6 Supporter involvement |
The case for radical change
193. The examples of bad ownership are sufficiently
numerous to point to systemic failure. A case can be made that,
rather than tighter regulation, a more fundamental ownership change
is required. Dave Boyle, former Chief Executive of Supporters
Direct, argued that:
the benefactor model is more ruinous than contributory
to the health of the game. [
] Benefactors are often quite
good in the short-term. The medium-term record is very poor, and
I think one of the biggest contributory factors to football's
economic poor health is the very short time horizon.
He proposed a supporter ownership model along the
lines of the German majority ownership by sports club model, as
a better alternative. English football culture and tradition is,
however, very different from that in Germany, and given its survival
for well over a centuryalbeit with growing challengeswe
are not convinced that the case can be made for such revolutionary
change. A less radical but possibly more fruitful approach might
be to consider whether a supporter ownership model can thrive
alongside the private company model and, if so, what the advantages
might be. Within the English context, this has become associated
with majority or minority ownership by a supporters trust, the
model advocated by Supporters Direct.
The case for incremental change
194. Evidence from supporters trusts, a number
of which already owned their clubs, suggested a number of reasons
why a supporter ownership model might prove advantageous. The
first advantage stressed was the community benefit. Julian Tagg,
Chief Executive at supporter-owned Exeter City, currently playing
in League 1, observed that his motivation to become involved was
"about providing something for the city".
Runcorn Supporters Trust, which owns its non-league side, explained
how it produced a development plan for the local council "to
ensure that our vision was for a community club at the heart of
the local sporting community".
Brentford Supporters Trust, which again owns its league 1 side,
acknowledged that many clubs, regardless of ownership, have community-based
activities, but argued that the difference was that "where
a trust is involved at board/shareholder level, community work
is seen as 'must do' rather than 'nice to do'".
Michael Frater CBE, Chief Executive of Telford and Wrekin Council
2000-2006, contrasted the community approach of non-league Telford
United's previous private owner with that of the current supporter
The single wealthy owner was not interested in the
idea of a community based club and then went bust. The industrial
and provident society model owned by supporters has embraced the
community model with energy and enthusiasm and has since 2004
gone from strength to strength in footballing and financial terms
as well as providing enormous community benefit.
linked to the community benefit was the argument that a supporter
trust model offered more reassurance that the club would be able
to provide such benefits in the future, given its commitment to
protecting the club in the interests of future fans. Andy Green
argued that, where supporters trusts have a share in the club,
they act as a break on recklessly short term borrowing and are
more likely to safeguard historic grounds for their communities.
Cardiff Supporters Trust pointed out that, even though it did
not have a share in its club, it had pushed for an Annual General
Meeting (not held for three years) and provided financial scrutiny
in conjunction with small investors. Fisher Supporters Trust,
which owns non-league South-East London side Fisher FC, contrasted
the sustainable approach with the short termism of the previous
196. A further related argument was that the
supporter trust model brought in fans and contributed to a more
dynamic environment. Brian Lee, Chairman of the Football Conference,
observed that at Exeter "all the supporters having paid their
entrance fee, go and clean the terraces".
In its evidence, FC United, a new club formed by disenchanted
Manchester United fans, pointed to a real sense of energy, with
300 volunteers regularly assisting the two full time staff in
keeping the club running.
Chester City Supporters Trust highlighted increased attendances
under their new supporter trust-owned model, even though they
were now playing three divisions lower than when they were a League
197. Supporter trusts were also keen to highlight
another practical benefit: their ability to attract more money
into the club. York City Supporters Trust explained how it was
able to raise enough money to acquire the club from administrators
in March 2003 with a majority 85% share holding. Brentford Supporters
Trust commented that it was able to assemble a £5 million
funding package to re-finance the club's bank overdraft. Southend
Supporters Trust, although not involved in the ownership of the
club, provided £60,000 to release Southend from a League-imposed
transfer embargo, and stepped in several more times to ensure
suppliers were paid and to underwrite travel costs. At the time
it submitted evidence, Southend Supporters Trust was still waiting
for the Chairman to honour a promise to invite a supporters trust
member onto the Board. Bradford City Supporters Trust commented
that it took the initiative in raising £250,000 within a
few weeks in the summer of 2004, during the club's second administration,
"and this sum saved the club from extinction".
