. Having negotiated to buy the shares owned by Alisher Usmanov, a Russian magnate who was not in my opinion a fit and proper person to own a football club, Kroenke then owned 98.82% of the club. He was therefore entitled in law to force other shareholders to sell to him and take the club private. As a result, supporters who had held shares in Arsenal, had inherited shares in Arsenal, had held them since the war, have seen that link end. It is the end of custodianship, and the transparency and accountability that comes with supporter ownership is also lost.
Private ownership of football clubs, often by overseas Governments or investors, is now commonplace. It needs a reaction from the governing bodies and the Government. Given the weakness of the regulators of the game to enforce any meaningful fit and proper person test, which has been discussed, the need for transparency and accountability is all the more important.
Supporters need greater recognition and a greater role in their clubs. We are more than wallpaper for the TV companies, which are the real customers that owners care about. You can watch a game behind closed doors, but it is not the same without the fans. The players behave differently, and it lacks the theatre and the emotion. Imagine last night at Anfield without the fans—it is impossible.
Owners need fans but take them for granted because they are fanatics. That is why I welcome the policy of my Front Bench that football supporters should be formally represented on the boards of football clubs. There is also a parallel policy of giving workers a place on the boards of major companies. If that goes ahead, we need to tweak it, as I certainly can vouch that Arsenal would be better served with supporters on the board, rather than workers in the form of millionaire players such as Mesut Özil and Shkodran Mustafi.
We should also examine whether there is a way to force clubs to provide their fans with financial reporting information and meetings similar to the AGMs that plcs have to have as a way of maintaining accountability and transparency.
Finally, is it time also to look at making it a requirement that a certain portion of equity in a club should be reserved for supporter shareholders of that club? I am not talking about a great amount but enough to provide accountability and transparency.
This is, particularly for Bolton fans, a hugely timely debate. I wish that club well. I hope that the regulators of the game are listening, and I hope that they will do more for the fans of the live game.
My Lords, this is one of those debates where you think of various things to say but then hear them ticked off one by one by the people who speak ahead of you.
If ever there were an answer to sexism, it can be seen in this debate. The female Members of this House have championed football—seen as a male preserve until fairly recently—and indeed they have done most of the heavy lifting. So it now falls to the rugby player to comment around the sides of the heavy work that has been done.
When it comes to Bolton Wanderers, I should declare that I was brought up in Norwich. Our experience is very different. We have had civic receptions to say, “Well done”, although we have been promoted and relegated almost as often. Our club has experienced ups and downs, but it is very lucky to have better management. If you have good management, you will survive the bumps and the bangs.
The noble Lord, Lord Knight, has just pointed out to us that, even if fans protest and do not turn up, they do not tend to transfer their allegiance. I just wonder how many applications from other parties will be arriving on his desk tomorrow morning—but that can probably be reported back to us. However, there is something about the soccer fan that makes him want to stay with his club—probably more so than in virtually any other sport. I have seen the same thing to some extent in rugby league, but rugby union is only just establishing a regular fan base. It used to be the case that you supported the club that you played for, at least perhaps in a junior team. That tends to be the culture. Also, the culture of promotion and relegation means that, if anything goes wrong, it goes wrong big time. If you have a bad season, your income base falls away and you become even more vulnerable.
The noble Lord, Lord Knight, referred to another thing that I had intended to mention: the idea of franchising and having a guaranteed fixture list must be very attractive to many big owners, particularly American ones. We have to look at the culture of this incredibly successful sport, which is an amazing generator of invisible earnings for this country. We have to examine disasters such as the one at Bolton—a disaster for the club, for the structure, for everybody involved in it and for the financial base of that town and the league itself. If we want to preserve the culture of it being technically possible to reach the top through good management and canny decisions, we have to make sure that there is better governance.
The briefing provided by the Library spoke about how a huge step was taken a couple of years ago—which it was. But was it enough? The evidence would suggest not. But one thing that has come out, both here and in much of the briefing I have received, particularly through the FA, is that we are not taking advantage of the fan. If ever there was a role for exposing and ensuring transparency in how a club is managed, there is a body that will do it for you. This is also a way in which the manager of the club, for instance, might benefit. He says, “I can’t pump more money in. I can’t buy you those players, because I have to prepare in case something goes wrong”. There is no guarantee of success. I am afraid that the average football fan has rather a record of blaming everybody else: the wrong combination of players, someone being injured, the wrong manager with the wrong team. It will happen, because just as success is rewarded, it is guaranteed that failure is punished. Things will swing around—even if it is only relative, it is going to happen.
