Examination of Witness (Question Numbers
346-399
Ian Watmore
22 March 2011
Chair: Good morning. This
is a further session of the Select Committee's inquiry into football
governance and I would like to welcome, as our first witness this
morning, Ian Watmore, the former Chief Executive of the Football
Association. Can I invite Louise to ask the first question?
Q346 Ms Bagshawe: Why
did you resign as Chairman of the FA?
Ian Watmore: I
didn't resign as Chairman, I resigned as Chief Executive.
Ms Bagshawe: Chief Executive,
I am sorry.
Ian Watmore: That's
okay. I think the words I used at the time were, "Well there
was nothing chief or executive about the job", and that is
why I left. I was frustrated about a number of things that you
just couldn't do and in my experience the Chief Executive of any
organisation would have been able to have just got on and done
some stuff and most of what I was trying to do either hit the
buffer of treacly governance or just wasn't possible to do at
all because we didn't have control of our money and our resources.
Q347 Ms Bagshawe: Can
you elaborate on some of those things that you found impossible
to enact?
Ian Watmore: Yes,
first of all I sent a note to the Committee in which I argued
that the board of the FA should be independent of all its vested
interests and the reason I argued that is because I think an organisation
like the FA is seen to be the governing body of football in this
particular case and yet it has got people on its board who have
a severe conflict of interest. They may be very good people, they
may have a lot of knowledge and experience and so on but they
are conflicted and I think the usual analogy that I use is you
wouldn't want to be running Ofcom with Sky, BT and the BBC on
your board, it is that kind of sense.
The governance was a problem; the staff were not
a problem and a lot of people write about the dysfunctionality
of the organisation and I think one thing I would like to put
on record is that the staff that I worked with at the FA were
absolutely fantastic and they are so not the image that they get
portrayed with. They are very knowledgeable, they are very energetic,
they achieve an awful lot behind the scenes that you know nothing
about and they were great to work with, so that wasn't a problem.
One of the other problems I found was that the organisation's
money wasn't under control of the executive team so we raised
whatever money we raised—usually about £200 million
a year, through TV deals and sponsorship deals—and then
once we had spent our core costs for running the actual association
at Wembley the rest was distributed 50-50 to the professional
game and the national game.
Apart from the fact I begrudged giving FA money back
to the professional game—because I didn't think they needed
it and the national game did and I thought it would have been
much better to have channelled the money in that direction—the
sheer fact was that we didn't have responsibility for how that
money was spent. A number of the programmes and projects that
you would want to do just weren't possible to do because you didn't
have control.
Q348 Dr Coffey: Can I
ask specifically about the independent board? You have used the
analogy of Ofcom, where the Government appoints a regulator to
manage private competition. What it suggests to me, your suggestion,
is more the civil service utopia perhaps, of having a Government
with no Ministers because they are pretty inconvenient, because
they speak to constituents and make policies, whereas if the civil
service ran it all it would be fine and so that independence would
have a tickety-boo gain. I am not sure that is really true.
Ian Watmore: I
am not sure that would be the civil service utopia anyway, and
I am certainly not going to say it even if I thought it. The reality
is that I think when you are in one of those leadership jobs in
an organisation like the FA, to use the analogy, you are as much
like a Minister as you are the civil servant; you are the person
on public display, you are the person that the public thinks and
expects to make the key decisions and I think both my Chairman
at the time, Lord Triesman, and I felt that we were seen to be
responsible for a lot of things but not with the ability to make
the decisions and actually carry them through.
Q349 Ms Bagshawe: You
are hardly the first Chief Executive of the FA to resign recently,
given there has been such an enormous turnover of FA Chief Executives
since Graham Kelly left the job. Would you say it has become an
impossible job for the reasons that you state; there is no actual
decision-making power in the job?
Ian Watmore: I
felt it was impossible for me and that is because I was used to,
both in the private sector and in Government, a different form
of governance that supported what you were trying to do and so
I didn't feel I could carry on. I think it would be for others.
I wouldn't want to say it was impossible for anybody to do what
they wanted to do in the job but for me it wasn't right.
Q350 Ms Bagshawe: Do
you feel that the resignation of past Chief Executives was motivated
by the same concerns though that you have just expressed?
Ian Watmore: Interestingly
I went to see them all when I got the job; I went back as far
as Adam Crozier. I didn't meet Graham, I probably should have
done but I didn't. Anyway, I met the others and of course everybody
has a different perspective on why they went and different reasons
but I think the common theme is that around the board table, you
have got all of the people from the counties in the professional
game and they all have different interests in what they are trying
to achieve and there is no independence and clarity that emerges
from that and that gets very frustrating as the Chief Exec, whether
you're picking a new manager or trying to spend a relatively small
amount of money on something quite unimportant in the big scale
of things; all these issues blow into one when you're sitting
in the middle of it all.
Q351 Ms Bagshawe: How
would you characterise the relationship between the FA and the
Premier League?
Ian Watmore: One
of the interesting questions; who, for this purpose, is the Premier
League? When I met with the key club members, the sort of people
who run and manage the clubs, the relationship was very good.
All of these clubs belong to the FA as much as they belong to
the Premier League but they have been, over many years, grouped
in a sort of pack around the league that they play in, so individual
clubs, no problems at all. When we got the collective things it
depended on what the issue was. Some things we had real strong
agreement with, for example, goal line technology where our common
enemy, if you like, was FIFA who wouldn't sanction that; we joined
up very well on that.
On other issues we might be miles apart or have a
disagreement over whose responsibility it was. I think that my
Chairman at the time mentioned in his evidence that football regulation,
in the sort of financial regulation sense, was deemed by the leagues
not to be something for the FA, it was deemed to be something
for them and Lord Triesman disagreed with that and that is where
the tension first emerged between them. I think it is issue by
issue.
