House of Commons - Education and Employment

Select Committee on Education and Employment Minutes of Evidence

Memorandum from the Football League (WP 25)

EXECUTIVE SUMMARY

This submission from The Football League is summarised below:

— The Football League represents 72 of the 92 professional clubs in England and Wales who in turn employ a significant proportion (71 per cent) of full-time professional players.

— Currently only 21 out of over 2,000 full-time professionals employed within The Football League, ie 1 per cent, are work permit players.

— All 92 professional clubs, irrespective of their divisional status, have to conform with the same employment regime and engagement procedures, arrangements which have been negotiated on a national basis with the players' union.

— As such The Football League believes that all clubs should enjoy the same recruitment opportunities. To do otherwise is iniquitous and this leads to a distortion of the football business.

— Work permit criteria which seeks to differentiate, either directly or indirectly, between the various tiers of professional football is, therefore, inequitable and divisive. These concerns have become all the more pertinent since players were given the opportunity to move freely following the decision of the European courts in the Jean-Marc Bosman case.

— The Football League were particularly aggrieved that the Overseas Labour Service at the Department of Employment chose to introduce differential criteria in Season 1998-99 despite representations from the League. This marked a watershed in the development of the work permit arrangements within football.

— The Football League supports the need for legitimate controls on work permits and is content that the overriding principle should be that individual players must be capable of making a significant contribution to the development of the British game. In this respect qualitative criteria such as the requirement for a player to be an established international are perfectly justifiable.

— The "significant contribution" test must, however, be relative to the level at which individual clubs play. Third Division clubs, for example, could not contemplate signing World-renowned stars but as teams like Torquay United have shown in the past, players can be successfully recruited from overseas at their level and subsequently even graduate to a more senior club.

— It is the introduction of an arbitrary indicator like FIFA rankings which causes the most concern for Football League clubs. In particular, The Football League believes that FIFA rankings, which were never intended to be utilised as a measure for prospective employment, have the effect of discriminating against lower division clubs.

— Significantly, FIFA rankings would not have featured in the work permit criteria for Season 1999-2000 had the professional game accepted a voluntary quota system. Unfortunately this concept was vetoed by the FA Premier League.

— The Football League is also worried that the criteria for issuing work permits have been loosened in every other respect creating the prospect of "standby" players being signed at the top level who will only be occasional contributors to the development of the British game. In this respect quality control has been significantly diluted.

— Following recent decisions emanating from the newly introduced Review Panel, which have added to the overall confusion, The Football League has asked the Employment Minister to reconsider the principal criteria, notably the use of FIFA rankings.

— The Football League would stress the importance they place on the development of home-grown talent. Indeed, there is more investment in this area than ever before with around £20 million per annum being ploughed into an integrated youth development programme by the 72 Football League clubs alone.

— The recruitment of players from abroad is not seen at Football League level as an alternative to this process. But every professponal club should at least have an equal opportunity to trade overseas, including the prospect of an occasional signing from outside the European Economic Area.

— The requirement for quality control as well as a need to restrict numbers is fully understood. Furthermore, it is in the interests of Football League clubs that the correct balance is struck.

— The Football League has already indicated a willingness to re-examine a voluntary quota system and will enter any discussions in a constructive manner. The mistrust and suspicion which has arisen over recent times must be eliminated.

LIST OF ANNEXES

SECTION 1—BACKGROUND TO THE FOOTBALL LEAGUE

1.1 The Football League is the world's original League football competition and until 1992 it was professional football's only representative body in England and Wales.

1.2 The FA Premier League (FAPL) was formed in 1992 and today it is the representative body for England's top twenty clubs. Meanwhile, The Football League retains responsibility for the other 72 professional clubs.

1.3 Every Football League club is full-time and collectively they employ 71 per cent of the 2,900 professional players contracted across all 92 clubs in the FAPL and The Football League.

1.4 Out of just over 2,000 professional players registered with Football League clubs only 21 (1 per cent) are currently work permit players, ie those from outside the European Economic Area (EEA). This compares with 27 work permit players in the FAPL which is just over 3 per cent of their clubs' professional staff.

1.5 Irrespective of there divisional status all professional clubs within the FAPL and The Football League have to operate within the same employment regime and conform to the same strictures including a standard form of players' contract, identical engagement procedures and the same pension arrangements. Existing national agreements with the Professional Footballers' Association (PFA) control these provisions.

