Football Management

Commentary on the management of over 160 English football clubs by Dr John Beech, winner of the FSF Writer of the Year Award 2009/10 Twitter: @JohnBeech Curator of! Football Finance

Posts Tagged ‘Politics’

The great governance debate

Posted by John Beech on May 13, 2011

The House of Commons Select Committee on Football Governance certainly finished their hearings with a bang.

First up was Mike Lee, ‘strategist behind the 2022 Qatar World Cup bid’, and late of the London 2012 Olympics bid.  His appearance was bound to be confrontational given the submission of new evidence by The Sunday Times (1) regarding the awarding of the World Cup to Qatar.  He was given a bit of a hard time, and, unusually, received an apology for this (2).  Qatar has become such an issue that even the International Olympic Committee have ordered a Qatari bribery investigation (3).

Next up, and the final witness, was Lord Triesman.  His allegations about the bidding process for 2022 were made under parliamentary privilege, and have caused a considerable, and appropriate furore.

Important though the governance of the national is, I was disappointed that the Committee had drifted off what I saw as the main topic – the governance of leagues and clubs.  Judging by the written submissions, this seems to have been the topic that was generally seen as more important.

There is perhaps a different reality, one in which the reform of club and league governance remains centre stage.  On Wednesday Supporters Direct an launched two special briefings put together by Supporters Direct and Substance.  Both concern encouraging supporter community ownership in football; the first is on Developing Public Policy and the second is on Developing Football Regulation.  (I should admit a vested interest at this point – some of my research is quoted in the latter.)  Both are downloadable pdfs, but note their length before you rush to print them.

Dave Boyle (Supporters Direct) and Adam Brown (Substance) at the launch

Far from simply being an advocation of fan ownership, they set out clearly how the current financial model for running football clubs is broken, the specific ways in which it fails, and how a sustainable alternative model would work.  As well as fan ownership, a strong case is made for club licensing along the lines of the systems practised in Germany and in Northern Ireland.  The briefing papers also spell out the role that government should take in driving reform through effective changes in legislation rather than through some more direct intervention.

I found it particularly encouraging at the launch that there were 3 MPs present.  Governance reform is definitely still on the political agenda.  As Dave Boyle of Supporters Direct pointed out, a pile of all the official reports on football is now over a foot high, yet their recommendations have, on the whole, not been implemented.  Such is the current state of football governance that the failure to take action cannot be justified.  In real life, doing nothing is always an option whatever anyone might claim, but doing nothing would have a culpability to the disintegration of professional football attached to it.

Posted in Governance, Law, Politics, Uncategorized | Tagged: , , , | 6 Comments »

Bubbling away in the background…

Posted by John Beech on July 31, 2010

Hidden away in last month’s budget (1) was a proposal that could be causing some concerns for football club finance directors.  Para 2.25 states:

The Pay As You Earn (PAYE) system is a fundamental part of the UK tax system. The Government wishes to explore how it could be improved in order to reduce costs and make the system easier for employers and HMRC to administer. As an initial step, the Government intends to consult with employers and payroll providers on mechanisms that could support more frequent or real time PAYE data.

A detailed discussion document (2), aimed at kicking off the consultation process (which is scheduled to be completed quickly, by 23 September), has just been issued, and Para 4.31 suggests that the use of real time information has the potential for:

enhancing compliance with tax laws by using real time information to assist in tackling late or under payment of the deductions some employers make

Late or under payment of taxes?  Football clubs?  Surely not!

Another document , Tax consultations announced at Budget (June 2010), downloadable from the HMRC website here, introduces the consultation under the simple heading of PAYE improvement.  All this falls short of proposals in Alistair Darling’s budget (3) of March this year, aimed at “Employers that operate Pay As You Earn (PAYE) schemes to account for income tax and National Insurance Contributions (NICs) and have a history of serious non-compliance in terms of paying late or not paying“; these would have included “provisions allowing HMRC to require security in the matters that can be covered in PAYE regulations. It will also set out the new offence of failing to provide security. Similar provisions will be made for NICs through regulations using existing powers.

The Budget does however say that (Para 2.112) “The Government will now consult on introducing a power for HMRC to require financial security where PAYE & NICs are at serious risk of non payment, rather than legislate in the upcoming Finance Bill as announced at the March 2010 Budget“, so financial security is not necessarily off the agenda

So, because of a timely change in government, football clubs may have had a narrow escape from the prospect of having to up-front security if they already had a bad track record of payments to HMRC (too many to list, but Club round-up might include some possibles).  HMRC may well be just a tad disappointed.

Nevertheless, HMRC may well end up with stronger powers to ensure PAYE and NICs are paid on time, a situation which too many football clubs are entirely unfamiliar with.  Certainly the days of being able to negotiate late payment of already overdue debts look to be coming to an end.

Posted in HMRC, Politics, Wages | Tagged: , , | 4 Comments »

A Political Football

Posted by John Beech on May 20, 2010

In the lead up to the general election (and running alongside a large number of local council elections), I blogged on how I thought it significant that the political parties were wooing the fan vote, but did not hold out much prospect for major new initiatives actually happening after polling day.  Well, as many a commentator has pointed out, the public have now spoken, although it’s not entirely clear exactly what they were saying.