On a personal level Richard Scudamore—who is
possibly one of the best operators and runners of anything in
football—and I got on, I think, pretty well. We had our
sort of Roy Keane-Patrick Vieira moments and things but afterwards
there was kind of sort of mutual respect I think and that wasn't
an issue.
Ms Bagshawe: Okay, thank
you.
Q352 Chair: You say you
got on fine with Richard Scudamore. You will have heard the evidence
of Lord Triesman that he had rather greater difficulty getting
on with the Chairman of the Premier League whom he found to be
aggressive, was that your experience as well?
Ian Watmore: I
kind of take the view that David said what he said then and I
think that is probably the most evidence you need. I think there
is a football saying, isn't there, what goes on in the dressing
room stays in the dressing room and I think probably I would rather
stick there.
Q353 Paul Farrelly: So
you wouldn't contradict it?
Ian Watmore: I
wouldn't contradict it.
Q354 Jim Sheridan: Can
you just explain what you mean by these people who have conflicts
of interest. Who they are? Give us a flavour for what these conflicts
of interest were and perhaps give us a tangible example of what
that means?
Ian Watmore: Okay.
As you probably know the current FA board—or the one that
has been in existence for the last few years—has five members
of the professional game through from the Premier League, two
from the Football League and five from the counties and then an
independent Chair and Chief Exec. You might get an issue. Let's
take the one that we talked about which is the financial and debt
position.
It is very hard to have a sensible discussion around
a boardroom discussion when the Chief Exec of Man United is one
of those board members and his house is being daubed back at home
green and gold by the fans who oppose the Glazer ownership. He
is a great guy, David, I have lots of time for him but on a topic
like that he is conflicted. If we talk about where the international
game might benefit from perhaps the FA being tougher about calling
up younger players so that they always played for the England
teams rather than went off on club tours and so on, then the club
people are, by definition, conflicted on that. It is great when
they do have a really successful international player but they
are juggling different interests whereas we, as an FA, are thinking
purely and simply about how to develop the national team.
On the other side of the fence the county people
who do wonderful work on the ground, and I can't speak more highly
of them about what they do, they give up their time year after
year after year and make all sorts of things happen in communities
where football is really socially cohesive and it really binds
people together. But they are worried about losing out by picking
a fight, being seen to pick a fight with the big guys from the
Premier League or the Football League or whatever.
There is this kind of tension that really exists
between them and the consequences that unless it is a common enemy
type of topic, like goal line technology—where everybody
can get round the table and agree on it—you find everybody
is coming at it from a slightly conflicted position, which is
why I think you either go to the German model where kind of everybody
is in one entity and it is all part of one entity but I suspect
we are a long way from that, or else you go for independence and
that is what I would like to see.
Q355 Jim Sheridan: Are
you suggesting then that the FA would be far more effectively
run if we didn't have big clubs like Manchester United represented
on the board?
Ian Watmore: On
the board, yes. I think very strongly that we can have all the
dialogue with the big clubs that we need. If I wanted to pick
up the phone and talk to any one of any of the clubs in this country
or go and visit them or see them on a Saturday or whatever, it
was no problem at all. You get access to everybody when you need
it and I think we could involve them and get their opinions and
understand what they wanted and all the rest of it, as we do with
other people who aren't on the board. We go and talk to Gordon
Taylor at the PFA or Richard and his colleagues at the LMA and
a whole variety of other places; you can get inputs from a variety
of sources. But when it comes to making hard decisions I believe
the best board is one that is made up of the exec teams of the
organisation and independent non-execs and that is what I would
recommend.
Q356 Dr Coffey: What
was your vision for the FA?
Ian Watmore: I
ended up just encapsulating the vision. I called it football first
and the reason I did that was because I remember somebody earlier
on said to me, "I quite often go to meetings in the FA and
the word 'football' never crops up and it is always about money
or something else and the essence was not to put the football
first". A really good concrete example of that was Stuart
Pearce who, running the under-21 team, came to me and he said—they
usually play the under-21 games in one of the clubs around the
country, grounds around the country—"I would really
like to play at Wembley. I think these guys would benefit from
playing at Wembley so that when they come up into the first team
and play at Wembley—".
The crowd size at Wembley is likely to be much too
small for the thing to even break even, let alone be profitable
so it is going to cost us money to put on the game and in the
past I think that would have been blocked for that reason whereas
I said, "Yes" because it seemed to me it was more about
the football and less about the money; this was about trying to
grow the talent, so putting football at the heart of everything.
I was very strong on the Wembley pitch, for example, and I thought
the history of Wembley has been dogged with controversy—and
I don't want to go back over that—but the stadium itself
physically is great but at the time the pitch was terrible and
it seemed to me that people were more worried about the business
case of Wembley than they were about the quality of the football
in it and I happily—well not happily for me as an Arsenal
fan—went to the Carling Cup Final as an Arsenal fan to see
my team humiliated in the last minute but the pitch was absolutely
stunning because they have now done exactly what I think they
did at the Emirates and other places with this new pitch technology.
I was trying to just inject in every decision and
every thinking about what the FA stands for, to put the football
at the heart of it and then let the other things take care of
itself. That then cascades right across the game from international
football at the highest level to kids playing on a Sunday morning,
and I could talk for hours about where we go with that but that
was the essence of it.
Q357 Dr Coffey: Just
to refer to the stadium or aspects of the stadium as your first
two responses to the vision of football and how you use that,
the stadium has been criticised as being a debt-heavyweight around
the neck of the FA. What changes would you perhaps like to see
to that? Is it a conflict of interest that David Bernstein is
both Chairman of the FA now and of WNSL?
