John Whittingdale The Minister of State, Department for Culture, Media and Sport, Minister of State (Department for Science, Innovation and Technology)
I start by congratulating Matt Rodda on securing this debate. As he mentioned at the start of his remarks, it was the intention of the Minister for Sport, my right hon. Friend Stuart Andrew, to respond to the debate, but he has had to return to his constituency urgently for reasons that I think colleagues will fully understand.
In his remarks, the hon. Gentleman highlighted the deep concern that he and many of the fans he represents have expressed regarding football ownership. I pay tribute to his commitment, and to theirs; having listened to his description, we understand how difficult it must have been for those fans over the past few years. We are very much aware of the passion and interest that many hon. Members feel about the long-term sustainability and governance of English football, and their commitment to their local clubs. I thank the hon. Members for City of Chester (Samantha Dixon), for Strangford (Jim Shannon) and for Sheffield South East (Mr Betts) and my hon. Friend Anna Firth for their contributions to this debate. In particular, as a Member of Parliament for Essex, I am very much aware of the difficulties faced by Southend United, and my hon. Friend has been a fantastic champion for the fans of that club.
The presence of those hon. Members in this debate demonstrates how important football clubs are to the lives of people in this country. In 2011, when I chaired the Culture, Media and Sport Committee—quite a considerable time ago now—we conducted an inquiry into football governance. It is somewhat depressing that, 12 years later, we are still debating many of the same issues. However, I hope that the inclusion of the football governance Bill in the King’s Speech yesterday will reassure the hon. Member for Reading East and others that this Government are intent on delivering and safeguarding the future of football clubs for the benefit of communities and fans.
The hon. Gentleman has talked about his own local club, steeped in the fabric of its community. It has been relegated, suffered sporting sanctions and faced financial penalties because of reckless decisions made by owners and terrible mismanagement. We have also heard about poor and non-existent governance practices, with fans being prevented from influencing key decisions that affect them and having to petition local councils, in some cases to protect stadiums. All such incidents threaten the long-term health and sustainability of all clubs, not just Reading.
We have heard about how English football clubs make significant contributions, and also about what happens when the community is let down by irresponsible owners in charge of football clubs. No employee, be they a player or, indeed, someone in the club shop, should fear not being paid. It is the local communities and fans that are the lifeblood of these clubs, and they bear the brunt and fallout of bad ownership decisions. They see where the structures are not working for the good of the game, and they can articulate most clearly how these are set right.
My colleagues in the ministerial team have prioritised engaging with fans and listening to their concerns, and I would like to pay tribute to my hon. Friend Tracey Crouch for leading the fan-led review of football governance. This has been of immense value in developing the White Paper and during the period of the consultation we held earlier this year. I would like to thank the Football Supporters Association for its support; its contribution has been extremely valuable.
Too many clubs have been brought to the brink with unsuitable owners taking over, stripping them of their assets and refusing to fund them any more. We are committed to breaking this cycle of inappropriate ownership, financial instability and poor governance practices. That is why the inclusion of the Bill in yesterday’s King’s Speech is so important. The Bill will establish an independent football regulator, which will put fans back at the heart of football and help to deliver a sustainable future for all clubs. It will strengthen the governance and financial resilience of football clubs to protect the national game and clubs linked with communities and fans. Crucially, the regulator will address systemic financial issues in football, while providing the certainty and sustainability required to drive future investment and growth. This will ensure that English football remains the global success story and tackles the harms that exist.
The Bill will give fans more of a voice in the running of their clubs by setting a minimum standard of fan engagement. Clubs will need to meet this, and will be required to comply with the FA on its new rules for club heritage. It will give fans a veto over changes to the badge and home shirt colours, in addition to the strong existing protections for club names. Most clubs have a strong relationship with their fans and consciously engage them in decisions about club heritage, but not all do. For instance, fans of Cardiff City and Hull City will understand the importance of these measures after they recently had to battle to bring back or to keep their club’s colours and badge. Likewise, the new system will create strengthened owners and directors tests to make sure a club’s custodians—their owners and directors—are suitable.