198. Mention of supporters trusts providing emergency
funding highlights another key practical benefit of supporter
trusts: the role they are already playing as owners of last resort,
though this can be a double-edged sword, as it leaves supporters
trusts more open to failure. Dave Boyle told the committee that
supporter trusts at York City, Stockport County, Notts County
and Chesterfield had all fulfilled this role. Lord Mawhinney observed
that "York City was extremely important because the supporters
trust in York City deserve an enormous amount of credit for saving
that club from going out of business".
199. There was some debate in the evidence as
to whether the supporters trust ownership model required a majority
ownership stake for clubs to reap all of the aforementioned benefits.
Supporters Direct identified 90 supporters trusts with a minority
equity stake in their clubs and 64 with a seat on the club Board.
It argued that:
The ability of this involvement to bring benefits
to a club depends on its approach to good governance. Where the
club has proper procedures in place, supporter-elected directors
can play a very positive role as part of a balanced board considering
Conversely, where the club's governance is poor,
with dominant individuals making most decisions outside of formal
processes, the ability of any minority interests to influence
decisions is limited.
Lincoln City Supporters Trust, which has a substantial
minority stake in the club, argued that the introduction of supporters
into the running of the club had "created a team ethic behind
the scenes and not just on the pitch".
Swansea City Football Club is a particularly interesting example
of minority supporter ownership because the club has just won
promotion to the Premier League. Swansea City Supporters Trust
owns 20% of the shares. In its submission, it summarised its contribution
to the club as follows:
without the work of the Supporters Trust there may
well have not been a football club at Swansea City [
now following that crisis the supporters and the community have
a voice in the way the club operates which adds to that feeling
of togetherness and trust that seems to be sadly lacking from
most other clubs where fans are purely seen as customers. We add
a lot more than money to the club; be it professional skills,
a unique understanding of our heritage and community, volunteer
time, check and balance to the financial strategy, two way communication
between the fans and the Board - the list goes on.
200. John Bowler, Chairman of Crewe Alexandra,
was very positive about the benefits if Crewe's Supporters Trust
were to take a minority share and a place on the Board. He noted
though that it was proving hard to set up because "it is
no mean task setting up an efficient supporters trust and there
are a lot of bodies in the cemetery already where it has not worked".
In principle, though, he felt that smaller clubs would like to
see the supporters trust have a share in the club as it would
bolster its community involvement. FA Chairman David Bernstein
commented that he thought that "on the whole minority holdings,
where possible, are quite desirable".
Problems with supporter ownership
201. Other evidence, however, pointed to areas
of weaknesses in the supporter trust ownership model. Lord Mawhinney,
Greg Clarke and David Bernstein all highlighted the difficulties
that could ensue when share-holding supporter trusts appointed
a fan to sit on the Board. Lord Mawhinney suggested that the fan
on the Board risked being torn between his fiduciary responsibilities
and trust expectations that he would keep them informed of all
that was going on.
Greg Clarke drew on his own experiences working with a fan on
the Board at Leicester City:
He was a cracking director but he got into all sorts
of trouble with the trust; not nasty but they would say, 'Well,
who are we going to buy then in the transfer?' and he would say,
'Well, I can't tell you'. They would say 'What good are you doing
if you can't tell us what is going on?
David Bernstein made a different point, namely that
for supporters trusts' own protection there were "some boards
that they may better not be on" for what he termed "obvious
This could be a reference both to financial risk and the possibility
that a duplicitous owner might use a minority share-owning supporters
trust to lend legitimacy to his actions.
202. A second, linked, potential weakness identified
was slow decision-making. Leeds United Chief Executive Shaun Harvey
was clear that, "the best model is a small dynamic board
that's able to make decisions quickly".