Ian Watmore: Wembley
is kind of a subsidiary of the FA so I don't think there is a
conflict and David is one of the people who helped save the Wembley
project when it was going in a very bad direction. I think he
has got huge experience and he was also very successful at his
club in his business career so I think he is a good choice of
Chairman, not that it is for me to comment but I do happen to
think he is.
The stadium does drag financially and the FA is short
of money so it is a concern but we are where we are; it was built
on a debt model—I forget the exact figure that is still
in the books that's overdue but it is something in the hundreds
of millions that still has to be paid back—and every year
that is a financial drag on the FA, which it would be great if
it wasn't but it is what it is.
Q358 Dr Coffey: Coming
back to your idea of football first, do you think the FA still
has that as a priority? Is it implementing those tasks effectively?
Ian Watmore: I
can't tell really from the outside. My sense is everybody agreed
with it on the surface but, as you know, probably in Government
it is quite easy to agree in principle but not in practice and
we see a lot of that going on, so I couldn't tell on the ground.
But when we come back to why do people criticise the FA, they
criticise it because they perceive it not to be making sensible
decisions in the regulator in governance space and they criticise
it for seemingly to always get it wrong, vis-à-vis the
England senior team, those are the two things that dominate whenever
you ask the public about the FA. Until we crack both of those
and have a clear programme that builds to a long term success
of the England team and get a sort of regulatory discipline environment
that people trust then I think they will continue to be dubbed
in that way.
Q359 Dr Coffey: What
do you think was the worst decision that was made at the FA when
you were Chief Executive and can you explain a bit about the governance
process and why it went so wrong?
Ian Watmore: The
worst decision, that's interesting.
Dr Coffey: I will ask
you in a moment what your best was but I would like to hear—
Ian Watmore: No,
that is a good challenge. I think probably the one that frustrated
me most was the pitch at Wembley just because it was something
we could control in our own backyard and it wasn't about intergalactic
football and all the interrelations of everybody else and it was
really frustrating. When Michael Owen ripped his hamstring or
whatever in the Carling Cup Final with Manchester United and he,
to this day, believes it was the pitch that did it. You could
just foresee that happening to a whole bunch of England players
just before the World Cup—and as it turned out it probably
wouldn't have mattered—but at the time we thought we had
real high hopes at the World Cup. That one was definitely a frustration.
But I think the real strategic issues that we weren't
grappling with were the areas of what role does the FA have in
regard to governance of the game. The answer was quite a weak
role and weakening every year and yet people perceived it to have
so much more power than it actually had, and I think that was
the biggest source of concern to the Chairman and I. You could
look at what I said about the financials of football clubs. I
was frustrated that the women's game was the first casualty when
Setanta went bust, everybody just said, "We won't do the
Women's Super League" then I had to fight very hard to bring
that back in.
We had a lot of issues around the staff and I had
to take some very tough action with the staff, the sort of thing
that is going on in Government at the moment; pay freezes, we
have ended the final salary pension scheme. These are people who
don't earn a lot of money, who have given their lives to the game
and what was really annoying at the end of it all was that 50%
of every pound we saved there went back to the professional football
game and that didn't seem right either, that was a hard sell to
people. So there was a combination of things.
Q360 Dr Coffey: To give
you the other side, what was your best decision? It might be the
pitch.
Q361 Ian Watmore:
No, because that came after I went, they made what I thought was
the right decision later on. I hope the best decision will turn
out to be two things: one was to reignite the National Football
Centre project. We had bought the plot of land in 1999 I think
and it was still 2009 at the time and nothing was there really,
realistically. Working with David Sheepshanks and others I think
we breathed a lot of life into that project and I think that is
now off and running.
I think we made some pretty sensible decisions around
the money side because when Setanta went bust the finances of
the FA were in freefall; it was the equivalent to a Lehman's Bank
moment for us, we'd lost 15% to 20% of income overnight and then
the market for what was left was deflated. So knowing next time
round we put a lot of financial stability in, and I am sure there
is still more to go, in that area.
We started the web-based TV channel, FATV,
which I think in the long run will be very important as people
move towards the internet for their football consumption. The
final thing I did do was sign the press release that made the
Women's Super League a reality because I was very passionate about
trying to do something for the women's game and had some of my
best actual moments I think on tour with the women's team in Finland
the previous summer when they got to the final of the European
Championships. I really hoped to see that that combination of
them playing well and the start of the Super League would get
the women's game off to a future.
Q362 Dr Coffey: What
I am trying to tease out is that you were able to make good decisions
and also decisions you were less proud of as the FA, what was
different in the governance process, if you like, that allowed
you to achieve some success? I suppose I am trying to come from
the fact that sometimes as Chief Executive, you will get what
you want all the time and other times you don't take everybody
with you, so what changes to the governance of an independent
board would make that different?
Ian Watmore: I
think the fundamental thing when you are a Chief Exec of any organisation
is you want the board to challenge you but you want the board
to think of themselves, first and foremost, as part of the organisation.
People from various sectors of the game would sit in meetings
of the FA and talk about the FA as though it was a third party.
They were not driving the best decisions for the organisation,
which is the FA; they were driving the best decisions for whichever
area they came from. Sometimes they coincided and sometimes they
didn't. I believe you need a board that is single-purpose and
focused on the organisation and I didn't think it was.
I also found it very regrettable that the board leaked
like a sieve, if that is not being unkind to sieves. It sort of
started on the day I was interviewed for the job. The headhunter
said to me, "We won't send the papers out on the Friday night
because it will all be all over the Sundays, we will do it Monday
night and the interview is on Tuesday and you've got a chance
of staying silent" but it was in the papers on Tuesday morning
and it went on throughout the period and I felt that was a problem
too. Again, that's another thing that I think is sacrosanct about
boards. Boards should be trusted by everybody on it that what
is said and done in it, is confidential to that board and it clearly
wasn't.
