Written evidence submitted by Steve Lawrence
Key points:
— European
Union Competence in respect of Sport (The Treaty of Lisbon).
— Specificity
of Football particularly in respect of the spectrum from amateur
to professional.
— Emphasis
on the youngest participants.
— Dysfunction
of the trinity of The FA, The FA Premier League and The Football
League.
— The
imperative for government intervention.
— The
contribution that football can make to social cohesion and the
potential for a model "Big Society" initiative.
— Alternative
means of governance particularly for the grassroots game.
— A coordinated
pyramid for competition based on geographical criteria.
— The
English Amateur Football Association.
— The
potential for £1 billion of revenue to a revitalised strata
of community members clubs.
— The
Netherlands as an example of good practice.
1.0 INTRODUCTION
1.1 The Treaty of Lisbon confers new competence
on the European Union in respect of sport and it is the stated
intention of the European Union to develop policy in the realm
of sport;
Article 165 of the TFEU states that:
"The Union shall contribute to the promotion
of European sporting issues, while taking account of the specific
nature of sport, its structures based on voluntary activity and
its social and educational function."
It goes on to say that:
"Union action shall be aimed at—developing
the European dimension in sport, by promoting fairness and openness
in sporting competitions and cooperation between bodies responsible
for sports, and by protecting the physical and moral integrity
of sportsmen and sportswomen, especially the youngest sportsmen
and sportswomen."
This new competence of the European Union is relevant
to the Inquiry into Football Governance in the United Kingdom
and the Culture, Media and Sport Committee should give appropriate
consideration to it. In this regard "The Lisbon Treaty
and EU Sports Policy" published by the Directorate
General for Internal Policies should form a core reference document.
The emphasis on sport as voluntary activity,
and its social and educational function ought properly
to define the characteristics of any UK Policy which emerges from
the Inquiry.
In addition the references to fairness and
openness and moral integrity especially in relation
to the youngest must inform initiatives.
1.2 In particular the Committee should address
the issue of the "specificity" of football. It is particularly
important to recognise that the development of the professional
game has created a component of the sport which has fundamentally
different characteristics to the amateur or "grassroots"
game. Additionally football needs to be recognised as having
very distinct characteristics and requirements as a game for participation
quite distinct from its nature as a game for spectators.
It is also important to recognise the differences between football
for youth and football for adults.
1.3 The Committee should have due regard to the
antitrust rulings of the European Union in respect of media rights,
ticket sales arrangements, sport goods, regulatory and organisational
aspects, anti-doping rules and state aid.
1.4 Sport in general and football in particular
has the potential to contribute very significantly to social cohesion,
reduction in anti-social behaviour, physical and mental health
of the general population, attendance levels in employment, education
and volunteer activity. It is important to account for these aspects
in financial terms when calculating the costs of implementing
a strategy for football. It should be noted that other European
countries calculate a very significant net return on investment
in football particularly at the "grassroots" and level.
1.5 The complexity of football governance in
England contributes significantly to the present dysfunction.
The relationship between The Football Association, The FA Premier
League and The Football League constitutes a noxious cocktail.
2.0 GOVERNMENT
INTERVENTION
2.1 Government intervention in football is absolutely
essential, football governance is moribund and dysfunctional and
in certain areas football is administrated for the advantage of
the few at great cost to the many. An immense community of players,
parents, coaches, spectators and volunteers is calling for leadership
and radical change.
2.2 Government intervention should be by legislation
requiring the metamorphosis of The FA, The FA Premier League and
The Football League and/or legislation bringing into being a new
English Grassroots or Amateur Football Association with special
competence in respect of children.
2.3 Government intervention should extend to
revising legislation in respect of amateur and professional sports
clubs determining structures of ownership and of membership.
2.4 Government intervention should also include
legislation requiring local authorities and other undertakings
to gift or otherwise make available land, buildings and resources
appropriate for member's football clubs in order to further the
interests of social cohesion and the common good.
