Trust News

Cardiff City Supporters’ Trust has submitted evidence to the influential House of Commons’ Culture, Media & Sport inquiry into football governance.

Our submission below is followed by comments from chairman Tim Hartley

Culture, Media and Sport Committee Inquiry into Football Governance – submission by Cardiff City Supporters’ Trust

1.  Introduction

1.1 Established in 2008, Cardiff City Supporters’ Society Limited (the Trust) is a democratic, not-for-profit group of supporters, committed to giving fans a voice in the decision-making process of the club, and to strengthening the links between Cardiff City and the community it serves.

2.    Concerns

2.1 The Trust shares the concerns of many supporters across the United Kingdom at the way football clubs are owned and managed by wealthy individuals simply as businesses without any concern for, or involvement by, the wider social and footballing community. We have seen clubs chasing the golden goose that is football’s Premiership, making short term investment decisions which have long term consequences.

2.2 Investing in football on a purely business basis, without concern for a club’s sustainability is contrary to the interest of the club itself and indeed the interest of the fans who will still be attending matches long after the investor has moved on to other business ventures.

3.  Cardiff City

3.1 Chasing that dream of Premiership football Cardiff City has over recent years, swayed from one financial crisis to another. Players were enticed with unrealistically high signing on fees and wages without the club having the long term means of paying for them.

3.2 Under the ownership of Lebanese businessman Sam Hammam, the club was run at a significant operating loss. This resulted in the club loaning more than £21.7 million from Citibank between 2000 and 2004. Citibank called in those debts in late-2004, so the club then borrowed £24 million from a mysterious Swiss-based Panamanian-registered company called the Langston Corporation. The advance was given in the form of unsecured loan notes.

3.3 This particular loan was unsecured because there were no material assets at the club other than the playing squad. (A pepper corn rent was being paid to the council for the use of Ninian Park, the club’s ground at that time).

3.4 The club was incurring heavy losses and has only showed a net profit in one year during the last ten and then only because promising players or those with a proven track record were sold. There could be no more borrowing. Consequently, costs had to be cut but the club’s hands were tied with a high wage bill and long term contracts for players in place.

3.5 Ninian Park could not be redeveloped so a new build was conceived – this would be more attractive to those who had not previously attended football matches, would increase the capacity and raise the price supporters paid to attend the all seater stadium. Retail outlets were in large part to pay for the new stadium. However, delays in the project meant it finally opened during a recession.

3.6 Even after the new stadium opened cash flow became a problem. Season tickets were offered for sale earlier and earlier. Some contractors at the stadium went unpaid. This season’s season tickets were offered to supporters well before Christmas 2009. Fans were told that the money raised would go towards strengthening the playing squad.

3.7 The supporters were keen to play their part in helping the club financially, but the first they heard of the financial difficulties was when the local paper announced that the club had been served by HMRC with a petition to wind the business up for non payment of taxes.  As it transpired, the season ticket money, given in good faith to purchase new players, was used to pay outstanding bills. The new players never materialised. It was against this history of mismanagement that the Trust was set up.

3.8 By early 2010 the Trust became concerned that the club had not held an AGM for three years. Such a meeting would have allowed small investors, which by then included the Trust itself, to ask searching questions as to the financial viability and the management of the club.

3.9 The Trust pushed for an EGM to discuss the ongoing crisis. It wrote to every investor in the club and asked them to proxy their votes to the Trust in order to call a meeting. In the face of such discontent the club did finally call an EGM. Some unpalatable truths were disclosed at that meeting, in part as a result of the actions of small investors and the Supporters Trust itself.

4.  Recommendations

4.1 In the light of the experience of the Cardiff City Supporters Trust we offer the committee the following recommendations with regards to the future management and regulation of football in the United Kingdom.

4.1.1     The government should establish a UK Football Commission (the Commission) which would oversee the financial and corporate governance arrangements of professional football clubs. The Commission would include representatives from the FA, football trust or Supporters Direct and a players’ representative.

4.1.2     The Commission would conduct the ‘fit and proper person’ test for chairmen of football clubs over and above all other aspects of due diligence undertaken when a club changes ownership. This test would become a statutory obligation and be conducted in conjunction with the Football League and the Football Association, with the Commission having the final say on the suitability of all such persons to run a football club.

4.1.3     The existing fit and proper person test would be strengthened. New measures could include the person’s previous record not simply in business but also in football, their personal history and past and their present financial standing.

4.1.4     A club’s players wage bills should be capped as a percentage of the total turnover of the club and monitored by quarterly returns to the Commission. This would ensure there is no breach of the cap and that the figures could not be somehow masked over longer accounting periods.

