The dangers facing English league clubs are “very real”, with key aspects of the nation’s game “at genuine risk”, says the chair of a fan-led review commissioned by the government.
Former sports minister Tracey Crouch has written to Culture Secretary Oliver Dowden to propose a series of measures.
This includes an independent regulator to “protect the future of our game”.
The review has heard over 100 hours of evidence from fans, the Football Association and clubs at all levels.
“The evidence has been clear that football clubs are not ordinary businesses,” wrote Crouch. “They play a critical social, civic and cultural role in their local communities.
“They need to be protected – sometimes from their owners who are, after all, simply the current custodians of a community asset.
“Key aspects of our national game are at genuine risk. The short-lived threat of the European Super League jeopardised the future of the English football pyramid.
“While that threat has receded – for now – the dangers facing many clubs across the country are very real with their futures precarious and dependent in most cases on the willingness and continuing ability of owners to fund significant losses.”
The measures proposed by Crouch include:
- A new independent regulator to address issues that are most relevant to the risks to the game, especially financial regulation, corporate governance and ownership.
- Further work over the summer to ensure greater fan engagement and influence at all levels of governance in the game.
- Suggested potential reform at the Football Association, the Football League and the Premier League, with a recommendation that at least 50 per cent of the FA board be composed of independent non-executive directors.
- Greater protection for important club assets such as badges, location and colours, through a ‘golden share’ for supporters that provides them with veto powers.
- Further investigation over the summer on revenue flows within the football pyramid, including ‘parachute payments’.
- Calls for a joined-up approach from the football authorities to improve player welfare, particularly with regard to players released from the academy system.
- Allowing clubs to operate all-weather pitches in League Two to help with generation of revenue in lower leagues.
- Suggestion that the English Football League (EFL) enter discussions to absorb the National League top division into the EFL structure.
- Possibility of a levy on transfer or agent fees to support the development of the grassroots, amateur and women’s games.
- A separate review into the future of women’s football following “varied” evidence on the best way forward.
Crouch will issue her final recommendations in the autumn.
‘English football facing existential crisis’
The review was promised as part of the Conservatives’ 2019 General Election manifesto and commissioned early after the foundation and swift collapse of the Super League in April.
Crouch highlighted Deloitte figures from 2018-19 – before the impact of the coronavirus pandemic – which she felt underlined the perilous state of many clubs’ finances.
She pointed out that nine Premier League clubs were reported to have made pre-tax losses that season, and eight clubs had wage-to-turnover ratios over 70 per cent.
In the same season all but two Championship clubs made pre-tax losses and the average wage-to-turnover ratio was 107 per cent.
“It is sobering to consider that these numbers are the end result of a long period in which football had been growing revenues to record or near record levels,” she wrote.
“The threat of possible future reductions in income expected as the broadcast market diversifies indicates that, without reform, English football could face an existential crisis in years to come unless pre-emptive action is taken now.”
Football authorities have “lost the trust and confidence” of fans, she added, as had a number of clubs.
She said the authorities had been issued with repeated warnings in the past which had not been heeded, and “therefore it is now time for external assistance”.
Crouch also said the game’s governing bodies had not succeeded in delivering sufficiently on the equality, diversity and inclusion agenda.
‘Fan voices have been heeded’
Dowden welcomed Crouch’s recommendations and said: “We’ve seen this year with the failed European Super League proposals and Euro 2020 how central football is to our national life.
“I’ve been clear that now is the time to take a wide-ranging look at reform of the game. I will not hesitate to take bold steps where necessary.
“I am grateful to the chair and panel for their update on the fan-led review. I look forward to receiving the final report and recommendations in the autumn.”
The Football Supporters’ Association (FSA) welcomed the update, and its chief executive Kevin Miles said: “It’s clear from the preliminary report that not only has the evidence been led by fans but also that those fan voices have been heeded.
“The commitment to the establishment of a new independent regulator for English Football is especially welcome.
“Additional proposals linked to the sustainability of the game, golden shares for fan groups, grassroots investment, mandatory supporter engagement and a strong voice for fans in governance at all levels, are hugely encouraging.
“We will continue to play a constructive role in the work of the review in fleshing out the detail of the interim proposals. Their full implementation could be a huge step to secure a sustainable future for our clubs, the communities around them, and the wider game.”
‘Supporters play a crucial role in football’
Both the Premier League and EFL welcomed the preliminary findings.
A Premier League spokesman said: “We will now consider the initial update and are committed to supporting Tracey Crouch, the panel and the DCMS team as they finalise their recommendations.
“Supporters play a crucial role in football and clubs have a significant impact in their communities. We look forward to working closely with the FA, EFL and other football organisations on these important issues.”
The EFL said: “We will now consider the recommendations in full, and continue to push for a redistribution of the game’s finances which require a fundamental reset in order to deliver long term sustainability across the pyramid.
“As ever, the league will continue to engage with clubs, authorities, supporter groups, the review team and others as part of the process.”
‘No more Russian roulette with the traditions and history of clubs’
The Fair Game group, which is campaigning for reform of the sport including the introduction of an independent regulator, also reacted positively to Crouch’s recommendations.
“There is a lot to welcome in this letter,” said director Niall Couper. “The need for a new football regulator is now indisputable. Football cannot continue in the same unsustainable way.
“The Premier League is the richest league in the world. Yet, the Championship is the biggest loss-making division in the world, and lower down the pyramid we have seen the collapse of Bury and Macclesfield and many others teetering on the brink.
“This letter concludes that financial flows within the game needs an overhaul. However, redressing the balance cannot be left solely to the leagues themselves – the very organisations that have led us to where we are now.
“English football has become a siren to gamblers. As the letter rightly highlights, too many clubs routinely spend way above recommended levels on players’ wages.
“Owners should no longer be allowed to play Russian roulette with the history and traditions of football clubs.”
‘I don’t want problems, give me some solutions’ – Analysis
BBC Sport football writer Simon Stone:
The initial soundings I have taken from people in the game have been mixed. An independent regulator is something that has been spoken about for so long, by so many, that it is not a surprise.
Issues around distribution of finance and fan involvement have also been well-aired.
There was almost an instruction for the National League to scrap its board composition, which goes back to the acrimony around the league’s chaotic state last season and calls for the resignation of then chairman Brian Barwick, who has now left the organisation.
Reading the review though, I was reminded of something my mum used to say to me as a kid, ‘I don’t want problems, I have plenty of them, give me some solutions’.
For all the well-researched issues raised in Tracey Crouch’s review, the fundamentals remain. Most of the revenue in English football is driven by a collection of leading clubs, all privately owned. The current structure allows them to keep most of it, the rest gets filtered down.
By definition that makes some clubs exceptionally wealthy and other aspects of the game less so. In addition, none of the people running the bodies in question think they are doing a bad job.
As Crouch says, ‘this is just the start’. But she is going to need a lot of determination – and government support – to implement the change many feel is long overdue.