So how are we going to do this? I suggest that it might be worth looking at something along the lines of members of the board, possibly non-executive directors, having the job of exposing what has happened. There is a degree of agreement. I thought we might be heading for a classic left-right combination when the noble Baroness, Lady Taylor of Bolton, and the noble Lord, Lord Kirkham, started up. But even then we had a degree of agreement that it is an independent structure that the Government cannot get that involved in. So we cannot regulate too much, but we should encourage a framework that tells us what is going on because, as all sports get more professionalised, these pressures are going to come, and indeed have already come. Rugby league has had, let us say, its interesting moments. The initial phases of professionalism in rugby union have had their moments. All have been placed under similar pressures. Football is far and away the most dominant game, but it will be seen as something as a template and model.
We have to look at this as a whole because of the importance of sport to our culture and everything else. We use professional sport as a driver to get others involved in sport. Indeed, many of the duties placed on our senior professional clubs are there to encourage junior and amateur sport, to make sure that people go through. The good work done by all sports, on mental health, for example, happens because professional clubs have the resources, the drive and the connections to do it properly. Sport is a tremendous asset when it is used properly. When it fails, the damage is massive. I am not sure of the situation in Bolton, but anyone who has been involved in youth teams, community work et cetera will be damaged. There can be no two ways about that. Also, do you want to link yourself to something that might disappear? How much more reticent will you be about using this asset? All these things come to the fore.
We have an odd situation, and an economic activity that is culturally linked to the very soul of many communities. Unless we get a better understanding, and a better way of looking after these things properly, we will continue to have these problems. Bolton Wanderers are merely today’s problem—as Leeds United were a problem in the past. Look north of the border and you see Glasgow Rangers. Whoever would have thought that they would go through the experience they went through? We have to see that these clubs are maintained and run properly. Making sure that they are transparent in their actions is the only real way we can do this, because I do not think we want a state-run professional sporting structure. So I hope that the Minister when he responds will give us an idea of what sort of encouragement and support the Government can give to football in this case, and professional sport generally, so that it can run itself better.
My Lords, I join others in congratulating the noble Baroness who brought this Question before us. With the noble Viscount and myself left to offer our contributions, it feels as though we are moving into extra time and I just hope it does not end in penalties. This has been a debate dominated by mention of, and sadness for, Bolton Wanderers. Two Members of this House with “Bolton” stuck on the end of their names have had fierce things to say in favour of their club and have expressed deep regret for its present fate. I wonder whether we could have a little proposal here on my part, not for the Minister to consider but perhaps for the two noble Baronesses. Mr Gordon Taylor has just retired from the Professional Footballers’ Association as the highest-paid trade union official in the world, whose last recorded emoluments amounted to £2.29 million. If I am right, the figure for Bolton Wanderers’ debt being quoted in court is a mere £1 million—perhaps it is a bit more than that but that is the figure that was in the newspaper; clearly I am in the presence of people who have authority that I cannot possibly claim—so perhaps Mr Taylor might be approached to see whether some of his generosity could be applied in that direction.
Like the noble Lord, Lord Addington, I am a rugby player. I do not always see the positive side of football; when I go to games, I can sometimes be quite afraid because of the kind of raw emotion on display and the nature of some of the chanting. After all, if you have been to Cardiff Arms Park or its successors and taken part in rugby games, where the opposing fans are mixed up with your own fans, having a jocular time, and the only villain of the piece is the referee, then you will know that that is greatly missed when we go to see a football game. I have lived within sound of the roar of the crowd at the Arsenal stadium—Highbury, as it of course was—but without ever being able to afford to go in it. Similarly, my wife reports her entire family going down to the Victoria Ground to see Stoke play—indeed, to see Stanley Matthews play. I was not going to mention Stanley Matthews, because he scored the goal for Blackpool against Bolton Wanderers in that famous cup final that saw them off in that year of glory.