1.6 In this country professional players who attain the age of 24 and reach the end of their contract become free agents and can now seek an alternative club without compensation being payable to their orginal employers. This development, coupled with the more widespread recruitment from abroad at the top end of the game, has resulted in a reduction in transfer income for many clubs in the lower divisions.

1.7 Given the employment conditions which apply within the professional game and the burden these arrangements place on clubs across the boad, particularly in the post-Bosman era, The Football League believes that there is no case for a differential policy in relation to player recruitment. The same treatment should prevail throughout professional football, therefore, in relation to the issue of work permits for potential new recruits from outside the EEA.

SECTION 2—UNSATISFACTORY ARRANGEMENTS FOR 1998-99

2.1 Historically, the criteria for dealing with work permit applications within football in England and Wales have been reviewed on an annual basis. This process has involved officials from the Overseas Labour Service (OLS) of the Department for Education and Employment (DfEE), in consultation with representatives of The Football Association (FA), the PFA and The Football League. Since their formation in 1992, the FAPL has also been party to these discussions.

2.2 Until 1998, these criteria were established by general consensus amongst the bodies involved. A sample of the criteria which applied immediately prior to 1998 is attached at Annex A.[1]

2.3 The criteria provided, inter alia, for work permits to be granted for no more than one season at a time and stressed that the "most important consideration" for granting an extension would be the contribution the player had made to the game in this country. This proviso was defined further with the interpretation that a player would be expected to have become a regular member of his Club's first team, ie to have played in the region of 75 per cent of first team games. The standard for the level of contribution expected of a player was thereby established. Players who subsequently fell short of this level of impact without good reason, eg injury, illness, suspension, etc would not have their work permits renewed.

2.4 The significance of this appearance test has long been established, therefore, as the main indicator of a player's contribution to the British game, ie he should be a regular player and not an occasional contributor.

2.5 It was not until 1998 that the OLS departed from the previous policy of endeavouring to develop the work permit criteria by consensus. In May 1998, their officials proposed that in the future only those clubs in the FAPL and Division One of The Football League should be permitted to sign players on a work permit. This position is confirmed in a letter dated 20 May 1998 which is attached at Annex B.

2.6 Despite The Football League's efforts to resist this discriminatory approach in a letter dated 15 June 1998 (see Annex C attached), the OLS proceeded to issue work permit criteria which reflected such a policy.

2.7 The OLS totally ignored The Football League's protestations over this crucial aspect and instead circulated a standard letter dated 22 July 1998 to all football bodies imposing unilaterally their criteria for Season 1998-99 (see Annex D attached). This course of action demonstrated a complete disregard for the previous consensual approach to which all the football bodies had always been willing contributors and partners.

2.8 The Football League continued to make representations to the OLS in a letter dated 11 August 1998 (see Annex E attached) seeking the deletion of the offending clause.

2.9 Regrettably this was to no avail. In a letter dated 24 August 1998 (see Annex F attached), the OLS attempted to reassure the League that despite how it might appear they were not endeavouring to exclude Second and Third Division clubs. This was despite their original position outlined in the letter dated 20 May 1998 (Annex B).

2.10 The experience during the course of Season 1998-99 conflicted directly with the reassurances given by the OLS. Applications from Oldham Athletic and Wrexham, both Second Division clubs, were refused. This was despite both applications meeting the normal requirements. Indeed, no application from Second or Third Division clubs was approved following the new criteria being issued. The clearest evidence of the discriminatory approach taken by the OLS is provided by last season's refusal of Second Division Wrexham's application for a work permit in respect of Clayton Ince from Trinidad and Tobago. During the course of the current season the same player has received a work permit with Crewe Alexandra which is, of course, a First Division club. Whilst acknowledging that the criteria have now changed, it is ironic that a player who last season was not viewed as being qualified is suddenly acceptable.

SECTION 3—IMPOSITION OF NEW CRITERIA FOR 1999-2000

3.1 During March 1999, the OLS consulted with the football bodies following concerns from Ministers about the work permit criteria. The Football League took the opportunity once again to stress the importance of having an even-handed system which catered for all professional clubs. The significant progress made by League clubs in the area of youth development was also emphasised.

