Football Governance Bill - Committee Debates D(el)ay 3
"Filibustering" continues from opposition Peers who rally in support of Saudi Arabia & Qatar involvement in football as well as protection of Premier League Clubs interests.
Day 3 (Wednesday 4th December) of the Committee debate on the incoming Football Governance Bill in the House of Lords, started with a statement from Lord Kennedy of Southwark “My Lords, before we commence Committee, I remind noble Lords that we need to make substantial progress on the Bill. This is now the third day in Committee, so there should be substantial progress today.”
The request for quick resolutions had little or no impact on the days proceedings.
Day 3, like the first two days of debates, once again saw Peers (predominantly Conservative) drag out proceedings across two sessions, session 1 lasting four and half hours and session 2 lasting over two hours, ending late into the evening (10.47pm). With only 48 (finally reaching Clause 5) of the 342 amendments referenced, discussed or debated.
The focus or delay strategy for the day was around clauses related to:
The Premier League - consultation by the Government with the Premier League and the Premier League’s potential concerns with the Football Governance Bill i.e Parachute Payments (further delay tactics by previously mentioned Peers).
Club Owners - The meaning of “Owner” and “Ultimate Owner” and scrutiny club owners or people with “Influence” at a club are likely to be subjected to by the IFR.
Protecting clubs football stadiums - potential for owners to sell or move stadiums.
Independent Football Regulator (IFR) the cost burden on clubs, organisation size and remuneration, including the Expert Panel and media related conflicts of interest.
Premier League Consultation
Baroness Brady, Vice Chairmen of Premier League club West Ham United, raised concerns on the lack of consultation between the Government and Premier League clubs on the Football Governance Bill. The Baroness went on to say:
“Just seven Premier League clubs—mine was one of them—were granted a brief half-hour meeting with the Secretary of State over the summer. Following this cursory engagement, significant decisions were made that could fundamentally affect the future of English football, most notably with the inclusion of parachute payments within the backstop mechanism. I say again: seven clubs out of 20 have been seen for just half an hour since the Government took office and before they made that seismic decision”
The seven clubs were later clarified by Brady as being West Ham, Crystal Palace, Brighton, Liverpool, Spurs, Everton and Brentford.
She also went on to say:
“That would be especially important, given that the impact on Premier League clubs is very different from that on other stakeholders in the Bill, as the Premier League is the only party that provides funding to any other part of the football pyramid. The backstop is clearly designed as a mechanism to gain direct access to, and apportion, Premier League revenue and no one else’s. It would allow the IFR to do this even if it was against the Premier League clubs’ will, or even without the clubs’ agreement, even if it was to have a detrimental effect on the clubs and the overall competition that it removes revenue from.”
One could argue that there is a clear pattern forming in the debates from peers linked to Premier League football clubs and that is to slow down the process, tie it down with already discussed and debated amendments and try to ensure the Bill does not require their clubs to distribute any more revenue throughout the football pyramid.
The debates have already seen two peers, Baroness Brady (Vice Chairman West Ham) and Lord Finkelstein (Director of Chelsea -refer to Day 2 summary) scrutinise any amendments that may not be favourable to allocation of the Premier League clubs finances, even if the amendments provide more certainty and financial sustainability to clubs outside the Premier League or more involvement for match going fans.
Delay tactics in the House of Lords being supported by the Premier Leagues tactics outside the House, where reports have confirmed the Premier League has issued letter templates for Premier League clubs to send to local MP’s raising concerns on introducing a IFR.
Response from Baroness Twycross to Baroness Brady below:
The noble Baroness, Lady Brady, referred to what she called a lack of consultation. I am thoroughly surprised by and do not recognise this. The intended scope of the Bill is built on one of the most sound evidence bases and most extensive consultations possible. Over the past three years, there have been countless opportunities for all affected and interested parties to make representations. These include the fan-led review, the Government’s response to the fan-led review, and the White Paper. No club that has asked this Government for a meeting has not had one. Some Premier League clubs have indeed turned down invitations to meet. I met the noble Baroness myself and I attended the meeting in the summer that was referred to.
“influence” of Middle East Club Owners
Amendment 27 (figure below) from Lord Moynihan rallied the opposition Peers and was used as an excuse to cheerlead their support of Middle East involvement in Football.
After introducing his amendment Lord Moynihan went on to say the following on Saudi Arabia:
“Perhaps the best way to seek clarification from the Government is to work through a specific example. Newcastle is majority owned and financially controlled by the Saudi sovereign fund, the PIF. The PIF became the majority shareholder and de facto owner of the club, with 80% of the shares acquired in October 2021. The chair of the PIF is Crown Prince Mohammed bin Salman, son of Saudi Arabia’s King. MBS, as he is known, runs the Saudi Government”
and then:
“When the Prime Minister heads off to Saudi Arabia this month to promote trade and relations with Saudi Arabia, what will he say when the Crown Prince asks, “As I exercise influence over the PIF and since the PIF owns Newcastle, am I to be subject to detailed investigation by the regulator as set out in your Bill, and is there anything the regulator will not take into account about me as a ‘person of influence’ over the future of Newcastle United?”
Lord Moynihan, whose registered interests include accommodation and subsistence costs paid by Ministry of Foreign Affairs of the State of Qatar, went on to say
“There is no doubt that hosting the World Cup in Qatar had significant influence on important social and employment changes that took place in that country. The fact that the ILO had an office there, worked there beforehand with the Government, was pushing for changes and continues to be there, is a great example. It is the only country in the Middle East that has that office. It is a great example of the power of sport for good and the power of sport for change. So I am sorry the Minister did not respond to that point, because I think it is an exceptionally important one.”