2.5 The model for football might be appropriate
for sport generally and a significant piece of legislation "The
Sport Act" might be considered.
2.6 The creation of a New Institute for Sport
and Social Cohesion modelled on the Netherlands Instituut voor
Sport & Bewegen should be considered. The Institute would
be charged with informing sport policy with particular emphasis
on social cohesion and as an example of how "Big Society"
ideas can be implemented on the ground.
3.0 SPECIFICITY
OF SPORT
IN GENERAL
AND FOOTBALL
IN PARTICULAR
3.1 It is important that football clubs be treated
differently from other commercial organisations. Sport in general
and football in particular are unusual activities encompassing
a wide spectrum from amateur to professional, young to old, encompassing
leisure and cultural characteristics from participation to spectating.
The EU guidance on sport recognises this fact referring to the
"specificity" of sport. It is crucially important
the any UK government proposals on football take account of the
potential for future EU intervention. Indeed the present Inquiry
is well timed with the potential to place the UK in harmony with
the radical changes which are likely.
3.2 It should be remembered that every football
club, large or small will have a community aspect to it. Large
professional clubs will have a "football in the community"
component and small clubs will be not-for-profit undertakings,
perhaps member's sports clubs, whose function is wholly community
orientated.
3.3 At the smaller scale a member's club constitution
with not for profit principles designed to encourage volunteer
activity and allowing sponsorship and municipal participation
is essential. The example of the standard Dutch amateur football
club is a healthy model.
3.4 At the largest scale a commercial corporate
model is necessary but designed to encompass a substantial fan-based
membership. The German Bundesliga constitutes a good example of
what can work in practice.
4.0 THE GOVERNING
BODIES OF
FOOTBALL IN
ENGLAND HAVE
BECOME DYSFUNCTIONAL
4.1 The FA has a Council of 114 members of which
53 represent County Associations (to whom The FA distributes £15
million annually), 24 are Vice-Presidents, 10 are Divisional representatives,
seven represent The Football League (to which The FA distributes
£11 million annually), eight represent The Premier League
with 12 other individual representatives including HRH Prince
William. (The FA website)
4.2 There is only one representative for players,
one representative for referees, one representative for football
fans, there are no representatives for football coaches, and there
are no representatives for the parents of 1.5 million youth players.
4.3 Football involves players, coaches, referees,
the parents of youth players and spectators. These stakeholders,
some seven million people according to The FA, are represented
on The FA by three people out of a Council of 114. The FA is utterly
un-representative of football.
4.4 In 2000 Lord Pendry promised in the first
annual report of The Football Foundation that The FA would contribute
£20 million per annum to grassroots football. In 2010 The
FA is contributing only £12 million (by agreement with Sport
England)—a reduction in real terms of significantly more
than half over ten years. (Sport England FOI release)
4.5 The FA strategy for English football over
the last 15 years has been:
4.5.1 to cede governance of high level youth
football to the FA Premier League in the form of the Football
Academies and Centres of Excellence. (FA Charter for Quality 1997)
This has resulted, according to current FAPL figures,
in a position where the FAPL development programme produces some
50 foreign players within the U16-U18 cohort with an attrition
rate of less than two players for every one graduating whereas
270 indigenous players graduate into the U16-U18 category with
an attrition rate of nine players for every one graduating. These
figures suggest a focus on the development of foreign players.
(FA Premier League website)
4.5.2 to re-construct Wembley Stadium, the most
iconic arena in the history of world football, at a cost approaching
£1 billion with no significant net benefit in terms of televising
of matches and with a smaller and sub-standard pitch.
Income from broadcasting at £133 million constitutes
42% of FA group turnover. (FA Limited Report and Financial Statements
2009)
The interest burden from construction loans is subject
to an interest rate swap and for 2009 was £26 million. (FA
Limited Report and Financial Statements 2009)
Of the 20 top nations in world football only one
has a dedicated national stadium for football.
