Football Governance - Culture, Media and Sport Committee Contents


Examination of Witnesses (Question Numbers 760-817)

Hugh Robertson MP and Henry Burgess

26 April 2011

Q760 Chair: Can I welcome for the second part of this morning's session the Minister for Sport, Hugh Robertson, and Henry Burgess of the DCMS. Adrian Sanders is going to start.

Q761 Mr Sanders: Good morning. Can I ask, what was your rationale for calling English football "the worst-governed sport in the country"?

  Hugh Robertson: The fact that when I looked at the corporate governance arrangements that govern major sports in this country, in particular the big five, the corporate governance arrangements surrounding the Football Association are noticeably worse than they are in other sport. They had no independent non-executive directors on their main board, despite the recommendations of the Burns Review. At the time I made the remark, I think there was some doubt that they would even get an independent non-executive chairman. Every single one of their directors is white, male and late middle-aged, at the risk of being a little bit indelicate. There is nobody on the board who has played the game to any reasonable level, no women, nobody who represents the black or minority ethnic communities.

  In addition, we have just had a very disappointing World Cup campaign in South Africa. We had spent £15 million launching a bid to bring the World Cup back to this country and, after two years' lobbying and £15 million, had succeeded solely in garnering one extra vote, apart from our own. In addition, the Chairman of the Football Foundation has just resigned in despair at the politicking going on in and around the game. I have lost count of the number of Government reviews, football taskforces, letters exchanged between the Secretary of State and the football authorities, Burns reviews and the rest that come and go, and yet there has been no substantive change. I think I would be right in saying the evidence is pretty clear.

Q762 Mr Sanders: So what exactly are your powers to do something about it?

  Hugh Robertson: Well, that is a good question, and I think as the Minister, you probably have two reasonable areas of responsibility. The first is that any Minister for Sport should have at the centre of his brief the performance of the national team. So I think if our national teams are under-performing, then it is perfectly reasonable for the Minister to ask the question why.

  I think secondly, we invest quite a considerable amount of public money in football, and so I think it is my responsibility as the Minister to make sure that the corporate governance arrangements surrounding the spending of that money are as they ought to be.

  Thirdly, of course football is the national game. It is way ahead of any other game in this country in terms of the number of people who play it and follow it, so it would have to be a concern for the Minister for Sport if he didn't feel that that game was correctly governed.

Q763 Mr Sanders: But you sound pretty convincing that something has to be done. The question is what can be done by a Minister for Sport for a game that is self-governing?

  Hugh Robertson: Well, in that we could, in extremis, pass legislation, as indeed a number of other countries have done. That would be, in my view, a last resort. I think there is a fine line between where Government can go and where it cannot, and it is emphatically not for Government to run football, absolutely emphatically not. I think it is for Government to make sure that football is in the best possible condition to run itself. So I think I certainly have an influencing and persuading role. You certainly could not accuse me of not making my views clear on this particular subject. If indeed we judge in the end of that the situation is so bad and so immovable that legislation is the only way, some form of sports law—as in the case in many other countries around the world—then that would be an option we would have to consider.

Q764 Paul Farrelly: Just following on from that question, which is that your views are quite clear, but your solutions are not.

  Hugh Robertson: No, and that is a perfectly good point. I do have my own views about it, but just to be very clear about the role that I think you are playing in all of this, successive governments have tried to crack this particular nut, whether it was by letters from Andy Burnham or the Burns Review or football taskforces or so on and so forth. Many of the journalists who cover this area keep on saying, "Where is the evidence that anything is going to change this time around?" So where I think we are in a different situation now, my hallelujah moment was a Wednesday morning back last July, when I turned up at Westminster Hall to reply to the 9.30am debate. The chief whip always used to say if you have more than 10 MPs at the Westminster Hall debate early on a Wednesday morning, something was in the water. There were over 60 there to complain about football governance. It has been the single recurrent issue raised by Members of this House, and indeed, in all the correspondence we have received since that moment. There is a real feeling in Parliament that something should be done about it.

  The options available to me to move this on were either to have another internal Government review, or to encourage you, the Select Committee, as the parliamentary Committee responsible for this, to have a look into the whole affair. I was delighted when you agreed to take that on. I don't want to sit here and outline necessarily all my particular solutions. I want to wait and see what you come up with and then have the opportunity to respond to it. Indeed, I think that is in both our interests to do that. I don't want to—

  Paul Farrelly: I think it is in our interests throughout the session on the different subjects, because we are all well versed how Governments respond to Select Committee inquiries, and respectfully, Minister, if you don't outline your solutions, this might be a rather large waste of time.

  Hugh Robertson: No, I don't think it will at all, because I would hope at the end of your inquiry, you will come forward with a series of solutions. I would be very surprised if those solutions did not address the corporate governance arrangements surrounding the FA, and then the sort of slightly clever flip that has to be done thereafter, which is once you have sorted out the corporate governance arrangements around the FA, how you re-empower them to act as a proper sport national governing body—football is a very different game to the game that it was 20, 30, 40 years ago—and then the impact of that on the other bodies that exist in the football landscape.

Paul Farrelly: I want to come in a moment to what is in the coalition—

  Hugh Robertson: It is about the regulatory architecture, I think is quite a good phrase.

