English football needs shakeup to tackle debts - report

LONDON, July 29 (Reuters) - Sweeping changes must be made to English football to address financial instability, levels of debt and to secure the domestic game’s future, according to a parliamentary report published on Friday.

The Culture, Media and Sport Committee said the Football Association should lead the way in shaking up soccer although the FA also needed urgent reform of its own.

“No one doubts the success of the Premier League in revitalising English football,” said committee chairman John Whittingdale. “But it has been accompanied by serious financial problems throughout the football league pyramid.

“Significant changes need to be made to the way the game is run to secure the future of England’s unique football heritage and the economic and community benefits it provides,” added the Member of Parliament.

Whittingdale said a new-look FA should galvanise the process of change.

“The FA is the organisation for the job but it has some way to go getting its own house in order before it can tackle the problems in the game and address the future,” he explained.

“We need a reformed FA to oversee and underpin a rigorous and consistent club licensing system and robust rules on club ownership which should be transparent to supporters.”

Whittingdale warned legislation could be introduced if English football was unable to clean up its act on its own.

LAST RESORT

“Almost all our recommendations could be achieved without legislation, through co-operation and agreement between the football authorities, and we urge them to respond positively with an agreed strategy and timetable for change,” he said.

“Legislation should be considered only as a last resort in the absence of substantive progress.”

Deloitte’s Annual Review of Football Finance, published last month, said operating profit margins in the Premier League had reduced from 16 percent to four percent over the lifetime of the competition.

Figures also showed the net debt of top-flight clubs a year ago was 2.6 billion pounds ($4.2 billion) and that more than 50 percent of division one, two and three clubs had gone into administration since the Premier League was founded in 1992.

Among the committee’s recommendations are:

* Imposing a rigorous and consistent formal licensing model to promote sustainable forward-looking business plans and underpin self-regulation measures introduced by the Premier League and the Football League, and financial fair play regulations being introduced by UEFA.

* A strong fit and proper persons test (for ownership) consistently applied, with a presumption against selling the ground unless it is in the club’s interest.