Julian Tagg, Chief Executive of a supporter-owned club, agreed
that slow decision-making could be a handicap.
A third related point was the difficulty sometimes in identifying
a properly representative trust with the legitimacy to enter into
a partnership. David Gill, for example, made this point.
203. A fourth issue identified from the evidence
was the challenge faced by supporter-owned clubs to compete financially
with more conventionally-owned rivals. Brian Lee, Chairman of
the Football Conference which has seen a number of supporter-owned
clubs come up or down its ranks, observed that "The problem
with supporters trusts is that they do not have the financial
background. They have a lot of enthusiasm and a lot of passion,
but unfortunately enthusiasm and passion don't pay the bills".
He observed that, in 2010, Chester City Supporters Trust was unable
to save Chester City from folding because the finances involved
were just too great. York City Supporters Trust acknowledged that
it had found it necessary to sell the majority share holding of
its club to a private individual to secure the long term funding
of the club. Wimbledon Owners Supporters Trust, which will next
season compete in League 2 for the first time, commented that
the only disadvantage of the supporter-owned model was "the
difficulty of competing with clubs where rich owners can make
substantial sums of money available for players' wages".
Brentford Supporters Trust commented similarly about the competitive
disadvantage of competing against clubs with "reckless sugar
204. Associated with the issue of finances, a
further weakness identified was the failure of some trust-owned
clubs to sustain their initial impetus. Hendon Football Club Supporters
Trust accepted that:
a Trust owning a club is no silver bullet to all
of the problems of other ownership models: Notts County, for example,
suffered from problems with supporter pressure for investment
ultimately leading to the Trust selling the club and the recent
abortive Munto/Quadbak takeover.
Stockport County was also cited as an example of
a "failed" supporter-owned model.
205. Other evidence, however, argued that the
problems identified above were by no means insurmountable. Malcolm
Clarke, Chair of the Football Supporters Federation, was critical
of "patronising" suggestions that fans could not be
trusted with confidential information. He suggested, instead,
that supporters trusts can often draw on a range of skills and
experience. Dave Boyle further observed that: "The relationship
that a lot of clubs seem to have with their fans to me is more
redolent of perhaps an Edwardian marriage where the wife would
be never told the salary of her husband because these matters
were not for her".
Greg Clarke noted that, in his Leicester City example, the supporters
trust appointed as its fan on the board, "one of the senior
partners of one of the biggest law firms in Leicestershire".
Julian Tagg argued that Exeter City had managed to evolve a model
that allowed for slower decision-making and the supporters trust's
need for information. Though the model was not perfect, he stressed
that "we've made it work".
He also suggested that it was not such a bad thing that the supporters
trust wanted to discuss things and to receive information about
the club as, ultimately, this strengthened governance.
206. Malcolm Clarke told the Committee that it
was relatively easy to establish the legitimacy of supporters
trusts. He pointed out that supporters groups are democratic organisations
and that the numbers involved were a good indication of credibility.
He was critical of David Gill, asserting that:
certainly at Manchester United both the Trust and
other organisations have been very successful with very large
memberships. I think it's a bit of an excuse from Mr Gill, to
be honest, to try and pretend that some of those big groups are
not representative of very significant strands of opinion.
Supporters Direct also stressed that supporters trusts
are registered as Community Benefit Societies with the Financial
Services Authority (FSA).
207. Dave Boyle offered a defence of the mixed
record of supporters trust-owned clubs, pointing out that where
supporters trusts have had to relinquish control of their club,
"in every one of these cases I can point to astonishing legacy
He observed that:
No supporters trust has ever really inherited a club
which was going well. They've been investors of last resort, the
people who rescue it because the alternative is to let it die
and that's just not an option, and because of that, they have
incredible problems with debt, with loss of assets.
A way forward for supporter ownership
208. The supporters trust ownership model appears
to us to be one of the positive developments in English football.