However, we have to come to the point. It is the very importance, centrality and key role of football that makes it so vital that we give it our best scrutiny. I am sorry that two noble Lords have not spoken today. One is my noble friend Lord Triesman, who is not taking part in the debate for family reasons. His contribution and his insights into his time at the FA, his successor and his successor’s successor would have been more than useful. It is not an easy place nor an easy culture to manage. I think we would have found that my noble friend was still wearing his bruises as a result of that encounter with immovable and implacable systems and institutions in the FA. I think Mr Clarke is doing his best.
At the end of the day the board has been reduced from 12 to 10 and is required to have three women on it—this tick-box thing. There are now three women on the board but no one really from the minority-ethnic groups who are the first visual encounter with our football scene that any of us gets. In last night’s wonderful match at Anfield over half the team were from minority groups, and the same was true of Gareth Southgate’s team in the recent match against Montenegro. If you see the brilliance, the footwork, the commitment, the spirit and the passion represented in this diverse manner on the field, which is the most glorious advertisement for football, then you ought to see it in the management and oversight structures and institutions that run the game. Indeed you must see it, otherwise people from minority-ethnic backgrounds will feel that they are puppets paid to play the game but that the sport is not really theirs. Just one football coach was black, and I think that that is a shame.
The other person that I miss today is the noble Lord, Lord Ouseley. I wish that he were here, taking part and talking about Kick It Out. We cannot just gloss over the fact that racism and racial bigotry seem to be within the spirit and ethos of the game and express themselves in such ugly forms again and again. I remember meeting people from the Inter City Firm in the 1980s, the fascist thugs who organised at school gates to take their young protégés off to matches to disrupt them, to taunt the police and to have a go at Muslims. It was shameful and kept many Muslim people from our grounds altogether.
Our institutions must manage not only the activity and give an account for the funds that are theirs to manage, but the climate in which the game takes place. They have more responsibility than simply to regret things and effectively to wash their hands of it afterwards. I liked the introduction from the noble Baroness, Lady Grey-Thompson, about the need for those running football to actively remember their duty of care to everybody in the game, not just the players—the staff, the people in the background, the people we never see. They need to be treated properly too.
In every way, football is exciting. Indeed, why are we sitting here debating this when Spurs are about to go on the pitch to play against Ajax? If anybody has an up-to-date score before I leave, please let me have it. I did not realise that my noble friend Lord Knight is an Arsenal supporter. My daughter is, but my sons are Spurs supporters. It has made life in our household extraordinarily difficult. If only they had all stuck to their father’s sport, rugby, it would have been so different. But then, if we have a Motion to discuss the way the Welsh Rugby Union manages the game of rugby in Wales, we would get into the same sticky holes we have got into in thinking about football this evening.
Football is too important for us to simply think of it as a game played either on telly or in a stadium. It is part of the culture of this country, and that makes it absolutely necessary for us to give it our closest attention in terms of the way the institution looks after the people involved in the industry and the way the questions of bullying, grooming, racism and so on are looked after too. Thanks to those who brought this forward. Now, in extra time, over to the noble Viscount.
My Lords, I should start by saying that my noble friend Lord Ashton has absented himself from the pitch, so I suppose I must be the sub. I thank the noble Baroness, Lady Taylor, for securing this short debate, and all Peers for their informed contributions. It is a debate on football, which is rather remarkable. It is not lost on me that if we had more debates on football every day here it would encourage more young people to engage with politics. That is just a thought before I begin.
As my noble friend Lord Kirkham said, football is often referred to as the beautiful game, but it is more than that. It is our national game and there is much to celebrate. If I may highlight a few things, the Premier League remains a formidable domestic and international success. Economically, we benefit from the 100,000 jobs it creates, £3.3 billion in tax contributions each year and a figure of £7.6 billion GVA impact overall. One billion homes globally have access to Premier League coverage. Some 686,000 international tourists attended matches, bringing additional benefits.
Our stadiums are full each week. This includes the English Football League, which is one of the best-supported leagues in Europe. Our England teams, male and female at all age levels, are excelling on the world stage. With government support, this country looks forward to hosting the European Championships in 2020 for men and 2021 for women.
