19 March 2024

A football regulator would foul the beautiful game

By Jonathan Eida

Governments that are successful will ultimately rise and fall on good policy. Weak governments will bow to political whims, while others will rise to challenges with bold ideas. The latest push to implement a football regulator is certainly a case of the former. While there is no doubt that millions of voters hold dear the sanctity of the beautiful game, and have concerns about its direction, when you look at the wealth of other policy areas that need attention, a football regulator should surely be last on the list.

We all remember the chaos that ensued when the ‘Super League‘ was unveiled. The airwaves went into meltdown when the announcement was made that the so-called ‘big six’ Premier League teams would be joining a competition. A ‘fan led review’ on the state of football conducted by Tracey Crouch soon followed. Among the recommendations was the introduction of a football regulator. The concerns about clubs joining the league was coupled with a number of clubs claiming bankruptcy including Derby County and Bury. This provoked more anxieties about who runs our country’s clubs and raised questions about the supposedly malign influence of foreign club owners.

Then there were ongoing concerns over the funding mechanisms in the football pyramid, where clubs at the top disproportionately benefit from television and advertising revenue. This undoubtedly questions the integrity of the game.

These are legitimate issues that require good governance to be solved.

However, the necessity for a football regulator is dubious. In fact, it calls to question the purpose of the existing football infrastructure. The Football Association (FA), which governs the English game, is already charged with ensuring that the sport is run to the highest standards. At the end of 2021/22, the FA received over £110m in deferred grants from government bodies such as Sport England and the Department for Culture, Media and Sport. So taxpayers are already footing the bill for an organisation supposedly in charge of governing the game. A new regulator would effectively be doubling the number of the existing institutions.

In all fairness, governance in football over the past decade has moved in a positive direction. For the first time this year, two Premier League clubs (Everton and Nottingham Forest) have faced point penalties after financial mismanagement accusations. Moreover, English clubs already have an ‘Owners’ and Directors’ Test’ that helps to prevent club mismanagement from taking place. There is a fit and proper persons test which prospective owners are subject to, offering a guard for football clubs, preventing criminals and other nefarious actors from controlling the game. While questions have been raised over owners, most recently, the Saudi takeover of Newcastle United, these are broader societal questions relating to foreign influence which shouldn’t apply exclusively to football.

Questions will persist after bankruptcies occurred at several clubs across English football. However, there are currently 72 clubs in the football league, most of which are not under massive financial pressures. But then again, there is a limit to what a regulator can do to mitigate them when they do occur. Take former Derby owner Mel Morris. A lifelong Derby fan and businessman. For most football fans, and no doubt in the eyes of the proposed regulator, this profile represents an ideal management candidate, yet things still went pear shaped.

But isn’t it better to be safe than sorry? Surely we ought to let a regulator come in and cover any bases not previously covered?

To do so would be to ignore the wealth of misery created by regulators in almost every industry. Quangos represent a burdensome, bloated state, which is dragging the country to its knees. Quango mismanagement is rife – a fact that the Taxpayers’ Alliance has repeated ad nauseam. The Centre for Policy Studies has also pointed to issues with giving quangos unchecked power and the adverse effect it has on economic growth.

The immutable rule about quangos is that they never do as they say on the tin. Mission creep is a guarantee, and a regulator for football would be no exception.

But here is the strongest argument against a football regulator. English football is a financial bull right now. There is no sign of it slowing down, quite the opposite – there has never been a more exciting time for football financially. Chelsea Football Club sold for £2.5bn plus a £1.75bn investment pledge to a private equity group. Sir Jim Ratcliffe bought a 27.7% share in Manchester United for £1.31bn with the current Glazer regime unwilling to relinquish full ownership of the club. The reason for all of this is simple. Investors see the potential in English football. Yet politicians, as usual, are behind the curve, and the push for a regulator demonstrates this.

The UK is still in a technical recession. Businesses and industry need room to grow without the government tripping them up at every turn. While the game of course needs good governance, there are mechanisms in place and these existing structures should be strengthened. However, UK sport is an opportunity for economic growth that should be nurtured, not throttled by the grip of a regulator.

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Jonathan Eida is a Researcher at the TaxPayers' Alliance.

Columns are the author's own opinion and do not necessarily reflect the views of CapX.