Is English football in crisis? Is the game at the edge of a precipice? That’s the view of the report of the Fan Led Review of Football Governance, published last November.
The proposed solution is a new regulator with wide ranging powers to license and regulate football clubs in the top tiers of the game. Adding a new oversight body to the regulatory structure would be costly and onerous, and the assault on the property rights of owners would deter investment in the game, driving the opposite outcomes to those intended.
The review was set up in the wake of the collapse of Bury Football Club, together with the abortive European Super League and the disruption caused by the pandemic, described as the three crises of the professional game in England. The then culture secretary Oliver Dowden who set up the review, accused clubs of putting “money before fans”, while the “People’s government” was “unequivocally on the side of fans”.
Unfortunately the proposals of the review, drafted by Conservative backbencher Tracey Crouch MP, put it firmly on the side of technocrats.
Undeterred by the results of the three crises (Bury’s football club has re-formed and is thriving), the review put forward a regulatory system modelled on financial services regulation, with a licensing regime and detailed requirements on the conduct of business. But financial services is a huge multi-billion pound industry, while most professional football clubs are SMEs relying on local business people and volunteers. There are also clear economic reasons for regulating financial services, or industries like energy and water, to counter market failures and systemic risks. But regulation has not insulated financial services and energy markets from crises, and they suffer from a lack of competition. This should have been a warning sign.
The review is coy about the implications of its licensing regime. It talks about an indepedent regulator having powers to take over stewardship or control of a club that violates its licence conditions. It would deprive the existing football authorities of autonomy in running their competitions – but does not seem to face up to the implications that this would have for the financing of a club. The experience of Chelsea after its owner Roman Abramovich was sanctioned gives us a clue as to the acrimony and instability following private owners being cut out and regulators taking over.
Far from levelling the playing field, the regulatory structure would make it harder to challenge the current premiership giants. The big clubs will be able to absorb the additional costs; smaller clubs that operate on tight budgets might struggle. Any potential new owner considering investing to turn around the fortunes of their local club might think twice at the prospect of being caught up in attritional battles with fan committees for every change they want to make, and losing it all if the regulator doesn’t like their business plan.
The idea of a body to protect the community spirit and heritage of football clubs is appealing. But in reality, the interests of owners and fans- who favour financial caution and governance over drama, romance and expensive players – might be more aligned than the interests of regulators.
There is no doubt that the FA has fallen short in its governance of the game and needs to do better, but the heavy hand of a state regulator is not the way forward. I shudder at the thought of a game overseen by the FCA of sport.