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The Committee for Culture, Media and Sport and the thinly-veiled threat

October 22, 2011

The Culture, Media and Sport Committee released its report into football governance in the Summer. It seems that the FA have now been set a deadline to implement the reforms, February 2012. So what are the reforms likely to be?

Points 1-5 are all about restructuring of the FA’s Board. This seems to be a desire to change the way that the different levels (grassroots all the way up to EPL) are represented. Part of the idea is bringing some decision-making departments that were ‘bunkered’ away into the main fold of the organisation, but they stop short of advising more than 10 members to the board – in favour of it being more stream-lined that way. The FA Council also has advised reforms that aim to make it like ‘Football’s Parliament’ although what circle of hell that would be I’m not sure.

One of the key aspects of the reforms – the debt in the modern game is discussed next. The report acknowledges the exponential growth and improvement that has happened since the 1980’s (*cough* the PL *cough*); yet also acknowledges that while serviced debt is not always a bad thing, non-serviced debt is toxic, especially when combined with mad things like the Football Creditors Rule.

The report, stating the obvious, that the financial rewards of The Premiership and European Football (CL, not perhaps UEFA) are such a golden carrot that clubs spend up to the hilt to stay in the Premiership and clubs in the Championship spend up to the hilt to get there. This is where the problem lies. All that money, borrowed against not a whole lot, can go arse over tit with alarming alacrity. One often wondered how clubs like Middlesbrough competed at the top when the average capacity in the Championship is under half (at around 16,000). That is how a club derives most of their income in the Championship and it certainly remains vital in the PL (look at QPR’s ticket price hike and subsequent reversal).

And it is that income that forms the cornerstone of UEFA’s Financial Fair Play Policy (Michel Platini, j’taime). Clubs, on a sliding scale for the next few seasons, cannot spent more than they earn. So things like matchday revenue will become even more vital, especially for those clubs who are held up by rich owners, perhaps without the fanbase that a ‘big club’ enjoys (sorry Wigan…).

This is what forms conclusions 16 and 17 – thanking the Football League for adopting a version of the Financial Fair Play rules (in principal). Excellent news for clubs like Leeds United, bad news for Leicester (I would love to know if they spend more than any PL club).

Talking of Leeds United, however, a club especially close to my heart, point 23 attacks the opaque club ownership that can often allow the owners of clubs to walk away unscathed after decimating a club’s reputation, league position and fanbase. We all know the trials and tribulations of Ken Bates in charge(???) of Leeds for the past few years, and how long that saga will rumble on and to what result it will deliver will be unknown for many months to come I believe.

This all brings us to the Football Creditors Rule. Which allows a club, when in administration, to only pay 100% of it’s debts to football-related parties (players, other clubs). It means local business often lose out on vast sums of money for them that might be paltry to a top player’s salary. They can sometimes only get a few pence in the pound of what they are owed.

These are some of the more major recommendations for reforms, although there are others. What will the future hold for this? It seems that after February, we will know. The threat is that if the FA don’t sort it, legislation will. Will that be a desirable outcome? God knows. All I can offer is that although it is an important issue, and perhaps a wonderful mirror to hold up to the rest of the country’s finances, the Government surely have more important things to do, like taking your mate away on business, throwing confidential documents in a bin or making things up…

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