Manchester City, Manchester United, Newcastle United: The impact government regulation will have on the Premier League and English football
AWAY GOALS RULE - The UK government revealed plans in February for an independent regulator to take control of football in the country. Let's take a look at what that will mean for the Premier League
English football’s greedy free market thinking has reached a boiling point even this British government can no longer tolerate.
A report regarding regulation of the sport titled A sustainable future - reforming club football governance was published on 23 February by the Tory party.
That this UK government in particular has stepped in with a proposal for regulation only shows how far the football authorities have let the sport’s financial stakes ruin many clubs.
This has been a conservative party that has overseen austerity, corruption, economic crises and the disastrous Brexit referendum.
Their policies have only stretched the wealth gap between the highest earners and the rest during their 13 years in control of the UK, lowering the standard of living for much of the population.
And just this week, current — cannot emphasise this enough, as of writing — Prime Minister Rishi Sunak announced a bill to deport asylum seekers without considering their claims, which the UN branded a “clear breach” of international law.1
With this in mind, it is hard to reconcile English football’s need for independent oversight with the actions taken by this conservative government.
Why regulation is needed
While English football has thrived without government involvement for well over 100 years — the Premier League has grown into the most profitable and economically successful football league on the planet — that success has also led to issues elsewhere.
The report quotes a figure of 60 cases of clubs going into administration since 1992, with the likes of Bury and Macclesfield Town ceasing to exist as a consequence.
The great strength of the Premier League comes from the fair distribution of the billions earned every year in broadcast revenue among its 20 members.
But the remaining clubs across the country don’t see a cent of it.
The only way that money gets pumped back into the lower divisions has been through transfer fees, which has created an uneven distribution platform that the EFL has been seeking to change for several years in order to form a fairer and more sustainable playing field.
A lack of agreement between the Premier League and the EFL has led to calls for an independent third party to step in and resolve the issue.
The threatened breakaway to form a European Super League from the top division’s Big Six in April 2020 only further strengthened the argument in favour of independent regulation given the fervent fan backlash against this idea.
These factors have led the government to lose all faith in the industry to regulate itself, causing them to decide to step in.
What the proposal entails
The government’s proposal is focused primarily on the sustainability and financial regulation of the men’s game, opting to ignore other important issues such as inequality, player welfare, the women’s game or the role of agents.
A hands-off approach can be expected, with a key line reading: “The Regulator will operate an ‘advocacy-first’ approach to regulation, but with the power and mandate to intervene swiftly and boldly when necessary.”.
Direct action is being seen as a last resort in the event that agreements cannot be reached with the authorities over the direction for regulation in the future.
This isn’t a very striking stance for the government to take but hardly a surprising one given its hands-off approach to the country’s own economic policies.
Impact on football ownership
However, it is willing to take a more hands-on approach to football ownership, with a stricter owners and director’s test set to be put in place.
Yet it does not go far enough in this regard.
The current system already has checks and balances in place to ensure the legitimacy of prospective owners, albeit further strengthening of that process is welcome.
But there is no clear indication that The Regulator will bring greater transparency to future takeovers in the interests of supporters.
Also, while the report does reference the importance of fans, it does not offer a concrete route to bringing power back to the people in the form of fan ownership.
State-backed club ownership
Last month, the Premier League announced over 100 charges against Manchester City in regards to alleged fraud which could see them face a severe punishment.
The timing was suspicious, but this was the culmination of over four years worth of investigating.
Right as the UK government was making its first in-roads on regulating the running of the sport in their country, the Premier League took a stand against a controversial ownership that has been in place since the late 2000’s.
While trophies have come under the ownership of the Abu Dhabi-led group, much mystery has surrounded their financing of City, leading to plenty of scrutiny regarding the source of the club’s state-backed wealth.
This is the biggest test of whether the Premier League can adequately regulate itself, and a situation that the government will no doubt be keeping a keen eye on as it formalises the process of creating The Regulator.
The ownership of the club by a nation state has been incredibly harmful to the game, but there is no detail regarding this aspect of football in the report at all, which is wholly inadequate.
Similarly, Saudi Arabia were welcomed with open arms by the league when they sought ownership of Newcastle United.
When the deal was finalised, the Premier League released a statement claiming they had received “legally binding assurances” that the Public Investment Fund of the nation had no connection to the state.2
A ludicrous assertion.
And it was only in recent weeks that PIF showed what kind of farce that statement was.
The club’s chairman Yasir al-Rumayyan was described in a US court last month as “a sitting minister of the Saudi government.”
Not only that, but the PIF was described as “a sovereign instrumentality of the Kingdom of Saudi Arabia.”3
These two incidents happening so close together, as well as Qatar’s attempt to purchase Manchester United, only highlights even further how absurd the English government’s oversight of this issue is in this report.
Conclusion
The arguments in favour of the regulation of football are strong, but this report should just be seen as the beginning of that process.
Creating a fairer distribution of wealth to ensure greater sustainability, as well as making more stringent owners and directors tests, is all well and good but more urgent issues need to be tackled before the overall health of the sport can be considered to be in good shape.
Preventing clubs from breaking away from the existing league structure is perhaps the strongest step taken from this report and should be welcomed by fans across England.
However, not creating a pathway to fan ownership in some form is a total failure by those involved in the creation of The Regulator, and its inability to tackle state ownership of the likes of Man City and Newcastle is a huge oversight.
Other aspects of the game, such as ticket prices, affordable travel for away support, women’s football, grassroots funding and player welfare have all been ignored.
This is the tiniest form of a step forward, but at a time where scrutiny of the Premier League is at an all-time high, more steps will need to be taken to address the health of the game as a whole.
Much like a lot of government policy under the current Tory rule, this White Paper is found wanting regarding solutions to fix many of football’s current issues.
The White paper can be found here.
Source: The Independent
Source: Breakingnews.ie