Clive Betts Chair, Levelling Up, Housing and Communities Committee, Chair, Levelling Up, Housing and Communities Committee, Chairman of the House of Commons Members’ Fund
I think the consultation with fans is absolutely at the heart of this. It was at the heart of the fan-led review, and I pay tribute to Tracey Crouch for that. For the fans, it will be really important that the legislation specifies how fans groups will be appointed as part of the consultation, and it should not be left to the owners of clubs to decide which fans they want to talk to and which they do not, because that is at the heart of the current problems in many clubs.
John Whittingdale The Minister of State, Department for Culture, Media and Sport, Minister of State (Department for Science, Innovation and Technology)
Thank you, Mr Deputy Speaker.
I do understand the concern expressed by Mr Betts. Certainly, we would not wish to have a system in which the directors decided who they do and do not wish to talk to. It will be part of the licensing requirements that fans are involved. I am sure we will wish to explore that further during the passage of the Bill, but it is certainly the intention that that is one of the conditions for licensing.
We have seen other examples of fans fighting back against their owners to save their clubs at Blackpool, Charlton Athletic and, as we have heard tonight, Reading. That should not have had to happen.
Matt Rodda Shadow Minister (AI and Intellectual Property)
Does the Minister agree that part of the issue here is about the test for ownership? It was interesting in Reading’s case that Dai Yongge was refused as a potential owner for Hull City when it was in the premiership —unlike Reading, which was in the championship at the time. The English Football League allowed him to become the owner of Reading. There is an issue there and a question about the fit and proper test for owners.
Motion lapsed (Standing Order No. 9(3)).
Motion made, and Question proposed, That this House do now adjourn.—(Andrew Stephenson.)
John Whittingdale The Minister of State, Department for Culture, Media and Sport, Minister of State (Department for Science, Innovation and Technology)
I understand the hon. Gentleman’s concern on that point, particularly given the record of the owner of his particular club. The Bill will insert as one of the duties of the new football regulator the requirement to conduct an owners and directors test, to make sure that clubs and fans are protected from irresponsible owners. I am sure that we will want to explore that matter in greater detail when the Bill comes to be debated in this House.
The Bill will also require clubs to seek the regulator’s approval for any sale or relocation of the stadium and to demonstrate how they have consulted their fans as part of that. To give another example, at Derby County we saw the issues caused by the decision to sell the club stadium to a separate company owned by the club’s owner. More recently, as the hon. Gentleman has graphically described, we have seen fans at Reading petition the council to list the ground as an asset of community value, to make sure that it cannot be sold quickly and without warning by the current owner. The stadium that the club plays in not only has significant value to fans, but can be a club’s most valuable asset.
In addition, the regulator will prevent clubs from joining breakaway leagues. As Members will be aware, in 2021 fans were faced with the prospect of a breakaway European super league that was fundamentally uncompetitive and threatened to undermine the footballing pyramid. Fans will no longer face the prospect of seeing their club sign up to such ill-thought-out proposals. Ultimately, we want a thriving footballing pyramid and more money must flow through the game to make that happen.
On financial distribution, it remains our firm belief that the best solution is a football-led solution, but if one is not found, the regulator will have a backstop power to intervene and force a solution. I hope a resolution on that point will be found soon, and I urge both sides to reach a deal as soon as possible. It is in the game’s interests to avoid the risk of further financial uncertainty.
In short, through this legislation we are protecting the fundamentals of the game we love while ensuring a more sustainable future with fans at its heart for generations to come. Meanwhile, alongside the introduction of legislation, the Government will take the time to explore the extent to which preparatory work can be done ahead of the regulator being established in law.
I fully recognise the plight of Reading football club, as the hon. Gentleman described, and I understand his wish that measures should be brought in as soon as possible. I am afraid that I cannot commit to a pilot at this stage, but I can tell him that the experience of Reading FC and other clubs will continue to inform policy development and decisions about how the regulator is set up. Likewise, any sale that takes place in advance of the regulator is a matter for the football authorities’ existing rules and checks on owners and directors, but I urge hon. Members who are concerned on that point to encourage clubs and their leaderships to engage with the team in the Department as we take the policy forward.
If the hon. Gentleman has particular concerns, I know that the Under-Secretary of State for Culture, Media and Sport, my right hon. Friend the Member for Pudsey, will be happy to talk to him further. I thank him for bringing the matter before the House. I think we all look forward to the introduction of the Bill and the establishment of a regulator in due course. I certainly share his view that that needs to happen quickly, and before a general election.
Question put and agreed to.
House adjourned.