  Paul Farrelly: But first of all, just on what powers you have that Adrian introduced, when Andy Burnham looked at this with the taskforce years ago, he had some leverage, because he had the Office of Fair Trading inquiry and the issue of how football TV rights are sold, and out of those negotiations came the Football Foundation. I wanted to just ask you about the Football Foundation, but I don't want to steal the glory of my colleague, Thérèse Coffey, who has an issue about the Football Foundation, which she might want to introduce now.

Q765 Dr Coffey: The query about the Football Foundation is that I understand that Government money to Sport England is a third, Premier League is a third and the FA is a third, and there have been various criticisms about the lack of financing towards the Football Foundation; you have just mentioned the Chairman resigning, politicking. Who is it that initiates the actual funding amounts and is it only the FA or can the Government through Sport England say, "Instead of only giving £5 million" or whatever it is, "Sport England is going to give £20 million, so that means the FA has to give £20 million and the Premier League has to give £20 million"?

  Hugh Robertson: There are two separate funding sources. The first is the funding that goes directly to the Football Foundation, and currently £10 million from us, £12 million from the FA and the Premier League. There is then a second chunk of Government money that goes into the FA through something called Whole Sport Plans. That is, over the 2009 to 2013 period, some £25.6 million.

Q766 Dr Coffey: So it is my understanding though that the contributions effectively match each other, so if you wanted to see more money go into grassroots, why don't you just up the money going into the Football Foundation?

  Hugh Robertson: If I could, I would, Thérèse. We don't have the money is the short answer to that. When we were faced with the—

  Dr Coffey: Can I clarify just on the agreement then? So you are capped because of financial constraint, I get that.

  Hugh Robertson: Yes.

  Dr Coffey: Does that then limit what the FA and the Premier League can do?

  Hugh Robertson: No, it doesn't, in the event.

  Dr Coffey: No, not from your understanding?

  Hugh Robertson: No. I mean, if either the FA or the Premier League decided out of the goodness of their hearts to increase their contributions to £20 million, I would be absolutely delighted. It is just that we in Government at the moment, in the current financial—if I had the money, I would do that, because I think the Football Foundation does absolutely fantastic work, it is just that in the current—we managed to get it into what we call "the preserved pot" so we took only a tiny cut off it, but the fact is given the spending constraints, we had to give it a cut.

  Dr Coffey: Thank you. That clears up my question.

Q767 Paul Farrelly: This is precisely my question, and to do with your powers and leverage, because we found the Premier League said, "Well, we only agreed it would be net and it didn't include any slice of overseas rights". You can of course say, "Well, they should look again" and they can choose to take your advice or not. But they are all saying that, "We only agreed anyway to match what the Government gave and what the Government is giving is falling". So for a relatively small amount of money, if this is important enough to be in the Coalition Agreement, you can blaze a trail and show some leadership and therefore exert some leverage.

  Hugh Robertson: What, in terms of increasing—

  Paul Farrelly: Your contribution to the Football Foundation.

  Hugh Robertson: —the contribution that the other partners made to the Football Foundation? We have had that conversation with them on a number of occasions. You know, I always encourage every single sport to invest the maximum amount of money in its grassroots. Indeed, one of the first things I did as a settlement to the listing agreement last summer was to get a voluntary agreement, independently policed by a QC, of the sport and recreation allowance to put 30% of their UK broadcasting income into grassroots.

  

Q768 Paul Farrelly: But you are not, as a sportsman, leading by example if the Government is not doing the same.

  Hugh Robertson: Well, the Government only has a certain amount of money, Paul, and we have to make decisions accordingly. The two decisions that we took right at the outset in the Comprehensive Spending Review were to preserve the elite athlete funding for London 2012, because there are all sorts of commercial and other imperatives. It would have been completely wrong to allow an athlete to have had a certain level of funding and then to cut it off for the last two years of the Olympic cycle before a home Olympics, and to preserve the Whole Sport Plans, which drive up participation through the sport governing bodies.

  

Q769 Paul Farrelly: Yes, I think the point has been made. The Coalition Agreement says, "We will encourage the reform of football governance rules to support the co-operative ownership of football clubs by supporters". How?

  Hugh Robertson: Well, that is a good question, because the problem you have here is that the ownership of football clubs in this country is not universal. There isn't one structure that applies to every different one. They are all owned in slightly different ways. There is a range of options available here from schemes that work really well, such as the Arsenal Supporters' Trust at one end of the spectrum, through to a solution that simply involves a supporter liaison officer or something like that, a specially appointed person, in every single board. Once I have your report in front of me, then I will look to see how we can move this forward, what is the best way to do this forward, but I am not convinced that there is going to be one single solution that is going to fit for every single football club.

Q770 Paul Farrelly: What are your favoured options?

  Hugh Robertson: I have a very open mind about it, if I am honest. I don't have one is the short answer, because I don't think that there is one favoured option that will work for everybody. I think the Arsenal Supporters' Trust is a fantastic organisation and that works very well for that club, but it works very well in part because of the particular ownership structure of Arsenal Football Club, and indeed, I hope it will continue in the years ahead under new ownership arrangements. Arsenal Football Club is a very different organisation to one at the bottom of the leagues, and therefore one solution will not work for everybody.

