The owner of West Ham United, David Sullivan, suggests that the Premier League could lose its status as the world’s leading division if an independent regulator is implemented.
If the Football Governance Bill, which had its initial reading in Parliament on Tuesday, becomes law, it would introduce such a regulator.
The UK government proposed appointing a regulator following a fan-led review of football in 2022.
However, Sullivan argued that a regulator is only deemed necessary “when things are going badly.”
One of the key roles of the regulator would be to find an agreement between the Premier League and the English Football League (EFL) over financial distributions.
With no agreement in sight, the EFL has said action from an independent regulator is “more important than ever”.
“The Premier League is the top league in the world,” Sullivan told BBC Sport.
“It is a big export – other countries want to buy it off us and we do very well in Europe generally.
“Anything to water down our income will make us less competitive. We may cease to be the top league so they may ruin an asset that we have.”
However, EFL chairman Rick Parry said: “Nothing is going to change the competitiveness of the Premier League.
“The gap [in terms of wages paid] is just getting bigger and bigger between the Premier League and the rest [of Europe], so the idea that the Premier League is going to be unduly constrained or no longer competitive, I just don’t even see how that argument gets to first base.”
The fan-led review, prompted by the collapse of the European Super League in 2021, presented 10 recommendations to the government aimed at enhancing football.
The regulator’s authority will focus on three primary goals: enhancing clubs’ financial sustainability, promoting financial stability throughout the leagues, and preserving the heritage of English football.
Sullivan, who first invested in West Ham in 2010, criticized the government’s history with regulators, describing it as “appalling.”
“You tend to put a regulator in when things are going very badly and something has to be done to sort it out. We have the best football in the world,” he added.
What does the bill say?
New club owners and directors will undergo more stringent assessments to mitigate the risk of club insolvency, as witnessed in cases like Bury and Macclesfield. Additionally, a proposed licensing system covering clubs from the National League to the Premier League aims to be implemented.
Under this licensing framework, clubs will be obligated to engage with their fans on significant off-field matters, including club heritage and strategic direction.
Furthermore, if the Premier League and the English Football League (EFL) fail to reach a consensus on the distribution of Premier League funds across the football pyramid in England, the regulator may intervene. Currently, both parties have not reached an agreement on a “new deal,” prompting the regulator to be endowed with additional powers to resolve the issue.
For some time, the government has cautioned football authorities that an independent football regulator would possess such intervention capabilities.
“You have two problems – what we give and who funds it?” Sullivan said.
“There is a big argument between the bottom 10, who want the top clubs to pay a lot more, and the top clubs want everyone to pay the same.
“Whatever we give won’t be enough for them [the EFL]. Tesco don’t give the small supermarket chain a subsidy.”
The Premier League offers financial assistance to certain Championship clubs through parachute payments, which were established in the 2006-07 season to mitigate the financial impact of relegation on relegated teams.
These payments, distributed to each of the three relegated clubs, decrease in amount over three seasons.
Sullivan believes that the parachute payments are insufficient in aiding relegated clubs and expresses concern about the prospect of West Ham dropping out of the Premier League after 12 consecutive seasons, stating that it would be “horrendous.”
“We don’t think that parachute payments are the right mechanism. They obviously indicate there’s a problem but they tackle the symptoms,” EFL chief Parry said.
“We don’t want clubs facing financial catastrophe – either on the way up or on the way down. “What we’ve always said is we want to address the cliff edge – the gap between the Premier League and the Championship. For the non-parachute clubs, that £100m-plus. That’s the gap that is unbridgeable and challenging.
“We’ve always said we think that gap should be halved, and if we halve that, then we don’t need the parachute payments.”