House of Commons
Wednesday 26 May 1999
The House met at half-past Nine o'clock
PRAYERS
[Madam Speaker in the Chair]
Adjournment (Whitsun)
Motion made, and Question proposed, That this House do now adjourn.--[Mr. Hill.]
9.33 am
Mr. Joe Ashton (Bassetlaw): I do not usually waste the time of the House and I shall be brief today. I raise an important issue that did not arise until last weekend. The reports that appeared in many newspapers must have emanated from the Department for Education and Employment; they said that work permits for foreign footballers were to be changed drastically. Work permits are required for footballers who were not born within the European Community, and who come from Africa, south America and eastern Europe.
In general, the game welcomes an examination of the rules; they were originally made in 1975 when Britain was not in the EC, when there were only a handful of foreign players and when large amounts of cash were not involved. Criteria were laid down stating that foreign players had to be internationals, that they had to make 75 per cent. of appearances, that their work permits had to be renewed every year and that they were not permitted to take British jobs. That situation has trundled on for 20-odd years despite massive changes in the game and the involvement of huge sums of money.
There are good reasons for re-examining the rules. I shall not go into the details of the squad system, the Bosman ruling on transfers, the enormous amount of television money through Sky and all the other changes that have been made, but I believe that the system is unfair in that some clubs seem to get work permits for their players and others do not.
This is not a discussion about football, but about jobs and work. I am raising the subject today because of the unfortunate timing of the press release. All players' contracts expire on 30 June, which is the deadline by which clubs must say to players, "We are very sorry, but you are not good enough. Your contract is over and you are free to go without a transfer fee," or, "We want to keep you on." The fact that the announcement was made five weeks before that deadline, with the House rising until 8 June, has plunged many clubs into doubt and uncertainty. We are talking about some 48 players, some of whom are very high calibre, have contracts worth millions of pounds and are being paid thousands of pounds per week.
I understand that the Department for Education and Employment met the Football Association and the players' union this week for talks, but there must be an announcement from the Department in the next week or
so about certain issues. We have to know whether new rules will start at the beginning of next season or at the beginning of the 2000 season. How long will the talks continue?
Last season--and practically every season--600 professional footballers were made redundant. Their clubs tell them that they are not good enough or say that they want to change the team. Many of them are British. The Professional Footballers Association protest that they can be replaced by players from eastern Europe, who are probably paid only £25 or £50 a week and who think that £200 for playing in the English third division is a great deal of money. The Professional Footballers Association is worried about that and about the effect on the English national team. It feels that if all our teams carry nine or 10 foreign footballers, there is not much scope for future Beckhams to come through the ranks. Their entry at an early stage is blocked.
Those doubts have created a great deal of uncertainty concerning the 48 professional footballers from outside the EC. This very week, their clubs are deciding whether to renew their contracts and apply for new work permits starting on 30 June, or whether to take a chance on the rules being changed. They do not know what to do. I have been asked by the chairman of the premier league and other representatives of the game to make approaches to the Department and to ask for a statement. I rang the Department for Education and Employment yesterday and told them that I was raising the matter today. Instead of leaving everyone in limbo, there should be a moratorium or a freeze, and a statement saying that existing or renewed contracts will be exempt from the old regulations and will be covered by the new regulations, which will be more lax, until clubs and players know what to do.
Some of the players come from the former Yugoslavia and places such as Moldova, where there is a war. They do not know whether they will have to go home, whether their clubs will renew their contracts or whether they should go to Spain or Italy. What advice or reassurance can they get?
The new proposals, which were extensively leaked in the press, talk about young African footballers being sent here as apprentices, their schooling being paid for by British clubs that have their own outlets in Africa. African footballers have come to this country regularly via Belgium, which has strong African connections and less strict work permits. Some of the youngsters who have gone for trials in Belgium have done so without a return ticket home and have finished up virtually on the streets of a foreign country, unable to speak the language.
Mrs. Angela Browning (Tiverton and Honiton):
I am grateful for the opportunity to bring to the House this morning a situation affecting a group of elderly constituents. This is a problem of which many hon. Members will have had experience.
The problem concerns those people who, in the 1980s, were sold home income plans--very often by companies or independent financial advisers--and who remortgaged a house. The mortgages on most of the houses had been
paid for. People did this to release capital, which was then reinvested into bonds, usually comprising solely equity funds. As a result of the transaction, when the people who were then remortgaged tried not only to draw an income from the investments, but to pay off the new mortgage, they found that the funds simply did not marry up.