3.2 In May 1999, the usual review meeting was called by the OLS but this time wide ranging proposals were tabled apparently at the request of Ministers (see Annex G).

3.3 It was explained that Minister were concerned about the negative publicity emanating from a number of high profile work permit applications—the case of Marian Pahars of Southampton was cited as an example—and a more "transparent" system was being sought.

3.4 The PFA in particular expressed concerns about what the OLS had in mind and the review meeting was preceded by acrimonious press coverage (see Annex H).[2]

At the meeting held on 24 May 1999, The Football League expressed concern that whilst some relaxation of the criteria would make it easier for standby players to be brought in at the top end of the game restrictions, both direct and indirect, lower down the professional ranks were aimed at maintaining a two-tier regime. We were advised that the then Minister for Sport, took the view that football in the top flight was "now a squad game". It was not clear, however, how a standby player could make a valid contribution to the domestic game.

3.6 It was nevertheless agreed at the meeting that salary levels should not form part of the criteria in the future. Views on allowing a work permit to run for the duration of a player's contract instead of being subject to annual review were divided, however. The FAPL supported the principle of a longer work permit whilst The Football League, the FA and the PFA felt that the annual review process was a worthwhile quality control mechanism. The Football League for its part also argued against the use of FIFA rankings as part of the criteria on the basis that this was merely a back door method of discriminating against lower division clubs.

3.7 It became evident that the outcome of this meeting had not gone far enough for the Ministers concerned when the football authorities were summoned to a meeting at the House of Commons on 23 June 1999.

3.8 This meeting, with the Employment Minister and the Minister for Sport, discussed the desirability of creating a more open and transparent procedure for granting work permits. A range of issues were raised but most discussion surrounded the prospect of the two Leagues adopting a voluntary quota system. The FAPL felt that this would need to be coupled with very little in the way of additional criteria whilst The Football League once again emphasised the need to ensure that every division was catered for. It was agreed that the two Leagues should discuss a voluntary quota system further on the basis of a maximum of two players per club in the FAPL and Division One of The Football League and one player per club in Divisions Two and Three.

3.9 The meeting was followed up with telephone conversations between the OLS and The Football League and subsequently a written memo from the OLS (see Annex I attached). This communication indicated that the objective was to establish a clear, transparent and consistent system and that the only criteria which would apply if the two Leagues were prepared to introduce voluntary quotas was a quality control requirement relating to international appearances. There would be no reference to FIFA rankings at all. For its part, The Football League indicated that this would be acceptable. Unfortunately, the FAPL reiterated their earlier view that a quota system would have to be linked to the removal of all other restrictions. Significantly, the FAPL at this point also questioned the use of FIFA rankings as a suitable indicator and requested that in the event of new criteria being implemented then this aspect should be reconsidered (see Annex J attached).

3.10 In the absence of any agreement for voluntary quotas from the FAPL, the DfEE proceeded to unilaterally determine the new criteria for Season 1999-2000. In a communication dated 2nd July 1999 (see Annex K attached), the OLS advised The Football League of the regime which would apply for the forthcoming season. Much to the League's disquiet, the new criteria indicated that FIFA rankings would be an integral element. It was as though Football League clubs were being made to suffer for the FAPL's inability to accept quotas—one moment the OLS were indicating that FIFA rankings would not feature in the criteria and the next moment this element was a decisive ingredient in the process. The Football League were concerned that this did not bode well for the much sought-after "consistent" approach.

3.11 The DfEE announced details of the new criteria simultaneously (see Annex L attached)[3] which was an indication that the new arrangements were no longer negotiable and that the pattern for the new season had been set. The full criteria issued for Season 1999-2000 can be seen at Annex M.[4]

3.12 It was perhaps surprising, therefore, that in September, the OLS announced an amendment to the recently introduced procedures. This variation allowed players from outside the EEA who were signed on loan to be granted a work permit (see Annex N attached). The football authorities were advised of this change with no prior warning of consultation, which is difficult to understand bearing in mind the overriding test which features so prominently in the work permit criteria that players should be internationals "of the highest calibre who are able to make a significant contribution to the development of the British game . . . ". Players signed on loan, just like standbys, can hardly be claimed to be satisfying this test which is, after all, the principle at the very heart of the criteria. Players who join a club on loan are generally recruited either to do a temporary job or are signed initially on a short-term basis because the club are unsure whether they are suitable. In either case, it would seem to be another departure from well-established principles.