Cameron has already come in strong support of the 2018 World Cup bid, indicating that he is happy to comply with whatever is necessary, by implication including the waiving of tax bills (see FIFA’s muscle flexing).  Apparently singing from a different hymn sheet, the new Conservative Minister for Sport, Hugh Robertson, has indicated in no uncertain terms to the football authorities that “they must reform their governance and power structures or face the prospect of external regulation” (1) – something which would not exactly be looked kindly on by FIFA, who tend to suspend national football authorities that suffer from governmental interference.  We shall see.

On the opposition benches, we now have an increasing number of runners for the post of leader of the Labour Party, the most interesting one of which, from a football perspective, is Andy Burnham, former Culture Secretary.

All then is far from clear with respect to future political strategy and the beautiful game/ugly business.  I thought it would be interesting nonetheless to look at how the political representation has changed in the light of the election results, that is, with respect to the changes in constituency representation of clubs.  So far I have only looked at Premier League clubs, but plan to extend this to at least the Championship as time permits.

It would be easy to make far too much of who the local MP is for clubs from a fans perspective.  Clubs draw fans from a much wider area than just the constituency in which their stadium sits.  How many declared Manchester United fans, for example, could tell you that Old Trafford is in the Stretford and Urmston constituency?  How many have even heard of Urmston for that matter?

The local MP is however the natural point of contact for a club to raise its political concerns with, especially if there really is going to be imposed reform.  With regard to Premier League clubs, this comprises a grand total of not twenty MPs, but in fact eighteen.  The stadiums of Aston Villa and Birmingham City are both in the Birmingham Ladywood constituency, and Chelsea and Fulham both find themselves in the appropriately named Chelsea and Fulham constituency.  An interesting thought is that Greg Hands, MP for Chelsea and Fulham, could in theory find Abramovich and Fayed sitting in his surgery waiting to rant on!

A first looks shows the following:

  • Of the 18, 14 are LAB, 2 CON and 2 LibDem.  However, as of June 3rd, when relegations officially take place, both LibDems disappear from the list (they are the MPs for Burnley and Portsmouth) to be replaced by LAB MPs (whatever the outcome of the Play-Off Final).  The two CON MPs are the said Greg Hands, and Paul Uppal, who represents Wolverhampton South West, a CON gain from LAB.
  • In only four constituencies did the swing exceed the average swing in England (5.6% from LAB to CON) – Bolton West, Chelsea & Fulham, Stoke-on-Trent South, and Wigan.  7 swung to CON, 4 to LibDem, and 7 to LA, the most marked case being a 7.7% swing from CON to LAB in East Ham (home of West Ham United).  Other anomolies were swings from LAB to LibDem in Hull West & Hessle (7.9%), where Alan Johnson is still the MP, and Burnley (9.6%).

The overall picture is a tad messy, but in general these Premier League constituencies are now in opposition hands, as they normally have been, largely because the LAB vote held up better than elsewhere in England.

Of more direct relevance to the day-to-day running of clubs, and their planning applications, are local councils. Yesterday alone, for example, I found two news stories involving Premier League clubs and their respective local councils (in both cases, examples of conflict).  Tottenham Hotspur have had to revise their planning application to Haringey Council for their ground development because it has originally proposed the demolition of four Grade II listed buildings (2).  At Stoke, “Furious councillors have slammed a Government watchdog after a long-awaited audit report [on the Britannia stadium] was hit by yet more delays” (3).

In spite of covering numbers of voters than parliamentary constituencies, we are left with eighteen different councils (and exactly the same duplication as with constituencies).  Initial findings are:

  • LAB control eight councils, LibDem 3 (but these are the relegated Burnley, Hull and Portsmouth), CON 2, and 5 with No Overall Control (NOC).  The ‘new boys’ for next season are Newcastle (LibDem) and West Bromwich (LAB), plus either Blackpool (CON) or Cardiff (a coalition of Plaid Cymru and Independents).
  • LAB made three gains, two from LibDem and one from .  Neither CON nor LibDem made a single gain.

As I said above, it is easy to make too much of all of this.  What is clear though is the Premier League clubs find themselves represented in parliament mainly by Labour, now in opposition, and similarly Labour at council level, more typically in control.  This is as it has been historically, except of course that Labour are now in parliamentary opposition.  Generally this would be interpreted as bad news for the Premier League clubs, but perhaps the ‘new politics’ of coalition will see the Conservatives and the Liberal Democrats maintain their apparent impetus to woo the ‘football’ vote.

If they really are to survive a fixed five-year period in power, they will at the very least have to take more considered positions than the two knee-jerk responses I referred to above by Cameron and Robertson.  They will also have to think carefully where they stand as the UEFA Financial Fair Play Protocol comes inevitably into operation.  Will they take a ‘free-marketeer’ approach, placating the Premier League oligarchs and antagonising UEFA, or will they support a growth in fan ownership, an increase in their support of Supporters Direct being an obvious way to show this?

Posted in 2018, Governance, Politics, Premier League | Tagged: , , , | Leave a Comment »

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