The Football Governance Bill has progressed to the Committee Stage of the House of Commons after its second reading was approved by MPs on St George’s Day (23 April).
During the reading, Lucy Frazer, the Secretary of State at the Department of Culture, Media and Sport (CMS), addressed concerns about football regulation, emphasising that the government wants to protect the English game.
English football is one of the most valuable sports ecosystems in the world, with the Premier League alone valued at around £7bn, including media rights arrangements, ticket and merchandise sales, and sponsorship, among other revenue streams.
However, the government is concerned – according to Frazer – that fans are being ‘taken for granted’ and that many clubs, particularly smaller ones and especially those outside of the Premier League, are not feeling the benefits of the English game’s global success.
“We all want to see our national game prosper for generations to come, but if we want our clubs to thrive, fans have to be at their heart,” she remarked.
“If we want English football to remain a global success story, we have to ensure our pyramid is financially sustainable. I am proud to say that the Football Governance Bill will do exactly that.”
A result of the Fan Led Review of Football initiated by CMS after the extensive backlash to the highly controversial European Super League (ESL), the Football Governance Bill’s flagship measure is the creation of a regulator overseeing the sport.
Frazer outlined to MPs that the government has been engaging extensively with the Premier League and the EFL – the latter encompassing the Championship, League One and League Two – on the regulator’s functions.
The government plans to grant the regulator ‘significant powers’ relating to both individual clubs and the leagues, although the latter will occur ‘when triggered by either the Premier League or the EFL’.
It will also have backstop powers to look at the English football pyramid as a whole. With the pyramid encompassing 11 levels, a further nine grassroots levels and over 5,000 clubs, this will be a hefty task to take on.
The primary concern of the regulator, however, will be financial governance, Frazer emphasised to MPs, many of whom voiced consistency concerns about hurdles faced by local teams – such as Sefton Central MP, Bill Esterson, who relayed the opinions of local Everton FC supporters about the points deductions the club has faced this year.
Frazer asserted: “As I am making clear, the Bill is about financial regulation. I know that many fans are concerned about issues within the game itself. The Bill will not regulate how football is played, which is a matter for the footballing authorities.
“This is about ensuring that clubs up and down the pyramid are financially sustainable under a regulator. If no deal is agreed on distributions, the regulator can step in. This will protect the pyramid overall.”
Whilst the government asserts the regulator will not interfere in the day-to-day footballing activities of England’s clubs, the prospect of enhanced financial oversight has not had an entirely warm reception.
In an op-ed with The Times earlier this month, Premier League CEO Richard Masters expressed concern about the prospect of ‘banking style regulations’ being introduced to English football.
Overregulation of the game could hinder English football’s competitiveness and weaken its appeal, Masters argued. The CEO cautioned that the English game’s position as a leader in world football, and the revenue this brings in, could be threatened.
He also commented on potential interference in Premier League distribution of funds to the EFL and lower leagues in the pyramid under the current voluntary system of parachute payments, describing this as ‘the most generous funding in world football’.
In contrast, however, Frazer informed MPs that whilst parachute payments are factored into the bill, the provision relates to ‘the consideration on a club-by-club basis in the licensing regime itself’.
This was a response to Clive Efford, MP for Eltham, who called out what he saw as a flaw in the Bill in that it does not grant the regulator powers over parachute payments. Comparing these remarks to Masters’ comments, this suggests some disconnect between footballing and political authorities on what exactly the Bill will entail.
Responding to another MP, James Wild of North West Norfolk, who referenced local side Norwich City, Frazer reiterated: “We believe that parachute payments have a role to play, although I know people have concerns about distortion.
“Under the Bill, if there is any issue relating to the finances of a particular club, particularly by reference to the parachute payments it might have received, the regulator has an ability to look at that within the licensing regime as a whole.”
Many MPs found themselves sharing common ground with league officials regarding the need for ‘light touch’ regulation. Whilst Frazer asserted that this is the government’s aim, MPs were keen to hammer the point home.
James Sunderland, MP for Bracknell, argued his case that light-touch regulation is necessary to ensure the Premier League, EFL and National League remain attractive to owners, potential investors and media partners.
Ultimately, Frazer seems to have sold the Bill to MPs well enough, as it was approved and will now pass to the Committee stage of parliament for further, likely more intense scrutiny.
