Written evidence submitted by the Darlington
Supporters Trust
This document has been prepared by the Darlington
Supporters Trust to outline:
— The
background to the Darlington Supporters Trust.
— Objectives
of the Darlington Supporters Trust.
— Why
the Trust exists and the experience suffering several periods
of our football club experiencing numerous cash crises, insolvency
and periods of Administration.
— The
relationship between the fans and the club they support.
— The
future of football.
— Football,
government and Parliament - an opportunity to introduce sustainability
into the national game.
ABOUT US—THE
DARLINGTON SUPPORTERS
TRUST
1. This submission is presented on behalf of
the Board of the Darlington Supporters Trust, an Industrial &
Provident Society formally constituted in 2002.
2. Members of the Trust each have a single share
and are able to exercise full control over the Board which is
elected by the membership at an Annual General Meeting in line
with the Constitution which was produced in consultation with
Supporters Direct, of which the Trust is a full member.
3. The Trust is also a member of the National
Association of Disabled Supporters and the Football Supporters
Federation.
4. Membership of the Darlington Supporters Trust
typically stands at over 15% of the average home attendance for
Darlington Football Club.
OUR OBJECTIVES
5. We campaign to create conditions where we
can ensure that the club we support is run responsibly and that
it is financially sustainable.
6. We work and actively campaign to create a
situation where supporters can secure both influence and ownership
of the Club we support.
7. Seek to work with Darlington Football Club
to secure the appointment of a democratically elected Supporter
Director to sit on the board of the football club.
8. Undertake fund raising, including significant
contributions to Football in the Community and to youth development
at the Football Club.
9. Managing a ring fenced crisis fund raised
by fans in case of future requirements.
Why Does the Trust Exist?
10. Darlington Football Club was formed in 1883
and gained the reputation of being "the family friendly club".
11. The Club turned professional in 1908.
12. The Football Club experienced its first financial
crisis when ground improvements, started prior to the First World
War, left the club with a cash shortage during the war years and
only survived when the chairman of the Darlington Forge Albion
financed the completion of the work.
13. In 1960, fans raised £20,000 to pay
for the roof at one end of the Club's ground at Feethams and for
floodlights.
14. During the 1970s, the club had to apply for
re-election on several occasions, but the fans remained loyal
to the club, although fund raising had to be undertaken once again
by fans. David Frost notably presented a documentary about the
situation in Darlington.
15. The Club had yet another financial crisis
in 1982, but again was saved by fund raising efforts of fans in
the town.
16. In May 1999, George Reynolds a businessman
who had previously been jailed, arrived as Chairman of the Club,
promising to put millions in to it and to take it to the Premiership.
17. He also made it clear that he would move
Darlington away from the gentility of their ground at Feethams,
which they shared with the cricket club (and which had been left
in Trust to the people of Darlington), and build a lavish, 27,500
seater stadium on what was prime commercial land on the outskirts
of the town.
18. In 1999, George Reynolds UK Ltd put money
into the club to pay off the debts.
19. Darlington Football Club became the laughing
stock of many which slapstick attempts to sign Faustino Asprilla
and with allegations from Mr Reynold's wife that matches were
"thrown".
20. Nevertheless, with the land acquired, plans
to move to the new stadium went ahead with a building that Reynold's
claimed was to cost him £18 million.
21. At the same time as this, the Darlington
Supporters Trust had identified serious business problems in the
company that Reynolds was using to finance and develop the stadium.
22. Reynolds response was to confront his critics
at their home, often early in the morning, or making threats to
them and their families. Whilst footballers were charged by the
Football authorities for "bringing the game into disrepute",
no action was taken against a Football Club chairman who made
direct threats to individuals.
23. 1n 1999-2000, George Reynolds UK Ltd lost
£2.5 million and in the following year lost £9 million.
24. George Reynolds UK Ltd went into liquidation
in 2003, owing £3.4 million to creditors, most of whom had
built the new stadium.
25. Ask most observers outside of Darlington
and they will say that the (now Northern Echo) Arena was built
by George Reynolds - ask most people in Darlington and they will
say it was built by his creditors with money that he never had.
26. Reynolds was subsequently disqualified as
a director for eight years and then jailed for a separate offence.
27. The question of his eligibility to own a
football club in the first place then became an issue. When Reynolds
took over in May 1999, his criminal convictions were, of course,
long since served. The money he was putting into the club was,
though, improper, as it came from his own business which was clearly
insolvent and going bust.
28. The Fit and Proper Persons test for football
club owners is still, we would argue, ineffective in dealing with
issues such as this.
29. George Reynolds had been forced to hand over
the Club to the Sterling Consortium who acquired the Club to bring
it out of Administration, with Steward Davies taking over as Chair.
30. The Sterling Consortium had previously made
secured loans to Darlington Football club.
31. In 2006, the Club was sold to a Property
Developer, George Houghton who placed the club in Administration
again in February 2009. This resulted in a 10 point deduction
which destroyed any chance of promotion that season.
