Premier League Faces Unprecedented Regulation From UK Government

A new football regulator will have the power to decide how England’s lucrative Premier League distributes money to smaller clubs, giving the regulator greater control over the country’s most popular sport.

The ruling Labour party has bulked up a football governance bill proposed by the previous Conservative administration. The regulator will also expect top teams to consult their fans if they want to raise ticket prices or move to a different stadium, according to a statement from the UK government.

The regulation of football in the UK has been largely left to the Premier League and the English Football League, self governing bodies that manage the various tiers. However, collapses of smaller historic clubs such as Bury FC and Macclesfield Town, alongside the global profile of the Premier League and the threat of a rival Super League, has led politicians to step in and impose its own rules.

While the bill still needs final approval, it’s set to give the new regulator powers to influence the redistribution of Premier League money to clubs in lower divisions. The Premier League has long opposed any involvement from government.

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“We believe rigid banking-style regulation, and the regulator’s unprecedented and untested powers to intervene in the distribution of the Premier League’s revenues, could have a negative impact on the League’s continued competitiveness,” the Premier League said in a statement. 

At present, the Premier League can allocate a large part of the money it redistributes to parachute payments, which are given to teams relegated from the top flight. The system helps those teams manage a sharp drop in revenue when they fall out of the Premier League.

The EFL, which runs the three leagues outside of the top tier, has long argued that such payments to only a handful of teams distorts competition in the game’s second tier. Clubs in receipt of parachute payments are twice as likely to be promoted back to the Premier League, according to a review into English football backed by the previous Conservative government. 

Under Labour’s plans, the football regulator would make a final decision on how much the Premier League distributes to smaller clubs if it cannot come to an agreement itself with the Football League, which represents 72 clubs below the top tier. The proposal is known as the backstop, and will now concern parachute payments as well as the overall amount.

The bill is aimed at “putting fans back at the heart of the game, taking on rogue owners and crucially helping to put clubs up and down the country on a sound financial footing,” said Culture Secretary Lisa Nandy.

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