4.5.3 to construct a centralised elite performance
centre at St Georges Park, Burton at a cost of £100 million
which will be more than three hours travel time from 80% of the
population of England rendering it almost useless for its primary
purpose as a coach and player development centre. Its resulting
function is therefore likely to be as a residential facility for
the FA Premier League.
4.5.4 the publishing of a coaching manual in
2010 for sale at £39.99.
4.5.5 the establishment of a cohort of UEFA (category
A, B and Pro) coaches numbering some 2,769.
This compares with Spain 23,995, Italy 29,420, Germany
34,970 and France 17,568 (UK Coaching Network).
4.6 The FA plays no role in organising a coordinated
pyramid of competition for youth players, it organises The FA
Cup the FA Vase and England representative matches.
4.7 The net effect of FA actions over this period
of time has been to diminish financial stability from a position
of some £70 million of cumulative surplus in 2006 to a marginal
position in 2010 and the potential for a deficit in 2011 of perhaps
some £40 million. (FA Limited Report and Financial Statements
2001-09)
THE FA RETAINED PROFIT/LOSS 2001-09—£'000'S
4.8 The FA has acquired very serious conflicts
of interest. On the one hand it is the body which speaks for the
grassroots game, yet it also has serious concerns as a facilities
management organisation in respect of Wembley and St Georges Park
and finally it owes allegiance to The FA Premier League due to
its stake in the collective bargaining arrangements. It is therefore
very difficult for The FA to make adequate financial contributions
to the grassroots when it has interest payments to make on its
loans furthermore it is difficult for The FA to stand up to The
FA Premier League and demand that The FA Premier League honours
its commitments in respect of grassroots funding.
4.9 The FA Premier League is an extremely successful
collective bargaining organisation which operates as a cartel
in negotiating broadcast rights for the top 20 clubs in the English
football pyramid. Its cartel activities are sanctioned by the
European Union on the basis that significant benefits flow to
other areas of football in ways which would otherwise not happen
and that it abides by certain agreements in respect of selling
rights to more than one party. The agreement with the European
Union expires in 2013.
4.10 In 2000 Lord Pendry promised in the first
annual report of The Football Foundation that The Premier League
would contribute 5% of broadcast income to grassroots football.
In 2010 with gross broadcast revenue according to Deloittes of
£2.7 billion The FA Premier League is contributing £12
million.
4.11 The Football League (founded in 1888) is
a self governing body which administrates the league competition
system for 72 clubs in the Championship, League One and League
Two (being the 2nd-4th tiers of English football) and also the
League Cup.
This quote from the Football League's own website
states: "AUTHENTICITY: We are the world's original league
and retain honest, open and exciting competitions that are about
developing home-grown talent".
For 104 years until 1992 The Football League also
administrated the top tier—these days called The Premiership
(before 1992 called the First Division). The Football League enjoyed
significant income from the football league structure until 1992
when behind the Football League's back The FA made a deal with
the top 22 clubs to form the FA Premier League and thus acquired
a degree of control of the revenue from broadcast rights.
The Football League has suffered a diminution in
revenue since 1992 and is presently a junior partner in the football
hierarchy.
4.12 The Football Foundation is an independent
not-for-profit undertaking, founded in 2000, whose function is
to coordinate and distribute to the Grassroots Game funding from
The FA, The FA Premier League and Government.