Q771 Paul Farrelly: So did the authors of this passage in the Coalition Agreement not really know what they meant by it?

  Hugh Robertson: No, I think they knew exactly what they meant, which is that is over the course of this Parliament, the Government will bring forward measures to encourage supporters to have a bigger stake in the running of their clubs. We could have done this. If we had done this ourselves while you were having a Select Committee inquiry into it, I think you might have been quite annoyed with me and accused me of not paying enough attention to Parliament.

Q772 Paul Farrelly: I am sure we would never do that. In the submission that you have made, Minister, regarding supporters—it is on page 3, and it is the final line of paragraph 3 on page 3—you say, "Equally interesting would be a view on the value of opportunities to incentivise supporter involvement via a different approach to the treatment of any government facing debts". Now, can you tell us what you mean by that? What is going through your mind?

  Hugh Robertson: Well, what is going through my mind? What I am prepared to do is to look at any option that moves us forward. You have to recognise in all these situations that all this is being done against the financial backdrop that this country faces, so I am prepared to look—and I am prepared to work with football and others—at any sensible solution that enables us to move this forward. But I come back to what I said in answer to your last question: you have to recognise that English football isn't like football in other countries, where they have one ownership structure that works for everybody. We have different structures for every single club, and therefore the same solution will not work for everybody.

Q773 Paul Farrelly: I am generally trying to understand what that sentence means.

  Hugh Robertson: Well, pretty much what it says, I would say.

  Paul Farrelly: What does it mean, "Via a different approach to the treatment of any government facing debt"?

  Hugh Robertson: Well, in that we would look at any sensible suggestions that come forward in terms of the treatment that the Treasury applies to football debt, if there was a way that that would enable supporter involvement. You know, quite what that will precisely mean remains to be seen.

Q774 Paul Farrelly: Is that a quid pro quo or is it—because clubs owe the debt, not supporters?

  Hugh Robertson: Indeed, they do. But as I have said before, there are a number of possible models here. There was one that the last Government looked at very closely, by which you tried to give an element of equity in every single Premier League club to supporters. When you priced that out, that was going to prohibitively expensive. I think the figure was around about 10% and the total cost of doing it was over £1 billion. We clearly do not have that sort of money at the moment. If there were sensible moves that we could make either to encourage owners to make available shares to supporters—and that has been suggested by many people—for favourable tax treatment or something like that, that would be something we would look at. But you do have to remember in all of this that we are doing it against this very tough financial backdrop, and I would have to say, if you said to me as the Minister for Sports, "Do you want a tax break to encourage more young people to play sport or to help supporters' trusts?" the answer is probably is to encourage more young people to play sport.

Q775 Paul Farrelly: Yes, that is a different question, but I am sure my colleague, Damian Collins, will ask you whether that means a quid pro quo for not challenging the football creditors rule, for instance.

  But I just wanted to come on to some of the complaints that have been made by some of the trusts, the Arsenal trust and others, that the Financial Services and Markets Act acts as a barrier to raising money cheaply and effectively, and clearly, the regulation of the City and investment schemes has been there for very good reason, but they argue that there could be specific solutions that might help with the various protections that would need to be there against fraud and the like. One is that the FSMA might easily be amended to include industrial and providence societies, or community interest companies raising money for sport. Is that something that you have looked at?

  Hugh Robertson: Well, have we looked at actively to date? No. Is it something we could look at if we thought it was a sensible solution? Yes.

Q776   Paul Farrelly: So there have been no discussions with the Treasury?

  Hugh Robertson: No, there haven't, and you come back to this key point: if I was going to go the Treasury and ask for a tax break for sport, I want to get a tax break for sport that gets more young people playing sport, and that is my key and overriding priority. There is a fantastic opportunity on the back of London 2012 to do that. Yes, this would arguably be worth doing, but if I were being honest I would say it is a lesser priority than getting more people playing sport.

  Paul Farrelly: It would have to be for sport, not just for—

  Hugh Robertson: Correct, yes.

Q777 Paul Farrelly: My final question, there are options in the Localism Bill, but I imagine you haven't explored them in any detail. Do you think that really that majority supporter ownership is really only realistic for smaller clubs, that where we get into big money situations, it is just not going to be—

  Hugh Robertson: In terms of majority ownership of the club, if you have extraordinarily valuable big football clubs—unless you have a lot of very wealthy supporters—it is going to be very difficult to affect a takeover. Just look at the issues that the Red Knights had with Manchester United. That is not to say that smaller holdings cannot be disproportionately influential, and I think in its short life the Arsenal Supporters' Club has shown itself to be a sensible and worthwhile influence on the running of Arsenal Football Club, and I hope it will continue to do so. You know, there is an argument in a sense that it would be great to see supporters having a much bigger stake in football clubs. I just suspect given the finances involved, that is quite a big ask. If we could get to there, it would be fantastic, but I don't think we are going to, so much better to concentrate on an objective that is achievable, which is to get as many of them involved in a way like the Arsenal Supporters' Trust have done.

Q778 Chair: You have cited the Arsenal Supporters' Trust a number of times this morning and I don't think we would disagree on the basis of what we have seen, but, as you also pointed out, the management or the ownership, rather, of Arsenal has changed. You expressed the hope that it continues. Presumably one can do no more than hope?