From the evidence we have received, it is clear that supporters
trusts are building up an impressive track record as owner of
last resort, providing real community benefits and making an important
contribution to the sustainability of the game. Although not a
practical solution in every case, and less likely to be an option
further up the League pyramid, the supporters trust ownership
model deserves further encouragement. We also note that, where
majority ownership is not possible for financial reasons, a substantial
minority shareholding can still influence the culture of the club
for the better, and that next season, in the form of Swansea City,
there will be a practical example of this in the Premier League.
It would appear, therefore, that the Government is on the right
lines in wishing to encourage supporter ownership where this is
possible. To do so, however, it will need to consider ways of
addressing at least some of the main frustrations highlighted
by supporters trusts.
209. One complaint is that the process for setting
up and running supporters trust organisations is overly bureaucratic.
Steven Powell explained that:
I think that first of all we're trying to fit a square
peg into a round hole [
] Clearly there has to be security
for anybody who is investing money in the scheme, but the hurdles
we had to jump were designed for a different sort of financial
product. I'm a member of the trust, and I invested my money every
month. I'm not looking at that to help me in my retirement, I'm
looking at that as an investment in my football club and I've
left my units in my will to the supporters trust when I go.
Supporters Direct wrote that "there are regulatory
burdens imposed on trusts because they are raising funds to buy
shares in a private company and so treated like any other investment
activity, which is unsatisfactory".
Steven Powell is a member of Arsenal Supporters Trust (AST), which
has pioneered a model that allows fans to own part of a shareholding
in Arsenal Football Club. Arsenal is one of the few clubs whose
shares are still traded on the stock market. Given that Arsenal
shares trade individually at around £10,500 and are out of
the reach of most supporters individually, the scheme gives them
the opportunity to invest smaller amounts in a partial share.
AST's written evidence explained how the scheme works:
The Arsenal Fanshare Society buys shares in Arsenal
Holdings PLC and nominally divides each one into 100 Arsenal Fanshares.
As the value of one share in Arsenal Holdings PLC is currently
around £10,500, the value of one Arsenal Fanshare is currently
AST explained that members in the scheme gain a direct
ownership stake in Arsenal; an opportunity to attend the Arsenal
AGM; a quarterly shareholder email update from Arsenal; a vote
on key club resolutions; and access to scrutiny of the club's
finances. Arsenal fans paying in enough to purchase one full share
gain a guaranteed place at the club AGM and the full voting rights
for one share. AST noted that the scheme had been a great success,
with more than 1,600 members and the active support of the club.
However, it was critical of the regulatory burden on the scheme.
210. AST felt that its work had been "greatly
complicated by the inflexible nature of Financial Services Authority
It focused, in particular, on the Financial Services and Markets
Act 2000, which prohibits the Trust from offering shares or investments
unless it complies with a number of regulations. For example,
only organisations or individuals authorised by the FSA can issue
any investment advertisement to a general consumer. Additionally,
supporter ownership models are likely to be classed as Unregulated
Collective Investment Schemes, preventing the offer of shares
to persons other than high net worth individuals, sophisticated
investors and exempt institutions. To get round this, AST had
to establish a second Independent and Provident Societythe
Arsenal Fanshare Society Limitedand ensure that it "does
not make any profit nor have any trading income so we can establish
it is not a business and thus not an unregulated collective investment
scheme". AST concluded that: "This is a tortuous issue
that impeded our efforts for many years and means that we have
had to put in place duplicate structures for AGMs, Boards, accounts
and even legal advice, with all the effort and expense that entails".
Furthermore, in light of various other issues by which AST could
also fall foul of FSA rules, it decided to engage a management
company, Equiniti, "to administer the scheme on our behalf
at considerable expense".
211. The second big frustration encountered by
supporters trusts seeking to take a stake in their clubs is lack
of opportunity. Setting aside the general issue of finance, supporters
trusts are not usually offered shares unless the club is in dire
straits. There are very few clubs like Arsenal now, where supporters
are able to purchase shares on the stock market. Dave Boyle told
A lot of clubs make it very difficult for supporters
trusts to come on board because there are no shares available
in them. There are only five clubs in the English professional
league which are quoted on stock markets where you can actually
go and buy shares.