3.13 Coincidentally this rule change also immediately preceded consideration by the newly introduced Review Panel of an application from Middlesbrough on behalf of Juninho (see Annex O attached[5]).

3.14 The position regarding players entering the country on a short-term basis was, therefore, established, but the football authorities remain concerned about the merits of this situation.

3.15 The temporary transfer from one club to another of a work permit player already in this country was, however, not specifically addressed until Scunthorpe United enquired about taking a player called Clinton Marcelle from Trinidad and Tobago, who is currently registered with Barnsley, on loan. Once again, without prior consultation, the OLS gave this arrangement the all clear, subject to acceptance of the registration by The Football League. Unbelievably, the OLS qualified their sanction of this loan transfer for a specified period only "to allow Scunthorpe United to overcome their injury crisis" (see Annex P attached). Despite our reservations about allowing loans at all, we believe that the position should be clear and unequivocal—if they are to be permitted then the OLS should not arbitrarily determine issues such as the duration. These are domestic matters for the football authorities to determine. Unfortunately, this demonstrates once again the unacceptable level of interference from OLS officials. So much for a clear, transparent and consistent system!

3.16 In view of the confusion which has been generated by this sequence of events and in particular decisions emanating from the Review Panel (dealt with in Section 4), the Football League's Board of Directors have requested the Employment Minister to review the revised work permit criteria as a matter of urgency (see Annex Q attached). In particular, The Football League is concerned that FIFA rankings are being inappropriately used as a back door method of discriminating against lower division clubs.

SECTION 4—FOOTBALL WORK PERMITS REVIEW PANEL

4.1 The work permit arrangements for Season 1999-2000 make provisions for a Review Panel to consider appeals in respect of applications which do not meet the designated criteria. A copy of the Panel's terms of reference can be found at Annex R[6] and these indicate that the Panel's decisions are subject to ratification by the Employment Minister.

4.2 This Panel has sat on two occasions so far—on 11 August and 10 September 1999. A total of five cases have been considered. As four of these cases involved Football League clubs, the League was represented on each occasion with one member sitting on a panel of six.

4.3 The first hearing approved an extension of an existing work permit for a Sheffield United player and declined to recommend an application from Darlington for a Canadian player. The Football League were content with the decision to refuse Darlington's application because the player's credentials quite honestly did not indicate that he could satisfy the "significant contribution to the development of the British game" test.

4.4 The second hearing was to have much greater significance, however. The Panel, by a majority decision, decided they could not support an application from Blackpool for an Estonian international called Zelinski. When they considered the next case, however, the Panel agreed to recommend an application from Bury in respect of an Indian player called Bhutia.

4.5 Confusion has arisen amongst Football League clubs following these two decisions. As an established Estonian international who came highly recommended by the Scottish national team manager, Zelinski would appear to have much stronger football credentials than Bhutia. Similarly, Estonia's position in FIFA rankings is much higher than India's! The press were also quick to pick up on this apparent lack of consistency (see Annex S attached[7]).

4.6 There is a suspicion amongst Football League clubs that the Bhutia application was looked upon more favourably because there is a marked absence of Asian role models within professional football. Whilst the special circumstances surrounding this sensitive issue were understood, the credibility of the new work permit arrangements had been seriously undermined. And as these decisions were taken in private a marked lack of transparency now prevailed. This despite the objectives Ministers set out to achieve.

4.7 The Football League's position is that we believe both applications should have been approved because they were both established internationals and the evidence presented supported the view that the two players could make a valid contribution at the level their prospective clubs played.

4.8 It is interesting to note that the new criteria issued for Season 1999-2000 (Annex M[8]) now makes no reference to any differential between the various divisions and, on the face of it, treats every club on an equal footing.

4.9 The introduction of formal criteria which gives FIFA rankings such prominence means, however, that professional clubs lower down the scale are unlikely to be able to avail themselves of the opportunity to sign players from outside the EEA. In other words these provisions still discriminate against them.

SECTION 5—THE UNSUITABILITY OF FIFA RANKINGS

5.1 Football's world governing body, FIFA, introduced their ranking system for senior national teams in 1993, in association with Coca-Cola. These arrangements were overhauled in 1999.

