Government tells FA to act on club debt levels

The Football Association should take a leading role in controlling debt levels at clubs and monitoring finances as part of a new licensing system, the Government said today.

The Government's response to the select committee report on football governance has been published today and also calls for further changes to the make-up of the FA board.

On finances, the Government says there should be a role for the FA, working with the leagues, to protect the game.

The response states: "The Government shares the concern expressed by the committee at the extent of losses and the number of clubs on the edge of viability.

"Debt per se is not always a bad thing, but it must be genuinely sustainable and should be assessed as a percentage of turnover.

"Government believes that there is a legitimate role for the national governing body, working hand in hand with competition organisers, to ensure that appropriate and consistent checks and balances are in place to protect the overall financial integrity of the national game and its long-term viability.

"The recent moves by the Football League to work towards a break-even rule in the Championship are a welcome indication of the appetite amongst many clubs for a change."

The Government says there should be a system of licensing for clubs where financial sustainability and robust checks on club owners and directors are included.

The response adds: "The Government expects that the issue of financial sustainability should be addressed as part of the recommendations on the new licensing model."

Sports minister Hugh Robertson said: "This country is hugely passionate about our national game and there are many reasons we should be pleased with how it has progressed over the last two decades.

"However I believe that there are improvements that can be made in the governance arrangements, which have failed to keep up with the changing pace of the modern game.

"I do not want Government to run football, so this is an opportunity for the football family to work together to benefit the game in the long term."

The Government have set a deadline of the end of February for the changes to be brought in and have threatened to introduce legislation if the game does not make reforms.

That would require the FA, the Premier League and the Football League all to agree on making the necessary changes.

The Government's proposals also call for reform of the FA board. The suggested new structure would be made up of a chairman, general secretary, two further FA executives "bringing wider football expertise", two independent non-executive directors and two each from the professional and national game.

The FA Council's role should be changed so that committees report to the FA board instead, with a maximum limit of eight years for council members.

The football authorities should look at ways to encourage more fans on clubs' boards, say the Government, and clubs should be forced to release players for England duty at all age levels from under-17 upwards.

The report makes clear the Government's threat to bring in legislation if reforms are not made.

It states: "We expect the football authorities to work together to agree proposals, including plans for implementation, by 29 February 2012. The new board can then agree the way forward for the remainder of the recommendations, ideally for implementation for the start of the 2012-13 football season.

"The Government is fully committed to ensuring that the changes put forward by the football authorities make a lasting and substantive difference.

"If that does not happen the Government will introduce a legal requirement on the Football Association to implement the appropriate governance clauses by the swiftest possible means."

A joint FA, Premier League and Football League statement said they would take some time to decide on action.

The statement said: "The football authorities are grateful to both the Culture, Media and Sport Select Committee and the Department for Culture, Media and Sport for the time taken and interest shown in the governance arrangements for football.

"We shall now take time to consider the Department's response as we formulate what the most appropriate actions might be.

"The FA, the Premier League, The Football League and representatives of the National Game are already engaged in this process and are committed to keeping the Minister and his Department informed of our progress."

PA