212. Even at Arsenal, a recent change in the
ownership structure posed the risk that one owner would seek to
purchase sufficient shares (90%) to precipitate a compulsory purchase
of all shares, wiping out the Arsenal fan share scheme. Such
acts have occurred at Liverpool, Manchester City and Manchester
United. David Bernstein, the former Chairman of Manchester City,
told us that:
When I was chairman, we had 5,000 shareholders. We
had an AGM where 800 shareholders turned up and I was very, very
proud of that and I was very disappointed, in many ways, when
the club was taken over and all the shareholders were removed
to a single ownership.
What can the Government do to address these frustrations?
The evidence suggested a number of possible ways to reduce bureaucracy
and increase opportunity. Henry McLeish was one of a number who
suggested that greater use could be made of the Community Interest
Company (CIC) as a model for a supporter-owned club to raise finance.
Observing that it allows "because of the structure and status
of the organisation, for them [clubs] to obtain finance and possibly
obtain some grant funding that they wouldn't have been able to
get in their old classification as a public liability company".
He noted though that "I think it needs encouragement. It
is happening but it is going to happen very slowly".
Olswang similarly suggested that:
CIC's, particularly for lower league clubs, may well
be a very useful model to encourage clubs to adopt. A CIC is formed
primarily for social enterprises that are being carried out for
the benefit of a community [
] CICs are not for profit, provide
the directors and shareholders with the benefit of limited liability
and their primary purpose is to pursue activities designed to
benefit the community.
Bates, Wells and Braithwaite provided a detailed
argument in favour of CICs as a model for community-orientated
football clubs. It pointed out that the CIC model guaranteed transparency
through an annual report requirement and an asset lock that "reduces
the opportunity for private gains and provides some protection
for the club's assets".
213. Other evidence looked to the Localism Bill
as a source of assistance for supporter- owned clubs. Dave Boyle
observed that it includes provision for community groups to bid
for community assets. This could provide more opportunity for
supporters trusts to purchase clubs which have gone into administration,
as currently one of the challenges for them is to put a bid together
quickly enough to see off alternatives. Dave Boyle concluded:
the idea of a big society bank perhaps providing
liquidity to such groups [supporter trusts] would be very, very
helpful, because at the moment it's that speed of access to cash
which is often paramount, specifically where a lot of football
clubs have transferred ownership under crisis terms where there
needs to be an immediate injection to cover losses.
Wrexham Supporters Trust hoped that the Localism
Bill would help it to buy back its ground.
214. Other evidence looked for different ways
to secure the same end: preferential status for supporters trusts
seeking to purchase clubs that were up for sale. The Liverpool
Supporters TrustSpirit of Shanklyproposed a transfer
window policy "whereby clubs that are in the process of changing
ownership or ownership stake in excess of 20% are legally bound
to offer a properly constituted Supporters Trust the opportunity
to purchase a shareholding in the club".
Under different circumstances, Bristol City Supporters Trust proposed
that: "If a club goes into administration, the administrator
should be obliged by law to favour a rescue package involving
participation by a recognised supporters trust of at least three
215. Other evidence put forward the benefits
of tax relief on supporters trust fundraising schemes that were
intended for community benefit. Co-operatives UK noted that, in
Manchester, FC United had benefited from being granted Enterprise
Investment Scheme tax relief.
Dave Boyle, however, wondered if this would be replicable.
AFC Wimbledon proposed that fan-owned clubs with a turnover less
than a designated amount should be exempted from VAT. Southend
Supporters Trust argued that the rules on Corporation Tax should
be changed for the benefit of supporters trusts.