4.1.5     Supporters trust should have formal representation on the boards of professional football clubs, even if this is simply in an ‘observer’ capacity. Fans issues should become a permanent agenda item at all clubs’ board meetings.

4.1.6     New share offers in football clubs should ensure preferential status for properly constituted supporters trusts so that they have the first right to buy any new share issue. This would continue until the supporters trust has achieved a %age of the total shareholding of the club. (We suggest this should be set at 25% of the overall shareholding.)

4.1.7     As happens in France and the NFL, football clubs should be liable to independent audits every year so that the Commission is aware of the financial state of professional football clubs.

4.1.8     In order to encourage supporter participation and ownership, tax relief should be offered on investments by supporters’ trusts in their clubs.

4.1.9     Before there is a takeover of a professional football club, an ‘intentions test’ should be required by the Commission which lists and assesses potential investors’ plans to develop the club as a community enterprise as well as what role they intend fans to  play in the governance of the club. This should then be made a condition of agreeing any take over.

Chairman Tim Hartley said: “Football is not like any other business. Clubs like Cardiff City belong to the local community and to the men and women who support them.

“While chairman, managers and players come and go we, the supporters, are here for the long haul. Football is rooted in local communities and must respect and respond to the needs of fans.

“That’s why we need a new football law which recognises the role of supporters, which ensures that clubs are properly constituted and run so that they cannot be traded like any old company, whatever the consequences.

“We want a UK Football Commission established to oversee the financial and corporate governance of professional football clubs. Fans should have a representative on the board of every football club in Britain and supporters’ groups encouraged to buy a significant shareholding in clubs.

“These are just some of the steps which could ensure that clubs become true community enterprises in which we can all take pride,” added Tim Hartley.

The Fred Keenor Statue fundraising committee will be selling a batch of programmes and Keenor pin badges at the Trust gig in the Duke of Clarence, Canton, Cardiff, on Friday (February 11) from 8pm.

The programmes have been donated to the appeal by City fans and we’ll be selling them on the night so if you’re looking for additions to your collection, or wanting to start a collection, come along.

They include Cardiff City homes and aways and FA Cup Final programmes from 1964, including 1966-1989, 1991, 1995, 2000-2003 and 2005 and Wales homes. Prices of programmes vary and all money raised goes to the appeal.

Pin badges are £3 each while entry to the gig with Howl Griff, Brother Steve and Catrin O’Neill is just £3.

On Tuesday evening before the Reading game, club officials met with fans at the Cardiff City Stadium to discuss their future plans for the Canton Stand. Tracey Marsh attended on behalf of the Supporters’ Trust and Dave Sugarman was also present in his capacity as a member of the club’s Away Travel Group. The following is Trust member Dave’s report of the event:

Tuesday’s meeting was called by Cardiff City Stadium manager Wayne Nash in response to discussions which have been taking place on the fans’ message boards in recent weeks with regard to the atmosphere inside the stadium on match days. It seems there are many supporters who believe the atmosphere within the ground is currently a little flat and needs to be improved.

Trust member Gwyn Davies, who was present at the meeting, has been leading calls for the fans who wish to generate a livelier atmosphere to move from other areas of the ground to the Canton Stand, where he believes a designated singing section could be created. Gwyn has spoken of his hope that the club and the authorities will take a more relaxed view as regards fans standing in the Canton Stand, and his ideas have been getting plenty of support.

Ever since December 2008, when plans for the seating arrangements at the new stadium were first unveiled during presentations at Ninian Park, club officials have talked of their desire to create a dedicated singing section in the centre blocks of the Canton Stand. It has always been made clear that the stewards will be more tolerant of fans standing in that area of ground, while standing in other areas will be outlawed.

Nevertheless, significant numbers of supporters have frequently been standing in Blocks 117 and 118 of the Ninian Stand since the stadium opened. This has led to the club receiving regular complaints from other fans in those blocks who either want to or need to sit down. The stewards have been getting increasingly tough with individuals who are persistently standing in that particular area of the ground and the strong inference from the discussions during Tuesday’s meeting was that the clampdown is set to continue.

Another issue with regards to Blocks 117 and 118 of the Ninian Stand is that the club will be required to increase the size of the away section should the team get promoted to the Premier League. Therefore, some of the season ticket holders who are currently located in those blocks may be forced to move at some point in the future.

Taking the above factors into account, the club’s officials are very keen to work with all of the fans’ groups during the coming months in a bid to achieve a passionate atmosphere and a safe environment within the new stadium that will suit all the supporters who visit it.