As the noble Lord, Lord Pendry, and the noble Baroness, Lady Grey-Thompson, said, the women’s game continues to grow apace, and the Government are firmly behind helping the FA’s ambition to double female participation numbers over the next few years. Over 50,000 fans, a record, attended the women’s FA Cup final at Wembley last weekend, won, of course, by Manchester City. Speaking of Manchester City, how about that fabulous goal, which I happened to see, from Vincent Kompany on Monday night? It sets up this Sunday well for a fantastic last day shoot-out between Man City and Liverpool for the championship crown. I see a few heads shaking.
It is no wonder that, in a nation that consumes football so avidly, in this Chamber we often find ourselves debating all aspects of the game—and sometimes that includes disappointing aspects. Many noble Lords will have been present last month, when my noble friend Lord Ashton spoke about the game’s problems in dealing with racism and other forms of discrimination that have blighted the sport in recent times. The noble Lords, Lord Pendry and Lord Griffiths, raised this important issue. May I reassure the House that the Government are working closely with football to address this important matter?
Issues of governance or ownership are other matters of concern. Perilous financial difficulties, failing to bring fans on board as custodians of their chosen club and securing long-term home grounds are of relevance, and we have heard them repeated today by several noble Lords. On governance, the Government have been active in pushing the FA to reform its structure and give the game the overall leadership it requires. The sports governance code that came into force on 1 April 2017 applies to all sporting bodies in receipt of public funding from Sport England and UK Sport. It challenged the FA and all other governing bodies to demonstrate that they meet the highest standards of governance and regulation. The code applies best corporate practice.
We welcomed the reforms the FA has now made to comply with the code by ensuring that its decision-making bodies are more transparent, more independent, more diverse and therefore more representative of the participants in the sport. The FA needed to reform so that it could continue to pursue the long-term potential of football in this country, from grass roots up to the national teams, with government support. In partnership with football, the Government are currently investing more money than ever before in community football programmes and facilities.
Concerning the financial stability of the game, the increased checks and balances brought in by the football leagues and the FA, in the highest echelons of the national league, have done a great deal of good in ensuring that their member clubs’ finances are managed in a fiscally responsible way—despite what the noble Baroness, Lady Taylor, said. Requiring regular financial returns of member clubs has had an extremely welcome effect in greatly reducing the number of insolvencies in the professional game. However, this has not been sufficient to safeguard the financial situation of Bolton Wanderers. I listened very carefully to the heartfelt comments of the noble Baroness and my noble friend Lady Morris in respect of Bolton Wanderers. Good governance is not foolproof in predicting and preventing failure in any sector. It is easy to forget that of the 92 professional clubs, in spite of the large sums of money involved and club competition lending itself to rewarding success over everything else, financial failures are in the minority. Unlike 10 to 15 years ago, very few clubs fall into administration because of financial mismanagement.
The owners’ and directors’ test—formerly the fit and proper person test, to which the noble Baroness, Lady Taylor, alluded—stands up to what we would expect to see in the private sector, and is stringently applied to its full extent. The English Football League and Premier League work closely together to ensure the best diligence possible in this respect. The test is based on a set of objective criteria, such as whether an individual is banned from being a company director or has been involved in more than one administration at a club since 2004. These points were made by my noble friend Lord Kirkham. It is not a subjective assessment of anybody’s fundamental ability to run a football club, or their motivations. As well as the owners’ and directors’ test process, the football authorities carry out additional background checks on individuals and their financial standing as part of the overall due diligence process. We would expect those to be applied to Bolton and any prospective buyer. However, while tests can protect against legally inappropriate owners, they cannot, as in any other line of business, predict success or aptitude.
Let us be clear that a professional club is a business, like many others. What sets apart the business of football from other commercial endeavours is the place of the club at the heart of its community—a point made today—and the fan base of supporters, which has a brand loyalty beyond compare, as the noble Lord, Lord Knight, said.
To pick up a theme from the noble Baroness, Lady Taylor, and the noble Lord, Lord Addington, the fans are extremely important to the success of our football leagues. We welcome the fact that there is now much greater dialogue between clubs and their supporters. They discuss the matters of most importance in running their club, which include its financial state and transparency over its ownership. These meetings are a mandatory requirement on football clubs, in accordance with football’s rule books, and were introduced as a result of the Government’s expert working group on supporter ownership and engagement, which reported in 2016. I am pleased that this has gained traction across the league. It could lead to fans being placed on the board, if that is by mutual agreement between the fans and clubs.