216. AST was one of a number of supporters trusts
that wanted what it described as a more level playing field with
private investors who were allowed to claim tax breaks on their
investment in clubs. It proposed that:
DCMS establishes a working group that includes the
Cabinet Office and Treasury, that has as its remit to review all
the regulatory and fiscal structures that apply to fan investment
schemes like Fanshare and recommend additional measures that can
be taken to assist them to grow.
217. We asked the Sports Minister what measures
he was willing to consider to encourage supporter ownership. He
replied that he was open-minded, willing to look at any option
that "moves us forward". He was, for instance, prepared
to look at the Financial Services and Markets Act (FSMA) as it
applied to supporters trusts. He was, though, cautious about the
practicalities of majority ownership of "extraordinarily
valuable big football clubs" and cautious, too, about the
availability of tax breaks in the current financial climate.
218. The Minister set a challenge
to come up with proposals to promote wider supporter ownership.
We recommend that he look at two areas: measures to assist clubs
that are already supporter-owned, particularly options that increase
their ability to raise money; and measures that increase the opportunity
for supporters trusts to achieve a share in their clubs, whether
on a minority or majority basis.
219. Supporters trusts can be
organised as Industrial and Provident Societies, that are able
to bid for social and community funds. Unfortunately, trusts face
significant legal and bureaucratic hurdles when raising funding,
including from fans themselves. We recommend, therefore, that
the Government amend the Financial Services and Markets Act 2000
in order to recognise the special nature of supporters trusts.
Supporters Direct should continue to play an important role in
advising supporters trusts on how to take best advantages of the
opportunities available, possibly including use of the Community
Interest Company model.
220. We recommend that the Government
consider passing legislation to protect minority supporter stakes
that would otherwise be the subject of a compulsory purchase order.
221. As part of the licensing
process, the FA should give some thought to ensuring that properly
constituted supporters trusts, or consortia which include supporters
trusts, can play a part in rescuing clubs from insolvency. One
fruitful avenue might include giving trusts or such consortia
a real opportunity to make a successful matching bid for a club
that has gone into administration.
222. Supporter involvement is
not just about ownership. There are a number of examples of effective
consultation with fans. These include Arsenal, Sunderland and
a new approach from Liverpool with the Liverpool Football Club
Supporters Committee. We welcome these approaches to consultation
with supporters in a more structured format, and urge other clubs
to follow suit.
The role of the
223. Our earlier recommendation on licensing
would, if properly implemented, have the effect of reducing the
number of football clubs going into administration, and hence
reduce the opportunities for supporters trusts to assume ownership
of them or to start up phoenix clubs. We would suggest, however,
that the wider governance and community benefits of the model
should encourage clubsparticularly, though not limited
to, the lower leaguesto consider the benefits of a majority
or minority supporter shareholding model in circumstances where
there is no threat of administration. However, the attitude of
the football authorities will also be important here. In this
respect it is disappointing, though perhaps not surprising, that
the FA, Premier League and Football League have a somewhat ambivalent
attitude to supporters trusts, taking a line of strict neutrality
on ownership models, which can have the effect of keeping supporters
trusts on the outside. Supporters trusts offer some trenchant
criticism of what they see as the over-commercialisation of the
game, while the FA, Premier League and Football League offer an
equally trenchant defence of their work to increase the popularity
of the game at home and abroad.
224. Move beyond this, however, and they all
share a key objective; sustaining the unique size and strength-in-depth
of the English pyramid structure. The Premier League needs lower
divisions to "blood" its young players; help develop
new player and managerial talent; and provide competition both
in the cups and for the promotion/relegation battle, without which
the Premier League would become increasingly sterile. The pyramid
structure is fundamental to the rationale of both the FA and the
Football League. Supporters trusts, meanwhile, see sustaining
the viability of their local club within the pyramid structure
as pivotal. The pyramid structure thrives on compelling narratives,
and the stories of Swansea City (underdog into Premier League),
Exeter City (saved by the supporters trust and the luck of a great
FA Cup draw) and AFC Wimbledon (working its way up from the bottom
to secure a league place) provide three such recent stories for
the football authorities.