Q363 Damian Collins:
When you were the Chief Executive how much time would the FA board
spend on certain things like internationals?
Ian Watmore: I
would say in the board meetings I attended, quite limited amounts
of time.
Damian Collins: Once or
twice?
Ian Watmore: Yes,
and of course in the era I was in everybody thought we were on
a roll and Fabio was coach of the year on the BBC's Sports
Personality; we all thought we were going to do something
special in South Africa. It wasn't the crisis point that it can
be periodically but in the FA board as a whole it wasn't a major
topic of discussion when I was there.
Q364 Damian Collins:
There seems to be disconnect between what England fans, the football
writers talk about and what the FA board talks about and the ongoing
concerns about the fact that our players have probably never played
in a league consistently at such a high level in domestic football
and lots of them play abroad, there is never more money in the
game and yet the national team grows weaker and weaker. It is
the debate probably football fans have more than any other debate
and it is one that doesn't particularly seem to grip the FA board.
Ian Watmore: One
of the things I think is, again, I've said that the board should
be independent. I also think it should be half-executive, half-non-executive
and the reason I say that is I would like to see people like Sir
Trevor Brooking in his current role as football director and probably
Hope Powell as the leader of the women's game, on the board of
the FA talking about football; people who have played it, people
who are responsible for developing it in the men's and women's
game, people who have a pipeline of knowledge about who is coming
through the system and what is right and what is wrong. I would
like to see the board have more people of that ilk on it from
within the FA so that these topics would be discussed, they would
be driven out and the consequences and conclusions of that would
be arrived at sensibly.
Q365 Damian Collins:
How would you characterise the failure of the FA board? Is it
that there is no great desire for reform or change, there is plenty
of discussion about it, reports written, views expressed? Does
the board either not share those views or can it just not agree
amongst itself what to do?
Ian Watmore: I
think there is a very small conservative nature to it all so change
is not a welcome word in that sense; people want to evolve slowly
rather than radically. But you do have quite different interests
around the table from the five that come from the professional
side and the five that come from the counties. Half of the money
goes to each of them, as I have said; one half works out how to
spend this lot and the other half works out how to spend the other.
So the actual board meetings, they could be tetchy on certain
issues but they tended to be one group of people talking about
a subject, everybody else staying quiet or vice versa and I think
it was just a sort of unholy alliance between the two groups not
to tread on each other's patch and I don't think that is the way
the board of the FA should be.
Q366 Damian Collins: Just
finally, do you think if the board was reformed in the way that
you have discussed—an independent board of experienced football
people—that the FA would be, if you like, more realistic
in the way it uses its resources and you could question the way
the FA has spent money in the past on Soho offices, salaries or
how managers are paid, even the company contract Capello was given
before the World Cup? Do you think a reformed board would be more
practical about the way it uses its money?
Ian Watmore: I
do. I think particularly if you had some good genuine independent
non-execs of the type who are used to challenging company Chief
Execs and executive teams on how they are investing shareholder
money. I don't particularly name names but people like Terry Leahy,
he was a fantastic supporter of ours when he was at Tesco through
the Tesco Skills Programme. You just know that people of that
calibre would drive better spending decisions.
Q367 Alan Keen: Ian,
you seem to be saying that—and I agree with you because
I know virtually everybody involved in football administration—there
are some excellent people doing excellent jobs. If we take Richard
Scudamore, who I agree with you is one of the top people and a
proper football supporter; he supports Bristol City—
Ian Watmore: He
does.
Q368 Alan Keen: He understands
how supporters feel as well as everything else but Richard's boss
is the 20 club owners. Their interest is not in the future of
English football or the future of football at all. It is, in almost
every case, the ability of the club that they own to make money.
They may have come into it not being worried too much about making
money but I think ego comes into it as well. But certainly the
main thing is that their interest is not the same interest as
the future of football involving youngsters' development and everything
else and supporters of all the clubs around the country, whatever
level the club that they support is at.
It is the structure, isn't it, that is wrong and
Richard does a great job representing those people. But if he
or you were the managing director of football as a whole then
self-interest would work, with a right in there. Do you think
it needs Government legislation to set out a structure for football?
It is obviously a shambles, isn't it? What do you think about
legislation to set up a structure that is for the benefit for
the whole of football, like there is in other European nations?
Ian Watmore: I
think I agree with a lot of what you say, except the concept of
Richard having a boss is an interesting one. Sorry, just joking.
I agree heavily with the fact that, as you say, the running of
the Premier League and making it the global success that it has
been today, which Richard and others are primary movers of, has
been a stunning success story and one that we all enjoy if we
like watching that sort of football, which I do. They would argue
that money trickles down through the leagues to the other clubs.
I don't know whether that is better or worse than in another situation.
But what it does do is it becomes a single objective,
which is to make that league a huge success, whereas I think what
you have said is there are more objectives than that. We want
that but we also want a strong England team and we want a growing
national game in communities around the country and we want more
women's football, and so on. So these are things that I think
we need to line up and say, "Here's a series of objectives
for football as a whole". That is what I argue in my note
to the Committee, which you may not have but you can read afterwards
and see if it is more coherent than my verbal ramblings here.
You should set out what the strategic objectives for football
as a whole are and then what role the FA has within that and then
how the FA might have a governance structure to determine that.
I don't think it will come about through natural causes. It will
only come about through an external impetus that is either your
Committee or the Government through a Bill or something, because
I don't think it will happen on its own merits. It took something
like the Lord Justice Taylor report to change football once before
and maybe this is the time to do something equally significant
for the game in the long run.
