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Proposal to set up Football Finance Authority to save clubs

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Proposal to set up Football Finance Authority to save clubs

Postby Tippy Tappy Football » Sun Jun 07, 2020 10:12 am

A letter from Damian Collins MP, former Chair of the Digital, Culture, Media and Sport Select Committee, former FA Chairmen (Lord Triesman and Greg Dyke), League 1 and 2 MPs, the Football Supporters Federation and the Sunderland co-owner and Grimsby Chairman regarding setting up a Football Finance Authority (FFA) to help save League 1 and 2 clubs.

The proposals include allowing the FFA to take shares in clubs which they can sell on to Supporters Trusts. The EFL's financial regulations in the future would then be set and enforced by the FFA which would have an independent majority. If clubs do not follow the financial rules then the FFA could put them into a form of administration where a credible plan would be implemented by independent auditors to bring the financial affairs of the club back in line with the League’s rules.


Dear Oliver, Greg, Rick,

We may only have a few weeks to save professional football in this country as we know it.

The shock of the COVID-19 crisis has badly exposed the weak financial position of clubs in the English Football League (EFL), many of whom were already on the edge of bankruptcy.

For clubs in Leagues 1 and 2 in particular, the loss of match day revenue and money from the sale of season tickets is a major blow that some will not be able to survive. We want to see football return as soon as possible and for the current season to be completed in the divisions above League 2. Without matches being played, the salary costs of clubs are too high to make it viable for them to mothball their operations, even if the existing government support and furlough schemes continue. We do though need to address the fact the clubs would have to incur costs by taking staff out of furlough in order to resume training and matches, but without receiving match day revenue. Also, the cost of the COVID-19 testing protocols needed to ensure the safe return of players and staff will cost clubs around £140,000 each, a significant figure for some in the lower leagues, given the circumstances they face. Overall, if nothing is done to provide financial support to football, clubs with old and famous names will almost certainly go into administration within weeks.

More communities will go through the agony that Bury suffered last year and see a beloved cultural and sporting institution taken from them. We will also see the release of up to 1,400 players who will fall out of contract this summer. There is a great urgency now for an agreement on a rescue package for clubs in distress, and this will require the resources both of the football authorities and the government. However, this should also recognise both the short-term requirement for cash and the longer-term need for much greater oversight and regulation of the financial affairs of the clubs, including the opportunity for more supporters and communities to acquire a stake in them. Without this any bailout scheme will only be a short term fix. This would also complement the government’s existing manifesto commitment to a ‘fan-led review of football governance, which will include consideration of the Owners' and Directors'
Test.’

We would urge you to convene talks for as soon as possible to agree measures that can be put in place to save clubs from bankruptcy and expulsion from the League. We would also ask you to consider the following six-point plan as the
potential solution to this problem.

1. A ‘Football Finance Authority’ (FFA) scheme should be created by the Football Association - but working with and backed financially by the government - to provide financial assistance to EFL clubs.

2. Funds should be provided by the FFA to allow clubs to meet their short-term liabilities and provide them enough breathing space to restructure their finances but couldn’t be used to invest in recruiting new players or improving the club’s infrastructure. Rather than being offered as loans these funds would instead be exchanged for a minority shareholding in the club, of between 10% to 49% depending on the level of investment required and the value of the club.

3. Independent directors would be appointed to the boards of clubs as representatives for this minority shareholding. These directors can be nominated by either a registered Supporters Trust or by the relevant local government authority, but they must be non-political and subject to approval as Fit and Proper by the FFA.

4. These Independent Directors shall have real time access to the financial records of their club and can report their concerns back to the FFA. Clubs that continue to trade outside the rules of the EFL would be put into a form of administration by the FFA, where a credible plan would be implemented by independent auditors to bring the financial affairs of the club back in line with the League’s rules.

5. Either a recognised Supporters Trust or a local authority can subsequently acquire the FFA shareholding in their club at a discount to market value, and funds raised in this way would be returned to the government to help repay the public investment in this scheme.

6. The EFL’s financial regulations should be set and enforced by the FFA, the governing body of which should include representation from the EFL, the Professional Footballers Association (PFA), the Football Supporters Association (FSA) and the clubs themselves, but with an independent majority.