225. The submissions to this inquiry spell out
a strong message that the role played by the Supporters Direct
organisation has been absolutely vital to nearly all supporters
trust success stories. Supporters Direct was established in 2000,
following a recommendation in the Football Task Force report "Investing
in the Community", published in 1999. Like the supporters
trusts it seeks to support, it is registered as a Community Benefit
Society. Its mission is to promote sustainable sports clubs based
on community ownership and supporter involvement, and to that
end it provides support and advice to individual clubs, commissions
research and works to publicise the benefits of the model. As
well as providing support to English football clubs, it is active
in Scotland, Europe and in English rugby league.
226. William Gaillard told us that UEFA was funding
Supporters Direct to promote the model in Europe. He observed
that "Supporters Direct in England and Scotland have done
a fantastic job at rescuing clubs, but also at injecting a lot
of rationality and positive supervision, thanks to their [supporters
trusts] participation in club boards". He stressed
that "our experience with them is that they are highly qualified
and determined people with an excellent track record in managing
Academic Richard Giulionotti similarly emphasised that:
The achievements and successes of the 'Supporters
Direct' movement should be underlined, as reflected in the agency's
own reported figures: Trusts are in place at over 160 clubs; there
are over 120,000 members; Trusts contribute board directors at
almost 60 clubs; and, Trusts own or control 15 clubs. Trusts
have also played a key role in the survival of several clubs that
have been placed in administration. This kind of proximity to
club owners and directors should allow supporters to convey their
specific views regarding, for example, ticket allocations and
prices, club expenditure, and security in stadiums.
We also received a number of testimonials from individual
supporters trusts. Merthyr Town Supporters Trust recounted how
the Trust "sought the assistance of Supporters Direct, and
as the club continued to slide towards administration as the 2008/09
season got underway, began to pave the way for a future containing
a more positive community-based club".
Telford United Supporters Trust explained how Telford United Independent
Supporters Association turned itself into a Trust having come
into contact with Supporters Direct and seen the benefits of the
Trust's legally recognised and fully democratic structure. Fisher
Supporters Trust wrote that "we have reformed our club as
Fisher FC, and received much practical and moral support from
Supporters Direct in order to do so".
FC United Supporters Trust explained how "with the assistance
of Supporters Direct the model of an Industrial Provident Society
(IPS) was adopted as the basis on how the club would be structured".
Chester City Supporters Trust wanted to place on record its thanks
to Supporters Direct along with other supporters trusts. Swansea
City Supporters Trust and Scarborough Supporters Trust noted Dave
Boyle's presence and advice at key meetings when the decision
was taken to form the Trust.
Pompey Supporters Trust concluded that "Supporters' Direct
are the perfect vehicle to support non-profit and democratic football
227. It is of deep concern, therefore, that,
despite its track record in helping to deliver sustainable outcomes
for football clubs throughout the football pyramid, Supporters
Direct's funding has frequently been precarious and its future
is currently uncertain. In 2006, a three year deal drawing on
funds provided by the Government, Football Association, Premier
League and Football League for the Football Stadia Improvement
Fund (FSIF) distributed by the Football Foundation, promised more
security. Supporters Direct received £574,000 in 2007-08,
£591,000 in 2008-09 and £610,000 in 2009-10. However,
when this agreement came to an end, the Government indicatedunderstandably
given wider financial challengesthat it would no longer
be able to contribute to the FSIF. The Football Foundation decided
to establish a new fundthe Fans Fund to allow applications
for funding for any supporter group, including Supporters Direct.
The Fans Fund would be financed solely by the Premier League.
In the interim, the Premier League agreed to fund Supporters
Direct's core running costs through the FSIF, until such time
as the new long-term arrangements were in place. The FA's written
evidence noted that it had financially supported Supporters Direct
for many years, but not why it no longer did so.
228. Richard Scudamore told us in April that
"in a practical sense we now fund Supporters Direct, and
we have done for some time".