Q369 Alan Keen:
You mentioned Terry Leahy. An analogy with Tescos, if one part
of Tescos is doing exceptionally well, whatever that part of Tescos
makes, if it doesn't fit in with the overall aim of Tescos internationally
then Tescos will do something about it from the top downwards,
whereas football is run completely separately. It is all run by
good people with the best intentions and if you are being paid,
as Richard is, by those 20 owners then he does a fantastic job
and it is his duty to do that, even though he understands very
well that the thing is out of balance.
Ian Watmore: I
think it is possible to square the circle of competing objectives.
In a world where the best global talent is playing in the Premier
League, which is what people want to succeed, it ought to be possible
to use the money that comes from that to develop the best local
talent to be as good as that. It is cheaper to make, not buy,
if you do it over a long period of time and there are various
clubs around who do that very well. We can see some of those clubs
beginning to churn out really top talented English players who
aren't just the best in England, they are actually making it with
the best players in the world. Whether there are enough of them
is highly debatable and whether the system that is producing them
is producing them more by accident than design I think is definitely
worth questioning. I would think one of the key objectives that
we should set for the whole of football is to grow that pipeline
of talent systemically, using the wealth that is here because
of the Premier League.
Q370 Chair: Can
I just clarify: is it your view that for the FA to have the powers
you believe necessary to impose a greater governance on the game
that would necessitate some kind of Sports Act being passed by
Parliament?
Ian Watmore: I
don't think it needs to be because it is obviously something that
people could agree to do, but I don't think they will agree to
do it so it is going to be an external intervention that causes
them to change. You may not agree with what I am saying but if
you did agree with it I don't think it will come about through
just the natural process. I think it will require something different.
Whether that is an Act or a strongly worded demand from Government,
I don't know, but I think it won't happen otherwise.
Q371 Chair: There
is no particular reason to believe that a strongly worded demand
from Government is going to produce a response either.
Ian Watmore: Sorry?
Chair: It doesn't
necessary follow that a strongly worded demand from Government
is going to produce a response either.
Ian Watmore: No.
I think in the end you have to look at the restructuring. If you
need to do restructuring it needs to be forced, or at least to
be threatened there so that people might change themselves if
they know it is in the background.
Q372 Chair: Does
all your experience suggest that is going to have to happen?
Ian Watmore: If
you agree with the line of direction that I am recommending, yes.
Q373 Dr Coffey:
Is the risk of legislation that it will open up the FA to judicial
review on a regular basis? Would that be helpful?
Ian Watmore: There
is a lot wrong with legislating. Parliament has some big things
to worry about and using parliamentary time on this is one thing.
FIFA statutes don't like government interference. It is more aimed
at different governments than ours but nevertheless I am sure
it will be used. People will argue that it is threatening their
livelihood and so on. So it is not without risk. It would be much
better if people just said, "Look, in order to give this
a fair crack of the whip let's have an independent structure,
run it for five years and let's see where we go from there".
Q374 Chair: We
have received evidence, not from FIFA but from UEFA, recommending
that we adopt some kind of Sports Act.
Ian Watmore: okay,
that is more a party role then.
Q375 Jim Sheridan:
Can I clarify: external intervention; by that you mean Government,
or is there another external intervention?
Ian Watmore: No.
I think in this case it is Government. The analogy I had with
the Lord Justice Taylor report, I don't know whether that was
a Royal Commission or something but it was something similar.
Maybe a Royal Commission could recommend such things.
Q376 Jim Sheridan:
But there is no other intervention?
Ian Watmore: Not
that I can think of, not unless it was a commercial proposition
that dwarfed everything that there is today and I can't see that.
Q377 Mr Sanders:
From what you are saying, do you think the FA should have a more
leading role, actually take the leading role in regulating the
financial activities of professional football clubs?
Ian Watmore: I
think the answer to that is at the strategic level, yes. In other
words, I think the FA should set the financial regulatory environment
in which professional football operates but I think it should
then be for the leagues and the clubs to implement that, usually
through their competition rules, which is the most effective way
of doing it. A lot is talked about UEFA's Financial Fair Play
scheme and I think there is a sort of assumption that UEFA is
like a European governing body, somewhere between us and FIFA.
In fact that is not true. UEFA is a confederation of associations,
owned by the national associations. What UEFA is doing is using
its Champions League competition, and to a lesser extent its Europa
League competition, to say, "If you want to play in our Champions
League competition then you have to comply with these rules".
So it could be that the British clubs all said, "No, we're
not doing that", but of course they won't because they are
desperate to play in the top club football in the world, so they
will eventually comply.
UEFA use a competition as a means of achieving a
piece of regulation that they think will benefit the game. I think
we should set the environment at an FA level and then let the
individual competitions, in this case the leagues, determine precisely
how to implement that, their own roles within the rules that they
impose upon the clubs that play in the league.
Q378 Mr Sanders:
But the FA could set some parameters by which your membership
of the FA is determined. If you don't meet them you can't be a
member.
Ian Watmore: That
is the kind of thing, yes.
Q379 Mr Sanders:
Do you think the FA is fit for that purpose, though, under its
current constitution?
Ian Watmore: No,
for the reasons I have said. Whether it has the staff in there
to do some of that stuff—I think some of the people I had
in that area were absolutely brilliant. One of them has gone off
to run Portsmouth, which I think shows how good he is.
Q380 Mr Sanders:
The football club or the city?
Ian Watmore: I
think the city is easy by comparison to the football club. The
football club was, of course, the disaster club of a couple of
seasons ago. I think you would need to ensure that the capability
was there in the organisation to really understand, but I think
that is a soluble problem.
Q381 Damian Collins:
You joined the FA just after Lord Triesman presented his response
to the then Secretary of State for Culture's questions on football,
and that covered some of the ground you are talking about. He
talked about whether there should be a financial governance system
based on the UEFA fair play rules. When you joined, what was your
view on those plans and what happened that led to the collapse
and rejection of those ideas?