Damian Collins MP, former Chair of the Digital, Culture, Media and Sport Select Committee
Dr Malcolm Clarke, Chairman of the Football Supporters Association
Charlie Methven, co-owner of Sunderland Association Football Club
Philip Day, Chairman of Grimsby Town Football Club
The Lord Triesman, former Chairman of the Football Association
Greg Dyke, former Chairman of the Football Association
Ian Mearns MP, Chair of the All-Party Parliamentary Group for Football for Football Supporters
Clive Betts MP, Chair of the All-Party Parliamentary Group for Football
The Rt Hon Damian Green MP, Vice Chair of the All-Party Parliamentary Group for Football Supporters
Jonathan Gullis MP for Port Vale Football Club
Henry Smith MP for Crawley Town Football Club
Carolyn Harris MP for Swansea City Association Football Club
Kevin Brennan MP for Cardiff City Football Club
Rehman Chishti MP for Gillingham Football Club
Chris Green MP for Bolton Wanderers Football Club
Steve Baker MP for Wycombe Wanderers Football Club
Daniel Kawczynski MP for Shrewsbury Town Football Club
Sir David Amess MP for Southend United Football Club
Scott Benton MP for Blackpool Football Club
David Morris MP for Morecambe Football Club
Karl McCartney MP for Lincoln City Football Club
Ian Byrne MP
Rosie Cooper MP
Derek Twigg MP



https://thefsa.org.uk/wp-content/upload ... y_2020.pdf
Last edited by Tippy Tappy Football on Sun Jun 07, 2020 1:51 pm, edited 4 times in total.
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Re: Proposal to set up Football Finance Authority to save cl

Postby Sandy Pate Best Stag » Sun Jun 07, 2020 11:12 am

How would this work for clubs promoted from the National League? Presumably it would be a condition of league membership to have this in place to ensure fair play all round so would promoted clubs have to sell shares before they can be promoted?

The same thing applies to relegated clubs, can they continue as members when they are no longer in the league or will they need to buy the shares back at a time when money is presumably tight?

Would clubs who are already owned by supporters trusts be exempt? Also would it prevent rich owners investing as much into their clubs if they don't have complete control?

It appears to be a lifeline for clubs who are poorly run and short of money but I can't see many advantages for clubs who are financially secure and ambitious.
Who are you calling pedantic? I resemble that remark!
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Re: Proposal to set up Football Finance Authority to save cl

Postby Sandy Pate Best Stag » Sun Jun 07, 2020 11:19 am

Having read this again I am not sure if this scheme would be compulsory for all clubs so my points above may not be valid if it isn't. That said if it's not compulsory isn't it giving an advantage to poorly run clubs?
Who are you calling pedantic? I resemble that remark!
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Re: Proposal to set up Football Finance Authority to save cl

Postby Jimstag » Sun Jun 07, 2020 11:34 am

Sandy Pate Best Stag wrote:Having read this again I am not sure if this scheme would be compulsory for all clubs so my points above may not be valid if it isn't. That said if it's not compulsory isn't it giving an advantage to poorly run clubs?


Good question. Short-term Id day yes in that this would propose some sort of bail out, it would be interesting if there was a repayment requirement at some stage?

Longer-term they would have to comply with the management rules and become better run or risk being kicked out of the league.

One question for me is whether clubs have to get to that point before the rules kick in? I’d say it should become mandatory for all clubs and this body can then regulate the league otherwise club could gamble even more knowing there is a safety net in place.

The big one for me is how this will be funded short-term? I know there’s talk in the proposal about government funding but is this realistic?
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Re: Proposal to set up Football Finance Authority to save cl

Postby I am Spartacus » Sun Jun 07, 2020 6:28 pm

A former Chairman of DCMS, and two former Chairmen of the FA and the Chairman of Sunderland. How self absorbed are these people and how deluded do they think we are? What an absolute embarrassment and shower of failed leadership.

The former Chairman of the DCMS and the two former FA chairman have all been in position, of ultimate responsibility for football and have not grasped the nettle to instigate reform and enact change. Throughout their ‘reigns’ they have prevaricated and acquiesced to the Premier League. Happy to be cuckolded and take the scraps from the Premiership table to fund their initiatives whilst the EFL, non-league and adult football diminished. These are the same people that financially avaricious clubs have pulled their pants down and shoved a white feather right up season after season.

Thanks lads, but stating the blatantly obvious after you have left a real mess that affects communities day after day, does not make you the sort of person I would seek to receive advice from.

As for the Sunderland Chairman, how much of the former Premier League and TV has his club spunked away in the last ten years? It is way above £200 million. If Sunderland were in a higher position than they are in now and a better financial position they would not be putting their name to the letter. Also I hope JR does not make such a mess of the Season ticket refund for this season and the issuing of next seasons as Sunderland have.

We don’t need the same tired old people, ‘specialists in failure’ as Mouriniho would call them back at the helm. We need a fresh, bold, energetic and forward thinking leadership not the blazers and yesterday’s problems.

I don’t know, off the top of my head who I would want at the helm, for the kind of people that really get things done do not aspire to court publicity. But they are out there and are the people that football needs.

If we don’t get them we could end being led by a Piers Morgan wannabe or worse still, Piers himself!

Good evening by the way and remember that the revolution will be televised.
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Re: Proposal to set up Football Finance Authority to save cl

Postby I am Spartacus » Sun Jun 07, 2020 6:46 pm

The regulatory and governance framework needs to Be fluid enough to enable transition from the non-league to lifting the European Cup. Though with enough teeth to ensure that the rules are not broken and that attempting to circumnavigate the spirit of the rules such as Nation States owning a club with their ‘sponsorship’ to buy a league title, Premier League clubs already trying to ensure that they can still buy under 18 boys from abroad For their ‘community youth set ups’ after Brexit takes effect, Steve Dale not entering into the Fit and Proper persons test and a Haslam entering into ownership don’t happen again.

