Government report states the FA needs urgent reform

Fri 29th Jul 2011 | Football Governance

The Football Association (FA) needs urgent reform in order to tackle pressing problems in English football, say MPs in a report released today.

In a major report released today, the Commons Culture, Media and Sport Committee says big changes need to be made to the way football is run in England to address financial instability and levels of debt in the game, and to secure its future.

Crucially, reform must be undertaken without impinging on English football's many strengths. The Football Association (FA) as the national governing body of English football is the most appropriate agency to take the lead in addressing the weaknesses of English football, but it needs urgent reform itself to carry out its responsibilities effectively and meet the future challenges of the game.

The Committee recommends:

• Imposing a rigorous and consistent formal licensing model throughout professional English football to promote sustainable forward-looking business plans and underpin self-regulation measures introduced by the Premier League and the Football League, and financial fair play regulations being introduced by UEFA.

• A strong fit and proper persons test consistently applied, with a presumption against selling the ground unless it is in the club's interest. The Committee says "there is no more blatant an example of lack of transparency than the recent ownership history of Leeds United" and urges the FA to investigate if necessary with the assistance of Her Majesty's Revenue and Customs.

• Abolishing the Football Creditors Rule:  the Committee says it "epitomises the extent to which financial priorities are being distorted" and recommends that if the HMRC fails in its legal challenge to the rule, and football authorities do not address it, Government should consider scrapping it through legislation.

• Amending the Financial Services and Markets Act 2000 to recognise the special nature of supporters trusts and help them overcome the significant legal and bureaucratic hurdles they face when raising funding - the Government should also consider legislation to protect minority supporter stakes where they are facing a compulsory purchase order.

• That the FA should review expenditure at the grass roots, with a particular emphasis on coaching education.

The Committee recommends urgent reform of the Football Association itself before it can take on the challenge of addressing the problems of English football.  Specifically, the Committee says:

• The FA board should number ten, consisting of the Chairman; the General Secretary; two further FA executive staff; two non-executives; two professional game representatives; and two national game representatives.

• The reconstructed FA Board should reconsider whether the 50:50 divide of surplus revenues should be scrapped to allow it to take strategic decisions regarding the distribution of FA funds, and whether the National game Board and Professional Game Board promote strategic decision-making.

• The FA should review the composition of the FA Council to improve inclusivity and reduce average length of tenure, with the reformed Council absorbing the shareholder role.

John Whittingdale MP, Chair of the Committee, said: "No one doubts the success of the Premier League in revitalising English football.  But it has been accompanied by serious financial problems throughout the football league pyramid. Significant changes need to be made to the way the game is run to secure the future of England's unique football heritage, and the economic and community benefits it provides.

"The FA is the organisation for the job, but it has some way to go getting its own house in order before it can tackle the problems in the English game, and address the future. We need a reformed FA to oversee and underpin a rigorous and consistent club licensing system and robust rules on club ownership, which should be transparent to supporters.

"Almost all our recommendations could be achieved without legislation, through co-operation and agreement between the football authorities, and we urge them to respond positively with an agreed strategy and timetable for change. Legislation should considered only as a last resort in the absence of substantive progress."

F.C. Business Editor, Ryan McKnight welcomed the report's recommendations.

“The recommendations of the CMS committee are welcome but are not anything that hasn’t already been discussed within the corridors of football over the past few years.

However, he was cautious of the point to scrap the football creditors rule:“Whilst we welcome the further promotion of a stabilisation of supporters’ trusts and a more rigorous ‘fit and proper persons test’ we take exception to the football creditor’s ruling proposed change.”

“The Premier League have already introduced parameters around clubs keeping up to date with HMRC payments and the organic shift from the majority of clubs to be progressively more prudent/responsible towards their creditors justifies keeping a law that cements the sanctity of competition.” 

Click Here to Download the Full Report

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