The words “employment changes” by Lord Moynihan portray the opposite of reality. His comments made less than a week after a damning independent assessment on the Qatar World Cup by the human rights consultancy Human Level.
The independent assessment reporting that “a number of severe human rights impacts did ultimately occur in Qatar from 2010 through 2022 for a number of workers connected to the 2022 World Cup”. The reality is during construction of the World Cup stadiums, hundreds if not thousands of workers either died, were seriously injured or are still waiting payment. Hardly “employment changes” as described by Lord Moynihan.
In response to the Lords questioning on testing of clubs owners, Baroness Twycross went on to say:
“In response to the point made by the noble Lord, Lord Moynihan, the current tests have proven ineffective. They result in a drawn-out process that still allows unsuitable owners into the system. We have seen numerous instances of unsuitable owners and officers causing harm to clubs and detriment to their fans—that stops now.”
Independent Football Regulator (IFR) Remuneration
The peers also discussed amendments related to the pay of the IFR employees including the incoming CEO and future Expert Panel as well as the size of the Expert Panel.
Amendment 40 seeks to the limit the pay of the chief executive and employees of the Regulator to a cap of £172,153 per annum.
Lord Parkinson of Whitley Bay who put forward the amendment, sarcastically explained the rationale behind the proposed cap “I believe it is the current salary of the Prime Minister, who I am sure the noble Baroness thinks is doing an excellent job and is great value for money. I would be interested whether she thinks that employees and board members of this new regulator ought to be paid more than him in carrying out this duty, or whether she shares my concerns about the currently unlimited amount that they could be paid under the Bill.”
At first glance this seem like a hefty salary, but if approved, when you look at the task at hand, the salary may not be competitive enough to attract the expertise required to lead the new independent football regulator. Time will tell.
In response to Amendment 40 and what seems for the first time in the debates, a Peer stood up and shone the light on the current state of Premier League clubs finances.
Lord Londesborough, clearly laid out the challenge the new regulator will face and why it’s important to not cap salaries within the Bill.
He went on to say:
“I would like to bring back a bit of financial perspective to this debate. Remember, financial sustainability is really what brought us here. Yes, there is fans’ engagement, but we have rather lost sight of that. The Premier League is the richest and most-watched league in the world, a fantastic creator of jobs and a multibillion-pound generator of exports. However, we have warning lights flashing on our dashboard that we ignore at our peril.
Total debt across the Premier League is fast approaching £4 billion—not the £2 billion that one of your Lordships mentioned on Monday—and that figure comes from the University of Liverpool. Losses across the Premier League are running at close to £1 billion per annum, per season. As we have heard, typically, 16 to 17 of its clubs generate losses, while in the Championship 80% of clubs have negative equity, and not one of those clubs generates an operating profit outside of player trading.”
And also:
“I return to Amendment 40. We are going to need a CEO of the highest calibre for the regulator, and that CEO is going to have to show great leadership skills and profound and relevant domain experience. Capping his or her salary at £172,000 per annum will simply make the recruitment of a high-calibre CEO that much more difficult. I appreciate that we need to control costs, but that is not the area in which to do it.”
A sceptic would argue that by proposing a salary cap it would result in appointment of less competent candidates, leading to weakened regulator. A regulator that the Premier League and Premier League Club Owners, with their armies of lawyers could in turn run rings around when it came to any dispute.
A follow up post by the Pitch Inspection on what is a realistic salary for the CEO of the IFR is in the making, stay tuned.
Filibustering and Delay
We have used the word delay a lot in our recent posts on the committee debates. Our vocabulary has now been strengthened with the word “filibustering”.
Frustration from Peers, the ones who are looking to make positive progress on the Bill, was evident towards the end of day 3 debates. Lord Watson of Invergowrie, seemed to sum up the thoughts of football fans mad enough (The Pitch Inspection) to watch the full coverage of the live debates, said:
“I thank the noble Lord for giving way. I have bit my tongue for the last hour as I have watched the charade from the Benches opposite, all using up their entire allocation while interrupting each other, repeating themselves and slapping each other on the back. This is meant to be a debate. I raise it when the noble Lord is standing up not because I disagree with the fact that they are serious about what they are arguing. But had Mr Sunak waited until November and not called his election in July, the noble Lord, Lord Parkinson, would have been here with the same Bill in front of him, other than the issues that we heard have been changed so far—not the issues that we have been discussing for the last two hours or so. They would have been exactly the same. He would have been defending that Bill and now there is confected displeasure, if not outrage, with the way that the Bill is. Is that not hypocrisy?”
The last quote in this post however is saved for Baroness Twycross:
“I have never filibustered a Bill to which my party had committed in a manifesto and to which all parties had committed. While the noble Lord is correct that I would scrutinise legislation when I was sitting on those Benches, I have never sought to filibuster a Bill to which my party had committed and which my party had laid before Parliament, intending to filibuster it to the point of getting us stuck in treacle.”
Debates will continue on Monday 9th December. In the meantime it’s time to switch off and enjoy the weekends football.
Thank you for reading. Please feel free to share and comment, your support is much appreciated.
Kevin & Russell - The Pitch Inspection