The noble Baroness, Lady Taylor, and the noble Lord, Lord Pendry, asked whether we would press for a greater role for football fans. The Government will continue to engage regularly with supporter organisations, such as Supporters Direct and the Football Supporters’ Federation, which do excellent work in representing supporter interests.
Club successes, however, can be frustrated further by their lack of ownership of a home stadium, as demonstrated in markedly different ways at Dulwich Hamlet FC and Coventry City FC. The reliance of community clubs on local authority-owned facilities was well understood, but less is known about the degree of risk that this may pose across the professional and semi-pro game. With this in mind, the Government asked the FA to conduct a review of stadium ownership to inform what guidance and advice is needed to secure better protection of club assets and give greater clarity to supporters, local residents and everyone interested in the protection and development of football clubs and their assets. We are working over the course of this year with the FA to ensure that the review provides as much support as possible for clubs, knowing how important they remain to local communities.
The noble Baroness, Lady Taylor, asked whether the Government will encourage listing stadia as assets of community value, which is an interesting point. We would absolutely encourage the listing of stadia as assets of community value, as suggested, and will consider how this should be reflected in the work of the review.
Ensuring the long-term sustainability of clubs must remain the primary responsibility of all club owners. I feel that I should reflect for a moment on the large number of current and past owners, throughout all tiers of the football pyramid, who have done just that. They invest, more often with their own sums, to keep the clubs healthy; they recruit the best possible players and staff; they invest in our stadiums, so that we have a safe and enjoyable experience when we watch football; and their clubs are vibrant hubs in their local community.
Responsibility also lies with the football authorities which govern the sport and set the rules and regulations with which clubs and their owners must comply. I have mentioned the financial reporting and ownership rules that are in place to try to ensure that clubs remain on a sustainable footing. Where they do not, the football authorities have a range of sanctions that they can apply which act as a deterrent. Our football authorities must continue to keep under review the ways in which their member clubs can be protected in the long term. Long-term business plans, proof of sufficient funds and concrete assurances should be provided by owners around the protection of the club. This would provide clarity and reassurance to fans and ensure that support for football thrives at all levels.
I would like to give some reassurance to the noble Baroness, Lady Taylor, my noble friend Lady Morris and the noble Lords, Lord Pendry and Lord Addington, about the future. As Mims Davies, the Minister for Sport, has said, if football’s current rules are not sufficient then new rules may be required. If the football authorities believe that to be the case, and football needed the help of government above the scope of powers the game has to govern itself, then of course government would welcome that discussion.
I want to move to the interesting comments made by the noble Baroness, Lady Grey-Thompson, who asked whether there was progress towards having an ombudsman and what the latest was on the Ministry of Justice’s work on positions of trust in sport. We recognise that dispute and grievance processes in sport need appropriate levels of independence, so the Minister for Sport is considering the issue of a potential ombudsman. On trust, it is vital that sports youth groups and charities are safe places, and I welcome the MoJ’s recent commitment to review the effectiveness of laws protecting people from abuses of power. The review will look at the existing law in this area to ensure that it is working effectively and is clearly understood. If it appears that there are gaps in current provision or practice, government will consider carefully how to address them. DCMS is supporting the MoJ with this review and ensuring that the views of its sectors, including sport, are heard clearly.
The picture that I have tried to portray is that football is in a pretty healthy state. It is a fantastic homegrown product and a most valuable export. We should be proud of it. But it still has its challenges, about which we have heard much this evening. There are always areas where it needs consider what more can be done. This includes around governance and the regulation of the professional game. It includes its support to the grassroots to ensure that the game does not lose its community roots and the legacy of generations that follow their clubs. It must continue to find ways to provide the environment whereby every player, volunteer and spectator feels safe and included in its success.
The Government will continue to challenge football in the areas where we think it is necessary and we will ensure the health of the sport and our collective custodianship of it. It is always at the heart of those agendas. Finally, I wish Bolton Wanderers a fair wind in seeing through its current challenges.
House adjourned at 8.16 pm.