Ian Watmore: It
was, as you said, just before my time but my understanding was
that David and the staff from the FA produced a version of a response
to I think it was Andy Burnham at the time, and the board members
told him that was not the submission he was going to put in, that
he was going to put in a different one, which in paraphrase said,
"See the submission made by the Premier League and Football
League and that is the FA's position on these topics". I
think that was right at the start of the problems between him
and the professional game. I think he had also made a speech that
they didn't like about debt in football, and the combination of
those two things meant it was very tense on that subject whenever
it came up in any meeting.
Q382 Damian Collins:
Were these ideas pursued? They were in Lord Triesman's report
but from your time as Chief Executive was this something you felt
that, "This should be an agenda item, this is something we
should be taking up on a regular basis"?
Ian Watmore: It
was one we would have liked to have done but it was made clear
that the situation was not changing, that these were matters for
the leagues and not the FA. That was kind of the line and so that
was what prevailed.
Q383 Damian Collins:
Given what you said about the FA, you can probably see why the
Premier League might not have very much confidence in the FA to
take on that role?
Ian Watmore: You
can argue every one of these things. My argument would be that
if you regard the FA as essentially an assembly of the people
from the counties who may or may not have the sort of experience
and know how to deal with this sort of big business type of thing
then, yes, you would have no confidence, I'm sure, if you were
in the professional game. But if the body concerned was properly
resourced, staffed with the right sort of calibre people and had
the right sort of board structure then you should have confidence.
You might not like what they decide but you should have confidence
and that is why I think a different sort of FA is required for
these purposes, one that is independent of both its heritages.
Q384 Damian Collins:
When we took evidence a couple of weeks ago from David Gill, Niall
Quinn and the Chairman and Chief Executive of Stoke City they
all agreed that the UEFA Financial Fair Play rules will be a good
model for enforcement through the Premier League. Do you agree
with them?
Ian Watmore: Each
one of these sort of regulations tends to tackle a different problem
and the problem that Michel Platini and co were trying to solve
was the combination of billionaires coming in and just buying
any player they want and paying whatever wage they want out of
the petty change of their wealth, or alleged places where the
local cities were putting local money into the clubs. He felt
it was unfair that clubs of the Chelsea-Manchester City type,
or perhaps the Barcelona-Real Madrid models, were bound to be
strategically much more successful because they had all this money
being poured into them and he felt that by doing the Financial
Fair Play rules that would cap that possibility and it would mean
that clubs would then have to survive on the resources that they
naturally developed. So that is what is now coming in.
I don't think it inherently deals with the sort of
leveraged debt takeover of a club, which you might feel is something
else that isn't an attractive thing to do. When Manchester United
or Liverpool or any of these other clubs find themselves in the
position they are in, or were in in Liverpool's case, I would
have thought you should at least consider whether there was a
regulatory environment that said that sort of thing shouldn't
be allowed from the outset. You have some sort of capital ratio
or something in the way that the club is owned. That won't come
up, I don't think, with Financial Fair Play. You would have to
do something else, but Financial Fair Play will probably eventually
cap the billionaire, "I'll have that one" approach to
football.
Q385 Damian Collins:
On the Manchester City and Chelsea stories, is their high profile
something of a distraction? When we took evidence last week in
Burnley, the Chairman of Burnley said that if you want to sustain
a smaller club in the Premier League, on top of what you get from
gate receipts, on top of what you get from TV money, you basically
need someone who is going to put in £50 million a year in
cash every year just to hold you in the Premier League. That has
to be unsustainable.
Ian Watmore: I
would argue that it is, although they do seem to keep finding
people who are prepared to do it. People do argue that it is smaller
sums but it has always been that way in English football a bit.
But I do believe the sustainability of that should be questioned.
I do believe that if you apply Financial Fair Play at the highest
level it should force its way right through the system. Was it
Burnley you said you took evidence from? One of the reasons that
the Burnleys of this world get to that level is because the Chelseas
and Manchester Cities of this world have stretched it so much
up here that just to get ordinary players they now have to pay
twice the wages that they used to have to pay and so on, and the
television money hasn't kept up with it. So, I think having a
dampening effect at the top will eventually filter through to
the rest of the system. I think what UEFA are doing is promising
on that front, although we'll see if people find ways round it.
Q386 Damian Collins:
In your time at the FA did you ever look at licensing models that
operate in other countries? The licensing model in Germany is
one that is talked up a lot. It seems to be a fairly flexible
system but nevertheless it does at least guarantee a level of
oversight from the governing body of the financial performance
of the clubs and whether they compete on a fair level, a fair
level being that they can pay their bills without going into administration
during the season. Is that something that you looked at?
Ian Watmore: The
German model is a good one on a whole range of fronts. It is integrated
to start with. The DFB looks at leagues and the national association
is one integrated whole. It has all the strengths that you say
and we have seen for more years than we care to remember how good
they are at churning out international teams of all types: men's
and women's, all ages and so on. The only counter to that argument
would be that the Bundesliga is not the Premier League. It doesn't
have the global pulling power; it isn't the exciting league that
the Premier League is. It doesn't reach consistently the last
stages of the European Champions League with three or four clubs.
I think if you were to look at the Premier League on its own you
would say it has been more successful than the Bundesliga. On
the other hand, if there was some global downturn in football
finances the Bundesliga is more likely to come through as a sort
of HSBC bank and the Premier League would be more difficult to
pull through in that. But nevertheless I think, for the period
that we are looking at, the Premier League has a long way to go
before it runs out of opportunity. It is only really tapping into
the early reaches of the global audience.