The attendees at Tuesday evening’s meeting included Julian Jenkins, who is the club’s Head of Customer Services and Ticketing, Mark Jenkins and Dave Motherway, who are senior stewards at the Cardiff City Stadium, PC Simon Insole, who is a Football Intelligence Officer with the South Wales Police, and Graham Bond, who is the Group Leader of Cardiff Council’s Safety Advisory Group.

All of those present gave their support to the creation of a dedicated singing section in the Canton Stand. Some of the key points raised during the meeting were:

1)   Club officials are very keen to involve all of the fans’ groups in this initiative, including the Cardiff City Supporters’ Trust, the Cardiff City Supporters’ Club and the fans who use the internet message boards. During the coming months, supporters will be encouraged to make suggestions on how to improve the atmosphere inside the ground, with particular emphasis being placed upon the Canton Stand. The club is open to all ideas and wants this initiative to be fan-led.

2)   None of the supporters who currently hold season tickets in the Canton Stand will be asked to move in order accommodate anyone who wants to relocate to that area of the ground. Like all other season ticket holders, those who are currently situated in the Canton Stand have until 31 March to reserve their seats for next season. The only way fans will lose their current seats in the Canton Stand is if they fail to renew by that date.

3)  There are around 2,000 seats in the Canton Stand that are not yet allocated to season ticket holders. Of those, approximately 800 are in the four central blocks of the stand, with the majority of the vacant seats situated towards the front of the stand.

4)   The club receives regular complaints from fans regarding persistent standing in Blocks 117 and 118 of the Ninian Stand, but no complaints about persistent standing in the Canton Stand have ever been received.

5)   Platinum Ambassadors who wish to relocate to the Canton Stand from other areas of the ground will not lose any of their Ambassador benefits, including the guaranteed five-year price freeze, even if moving seats results in them purchasing cheaper season tickets.

Tracey Marsh revealed that the Supporters’ Trust hasn’t received a single complaint from its members regarding the proposed creation of a singing section in the Canton Stand despite suggestions on one of the internet message boards to the contrary. Tracey confirmed that the organization is fully supportive of the idea and intends to play a full part in the consultation process which is set to develop during the weeks ahead.

My personal view is that the initiative of creating a dedicated singing in the Canton Stand is a very positive one which should have some significant benefits for all concerned. Hopefully, the idea will be embraced by a large number of fans and the atmosphere within the stadium will improve as a result.

Dave Sugarman

2/2/2011

Cardiff City fans renewing their season tickets for the 2011-12 season are being offered the opportunity to make a donation for the Fred Keenor Statue Appeal.

In letters sent out by the football club, they are being invited to make a contribution of £2 or more to help the appeal to raise £85,000 for a lasting tribute to Fred Keenor and the rest of the 1927 FA Cup winning team.

David Craig, Project Manager and Cardiff City Supporters’ Trust board member, said: “We’re really delighted that Cardiff City agreed to offer supporters the opportunity to make a donation to the appeal when they renew their season tickets.

“The support we have received from the club for our appeal, which has topped £41,000 – almost half-way to our target of £85,000 – has been great.

“We hope that many thousands of Bluebirds’ season ticket holders will make a donation of at least £2 or perhaps £5, £10 or more if they can afford it. Fans have been so generous up to now and we hope they will be able to dig a little deeper into their pockets.

“This appeal has been very much a grassroots fans initiative and that will continue. But we’d like to see businesses in South Wales come forward to back our campaign with donations. That would help us reach our target quicker.”

David said that the Fred Keenor fundraising committee hoped to be in a position to ask Llantwit Major-based sculptor Roger Andrews to make a start later this year on creating the iconic image of the Cardiff and Wales skipper.

Season tickets went on sale on Tuesday, 1 February.

How many countries starting with the letter K can you name, and who scored most goals for the City in the 1999 – 2000 season? They’re just two of the questions asked at the Trust quiz at the Rose and Crown in Pontypridd. A good crowd came to Ponty to raise money for the Trust and for the Fred Keenor statue appeal. The aptly named Trust Us team won the quiz with a special prize going to the WAGs for their competitive spirit.

Special thanks must go to the landlord Snowy for giving us such a welcome and providing some lovely food. In total £614.70 was raised which included a donation of £80 from the Rose and Crown, £200 from Scrumpo and £100 from SAG Solutions.

Brilliant stuff! So who was City’s top goal scorer in the 1999-2000 season? Well I guess you just had to be there to find out!