  Hugh Robertson: One can do no more than hope and use my influence as Sports Minister to encourage it, to encourage Arsenal Football Club to continue to allow the Arsenal Supporters' Trust to exist.

Q779 Chair: How do you do that?

  Hugh Robertson: In the same way that any Government Minister applies influence, by using occasions such as this to say that I think it is a good and worthwhile institution and hope that Arsenal Football Club pay note.

  Chair: You wouldn't make a call to the new owner to tell them that?

  Hugh Robertson: I would consider that, yes.

  Chair: You would consider that.

Q780 Damian Collins: Firstly, just to recap on where we are, would it be fair to say that your view on football governance is that no change is no option?

  Hugh Robertson: Correct. Well, it is an option, because in the end if they all bury their heads in the sand, we are going to have to do something about it, so I suppose to the backwoodsmen it is a possible option, but as far as I am concerned, as the Minister, no change is no option.

Q781   Damian Collins: Yes, so whether it comes through persuasion, recommendation or ultimately Government direct action, there will be change?

  Hugh Robertson: Yes. In saying that, I should say that this is not a fight I particularly want or in many ways would have chosen. There is quite enough going on in the sport and the Olympic world at the moment without having a prolonged battle with football over governance, but I think things—as I said in answer to the first question—are sufficiently bad that we have to do something about it. And the key to this is not to overstep the mark. The responsibility of Government is to get football into a position where it is better able to run itself. It is not—it is crucially not—for Government to run football.

Q782 Damian Collins: We have discussed so far other areas of governance and I know there were other topics we want to come on to, but we discussed with UEFA in the previous session the issue of debt and obviously their Financial Fair Play Regulations. Is this something you have a view on? Obviously in other areas of public life, like the reform of banks, the Government takes a very strong view on debt ratios, capital ratios and performance. Do you think it should take a similar view with football clubs?

  Hugh Robertson: Yes. Broadly speaking, the answer to that is yes. There is a range of options over where we get from where we are now to where we would like to be and how you bring that about, and of course it should be for football to regulate itself. So we have to get football into a position where it is able to do that, and 19 of the 20 Premier League clubs are already UEFA Financially Fair Play compliant. Clearly, I would like to see all of them compliant and then a range of suitable financial regulations as you move down through the league.

Q783 Damian Collins: Do you think it is a source of regret that the Premier League clubs have adopted the Financial Fair Play Rules themselves, but the Premier League itself has no such comparable code? The Chief Executive of the Premier League said that they would not look to adopt it formally as code of practice for the Premier League, but that all the clubs themselves are compliant. Is it a source of regret that this had to come from UEFA rather than being something we have introduced ourselves?

  Hugh Robertson: If the question you are asking me is: is it a source of regret that a European football institution had to do this because we were unable to foresee this coming and do it ourselves? Yes, it is, because I want to see the governance of football in this country being in a position where it is able to make these decisions and act as a regulator for the national game. So yes, that is a matter of regret. If I am honest, I am probably less hung up about how they get there than the fact that they do get there, because I think that where they are now is a better place than where they were.

Q784 Damian Collins: My colleague, Mr Farrelly, referenced the football creditors rule, which is something I have probably raised in at least the majority of the sessions we have had. What has happened with Her Majesty's Revenue and Customs court case challenging the football creditors rule?

  Hugh Robertson: They are ongoing.

Q785 Damian Collins: What would you hope would be the conclusion of that ongoing process?

  Hugh Robertson: Well, you are inviting me to tread on slightly dangerous ground there. Although it is probably not for me to instruct a court what outcome they should achieve at the end of a case, to answer your question in a more general way, I think a lot of the evidence that you have received as a Committee about the football creditors rule has been pretty persuasive. I thought the remarks that David Gill made probably said it all. I can't remember who it was who said it was a second-order solution to a first-order problem. It will not go without a fight, but I think it is morally quite difficult to defend.

Q786 Damian Collins: We were talking about financial regulation. This is presumably an area where the Government can take a lead if it can't persuade?

  Hugh Robertson: No, because it is an internal football rule. It is not an HMRC rule.

Q787 Damian Collins: But could you consider legislation to abolish the football creditors rule if the football bodies wouldn't give it up?

  Hugh Robertson: Technically, yes.

  Damian Collins: So that would be an option, essentially.

  Hugh Robertson: That would be an option. But it is quite interesting studying the transcript of the inquiry here. There is a considerable body of opinion inside football that this rule has had its day and I think that is the most encouraging sign I have seen of that for some while.

  Damian Collins: I think if we had a window on to the world of football, it was when the Football League said they couldn't find any moral case for keeping the football creditors rule, but nevertheless they thought it should stay anyway.

  Hugh Robertson: Right. Well, there you go, yes. You could probably add that to the answer to the first question.

Q788 Chair: Can I come on to the judgment which we are awaiting from the European court in the broadcasting rights in the Premier League Karen Murphy case? How serious do you think it would be for football if the court upholds the opinion expressed by the Advocate General?

  Hugh Robertson: I might bring in my official in, he works on this closely.

  Henry Burgess: Thank you. I suppose it is right to be clear about what the status of that view is so far. So far we have had the opinion from the Advocate General.

  Chair: Indeed.