Q387 Damian Collins:
I suppose, to stretch an analogy, the question would be whether
English football clubs are becoming too big to fail and the relative
price of failure here is small. Leeds United will be back in the
Premier League, if not next season within a couple of years, as
probably one day will Portsmouth. The Germans have the ultimate
sanction, which they don't use or haven't used yet, but there
is potentially a case where they might.
Ian Watmore: I
would like to see a system that didn't weaken the Premier League
but did strengthen the FA. I love the Premier League as a spectator
and so on. It has transformed football in this country from where
it was in the late 1980s. I have nothing against the success of
the Premier League as a league competition and it is well run.
It has its issues, that I would like to talk about in a sort of
technocratic way some time, but right now it is in a good place.
The FA is not in a good place at the strategic level. I would
hope that we can elevate it to have a much stronger role in football
and then we can have a strong FA and a strong Premier League,
not a strong FA or a strong Premier League, and that I think is
the fundamental thing.
Q388 Damian Collins:
Finally, with regard to financial oversight, we discussed last
week with Leeds United the fact their Chief Executive doesn't
know who owns the club. Do you think that is wrong? Is that the
sort of thing that the FA, even if not having actual power over,
should take a sort of moral leadership on and say on some of these
practices, "There might be nothing wrong with what is going
on but it is questionable and not transparent and not the way
we do things"?
Ian Watmore: I
think one of the good principles of governance in any organisation
is transparency, and I would apply that to football.
Q389 Paul Farrelly:
Ian, I just wanted to return, as we wrap up this session, to a
few specifics about the FA. First of all, I wanted to take a few
of the points that Damian was exploring on finances and talk about
something that did happen on your watch. We know what happened
to Lord Triesman's paper but I have been passed a paper—not
by you or anyone associated with you—called Football
Finances that you prepared, I understand, in February 2010
and which was for discussion among a joint management group, including
yourself and the Chief Executives of the Football League and the
Premier League. That was prepared just a month before you resigned.
Could I ask you what was the reaction to that paper that you prepared?
Ian Watmore: I
think it was more of the same as we have been talking about, which
is this is not a matter for the FA really. I think there was an
initial worry that we were trying some sort of takeover or some
political stunt or something, which I wasn't. I was just trying
to write down the issues as I saw them and try and put them in
a sort of consultative way that would get us talking. It was made
reasonably clear that that wasn't the direction that people wanted
to go in. They gave us comments on it but I think it was just
one of many things where I realised I was just butting up against
the governance ceiling and it was time to stop wasting my time
and go and do something else.
Q390 Paul Farrelly:
Was that the straw that broke the camel's back?
Ian Watmore: Not
especially. It was one of them. There was a month of quite a lot
of things happening. One of the ones I found hardest to deal with,
although it is probably never spoken about, was I think David
Gill rather sensibly recommended that the decision-making bit
around who gets what suspensions and did they really punch somebody
in the face or not, the sort of compliance unit thing, should
be outside of the core FA and in some way with some unimpeachable
figure running it. I have quite a lot of sympathy with that. The
flip of that is that the Football Regulatory Authority, which
is the bit that sets all the regulations and so on in the first
place, would come back inside the FA. At the moment it is in an
arm's length status. I think it is analogous to a Government Department
setting a regulation but running the operation within, which is
100% the wrong way round. The problem I had when I was reviewing
that was if I brought the FRA back inside it would go immediately
under this conflicted board and then it wouldn't be able to make
the decisions that it needed to make. So I got into a place where
on almost everything that I was moving on I saw cul-de-sacs and
I decided I would just go and do something else.
Q391 Paul Farrelly:
You have just covered one question I was going to ask, probably
the last question. Your paper, was it ever discussed at the FA
board at all?
Ian Watmore: No.
Paul Farrelly: It just
remained among this management group?
Ian Watmore: Yes.
We tabled it over time but—
Q392 Paul Farrelly:
When you said that they thought it wasn't for the FA, who in particular
thought it wasn't for the FA?
Ian Watmore: I
don't want to go into particular individuals, conversations that
are private, but I think the generality of the position that David
had when he first tabled his approach remained, which is that
for these matters the leagues were the people to do it and they
should do it themselves and we should just butt out.
Q393 Paul Farrelly:
The danger here is that there are so many papers lying around,
so many recommendations, that someone will always find a reason
to disagree with something because somebody else has said something
different. That is something we have to wade through. You make
some interesting comments that at present the game is applying
the so-called fit and proper rule in a sort of not legally disqualifiable
way, which is taking a different judgement. You have mentioned
capital ratios previously but you argue that perhaps the game
might adopt a fit and proper business case approach as well. You
argue in particular about a ban on securitising future revenues
and player securitisation so that we don't get the West Ham-Sheffield
situation. You even go on to the football family taking such a
collective responsibility that, like the Government with schools,
it puts clubs into special measures. All of these suggestions
were batted away, were they?
Ian Watmore: In
effect. The topics in there, the intention of that paper—as
you say, it has never seen the light, I think it was leaked by
somebody to somebody else and it has probably moved around—was
to say there is no right answer, there is no silver bullet, but
we do have some issues. We have our two most famous clubs in these
debt problems, in Liverpool and Manchester United; we have the
club that has produced more England players of high quality than
ever, in West Ham, in the hands of creditors to an Icelandic bank
that has failed; we have one of our oldest and most famous clubs,
in Portsmouth, being the laughing stock of the Premier League,
as it was at that point. We ought to be at least discussing the
sorts of things I put in that note in deciding are any of these
things really the answer or should we just let free market reign?
As somebody once put it, debt is the slavery of the free and I
think debt is the slavery of the free market if you take it to
an extreme. There is obviously good debt, there are reasons to
go into debt to build a stadium or something like the approach
that Arsenal have taken to building Emirates and then selling
off their old ground and gradually getting back into financial
balance, but debt for the sake of it is troublesome over the long
term. I think we should be looking at ideas for how to control
that without stifling the inherent success of the underlying leagues,
which I am proud of.