I am well aware that there are some bona fide and useful home income plans on the market of which many retired people may wish to take advantage. I am talking particularly about a period when these plans were sold--sometimes deliberately--quite fraudulently. I want to draw attention to a group of pensioners with mortgages against the property in which they live. The vast majority of them no longer have any income from the original plan, and are in a situation where interest is accruing against the value of their property.
Many have been concerned that they will be turned out of their homes. In other such cases, the building societies or the lenders--it is mainly building societies--have said that they can remain in their homes. However, when they die, or if they have to move, the building society has first call on the value of the property. The matter has gone on for so long that the vast majority of those concerned are in a situation where if the house had to be sold and the capital realised, the mortgage would have to be repaid. The building society would then recoup the whole value of the property.
As people get older, this is an anxious situation for them. Before I was elected in 1992, some of those cases were brought to me. After I was elected, I had some satisfactory outcomes in one or two places with the help of the insurance ombudsman. In some cases, but not all, the underwriting attached to the new mortgage fell within the remit of the insurance ombudsman. In the early 1990s, he and his staff were extremely helpful to some of my elderly constituents.
I still have a batch of cases which fall into a particular category. A lady called Sonja Thompson, who resided in Devon--although she has a track record of living elsewhere--was brought to court on a charge of fraud. I have examined carefully the papers that she completed on behalf of my constituents in seeking to organise home income plans for them. There is no doubt in my mind that, although she was acquitted in the court case, it is as a result of her work that many of my constituents now find themselves in an anxious and difficult situation.
One of the problems has been that the building societies concerned appeared to take no notice of the lending parameters that are usually enforced when considering making a loan or offering a mortgage to someone. It was the norm for people such as Sonja Thompson to go to one particular branch of a building society because they had made contact with an individual member of staff--one assumes the management--in that branch. Given the volume of cases over a short period that were processed by a particular branch of a building society, one must question the role of the building societies.
In my constituency, the group of people who are left in this unhappy situation have mortgages primarily with the Britannia building society. I asked the Britannia building society to discuss the matter with me last year--which it did--and I was given a written pledge that my elderly
constituents would not be turned out of their homes simply because the interest on the mortgage was accruing at a rate much faster than any of them could hope to repay.
That is not a satisfactory situation, and there is a need for some examination of the role of building society branches. It is incumbent on the head offices of building societies--which have reputations that they would wish to uphold--to take more responsibility for examining the way in which their staff dealt with such cases.
At the moment, I have five constituents who live in a home that has always been their home, but which they feel no longer belongs to them. They are living there by grace and favour of the building society. They know that when they die, the proceeds from that home will not go to their children or heirs, but will be reclaimed, under law, by the building society concerned. We appreciate that building societies will not turn people out of their homes, but the justice of the case needs to be examined. Clearly, these elderly people were conned, fooled and--in some cases--quite deliberately defrauded into signing an agreement that they did not really understand.
In one case, I have seen copies of documentation that has been altered by the person writing the details of somebody's income. Building societies accepted case after case without any proper scrutiny, and without checking that the information was bona fide or that the people concerned could afford to take out a plan that was in their best interests. We must look to bring some pressure to bear on building societies to take responsibility for the actions of their own staff.
Many societies will say that mortgages do not come within the Financial Services Act 1986. I accept that, but that is not the point. A building society wants to know what one earns and how one will afford to repay a mortgage, as is right and proper. I have written to the Economic Secretary this month, as I feel that I have exhausted every avenue left to me through the ombudsman, the various other bodies and direct representations to building societies.
I ask the Parliamentary Secretary to reiterate my request to the Economic Secretary to receive a delegation to talk this matter through. Some of these are complex cases, and solicitors have said that they would be happy to reintroduce some of them into the courts. However, there are difficulties because of the age of the client group. A solicitor to whom I spoke last week was willing to take the case on a no win, no fee basis, and he told me that he knows of barristers who are prepared to accept cases on the same basis. However, we must bear in mind the fact that we are talking about people who do not have a lot of money.
The problem that the solicitor has encountered has been with the Legal Aid Board. He told me of one couple, aged 82 and 79, with a total income of £137 a week. They would qualify for legal aid, but the Legal Aid Board requires them to pay £67 a month towards their legal aid costs. That is clearly prohibitive for people on a modest income, and even though the lawyers are prepared to proceed on a no win, no fee basis, the need to find £67 a month to qualify for legal aid is holding up the case.
Not all the cases are exactly the same. I have introduced the additional element of running a test case through the courts because if such a case is successfully prosecuted, many more could be resolved pretty rapidly. I stress that
the age of the people involved means that unless something is done quickly, even more of them will die without a satisfactory resolution.
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