32. Fundraising efforts continued by the Supporters
Trust and fans, but no buyer could be found (not surprising, given
the operating costs associated with a 27,500 seater stadium for
a club with a fan base that was more typically 2,500 per match).
33. In May 2009, Houghton returned to the Club
as Chairman and came to a deal with another local businessman,
Raj Singh, who became Chairman of the Football Club
34. It is believed that Mr Singh owns the football
club, but the ground and the land upon which it is built, is under
separate ownership.
THE FANS
AND THE
CLUB
35. Throughout all of the above, the fans have
remained dedicated, loyal and supportive, including raising significant
amounts of money to keep the club going.
36. At no point in the history of Darlington
Football Club, has an offer of the appointment of a Supporter
Director been seriously considered or proposed by the football
club, in spite of public pronouncements to satisfy media curiosity
on occasions.
THE FUTURE
FOR FOOTBALL
37. The Darlington Supporters Trust is concerned
that the "benefactor" model of ownership is not sustainable
in the long term and there needs to be a major overhaul of the
way that football clubs are owned and managed.
38. The Trust believes that there should be absolute
transparency in the accounts produced by football clubs and in
the details of the owners of football clubs.
39. The Trust also believes that there should
be a level playing field in terms of the investment in clubs.
The Darlington Supporters Trust has great admiration for the work
of clubs such as Exeter City and AFC Wimbledon, which are run
by supporters on a sound, financial footing. They compete, though,
in leagues where other clubs spend more than they can afford (as
indeed Darlington has done in the past) leading to great inequality
in the competitiveness of our national game.
40. Supporters of Darlington have seen the Club
go from one where it was financially viable at its own ground
(the old ground at Feethams was one that could cope comfortably
with crowds on match days), to one which carries significant overheads
(and which is largely empty on match days). We have seen successive
periods of cash crisis and several Administrations when we felt
that our club was likely to close for good. The move to the new
stadium has been regarded by many long term fans as a betrayal
of trust with the supporters and has been described as a "monument
to the ego of one man".
41. It is with this experience in mind that the
Darlington Supporters Trust would wish to see more supporter involvement
in the ownership of the club. However, supporter investment is
difficult to organise and implement and works over a longer timescale
than conventional finance raising. Supporters Trusts should not
be seen as money of last resort for failing football clubs, but
as vehicles that can be used to ensure longevity, sustainability
and fairness.
42. The Darlington Supporters Trust looks to
the governing authorities to ensure that they are able to regulate
the game to ensure sustainability and to avoid a repeat of the
crises that fans at Darlington have been subjected to.
43. Indeed, the future of our national game depends,
we believe, on its ability to be well managed and sustainable.
Without that, there is nothing.
44. We know that in comparison to other countries,
English football is, to all intents and purposes, under regulated,
largely as a result of football clubs being treated as ordinary
companies accountable to their shareholders.
45. Accordingly, the Darlington Supporters Trust
looks to see better regulation to ensure the social and sporting
dimensions of football clubs is fully reflected - the chairman
of a football club or the owner of a football club may come and
go, but the fans remain loyal throughout. The days of the chairman
of a football club being able to say "I am the biggest fan
of this club - look at the money I have put in" should be
put well behind us.
FOOTBALL, GOVERNMENT
AND PARLIAMENT
46. That our national game - at all levels -
be properly managed and subject to good governance should be taken
as sine qua non and we firmly believe that the intervention of
government and Parliament would be welcomed in pursuit of these
objectives - indeed firm timescales should be laid down to ensure
that this is achieved. Football is our national game and it is
right and proper that government and Parliament should look at
these issues seriously.
47. We would recommend revisiting the legal framework
so that the creation of a legal vehicle for sports clubs could
be established which would enable the governing bodies to act
with more confidence in terms of governance issues. Norway, France
and Spain have specific legal vehicles for sports clubs which
give certain benefits to them whilst also giving rights to stakeholders
that are greater than those for normal companies.
48. Football clubs are part of the communities
they serve - in Darlington, since 1883. As such, they can not
just be viewed as normal commercial organisations. There is an
intrinsic "persona" of the club which is entirely distinct
from the private ownership that, in Darlington's case, has overseen
successive periods of Administration and uncertainty.
49. Darlington has survived thus far, not because
of good governance, but because of its supporters, without whom
the club would inevitably have gone out of existence completely.
This has been the case because of the clear, emotional attachment
that many fans feel towards Darlington Football Club, rather than
its owners. In simple terms, if a customer does not like the supermarket
they go to, there are others available - for a football fan, because
of the emotional attachment, no such alternative exists.
50. There is a very real alternative, of course,
where a club can be owned by its supporters or where supporters,
through representation on the Board of Directors, can have an
influence. Raising finance, of course, is fraught with difficulty
for a Supporters Trust, particularly in the present climate, but
also as a result of FSA rules. When fans raise money for ownership,
they do so because of their support for the club, not for financial
return. The dissolution of the FSA presents an excellent opportunity
for government to look at options whereby raising for capital
by a Supporters Trust can be more achievable to ensure the overriding
principles of sustainability.
January 2011
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