  Henry Burgess: In many cases, the court will follow the opinion of the Advocate General, but by no means in all. I think it is fair to say that were the court to follow in every particular the opinion that the Advocate General has given, that would make quite a substantial difference to the way that the commercial football broadcasting rights and selling deals operate here, quite a significant impact. It would make potentially less impact on the legislative framework within the United Kingdom, so it is unlikely that there will need to be a huge amount of legislative change within the UK, but the actual commercial implications could be very significant indeed. But the court doesn't follow the Advocate's judgment or opinion in every case, and not in every case, even if they decide to follow it do they follow all the arguments through. They could potentially pick up some of the arguments in that case and reach the same conclusion as the Advocate General without following all of them through to their logical conclusion. So they could pick up a particular part of it and make their decision on that basis rather than follow them all the way through. But yes, potentially, were the court to follow every particular view of the Advocate General, that would make a very significant difference here.

Q789 Chair: Very significant? Have you made any assessment of exactly how much it will cost English football?

  Henry Burgess: I haven't seen that assessment and it has not been done by me or my colleagues. I think until the court reaches its judgment—and it is important to remember that the judgment is then passed back to the High Court in this country to interpret that view—until we get to that stage, it will be premature to make a significant assessment.

Q790 Chair: But in terms of persuading the court, it is not sensible to at least have a vague idea of what it is going to cost football?

  Henry Burgess: I think we have reached the stage now where there are no longer any formal opportunities to influence the court. The court had an oral hearing before Christmas, at which the UK was represented, and made its view clear that were there to be significant change within this area, then change should happen as a result of the appropriate European and Commission processes, rather than through an ad hoc change or a reinterpretation of the legislative position. So I don't think we are at the stage yet of having quite enough information in order to be able to assess what the likely financial impact would be in any way that would be meaningful or helpful to the Committee.

Q791 Chair: Is the Government supporting the Premier League in seeking to persuade the court not to go down the route advocated?

  Henry Burgess: The Government's intervention in this case has supported the broad principles put forward by the Premier League, but the primary UK intervention point was to do with the law as it stands at the moment and for any change in that law to go through the appropriate Commission processes, and not to be affected in a way that was not sufficiently transparent or procedural through the court itself.

Q792 Chair: Can I put it to the Minister that the European Court of Justice at the end of the day we know is not entirely immune from political influence? Are we using what political influence we have to persuade the court that this would not be a sensible judgment to reach?

  Hugh Robertson: We are, and indeed I have taken the issue up myself with the European Commissioner responsible for this, Mrs Vassiliou.

  Chair: Are we alone in making that?

  Hugh Robertson: As far as I am aware, yes is the answer to that, but even if it were, that is not a good reason for us not to make the point, and we believe that to be in the national interest.

Q793 Chair: Can I come on to—or return perhaps, in some sense—some of the areas we were talking about before, which is the regulation and potential licensing of clubs. You will be aware that the Committee visited Germany and talked to the German Football Association about the system which exists there, which is obviously a much more formalised licensing one. Do you see any attractions in that kind of model?

  Hugh Robertson: Yes, I do, if I am honest, and I will be very interested to see your conclusions in this regard. But yes, I do, and I see it as part of a two-stage process, where I think at the moment the problem you have is that because the corporate governance arrangements are not satisfactory that it is very, very difficult to give the FA extra powers until the corporate governance arrangements are satisfactory. Once you have sorted that out, you then have to sort of re-enable them to act as a proper sport national governing body, and that means regulating its own game. One of the ways in which it could do that would be to have such a licensing system that would sort of act, I suppose, as a skeleton off which you could hang a number of other issues, proper rules on fit and proper owners, on debt as allied to turnover on sport involvement and the rest of it.

Q794 Chair: The German requirements go quite a long way, and obviously the headline one is essentially not allowing the clubs to fall into debt, but there are a lot of other different requirements, including things like investment in youth sport, youth football. Is that something you would also—

  Hugh Robertson: Yes, absolutely. I would want any such licensing system to be reasonably light touch, but a basic set of principles that all clubs should agree to in order to be allowed to compete in the competition would, I think, be one of potential ways forward.

  

Q795 Chair: Who would you see administering that?

  Hugh Robertson: Any system like that has logically to be administered by the sport national governing body.

  Chair: The FA?

  Hugh Robertson: The FA.

Q796 Chair: How far would you see it extend in terms of the—

  Hugh Robertson: A properly functioning sport national governing body is responsible for running the sport in the country, and indeed, that is the function carried out by every other sport national governing body. It would be unthinkable that such a thing should happen in rugby and should not be administered by the RFU, or in cricket, and not be administered by the ECB. So, you know, logically, it would have to sit with the FA. I think the slight reluctance or the slight sense of caution that you would get is that everybody needs to be convinced that the FA is itself properly governed and able to carry out that function before it was given that part. In some ways, the tragedy of all this is that at a level, there are some extraordinarily able people who work in the FA. I deal with a number of their executives and there are some very, very good people there. I think they would welcome this if they were given this opportunity, but it could only come after they had reformed their governance.

  Chair: Continuing in this area, Damian.

Q797 Damian Collins: Do you think it is reasonable for Leeds United fans to want to know who owns their club?

  Hugh Robertson: Yes.

