Speaker 01: 0:00

Hello Benchwarmers, and welcome again to The Bench Report. You're listening to Amy and Ivan. Today, we're looking at the football governance bill. It's already been through the House of Lords. Now it's landed in the House of Commons.

Speaker 02: 0:15

That's right. And this new law, well... It wants to tackle some pretty long-standing issues in English football.

Speaker 01: 0:21

Things like clubs running out of money.

Speaker 02: 0:23

Right.

Speaker 01: 0:24

And who owns them.

Speaker 02: 0:25

Exactly. Financial stability, ownership questions, and also making sure fans actually have a bigger voice in how their clubs are run.

Speaker 01: 0:32

And this all stems from that fan-led review back in 2021.

Speaker 02: 0:35

It does, yeah. That review really brought these issues into sharp focus. I mean, these problems aren't exactly new, are they? People have worried about club finances for years.

Speaker 01: 0:45

Definitely. And ownership has often been controversial.

Speaker 02: 0:48

And fans often feel, you know, left out of the loop, ignored even.

Speaker 01: 0:52

So what pushed it forward now?

Speaker 02: 0:54

Well, a few things really converged. The pandemic hit clubs hard financially, exposing vulnerabilities. Then you have the whole European Super League debacle.

Speaker 01: 1:03

Oh, yes. That caused quite the uproar.

Speaker 02: 1:05

It really did. It galvanized fan opinion and highlighted the need for, well... Better oversight. So the fan review recommended an independent body, an independent regulator.

Speaker 01: 1:17

And the government actually listened.

Speaker 02: 1:18

They did. Back in 2023, they published a white paper confirming plans for one. An earlier attempt at a bill didn't quite make it before the last election, mind you.

Speaker 01: 1:28

But the commitment remained.

Speaker 02: 1:29

Yes. The Labor Party also had it in their manifesto, something similar anyway. And then the King's speech last year specifically mentioned introducing this bill. So there's been a fair bit of cross-party engagement. Well, momentum.

Speaker 01: 1:41

So let's get into the bill itself. What are its main aims?

Speaker 02: 1:44

Broadly, it's aiming for three things. Better financial sustainability for clubs, protecting their cultural heritage, and ensuring genuine fan engagement.

Speaker 01: 1:53

Sounds sensible. And is it very different from the last government's version?

Speaker 02: 1:56

Not drastically, no. It's very similar in its main components. The absolute key part is creating this independent football regulator, the IFR.

Speaker 01: 2:05

The IFR. Sort of a watchdog for the game.

Speaker 02: 2:07

Pretty much. It's the central pillar. This idea gained a lot of traction after those events we just talked about.

Speaker 01: 2:13

OK, so this independent football regulator or IFR, what powers will it actually have? What's its job description?

Speaker 02: 2:21

Its main function will be operating a licensing system. For all clubs. For clubs in the top five tiers of English men's football. So Premier League down to the National League.

Speaker 01: 2:31

And if you want to play in those leagues, you need a license from the IFR.

Speaker 02: 2:34

Correct. And the IFR's objectives in granting these licenses are, first, promoting the financial soundness of individual clubs. Second, ensuring the overall financial resilience of the leagues. Systemic resilience, they call it. And third, safeguarding the heritage of clubs. Things like badges, colors, stadiums.

Speaker 01: 2:53

And how does it have to operate? Are there guiding principles?

Speaker 02: 2:56

Yes, it has general duties. It has to act compatibly with the bill's purposes, obviously. It must advance its own objectives, those financial and heritage goals. It also needs to consider things like sporting competitiveness and encouraging investment in the game. It shouldn't stifle that.

Speaker 01: 3:12

So it's a balancing act.

Speaker 02: 3:13

It is. And there are regulatory principles too, using its resources efficiently, cooperating with everyone involved, clubs, owners, fans, the leagues, the FA. Crucially, any regulations it imposes must be necessary and proportionate. You know, not using a sledgehammer to crack a nut.

Speaker 01: 3:30

Makes sense. And it needs to recognize football's specific context.

Speaker 02: 3:35

Yes. That football isn't just any other business. It has cultural significance. Oh, and it also has to publish a regular state of the game report looking at the health of English football.

Speaker 01: 3:45

Right. Let's dig into these licenses. You said top five tiers need one. What kind of licenses are there?

Speaker 02: 3:50

There are two types, provisional and full.

Speaker 01: 3:53

Provisional first, I assume.

Speaker 02: 3:55

Usually, yes. All licensed clubs, whether provisional or full, must meet certain mandatory conditions.

Speaker 01: 4:01

Like what?

Speaker 02: 4:01

Things like having appropriate financial planning in place, consulting properly with their fans on key issues, and reporting on their corporate governance how the club is actually run internally.

Speaker 01: 4:11

And the full license?