Q394 Paul Farrelly:
I have a couple more questions about the FA. I think we are quite
clear on what you would like to see. It is going way beyond Burns
and having an independent FA. What would be the best model in
professional sport or professional football, possibly from overseas,
that you would compare your ideas with?
Ian Watmore: I
don't think there is a particular sports model where I would go,
"Yes, that's the one to follow". Each of them has their
flaws. The German football one is a great one but it could be
challenged on the strength of its primary league. The Spanish
produce great clubs but one of the reasons they do that is they
skew all their television money towards Barcelona and Real Madrid
and not through the rest of the league, while the Premier League
is very good at flattening its distribution of cash from top to
bottom. We all know that most of the other sports, England cricket,
English rugby and so on, have had some of the same problems. It
has emerged from one place into another. I think the thing that
makes football in this country different is the global success
of the Premier League makes it such a disproportionately big event.
To some football fans now club football is what they watch in
preference to international football and in almost all the other
sports it is the other way round. Even today club rugby hasn't
reached the point where it dominates national rugby.
So I don't think there is an obvious one. I looked
at the States models and talked to Ivan Gazidis who came out of
major league soccer in the States. There are some things there
but it is a closed system there and I don't think we have that.
So I think we have to fall back on the fact we have the model
we have with strong leagues and a national association. If you
put governance around the national association, like you would
a top PLC company, which is half executive, half non-exec, where
the non-execs are chosen for their independence and their skills,
I think you have a real chance that the national association could
thrive without killing off the other two things.
Q395 Paul Farrelly:
Under the governance arrangements, would you like to place the
FA Council in the position of a supporters' trust with a club
where it may be consulted but it doesn't necessarily have any—
Ian Watmore: I
think I argue that it needs to cede more powers to this independent
board and not be the ultimate parliament of football, but I wouldn't
do that without the independence, because at the moment it's a
check and balance thing that is there to stop ridiculous things
happening. But I do like the people on the FA Council, not just
because I like them individually but they do have a real breadth
and wealth of experience and I think we should tap into it.
Q396 Paul Farrelly:
My final question is that the coalition agreement talks about
supporting the co-operative ownership of football by supporters.
My party's manifesto, for whatever reason, talks about mutualism
at the heart of football as well. What is so special about football
that we, as a committee, should be making any recommendations
about the future direction of the FA at all?
Ian Watmore: That
is perhaps a question for you, but I think the difference between
football and other sports in this country is it does occupy a
greater importance to people up and down the land en masse, whether
it is playing or refereeing or watching or talking about it in
the pub or helping your kids through or finding a way if you're
disabled into participative sport. It is just massively impactful
on British life, and it is British life not just English life.
I think it is therefore appropriate that the Parliament of the
day should have a view on whether something that important to
the people is in a healthy state. If it is not it should certainly
ask questions and then it should decide whether it goes further
than that and make recommendations and even laws.
Q397 Dr Coffey: You were
quite glowing about the German game earlier and the German FA.
They do not have any independent directors on their board, so
is it about structure or is it about personality and people?
Ian Watmore: I
think the lack of independence in Germany is because they have
bundled everything together. It is one integrated organisation
where they look at the whole. We have separated. We might as well
recognise that, and that the Premier League is a self-standing
entity under its own right. It is technically called the FA Premier
League, but to everybody in the world it is the EPL or the PL.
The Football League has reinvented itself massively successfully
after the ITV digital fiasco, and we have the national association,
that is the oldest one in the game. It annoys people around the
world that it's not called the England FA, it is the FA, a bit
like the Open Golf Challenge, it is not the British Open. It is
the oldest; it is 150 years old in 2013. I don't think we should
be trying to push all of those organisations back together à
la Germany. You might take a different view. I think we can achieve
the success of the Premier League and the success of the FA by
giving it strength and teeth, and I think that comes from independence,
but you may form a different view.
Chair: Thank you, that has been very
helpful.
Q398 Jim Sheridan: You
spoke earlier about a vested interest in the FA. There is no one
with more vested interest than the fans, is there, or should there
be a structure that involves some sort of interaction with the
fans and the FA?
Ian Watmore: I
think that is a great question. I argue very strongly yes, that
whatever the FA is, it should be consulting with the fans and
the players, the mass participation of the game as well; it is
not just fans, it is players, Sunday morning kids and parents
and that sort of thing. I think the FA needs a much better way
of consulting with and engaging with those people. There are groups,
as you know, like the Football Supporters' Federation and those
sorts of things where I think that there is a councillor slot
on the FA Council for at least one of those groups. They have
a role to play, but they are campaigning on particular issues
and I think they tend to attract people who are passionate and
fanatical about the way sport is run, so they have an interesting
view to tap into, but I think the FA needs to find ways of engaging
with the broad mass of the public. I would say a bit like in Government
these days, people are looking increasingly to the social media
as a way of tapping into people. I think football needs to do
that much more broadly.
Q399 Jim Sheridan: Secondly—hopefully
a yes or no answer on this—after listening to what you have
had to say today, would it be proper to assume or do you feel
that at any time that you, and subsequently the FA, were bullied
by the Premier League, or by individuals of the Premier League?
Ian Watmore: Do I think that the
FA—
Jim Sheridan: Do you ever feel you were
bullied?
Ian Watmore: No,
I am not a person who is easily bullied, so—
Jim Sheridan: Were there
attempts to bully you?
Ian Watmore: I don't recognise
bullying. People have argued passionately the opposite case and
people have become frustrated when I have made my point, but I
didn't personally ever regard I was bullied.
Chair: Thank you very much.
Ian Watmore: Thank
you.
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