Q798 Damian Collins: Are you concerned that this rather simple information seems so hard to come by and is it something that football's enforcement of its own regulations of club ownership has to be looked at again here?

  Hugh Robertson: Yes. I think the transparency is a good principle in the modern age, so yes. I think anybody involved with the game of football should know who owns big football clubs, yes.

Q799 Damian Collins: When the FA gave evidence to us, they told us that they did know but could not tell us, and now they have written back to say it turns out they do not anyway. The Chief Executive of the Premier League said that if they were not told by Leeds, they weren't certain what they would do and would have to have an inquiry that would take months and maybe even sort of overrun the start of the season. Do you share our concerns this is a fairly shambolic state of affairs?

  Hugh Robertson: Yes.

  Damian Collins: Well, that is all I have to say on that.

  Hugh Robertson: It has to be a patent absurdity that many people who save up all week, pass through turnstiles to go and watch that football game can't find out who owns it. It is ridiculous.

Q800   Paul Farrelly: I think that yesterday's result may mean that the question of Leeds being promoted is less likely, but we invited the Premier League to say very clearly that in the interests of integrity of its competitions that, "If you don't abide by this transparency rule, we consider it sufficiently serious to say you will not join our club if you qualify", and therefore the Premier League will have certainty about who else might be playing, as will the other clubs in the championship. But the response was that, "Well, we would have to go through a long process, at the end of which expulsion may or may not be the upshot". It seemed to us that the Premier League was a dog that not only really had no effective bite, it could only really dish out a good gumming to Ken Bates and the people who are hiding behind this secrecy and mystery.

  Hugh Robertson: Well, you have come back, in a sense, to my previous answer, which is that, yes, I think it is perfectly reasonable for fans to expect to know who owns their football club. And if they do not know who owns their football club, as the fans of Leeds do not, then that is something that ought to be corrected sooner rather than later. If you were to go down the path of having a licensing system, then I would have thought a fairly basic requirement of that licensing system was that people should know who owns their football clubs. It is not asking the world, after all, is it?

  Paul Farrelly: I am not going to use any more dog analogies either.

Q801 Dr Coffey: How do you view the relationship between the FA and the Premier League?

  Hugh Robertson: I think variably is probably the best answer to that. It seems to go through a number of iterations, and I have only watched it from afar in the five years I studied this in opposition, and I have watched it more closely since then. When they come together and work together for the interests of football, as they did during the latter stages of the 2018 World Cup bid, it makes for a very powerful force, and part of any changes that we do make to football governance after this, must be to make that relationship stronger. It is tempting to forget in all of this, you know, you can get into a sort of—and Boris has a good phrase for it, doesn't he? He doesn't quite call it "gloom-mongers" but you can get a bit miserable about the state of English football and forget that in the Premier League we have this country's most successful sporting export and it is followed around the globe. It is a fantastic competition and there is much that is good about it. What we really want to do is to harness that good for the betterment of football.

Q802 Dr Coffey: So this, well, it is probably the same way of asking the questions that have been asked earlier, but what do you think Government can do to strengthen the FA that wouldn't require legislation?

  Hugh Robertson: Well, I think the first thing is you have to tackle the FA Board. I think that is the key to unlocking all of this, or it is the first part of unlocking all this. It will not do it on its own, but it is the first and very necessary step. The way forward was signposted very clearly in the Burns Review, and the fact is that however many years on since that—and Burns indeed, I think, said—I don't know whether it was said in this Committee, he certainly said it to me—that he wished he had been bolder, to some extent. I think there is a range of solutions from the FA Board, from building on the independent non-executive chairman and to independent non-executive directors that we have, and then balancing those against three from the professional game and three from the amateur game to create a board of nine with the chairman having the casting vote, through to adding some of the executives on to that board and then reducing the numbers from the amateur game and the professional game, through to the Ian Watmore solution, which is simply to have a series of executives facing a series of independent non-executives who challenge those executives over the way they take their decisions, the more commercial model. I think it most unlikely that we would get to that without legislation. I would hope that by persuasion and influence we might move towards the first model.

Q803 Dr Coffey: The German FA or football board has no independent executives. It manages to have seen, if you like, the light on certain of its aspects. Why do you think—you in particular have seemed to, particularly following the Burns Review—the introduction of non-executives will make a difference? We have already heard today about how the former Prime Minister of Belgium is going to monitor the regulation of finances in UEFA. I can't say that was a ringing endorsement, but why is it that you feel that the non-executives will make that difference?

  Hugh Robertson: I come back to your first question, which was that you asked about the relationship between the FA and the Premier League. At the moment, you have a board that is potentially subject to being locked between the professional game and the amateur game. Independents break that stalemate. Clearly, the more of them you have, the more influential they will be. Sport across the board is by no means a beacon of good practice in this regard, but if you look at corporate governance models in the commercial world—and football is a very, very big business indeed, and it is a business, one would hope, with a social conscience, but it is a very big business indeed—to have that sort of independent expertise coming from outside football has only to be good for the governance of the game.

Q804 Dr Coffey: So if I was to put to you England winning Euro 2012 or independent board, what would you prefer?

  Hugh Robertson: England winning in 2012. There is absolutely no doubt about it. My job as Sports Minister is to make sure that this country's sporting stock is as high as possible, and it will be a great deal higher if we win the World Cup or the European Cup than it will be if we have two independent non-executives on the FA Board, keen though I am achieve the latter.