Speaker 02: 4:12

Well, beyond the mandatory stuff, there are threshold requirements. Financial resources, non-financial resources like staffing and facilities and fan engagement levels. If a club meets the mandatory conditions, but maybe needs a bit more work on those thresholds, the IFR can add discretionary conditions to their license to help them get there.

Speaker 01: 4:32

I see. So clubs need to provide quite a bit of information.

Speaker 02: 4:35

They do. Things like personnel statements, who the key people are, and strategic business plans outlining their future direction.

Speaker 01: 4:42

How long does a provisional license last?

Speaker 02: 4:45

The initial grant can be for a maximum of three years.

Speaker 01: 4:48

And getting the full license? What's the hurdle?

Speaker 02: 4:50

It's called the full license test. A club needs to demonstrate it's operating a team, obviously, meeting all those threshold requirements we mentioned, complying with the mandatory conditions, and very importantly, that its owners and officers, the directors and senior managers, are deemed suitable people.

Speaker 01: 5:07

And the IFR can say no or take a license away.

Speaker 02: 5:10

Absolutely. It can refuse or revoke licenses if clubs don't meet the conditions or if other serious issues arise.

Speaker 01: 5:17

You mentioned stopping breakaway leagues earlier.

Speaker 02: 5:19

Yes, the bill ties the license to participation in specified competitions, essentially the established pyramid. The idea is you can't operate a licensed club in a prohibited breakaway league.

Unknown: 5:31

Music

Speaker 01: 5:34

Now, this suitable owners and officers point, how does that compare to the current system?

Speaker 02: 5:39

Well, currently, the leagues The Premier League, EFL, and the FA administer their own owners' and directors' tests. They mainly focus on disqualifying conditions, criminal convictions related to dishonesty, previous involvement in insolvent clubs, that sort of thing.

Speaker 01: 5:54

But there have been criticisms.

Speaker 02: 5:56

Yes, concerns about how robust they are, whether they dig deep enough, and whether the league's policing themselves is truly independent.

Speaker 01: 6:02

So the bill creates a new system under the IFR.

Speaker 02: 6:04

Correct. Prospective owners and officers will need what's called an affirmative determination of suitability from the IFR before they can take up their roles.

Speaker 01: 6:12

So they apply to the IFR?

Speaker 02: 6:14

Yes. Applicants provide information, and the IFR assesses them based on honesty, integrity for officers, also competence for the role, and financial soundness.

Speaker 01: 6:26

Financial soundness of the individual. Or

Speaker 02: 6:28

the entity seeking to own the club, yes. Ensuring they have the means and a sound financial background. The IFR can make detailed rules about this process.

Speaker 01: 6:37

Can clubs notify the IFR about potential new owners?

Speaker 02: 6:40

Yes. There's a notification process for prospective owners and officers. And the bill distinguishes slightly between tests for individuals and for, say, registered societies like fan-owned clubs.

Speaker 01: 6:52

What about existing owners and officers? Can the IFR look at them?

Speaker 02: 6:55

It can, yes. If concerns arise about incumbent owners or officers, the IFR can make determinations about their ongoing suitability.

Speaker 01: 7:04

And if the IFR thinks someone isn't suitable?

Speaker 02: 7:06

There's a process. The individual gets a chance to make representations to argue their case before a final negative determination. But if found unsuitable, the IFR has strong powers. It can disqualify them and issue removal directions. Basically, kick them out.

Speaker 01: 7:22

What happens to the club, then?

Speaker 02: 7:23

The bill allows the IFR to appoint interim officers or even trustees to ensure the club can continue operating while new suitable people are found.

Speaker 01: 7:31

And everyone has to cooperate with these interim managers.

Speaker 02: 7:34

Yes, there's a duty to cooperate fully.

Speaker 01: 7:36

Okay, moving on to protecting heritage. What specific duties do clubs have here?

Speaker 02: 7:41

Well, first, the duty not to operate a team in a prohibited competition that reinforces the anti-breakaway league measure. And the IFR has a process for deciding if a competition should be prohibited involving consultation with fans and the FA day.

Speaker 01: 7:56

What about the physical home of the club?

Speaker 02: 7:58

Big one. Clubs have a duty not to change their home ground without getting IFR approval first. No moving the club miles away without oversight.

Speaker 01: 8:08

And financial distress.

Speaker 02: 8:09

Clubs, even formally regulated ones, can't appoint an administrator, which is a formal insolvency process, without prior IFR approval. The regulator wants to be involved before that stage if possible.

Speaker 01: 8:20

And the really core identity stuff. Badges, colors.

Speaker 02: 8:24

Yes, clubs will have a duty to consult their fans on any proposed changes to significant heritage matters.

Speaker 01: 8:30

Such as?