We asked whether he would continue to fund Supporters Direct at
the current level. He replied that "this is an ongoing debate
as to whether we, the Premier League, should be funding these
organisations. We took up the Supporters Direct funding when Government
decided it didn't meet the Government criteria of participation
only". He also observed, however, that "they admit by
their own efforts that they would rather find more sustainable
sources of funding, because they find it awfully odd being paid
for by the Premier League".
229. Richard Scudamore appeared to be a somewhat
reluctant funder. In June long-running discussions between the
Premier League and Supporters Direct over funding reached a crisis
point when the Premier League, and the other representatives on
the FSIF reacted to inappropriate comments posted by Dave Boyle
on his personal twitter account upon AFC Wimbledon's promotion
to the Football League in May. These were directed at a named
individual with a role in the decision to allow Wimbledon FC to
move to Milton Keynesa decision which had prompted Wimbledon
supporters to establish AFC Wimbledon. Deeming his apology, conveyed
by Pauline Green, Chairman of Supporters Direct, insufficient,
the FSIF withdrew its offer for future funding. Dave Boyle subsequently
resigned and new Chief Executive Brian Burgess entered into urgent
talks with the Premier League to establish under what circumstances
the FSIF would consider future applications from Supporters Direct
for funding from the Fans Fund. Supporters Direct accepts the
need to reduce its core costs and the need to increase its own
fund raising. As things stand, the Premier League has agreed to
pay Supporters Direct payroll costs to prevent immediate redundancies.
The FSIF agreed on 15 July 2011 to approve one of Supporter Direct's
frozen grant applications£268,292 for running costs
over the next three years. FSIF will consider whether to approve
the remaining grant applicationsaround £1,200,000
over three yearsin August 2011. Even if the FSIF does approve
all its grant applications, Supporters Direct would still face
a drop in grant assistance of 37% from 2010/11 to 2013/14.
230. The Premier League reaps the benefit of
collective bargaining on the basis not just of the integrity of
the competition but also its commitments given to Government that
it will channel some of the proceeds for wider community benefit.
We do not, therefore, see anything particularly problematic about
the Premier League funding Supporters Direct, though we are surprised
that the Football League does not also see fit to make a contribution,
given its interest in the sustainability of clubs in its competitions.
For the same reason, we are surprised at the absence of any obvious
FA commitment to the work of Supporters Direct. We do see something
problematic in funding organisations punishing a recipient organisation
for an individual's mistake, particularly when that individual
proffered an apology and subsequently resigned. While the comments
made on a personal site were unacceptable, it seems to us to be
a massive over-reaction to use them to question the validity of
an organisation whose track record is so strong. The consequence
is that the actions of the Premier League and the FSIF appear
vindictive and motivated by a desire to clip Supporters Direct's
wings. While we can see the advantages of the Fans Fund distributing
some funding directly to individual supporters trusts, we also
note that supporters trusts have asserted that they also need
to draw on the expertise of Supporters Direct. In this context,
William Gaillard, who expressed concern that the financial future
of Supporters Direct was not safe, observed:
If the experiment is to succeed it cannot be left
to just a bunch of volunteers who would basically give some of
their time to the cause. We need a core organisationa small
one albeitto run Supporters Direct. We do our part with
the European side and I think it would be a tremendous loss for
English football if this great experiment, which has already given
so much to this country's football, was discontinued or was less
efficient than it has been just because of a lack of funding.
231. The reluctance of the
FA, Premier League and Football League to devise a formula for
the long term future of Supporters Direct is deeply disappointing
given the fact that all have a vested interested in sustaining
community-based clubs. It constitutes a failure of imagination
and a failure of governance by the football authorities, and we
urge them to work quickly towards a funding solution that allows
Supporters Direct to develop its role assisting supporters trust
organisations and makes realistic assumptions of Supporter Direct's
own fund-raising potential. We urge the Government, as part of
its commitment to supporter involvement in football, to use its
influence with the football authorities to work to this end. There
is a positive opportunity here for the football authorities to
show their commitment to supporting community-based initiatives.
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