Q805 Dr Coffey: A slight detour from this: in terms of the Olympic Games and trying to have a British team, what have you been able to do to try and make that happen?

  Hugh Robertson: Try and persuade my counterparts in Wales, Scotland and Northern Ireland of what FIFA have said, which is that there is no threat to their independence by contributing to a Great British football team. Strangely enough, I think the greatest losers if we are unable to get over the line on this will be women's football, which would get an unbelievable showcase through London 2012 in a way that it doesn't always get otherwise.

Q806 Dr Coffey: To that end, do you think it is a shame the BBC isn't showing women's World Cup live, like they did four years ago?

  Hugh Robertson: Yes, I do. My job as Sports Minister is to make sure that every single young athlete, male or female, gets the best possible chance to represent their country and the pity about some of the politics that is going on around this Team GB business is I don't think it is going to make an iota of difference in terms of FIFA. It will simply deny the opportunity to compete in the London Games to young men and women born in Wales, Scotland and Northern Ireland, and I think that is a very great shame. If it was in my means to stop it, I would.

Q807 Damian Collins: Just to go back to some of the governance issues with the Football Association and their relationship with the Premier League, if the Premier League had a seat on the FA Board, do you think that should be reciprocated?

  Hugh Robertson: I don't know that I have a firm view on that in any way, if I am honest. When I described the possible models to which you could move, from three, three, three, professional, amateur and independent non-executives, through to executives challenged by independents, there is a range of models there. The first one recognises that football, however uneasy at times, however strongly at others when it is working together, is a sort of alliance of all those are interested in the game. So the argument for having the Premier League on the FA Board is that they are this country's most powerful sporting export. More people watch the Premier League than, I think, any other football league anywhere around the world. If you look at the number of people who run around on the continent of Africa or in Asia with Premier League football shirts on their backs, its reach is enormous, and the Premier League should have great credit for having achieved that during its time. When you have an organisation as powerful as that it makes sense, at one end of the spectrum, to make sure that it is involved with the regulation of this game. So to have them involved in some way is sensible. If that leads to a complete blocking of any progress—and I am not saying that it has done—then that is going to be slightly counter-productive, isn't it?

  

Q808 Damian Collins: But the question was about reciprocation, should the FA as football's governing body, have a seat on the board of the Premier League?

  Hugh Robertson: I think I would be inclined to tackle the first issue first, which I think is getting the FA's corporate governance sorted out. If the by-product of that, if we could get to this happy situation, was that the two organisations—and indeed the Football League as well— were able to operate more harmoniously together for the good of football, that would be fantastic news.

Q809 Damian Collins: But based on your earlier remarks, if the FA were to be responsible for, if you like, financial performance, as the governing body of the game—if you like, the FA is responsible for the game and the Premier League runs a competition within the game—wouldn't that necessitate some sort of formal relationship between them?

  Hugh Robertson: I would have thought in an ideal world, yes. Indeed, if you look at the arrangements that govern the London 2012, the British Olympic Association, as the athletes' representative, have a seat on the local board or at least did until recently. That is precisely so that you get all the partners who are involved in the delivery of the process round the same table. In an ideal world, yes, that would be the case. I think there are one or two other issues we need to tackle first, like getting the central governance of the FA Board correct.

Q810 Damian Collins: In some ways the previous witness from UEFA hinted at this, that what you have on the FA Board is a series of vested interests fighting with each other rather than a single body that takes a unified view of how the game should be run. Is that your experience of it?

Hugh Robertson: Yes, I think he is right. I think that is absolutely right. That is of course the importance of—to come back to the question asked earlier—independent non-executive directors because they can break that logjam, because the vested interests, however hard they try, will—vested interests, the representatives from the professional game and from the amateur game will necessarily stick out for the parts of the game that have put them on there. So they will create that sort of vested interest situation. The only way you can break that is by having independence on who can take a more general view. That indeed was of course why Burns made the recommendations that he did.

Q811 Damian Collins: From what you are saying, it sounds like you wouldn't go the whole hog, in terms of what Ian Watmore would do, and have a totally independent board?

Hugh Robertson: No. I don't think I yet have a firm view on it. It has been enough of a struggle to get to where we are at the moment, and you look at how many years we have been going at this. I think there is an opportunity now, through this inquiry, through the response we will have to make of it, to set football the challenge of achieving something; something that really makes a quantifiable difference here. There is a range to which they can go from 333 at one end, through adding some executives on to it, through to the Watmore solution at the far end of the spectrum.

I would strongly encourage football to realise that there is a strength of feeling about this, that people want something done. I hope they will see the light; that they will make these changes and that we will not have to legislate. But if they prove unable to do it—and the track record isn't massively encouraging—then legislate we will.

Q812 Damian Collins: Just two final questions. Something we discussed with Premier League when they gave evidence is: do you have a concern that the role of someone like Sir Dave Richards, who was involved in the bids, the FA Board, and Chairman of the Premier League, that anyone in that position could be conflicted between the various different interests they are being asked to serve?