Speaker 02: 8:31

The club emblem or crest, the colors of the home shirt, the club's name itself. And after consulting fans, they still need IFR approval for the change.

Speaker 01: 8:39

So fans get a say, and the regulator gets a final check.

Speaker 02: 8:43

That's the idea. Clubs also have a duty to keep fans informed if they are facing insolvency proceedings. Plus, licensed clubs must publish that personnel statement we mentioned earlier for IFR approval.

Speaker 01: 8:56

Do the leagues, the competition organizers, have duties too?

Speaker 02: 8:59

They do. They have to notify the IFR about significant risks they identify, about clubs breaching rules, and about any proposed changes to their own rules, and consult the IFR on those changes.

Speaker 01: 9:11

Okay, let's talk money. The distribution of Premier League revenue is always a hot topic. Does the bill force a deal?

Speaker 02: 9:17

Not directly force one, but it creates a backstop. This was a key recommendation for the fan-led review. Basically, if football can't agree on a financial distribution deal between the Premier League and the EFL, the regulator might get involved. The bill gives the Secretary of State the power, not duty initially to make regulations about revenue distribution, but only if the IFR advises that there isn't a sufficient agreement in place between the relevant parties, like the PL and EFL.

Speaker 01: 9:44

So the IFR triggers it.

Speaker 02: 9:46

Either the IFR believes there's no agreement after a certain period, or a competition organizer, say the EFL, could apply to the IFR asking it to consider stepping in. If the IFR agrees the conditions are met, it advises the Secretary of State.

Speaker 01: 10:02

Who then consults before making regulations.

Speaker 02: 10:04

Yes, consults the IFR, the FA, and the competition organizers. And any regulations would need parliamentary approval. The affirmative procedure, usually.

Speaker 01: 10:13

What about parachute payments, the money relegated clubs get? Are they part of this?

Speaker 02: 10:17

That's been debated a lot. The bill doesn't explicitly exclude parachute payments from being considered within the overall distribution picture, so potentially yes. The IFR would have a process to assess any distribution proposals put forward by the leagues and could potentially impose a solution through a distribution order if triggered via the Secretary of State.

Speaker 01: 10:36

Right. So if clubs or individuals break these new rules, what teeth does the IFR have? Investigations? Enforcement?

Speaker 02: 10:42

Yes, it has significant powers. It can gather information demanding documents and answers through information notices. It can formally open investigations into what the bill calls relevant infringements, basically, breaches of the act or the IFR's rules.

Speaker 01: 10:57

Is it always a full investigation?

Speaker 02: 10:58

Not necessarily. The IFR can also accept commitments from a club or individual to put things right instead of pursuing or completing an investigation.

Speaker 01: 11:07

But if they do find a breach...

Speaker 02: 11:09

Then there's a range of enforcement actions. Warning notices, formal decision notices, setting out the breach, and any penalty. Penalties can include substantial financial fines. And for very serious breaches, the bill even creates some criminal offenses.

Speaker 01: 11:22

Wow, criminal offenses.

Speaker 02: 11:24

In specific serious circumstances, yes. The IFR can also issue urgent directions if needed to prevent immediate harm.

Speaker 01: 11:31

Will these decisions be public?

Speaker 02: 11:33

Yes, there's provision for publishing warning notices, decision notices, and urgent directions. Transparency is intended.

Speaker 01: 11:40

And appeals. Can clubs challenge the IFR?

Speaker 02: 11:43

Yes, there's an appeals process. Certain decisions are classed as reviewable decisions. First step is usually an internal review by the IFR itself. If the club is still unhappy, they can appeal to the Competition Appeal Tribunal, which is an existing specialist body.

Speaker 01: 11:59

OK, nearly there. Yeah. Any other general points in the bill worth noting?

Speaker 02: 12:03

Just a couple. The secretary of state is required to review the effectiveness of the act within five years of it coming into force. Standard practice for major legislation. And as you often find, there's detail on the parliamentary process itself, how bills pass through the commons and lords, dealing with amendments, royal assent and so on.

Speaker 01: 12:22

So quite a comprehensive attempt to reshape football governance.

Speaker 02: 12:25

It certainly is. It touches on finance, ownership, heritage, fan engagement. It's potentially transformative if it passes in this form.

Speaker 01: 12:34

Its goal seems to be bringing more stability and accountability, addressing those long-running worries.

Speaker 02: 12:39

That's the ambition. balancing financial health with the cultural importance of clubs, and giving fans a proper stake.

Speaker 01: 12:46

And the next step is the second reading in the Commons. It'll be fascinating to see the debate there.

Speaker 02: 12:50

Absolutely. There will likely be arguments about the detail, the scope of the regulators' powers, the impact on investment. It's far from over.

Speaker 01: 12:59

As always, check out the episode notes for more details on today's topic. Find us on social media at BenchReportUK. Take care.