From 2001 to 2009 The FA Premier League contributed
£111.44 million to The Football Foundation, The FA contributed
£111.44 million, Sport England £51.76 million and other
Government funds £60 million. (Football Foundation Financial
Statements 2001-09)
To put these sums in context the total annual revenue
to amateur grassroots football in Holland is currently £1
billion Euros. (The Mulier Institute)
4.13 From 2001 to 2009 The Football Foundation
distributed £216.95 million to Football Associations, £7.28
million to Schools, £12.3 million to Councils, £4.4
million to Leicester City Council, £900,000 to The BBC, £187,000
to The Girl Guides, £300,000 to Barnsley Rugby Club, £150,000
to The Cricket Foundation, £890,000 to Nike, £10.59
million to FA Premier League Clubs, £1.25 million to The
Football League and £500,000 to Comic Relief. (Football Foundation
Financial Statements 2001-09)
4.14 From 2001 to 2009 The Football Foundation
distributed £1.03 million to Grassroots Football Clubs.
4.15 The structure of English football has essentially
become one of patronage with advertisers patronising broadcasters,
broadcasters patronising The FA Premier League, The FA Premier
League patronising The FA and The FA and the Premier League patronising
the Football Foundation. The filter system which has been created
allows only a trickle of revenue to arrive at the grassroots.
It is essentially a top down funding system and it is inherently
fragile.
5.0 ALTERNATIVE
MODELS FOR
GOVERNANCE
5.1 There are two ways forward in restructuring
football governance:
5.2 The first is to encompass the status quo
leaving The FA and The FA Premier League to administrate the top
tier of the professional game, with continuing financial responsibility
for Wembley, along with The Football League continuing to administrate
the lower tiers of professional football but;
to transfer jurisdiction of grassroots, amateur and
youth football to a new "English Amateur Football Association"
possibly by re-constituting The Football Foundation.
The new association would accept and encourage membership
of amateur, grassroots and youth football clubs, including school
teams.
The new association would be responsible for coordinating
a nationwide pyramid of competition across age groups with four
principal and eight tertiary regional administrative and development
centres. The new association would encourage membership of individual
clubs.
The model for this new association would be the KNVB
in Holland which has 1.2 million members, some 7% of the population
(Mulier Institute); in proportion England would expect to
build a membership to a target of some five million over time.
5.2.1 The revenue contribution to football in
The Netherlands from memberships is some 370 million Euros with
another 430 million Euros provided by municipalities. This strategy
has placed The Netherlands in the position presently of having
10 billion Euros of capital infrastructure for football. The Dutch
funding system for football operates from the bottom up and it
is inherently robust.
5.2.2 A membership model such as this for England
would create underpinning revenue circa £1,000 million per
annum. Bearing in mind that for a flourishing member's club sector
to exist long term access to land and buildings is a basic requirement.
5.3 The alternative is to amalgamate the activities
of The FA, The Premier League and The Football League into a pair
of re-formed bodies.
5.3.1 Firstly, a not-for-profit member's organisation,
funded by memberships drawn from all football clubs and with responsibility
for governance, administration and development of the game.
5.3.2 Secondly an arms length commercial corporation
with competence to negotiate and contract in respect of the various
rights.
5.3.3 The model for this re-organisation is the
arrangement agreed between Formula One and the European Union.
(See European Commission on Competition, Notice published pursuant
to Article 19(3) of Council Regulation No 17 concerning Cases
COMP/35.163)
5.3.4 The not-for-profit organisation would essentially
be the continuation in a different form of The FA. Responsibility
for Wembley would be diverted to a new and independent facilities
management company and The FA would be reorganised to absorb The
Football League and take on responsibility for coordinating a
coherent unified pyramid of competition from the top tier of professional
football to the lowest tier of U8 youth football. The FA would
then involve itself only in the governance and administration
of the game as per the proposal for an "English Amateur Football
Association". The reconstituted FA would have representation
from its member clubs with representation from amongst professional
and amateur players, coaches, referees, youth player parents and
fans and of course government
5.3.5 The County Association structure would
be sustained as the structure for referee development and administration.
5.3.6 The administration of media rights would
fall within the competence of a newly constituted corporation
encompassing the former FA Premier League whose responsibilities
would encompass the entirety of the unified pyramid of competition.