There are ‘old school values’ that need enshrining for the game to remain the game we all fell in love with though there are the new values of Stakeholders engagement and financial moderninity that need to be incorporated. The 10 yr old kicking a ball against a wall, dreams of playing at Wembley, though more often than not will never get there unless as a spectator. The rules need to make sure that the dream is kept alive and football is a game for the heart, soul, body as well as the bank balance of the few.

Community ownership is a buzz term that failed administrators and politicians use as part of ‘smoke and mirrors’ to get their ideas past the public. Do you want part ownership like they do in Germany where Bayern Munich win everything? There has to be a better way. There is the will, I hope in football to achieve this Nirvana, though will it overcome the will to maintain the status quo of a closed shop at the top?

Cancel your Sky subscription, it’s not much buts it’s a start. As not all the revolution will be televised.
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Re: Proposal to set up Football Finance Authority to save cl

Postby garlic » Sun Jun 07, 2020 8:23 pm

After you earlier rant , Spartacus, you finally began to give some thought to a structure that could work for no-league to Premier league. Personally i dont think the Premier League give a fig about football and are now totally consumed with tv and finance, which leaves the rest of us to sort something out for ourselves, and given that the vast majority of football clubs are in debt and dependant on a single financial backer, getting a consolidated agreement that curtails their power and ability to write off debts through football aint gonna be easy. So I would start with not allowing football clubs to become vehicles for writing off debt, so all investment has to be in the form of shares with no tax relief. Secondly, there has to be an agreed debt to investment ratio which cannot be breached. Thirdly, any club that goes into administration has to offered for sale at a cost no higher than 15% of it`s debt to the Supporters Trust. This should make all investors, financial backers etc very wary of dodgy owners. But hey, who gives a fgig what we think,only the tv companies matter now.
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Re: Proposal to set up Football Finance Authority to save cl

Postby arsene wengers coat » Sun Jun 07, 2020 9:36 pm

Talk of bail outs and gvt funded loans to prop up shoddily run business, thinly veiled as a hub of the community.

I mentioned a few weeks ago that this post-capitalist era of artificially supporting clubs was a bit odd on the wage cap thread. Premier League and championship clubs will be ok, they can be bankrolled by the Saudi's... So why do the fa care about the game? They don't, they care about the FA. Wage caps and bailouts to L1&2 is not a revolution if it doesn't apply to all clubs. If anything, these restrictions and bailouts just look to prop up poorly run clubs while the wealth and quality gap increases by not be applied at all levels.

The FA need to take affirmative action on all leagues and all clubs, or simply leave the market to dictate which clubs survive. Not this self-serving hinterland.

Its like Animal Farm, when the pigs who overthrew their past masters, the humans, start to resemble humans. The Seven Commandments are abridged to just one phrase: "All animals are equal, but some animals are more equal than others." The maxim "Four legs good, two legs bad" is changed to "Four legs good, two legs better." The lead pig holds a dinner party for the pigs and local human farmers, with whom he celebrates a new alliance. He abolishes the practice of the revolutionary traditions and restores the name "The Manor Farm". The men and pigs start playing cards, flattering and praising each other while cheating at the game. When the animals outside look at the pigs and men inside, they can no longer distinguish between the two.
You've got to go there and come back, to know where you've been.
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Re: Proposal to set up Football Finance Authority to save cl

Postby Tippy Tappy Football » Sun Jun 07, 2020 11:06 pm

The Bank of England has provided a £175 million loan to Tottenham Hotspur under the UK government’s Covid Corporate Financing Facility. The owner of Tottenham, Joe Lewis, lives in the Bahamas which is a tax haven.

https://www.taxwatchuk.org/ccff_companies/
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Re: Proposal to set up Football Finance Authority to save cl

Postby garlic » Mon Jun 08, 2020 7:33 pm

Tippy Tappy Football wrote:The Bank of England has provided a £175 million loan to Tottenham Hotspur under the UK government’s Covid Corporate Financing Facility. The owner of Tottenham, Joe Lewis, lives in the Bahamas which is a tax haven.

https://www.taxwatchuk.org/ccff_companies/

You couldnt make up how sick this current govt is. Everywhere else in Europe government funds are targeted at companies that are tax registered locally, have a definite climate change agenda and have decent employment practises. Every government bar ours.
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Re: Proposal to set up Football Finance Authority to save cl

Postby I am Spartacus » Tue Jun 09, 2020 10:56 pm

Breaking news, financial basket case club Sunderland, won’t be able to waste any Premier League parachute payment money next season.

Though that won’t stop them being holier than the rest of the EFL when it comes to implementing change.

And in other news, lots of broken glass in greenhouses in Sunderland.
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