The UK government has restated its intention to introduce an independent regulator for English football “as soon as possible” following a seven-month consultation process with clubs and the football authorities.
The renewed commitment is made clear in the consultation response published by the Department for Culture, Media and Sport on Tuesday to its February white paper, “A Sustainable Future – Reforming Club Football Governance”.
White papers are documents that set out proposals for future legislation and the road to this landmark intervention into the football industry started in 2019, when the government promised a fan-led review of the game’s governance in its manifesto.
That followed the shock caused by the expulsion of Bury FC from the English Football League (EFL) and the near-collapse of Bolton Wanderers, and the case for reform grew during 2020 and 2021 with the difficulties caused by the pandemic and the attempt by several leading clubs to form a breakaway European Super League.
In April 2021, former sports minister Tracey Crouch was asked to lead the review and she published her recommendations in November of that year, with the most significant being the creation of an independent regulator.
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UK government announces independent regulator for English football
Now, almost two years and months of concerted lobbying later, the government has said it has listened to everybody – some wanting more regulation, others wanting none – and its mind is made up: independent regulation is coming.
“Our football clubs are the lifeblood of communities and the envy of leagues around the world,” said Culture Secretary Lucy Frazer. “We want to see them protected for fans now and in the future.
“Today we outline our plans to make sure the new regulator for football is independent, and remains true to its central mission to safeguard these community assets and help the beautiful game continue to grow in England.”
However, there are still several details to be decided.
For example, the 52-page consultation response says the government is “minded to set up a new body to house the regulator” but “all options remain under review” and it will continue to consult experts on the matter.
Where the regulator sits in the governance structure has been a bone of considerable contention, with some in the game saying the regulator should operate under the English Football Association’s umbrella, as an entirely separate body could become “politicised”.
But others have pointed out that the FA and the leagues have proven they are unable to govern the sport properly and the regulator must be a standalone body to be credible. The government would appear to agree with the latter opinion.
Another area where consensus has been lacking is on the regulator’s “scope” – in other words, how far down the pyramid it should regulate. The government’s view is that its remit should extend to the National League, the English game’s fifth tier, but no further, as its primary focus should be the “financial sustainability” of the professional game. Where the grassroots and women’s games sit in this is a little unclear but the government has said it will continue to consult with stakeholders.
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What football thinks of new independent regulator
It also dismissed concerns that the relevant international governing bodies, FIFA and UEFA, would view the creation of a regulator as undue government intervention into the sport, pointing out football and government already coexist and cooperate on a wide range of issues, here and abroad.
There was also a wide range of views expressed during the consultation on whether the regulator should take a standardised view of its work, with a set of blanket conditions, or a more bespoke approach that targets “poorly-run, financially distressed” clubs. Again, the government believes the latter approach is better, as regulation should be “flexible, agile and proportionate”.
And there were concerns shared about the risk of conflicts between the various organisations in charge of the game, duplication of effort and possible gaps where nobody is sure who should be in charge. “We agree” was the government’s succinct answer, pointing out that it had extensive experience of setting up independent regulatory authorities that work well within their industries, such as the Financial Conduct Authority, the Office of Communications (Ofcom) and the Pensions Regulator.
However, the biggest dispute still to be settled is football’s oldest argument: how the game should share its wealth.
The current financial distribution model is complicated and contentious, with the Premier League making a solidarity payment to the vast majority of clubs in the EFL that totals £120million, about 5 per cent of media income the Premier League shares with its clubs.
However, the top division also allocates more than £200m a season to about half a dozen recently relegated clubs in the form of parachute payments. It says it does this to ensure clubs promoted to the Premier League have the confidence to invest in new playing talent and help relegated clubs deal with the shock of relegation.
The EFL, on the other hand, says parachute payments have ruined the competitive balance of the Championship and force the other clubs to spend irrational and unsustainable amounts of money simply to keep up.
The EFL believes the need for parachute payments would disappear if the Premier League would agree to share 25 per cent of the leagues’ combined media income on a more equitable and meritocratic basis.
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The Premier League, however, has said it is happy to send more money down the pyramid, although not as much as the EFL is asking for and only if the league agrees to tighter spending controls (which the EFL has repeatedly said it does not object to), but does not want to scrap parachute payments.
The government’s view is that, contrary to some Premier League voices, the current financial model is not working – there have been 60 cases of clubs going into administration since the Premier League’s creation in 1992, clubs across the spectrum continue to lose money every season and the clubs’ total debts are rising – but finding a solution should be left to the game, if at all possible.
If it is not, though, the government will give the regulator “a backstop system that involves targeted powers to intervene and facilitate an agreement on financial redistribution as and when necessary”.
This represents a significant win for the EFL and a defeat for those, largely within the Premier League, who do not think more of the top flight’s media-rights income should be used to support the rest of the pyramid.
The Premier League declined to comment on the government’s response to the consultation but it should be noted that all of its clubs have been fully engaged in the process and the league itself has been in regular contact with the relevant government officials.
It is also true that the government’s response makes it clear it does not want to jeopardise the global success of the Premier League, threaten inward investment in the game or overburden clubs with red tape.
EFL chair Rick Parry, on the other hand, has publicly welcomed the government’s latest position on independent regulation.
“As a consistent supporter of the independent regulator’s introduction, it is important that delivering financial sustainability for men’s English professional football will be its focus, and we now look forward to seeing legislation introduced to parliament,” he said.
Others were more circumspect in their reaction to the government response.
“It is great news that there will be a regulator for English football but, as ever, the devil is in the detail,” said Niall Couper, chief executive of Fair Game, a group that represents more than 30 English league and non-league clubs, including Premier League side Luton Town.
“The backstop powers need to be firmed up. A system where the game receives £3.19billion of TV revenue each year but clubs in League One can’t afford to pay their energy bills and the hiring of a kit manager in the National League is considered a luxury and, indeed, a club’s very survival is a daily concern, is clearly flawed.
“At the moment, for every £1,000 of TV revenue, £882 goes to Premier League clubs, £32.85 to most Championship sides and just 15p to National League South sides.
“The independent regulator has the potential to transform football for the better. But, in order to do so, it must have the necessary teeth to hold those it oversees to account.”
Of course, the biggest question mark of all, though, is when all this might happen. And on that the government has only said “legislation will be introduced as soon as parliamentary time allows”.
The current government must call an election by January 2025 but some experts think it will come before that. So, this government has approximately a year to get it through parliament, which should not be difficult as the opposition parties are all strongly in favour of the proposal. In fact, if this government does not do it in this parliament, they propose to do it in the next one.
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(Photo: Rob Pinney/Getty Images)
