Liverpool supporters’ group Spirit of Shankly (SOS) recently had the chance to put their views to the chief executive of the Premier League, Richard Scudamore, about how they felt he and his colleagues had mismanaged the game.
Liverpool supporters’ group Spirit of Shankly (SOS) recently had the chance to put their views to the chief executive of the Premier League, Richard Scudamore, about how they felt he and his colleagues had mismanaged the game.
In particular they questioned the validity of the ‘fit and proper’ person test given that many owners have been able to buy debt on to clubs. The view of SOS is that a club should not pay for its owners to own them and it isn’t right for the future of a club to be put in jeopardy for the sake of making a profit. The SOS spokesman, James McKenna, stated, ‘The Premier League have a duty to run the game properly, to regulate it and make sure it is protected.’
I have been critical of the effectiveness of the fit and proper person in the past, although this has been particularly in relation to Football League clubs where individuals with dubious pasts (including criminal records) have been able to secure control of clubs or have turned out not to have the funds available to them that they claimed. In other cases, they have treated clubs as a property speculation.
However, let’s start from first principles. In business as a whole, leveraged buy outs are not unusual, nor is it unknown for businesses to have a pile of debt. The key question is whether you can service it. Clearly the counter argument would be that clubs should belong to the community and should be structured as mutual organisations. However, that is not the way the Anglo-American model of capitalism has work and, along with globalisation, the sports franchise model was bound to spread from the US to the UK. Leaving aside whether it is a good thing or not, it is unlikely to change in the medium term.
A debate about regulation is more useful. Sport is rather unusual compared to other areas of economic and social activity in that it tends to be self-regulated. Those who want to learn more about this are referred to the work of Michael Moran of the University of Manchester and in particular his book The Regulatory State. I know that he started off his work on regulation by thinking that more regulation was a good thing, but came to the position that it was often ineffective and posed challenges to individual liberty. (Incidentally, he does not support Manchester United).
What is also becoming evident that under the Coalition Government, the political economy of sport in the UK is changing rapidly and that the picture I drew in my article for British Politics on its use under New Labour no longer applies in many respects. Indeed, I may need to make some last minute changes in the book I am co-editing for Manchester University Press on European football!
Simon Chadwick at Coventry University’s Business School thinks that the Coalition Government will take a much more laissez-faire approach to sport with the main policy instruments being tax breaks for companies who make investments.
In essence Dave Cameron and his Liberal Democrat colleagues do not see sport as a political tool in the way that New Labour did. The likes of Gordon Brown turned up at Charlton Athletic’s training ground to be photographed in a special shirt. (Charlton was particularly signed up to the New Labour agenda and one of its senior officials happened to be the Labour candidate in Gooner Ted Heath’s former constituency of Old Bexley and Sidcup).
For New Labour, sport was a political tool bringing prestige to the government (note Tony Blair’s inolvement in securing the Olympics) and was also a tool to promote health policy objectives and fight social exclusion. In Dave Cameron’s view, bringing the 2018 World Cup to Britain would secure substantial economic benefits, but there would be few political benefits.
The Premier League is unlikely to agree to any more regulation that might endanger their profit model, but the new Government is likely to put less pressure on the football authorities than its predecessors.