Shareholding in the new/revised undertaking would be controlled
by statute with a significant government stake holding. The corporation
would be profit making with obligations to contribute to the revised
FA Governing Body.
5.5 The re-structuring of football governance
carries with it the very real difficulty of structuring models
of stewardship which allow for a spectrum including individual
ownership, enthusiast representation to member ownership and municipal
stake holding.
5.6 A solution to this will involve legislation
to define a shortlist of ownership models with model Articles
of Incorporation which allow a spectrum of possibilities which
have corresponding balances of obligation and benefit.
5.7 A sanctioning committee within a newly constituted
"English Amateur Football Association" or the
reconstituted FA would have responsibility for administrating
a "fit and proper person" database in respect of the
various forms of constitution and would adjudicate where necessary.
DCMS might properly have representation on this committee.
6.0 LEARNING
FROM OTHER
MODELS
6.1 It is important that the Committee considers
governance models from other countries.
6.2 The structure in The Netherlands seems to
be inherently robust and extremely successful. it represents an
ideal model for comparison. The Netherlands has a population of
16.5 million which is 25% that of England, the population density
of Holland is 388.93 inhabitants per sq. km and for England the
figure is nearly identical at 384.13.
6.3 The Netherlands exports large numbers of
players, coaches and managers. The export of players and coaches
creates a virtuous circle where the international experience gained
by the KNVB is recycled and used to inform policy and development.
Essentially it means that Dutch football is at the leading edge
of world football. Holland is typically in the top three of FIFA
rankings.
6.4 Holland does not have its own national stadium,
it places international matches in various stadia around the country
but tends to use the Amsterdam Arena which is owned by The City
of Amsterdam and which is leased long term to AFC Ajax. There
is therefore no financial burden on the KNVB in respect of stadium
commitments.
6.5 The KNVB (Royal Dutch Football Association)
is the single body governing all aspects of Dutch football.
6.6 In 2002 under the guidance of Louis van Gaal
the KNVB instituted a "master plan" which integrated
professional and amateur football in a single competitive infrastructure.
A strategy of coach education was implemented administrated out
of the headquarters in Zeist. The KNVB has a staff of 420 who
administrate football for a population of 16.5 million with 400,000
youth players and a total of 2,700 clubs of which 36 are professional
clubs.
6.7 Each of the 2,700 amateur clubs is rated
by the KNVB according to its facilities, the quality of its coaching
and its contribution to wider social needs.
6.8 Spectators at amateur clubs do not as a rule
pay to watch individual matches instead they are members who pay
membership fees for the use of club premises. The KNVB has approximately
1.2 million members.
6.9 Holland's 2,700 clubs play in a single pyramid
of competition organised across six geographical regions. The
top two professional leagues are organised on a national basis.
The amateur leagues are organised with the top four Saturday leagues
and the top four Sunday leagues organised nationally. The remaining
leagues are organised regionally in four, five or six tiers.
7.0 THE NEW
ENGLISH MODEL
7.1 The strategic implementation of a new model
in England could be achieved through the creation of an English
Grassroots Football Association divided into four main regions
North, Midlands, South East and South West.
7.2 Each region would be further divided in a
binary structure facilitating competition within and between regions.
7.3 A national pyramid of competition for youth
and adult football could be administrated from four regional centres
which would coordinate player registration, league structure,
web based results and league tables, coach education and player
development with tertiary centres located to ensure minimum travel
times for participants. The existing ad hoc framework of leagues
would be absorbed into the new national pyramid.
7.4 The existing Academy and Centre of Excellence
structure would be absorbed into the highest tiers of the new
national pyramid of competition creating the opportunity for cross
fertilisation of ideas and techniques and the healthy flow of
expertise from the highest tiers into the national framework.
7.5 Inter regional competition at all age levels
would provide a meritocratic structure for talent identification
and development and the broad base of the pyramid would encompass
the notion of participation for all.
December 2010
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