openDemocracyUK: Opinion

Will the latest review into English football bring about any real change?

On conflicts of interest and bodies being unable to regulate themselves, the UK Parliament knows more than most. So can it reform English football?

David Goldblatt
26 November 2021, 12.01am
Boris Johnson's government says it will issue a response to the review in spring of next year
Ian Forsyth/Reuters / Alamy Stock Photo

About once a decade, English football, driven by a financial or governance crisis, is subjected to an official report that calls for massive structural change... and then nothing happens.

In the late 1990s, the Labour government commissioned the Football Task Force report, whose recommendations were so watered down it was nearly transparent. In 2011, after blistering criticism from a parliamentary select committee into football governance, Hugh Robertson, then the minister of sport, promised to legislate for change – and singly failed to do so.

Fast forward a decade and here we are again. In May 2021, 12 leading European clubs, six of them English, proposed for a microsecond to break away from their national leagues and create their own transnational competition. Almost instantly doomed, the ‘European Super League’ barely had time to breathe before a huge wave of fan protest and widespread public opprobrium brought about its swift and brutal end.

Having initially given the plan a green light, the UK government’s populist radar was still sufficiently alert to execute a sharp U-turn, a manoeuver it has become rather adept at performing, to oppose the new league and ask the ex-minister of sport, Tracey Crouch, to lead an inquiry. The review would take its cue from a consultation with fans, and fan representatives, with a view to preventing such breakaways in the future, while addressing the governance of the game more widely.

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On Thursday, the Fan-Led Review of Football Governance published its final report. Like its predecessors, the review concluded that English football cannot regulate itself and its money responsibly, nor properly take the interests of fans and communities into account. Conflicts of interest are everywhere, much like in Parliament, and the FA doesn’t have the institutional capacity or the political power to regulate the leagues. The leagues are in the same position vis a vis their clubs. Fans and communities are barely represented in any of these organisations and so the game is governed without much reference to them.

Given this, the review says legislation is required to create an Independent Regulator for English Football (IREF) – though one can only hope someone can conjure a better name – and endow it with sufficient power to do the job; in particular to create a licensing system, which would require clubs and leagues to annually comply with a range of financial and governance requirements.

The detailed conditions of these licenses are yet to be determined but there would be much closer control on subsidies from owners to their clubs and on loss-making and running up debt. The regulator would also, as a condition of awarding a license, be able to insist on higher standards of internal governance and transparency in football clubs, including a much more substantial commitment to equality, diversity and inclusion.

Excess wealth

Across the game as a whole, the review calls for two redistributive measures. One of those is a fairer distribution of parachute payments, which are subsidies paid by the Premier League to relegated clubs, who in the past have often headed into a downward spiral of decline and bankruptcy. Parachute payments currently constitute almost half of the Premier League’s transfer payments, the rest being shared amongst more than a hundred other clubs in the football pyramid, while completely distorting the economics and competitiveness of English football’s second tier, the Championship.

Driven by the lure of the excess wealth of the Premier League, and operating in an overinflated labour market, Championship clubs are regularly spending more than their annual income on players’ wages alone. The review argues that this must all be renegotiated by the leagues, and if they can’t agree, a solution must be imposed. This would include mandatory relegation clauses in every Premier League player’s contract, to prevent relegated clubs from having unsustainable wage bills and needing parachute payments of such a scale, and a redistribution of that money to more clubs in the lower leagues.

More substantially, the review makes a compelling case for a 10% levy on all Premier League transfer fees (except those from the lower English leagues) that would generate around £160m a year. Such a move could secure the financial stability of the lower leagues and make a considerable contribution to grassroots facilities. Yet, as significant as that figure is, it is but a small fraction of the money that agents are making from these deals; a point ruefully noted by the review but without any significant policy suggestions to address the issue.

Sorting out the finances of English football aside, the review argues that the independent regulator should also use the licensing system to initiate a wave of reform in the governance of the game. The current system of ‘fit and proper person tests’ for club owners and directors run by the leagues would be passed to the IREF. There is much talk of the standards being higher and the level of due diligence greater. However, it appears there is little here that would have prevented the recent purchase of Newcastle United by Saudi Arabia’s sovereign fund or that would weed out the narcissists and psychopaths who legally ruin football clubs.

'Golden share'

More radically, the review proposes that every club should have to create a ‘golden share’, held by a democratically constituted community-benefit society, in most cases likely to be the already-existing supporters' trusts. The golden share would, in effect, give fans a veto over key decisions affecting the club's symbolic and physical heritage, such as its name, kit colours and stadium location, all of which have been heedlessly changed by some owners in recent years.

However, the review explicitly rejects a move to the German model of majority-fan ownership and fan-elected boards at clubs, concluding it would be too expensive to buy out existing owners. Clubs would instead be required to have a plan for community and fan engagement, and to create and talk to a shadow board of elected fan representatives, but access to executive power, real insider status and a say in club politics will all be nugatory.

This is not to say that implementing the review would not bring some important shifts. The proposals on independent regulation and licensing and golden shares for supporters trusts would mark a real change for the better in English football, though their fate hinges on the commitment of a government whose concentration span is microscopic and whose promises are a devalued currency.

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The reform of parachute payments, player contracts and the transfer levy are not insubstantial interventions, though they will barely make a dent in English football's Gini coefficient. Even then, we should expect a significant campaign against even this modest reallocation of resources from some quarters of the professional game .

It is possible, still, that these changes could help build momentum for a wider democratisation of football clubs, financing of deeper and more democratic forms of social ownership, for the exclusion of authoritarian states and their satraps from club ownership, and a transfer of shares and capital to fans, rather than just revenue to other football club owners. This is football, anything can happen.

However, the golden share proposal aside, the review’s pleas for more fan engagement from clubs and the creation of shadow boards to engage supporters, are a very poor return for anyone hoping to see a real shift in the distribution of power in football. So, too, are the new rules on ownership that would permit literally any national government or its agents to buy into the English game.

The government says it will consider the recommendations before issuing a response in spring of next year. Either way, given the limits of the review reforms, there’s a good chance we’ll probably be back in another decade or so to try to reform English football all over again.

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