Hugh Robertson: Boards should do everything possible to avoid conflicts of interest, and I think the move that the new chairman of the FA made to take back control of the England team is the correct one. The chairman of a sport governing body should be, de facto, responsible for the performance of the national team. It is as simple as that. It is inconceivable that the chairman of the RFU would not be responsible for the performance of the England rugby team or that Giles Clarke would not be responsible for the performance of the England cricket team. It is ridiculous.

Q813 Damian Collins: Finally, although a lot of the issues about governance have been directed towards the FA—I think that is right and I think we all respect the Premier League's credible commercial success—do you think there is a role for greater independent scrutiny of the performance of the Premier League; the issue of whether they have an independent director on their board, which they were resistant to, and even if some of the details—the issue raised in the press last week about the company that Sir Dave Richards was a director of and his son ran receiving contracts from the World Cup bid, the FA and the Premier League and the question of have people been informed of that relationship? What sort of rules for declaring those interests exist? No one is implying necessarily anything was wrong but there seems to be a lack of clarity in terms of how those sorts of decisions are made, and if that lack of clarity does exist would that be a role for an independent director?

Hugh Robertson: Yes. Football—let me put it this way—it occurs to me is a sort of game in transition. Quite a lot of the structures that govern the game of football relate to a previous time. I will try and say that gently. Football is a very big business now that is followed by 11 million people, or whatever it is, who play it or follow it every weekend. You have to have the very best corporate governance arrangements around the boards that control our major games. So yes, a properly run board will have rules in place that would deal with conflicts of interest, and so on, like any other board does. We have this with the London Olympics. Where there are conflicts of interest people leave the room for the relevant agenda items, and so on. It is perfectly well established commercial practice in almost every other field and it should apply to football.

Q814 Paul Farrelly: One final question on the structure. In your written evidence you say, "In our view modern boards should have eight to 10 members and include non-executives", and that covers the range of options that you would like to see.

Hugh Robertson: That is encouraging, isn't it?

  Paul Farrelly: When we saw the FA at Wembley it seemed as if the two independent non-executives is pretty much a done deal for the Premier League, but they don't feel it is a done deal yet for their FA Council and they were being very cautious because they want to coax us through the FA Council with people from the counties, the vice presidents who carry on like judges, on and on and on, but what they are proposing at the moment—what they are trying to coach through the FA Council—is adding the two non-execs on top of what is already there and that is not good enough, is it?

Hugh Robertson: No. I mean I absolutely stick by what we said in the earlier evidence, that I think the best sort of boards are eight to 10 and have a significant number of non-executives on them. As you correctly say, the FA is a long way off that at the moment, so anything would be an improvement. I welcome the steps that David Bernstein has made since he took over, both in terms of removing the conflict of interest at that central board and by his stated desire to add two non-executive directors on to the board.

  If he can now thin down the representation from the amateur game and the professional game so you have the three, three, three, that would be a very worthwhile outcome. If we could achieve that through consensus and bring football along that might obviate the need to resort to legislation and go for a more radical solution. I do want to work with football to achieve this and it is just a question of getting them to realise that this needs to happen.

Q815 Dr Coffey: One of the ways to think about being a representative on the FA Board or Council is to have a cap or a term limit. Do you have a view on that? You know, if you have been on the council for 10 years you should—

Hugh Robertson: Generally speaking—I don't think there is anything terribly controversial in this—with anybody who does anything, possibly even politicians, there comes a time when you spend a certain amount of time getting up-to-speed on a given subject, you then have a productive period and there then sometimes can become a slightly sleepier period at the end of it. So I think term limits are a good thing in almost all walks of life. They certainly are with directors in the commercial world and, again, I can't see why that principle applied to football should be any different.

Q816 Chair: Minister, you started in your first answer by referring to the plethora of reports, inquiries and commissions that have crawled over this ground repeatedly and nothing has changed. Are you determined that on your watch something is going to change?

Hugh Robertson: Yes, I am. Whether I can actually do that of course remains to be seen because, like everything in politics, that will require backing. I would not for a moment underestimate the difficulty of this. I think there is going to be an awful lot of backbiting and unpleasantness before we get from here to where we are trying to get to. If I am honest that is not something I particularly welcome, either personally or would have welcomed at the time when we are trying to deliver the London 2012 Olympics, but I have thought about this at considerable length. I did have an eight month period to think this all through while the World Cup was going on because we had agreed that we wouldn't embark on this before that. As I say, a number of either my direct predecessors or previous Secretaries of State have tried to crack this nut and failed. I recognise that and, as I say, it is not going to be pleasant or a great deal of fun but it needs doing for the good of the game of football.

  Actually, what I want to do, I want to make sure that at the end of my time as a Minister that football is in a better position than it was when I took it over. I think the most serious issues relate to governance and the way the game is run, and I do not want to see it at the time that I leave, or get sacked or whatever happens to me, that we haven't tackled—because it is too much trouble or it is too much effort, or anything—something that needs to be done in what is after all our national game. I simply want to make sure that we have the best possible chance of winning a World Cup in due course.

Q817 Chair: In order to force change it is sometimes necessary to have an alternative which you don't necessarily wish to deploy but which you could resort to if change didn't happen.

Hugh Robertson: Called legislation.

  Chair: Called legislation, and is that your position?

Hugh Robertson: It is my position, Chair.

  Chair: Thank you.


 
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Prepared 29 July 2011