5.2 The main purpose behind FIFA rankings was to try to publish comparisons of the relative strengths of the various national teams.

5.3 It is fair to say, however, that FIFA rankings were never intended to be used as a measure for prospective employment.

5.4 It can be seen from the monthly list of FIFA rankings how individual countries are able to climb the table rapidly and descend again equally quickly. For example, Estonia climbed from 129th in December 1995 to 86th in July 1999. In the next three months to September 1999 they climbed another 12 places to 74th. The fact that a country can climb 12 places in three months demonstrated how haphazard this yardstick is.

5.5 It is acknowledged, however, that the work permit criteria averages FIFA rankings over two years but this will not completely eliminate the vagaries of a relatively arbitrary process.

5.6 What FIFA rankings certainly do not do is offer an objective view of the ability of individual players as the FAPL pointed out in their letter dated 29 June 1999 to the OLS (Annex J).

5.7 It is The Football League's contention, therefore, that FIFA rankings should not form part of the work permit criteria. They are wholly unsuitable for this purpose and produce an inequitable regime which puts some professional clubs at a distinct disadvantage. And this at a time when a loosening of the criteria has created the prospect of more financially advantaged clubs signing additional players who as mere standbys are unlikely to make a valid contribution.

SECTION 6—THE INVESTMENT IN YOUTH

6.1 The Football League are keen to stress that they do not believe in recruiting players from abroad as an alternative to developing home-grown players. On the contrary, Football League clubs will always depend very heavily on their ability to develop talent from within. Quite simply, it makes more economic sense.

6.2 We do not feel, however, that it is fair to restrict clubs who following the Bosman ruling have to compete in the market place of players (including for those players they may have produced themselves).

6.3 In order to demonstrate the commmitment of League football to youth development it is important to understand the scale of this initiative and the size of investment clubs are making.

6.4 Every League club has developed a business plan for their youth development operation in order to qualify for grant funding which is now available.

6.5 As full-time professional clubs, a clearly identified career-path which takes players from as young as nine through a newly introduced scholarship programme and onto the professional ranks is now in place at all 72 League grounds.

6.6 The total investment in youth development during Season 1998-99 at the 72 Football League clubs was £19.3 million (see Annex T attached).

6.7 A successful youth policy helps to address the escalation of players wages in football which has been fuelled by the Bosman ruling. League clubs have also suffered from the ripple effect of the wages spiral at the top level.

6.8 Whilst having to meet higher base costs, many Football League clubs have also seen a downturn in transfer income mainly due to the influx of players from abroad into the top flight.

6.9 This influx will ultimately harm the prospects for the domestic national teams and so the balance must be re-addressed. The most recent England team reflected the contribution Football League clubs have made towards developing international players with the following beginning their careers outside the top flight—Nigel Martyn (Bristol Rovers), Kieron Dyer (Ipswich Town), Jamie Redknapp (AFC Bournemouth), Steve Guppy (Wycombe Wanderers), Gareth Southgate (Crystal Palace) and Kevin Phillips (Watford).

SECTION 7—THE WAY FORWARD

7.1 As the representative body for the vast majority of full-time professional clubs, The Football League is adamant that there must be a review of the arrangements for granting work permits.

7.2 Not to do so would be to prejudice a section of League clubs who in other respects have to compete in the market place for players. A regime which provides such an uneven playing field distorts the highly competitive business of professional football and is, therefore, patently unjust.

7.3 The Football League for its part has already offered to the Employment Minister a willingness tore-examine a voluntary quota system.

7.4 Whether or not a quota system can ultimately be accepted across the whole of professional football, The Football League fully understands the need for quality control. Indeed as net sellers in the transfer market, it is in the interests of League clubs for a balance to be struck between allowing clubs the opportunity to occasionally recruit from abroad without being profligate. However, the present arrangements appear to provide too lax a regime at the top end of the game whilst fettering clubs lower down.

7.5 It is our firm belief that the "significant contribution" test must be relative to the level at which the player is expected to perform. In the past, work permit players have performed exceptionally well in the lower divisions, ultimately in some instances earning the opportunity to play at a higher level.

7.6 The basis for quality control should be restated without resorting to insidious indicators like FIFA rankings.

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