Select Committee on Culture, Media and Sport Appendices to the Minutes of Evidence

Annex 15

Fax, 2 August 2000, from WNSL to Sport England, and Covering Letter, 31 January 2000 from the Chairman of the Football Association to the then Secretary of State for Culture, Media and Sport

Please see the attached letter. Can we discuss this as soon as possible.


  Thank you for the copy letter to Ken dated 7 January 2000. We held the first meeting of our newly formed Board last week and were able to give this matter full consideration.

  At the meeting with Ken, a payment schedule was discussed, amounting to £20 million over five years. There is a lot of detail to be worked on, but I am sure this matter can be concluded in reasonably quick time. However, there are a number of key points I would like to record, and some issues for the future.

    1.  You have been kind enough to acknowledge that neither the Football Association, nor Wembley National Stadium Limited, have been in breach of the Lottery Funding Agreement with the English Sports Council (now Sport England). ESC have also confirmed this.

    2.  There is therefore no suggestion of either the Football Association or Wembley National Stadium Limited having to "pay back" lottery money. This would be a voluntary understanding between the Football Association group of companies (ie. the FA and WNSL) and the Government—we are of course partners in many significant areas and we see this very much as an aspect of this ongoing relationship.

    3.  You were also kind enough to say that in your view the Lottery Funding Agreement should, and could, be amended to reduce the amount of grant to £100 million, and to release some of the commercial constraints on WNSL so that it can generate funds to enable the payments by this group.

    4.  There needs careful thought within DCMS and ESC and ourselves to work out how this can be achieved. We firmly believe that the solution will eventually need to come from within DCMS and ESC as we find it difficult to second guess the obligations that exist on you and Derek, particularly public accountability for Lottery funds, and the relationship between the two organisations. We have had no discussion with ESC on this matter, and would need to look to you for guidance. Derek has raised the need for a meeting.

    5.  If the only solution is for payments to be made to ESC, which then reduce the grant, then a proposal might be that the £120 million is simply reduced by the amount of each payment made by the FA group from time to time, up to a ceiling of £20 million. This would preserve ESC's previous right to block a total repayment by us. As I have said, relaxed commercial constraints will enable this to take place as well as various other changes reflecting the new approach to various stadium issues for which you have asked. This overall approach also avoids any liability to "repay" £20 million having to be shown in the Balance Sheets of either of the FA companies, which for various different reasons would raise significant difficulties. All parties will need to undertake to approach these discussions constructively to find solutions—that is certainly the spirit of our dealings so far, and you have my assurance that our team will continue in this way.

  I think this accords with your approach to this issue, but I would be grateful if you would just confirm this.

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