Prime Minister warned over threat to smaller football clubs by 'watering down' the Football Governance Bill

Rishi Sunak risks letting down Red Wall Tory MPs over 'watering down' plans to save English football and protect lower league clubs, it was claimed last night.

The Prime Minister was warned that a proposed new football regulator would be 'too weak' to help stop lower-league clubs from going to the wall.

One Northern Tory MP said the Football Government Bill would only work 'if the regulator has the power to properly oversee football activities across the 92 football league teams.'

There were also claims that proposals to redistribute money from the wealthy Premier League were 'flawed' over plans to let relegated teams keep huge 'parachute' payments.

Last night, Labour MP Clive Betts accused the Premier League of placing a 'poison pill' in the proposed regulation plans to stop them working effectively.

The Sheffield MP said: 'I think the Premier League has lost the fight over having a regulator so they have put a poison pill in the regulation to stop if working effectively.

A Premier League source denied that, saying that 'we strongly refute his claims'.

But Rick Parry, chairman of the English Football League (EFL) told the Mail on Sunday that the football reforms as currently constituted would 'perpetuate the way money is distributed from the wealthy Premier League to the less well-off clubs in the lower leagues'.

He also claimed that failing to give the proposed regulator enough power was 'almost like saying the referee can look at the VAR screen to check for a penalty but then not have the authority to give the actual spot-kick'.

However, the Department of Culture, Media and Sport insisted the plans – to be debated in detail this by MPs - would 'safeguard the future of local football clubs for the benefit of communities and fans'.

A spokesperson added: 'Our legislation, which has been widely welcomed, will ensure that fans are placed back at the heart of the game by setting clubs and the entire football pyramid on a financially sustainable footing.

'We have always been clear that financial distributions between the leagues is a matter for the leagues, but if they cannot reach a resolution, the Regulator will have the power to intervene through the backstop.'

But last month, Premier League chief executive Richard Masters reminded MPs of the potential dangers of 'over-regulation'.

In a letter to the Commons' culture, media and sport committee, Mr Masters said that his organisation would 'continue to make constructive suggestions to improve the regulatory system that is being created to reduce the risks to English football'.

However, he added: 'Our position remains that sensible, light-touch regulation can be made to work, notwithstanding the risks it presents to the best-funded and deepest pyramid in world football.

'No industry normally likes to be regulated, and we are not the only football organisation to be raising concerns about the potential for overregulation and inadvertent damage.'

Last night, EFL chairman Mr Parry told the Mail on Sunday: 'Welcome as much of the Football Governance Bill is, it contains two major flaws which will perpetuate the unfair way money is distributed from the wealthy Premier League to the less well-off clubs in the lower leagues.

'First, the Bill specifically excludes parachute payments for clubs relegated from the Premier League from proposals to review how football wealth should be shared more equitably.

'That's absurd as these payments – almost £50 million per club for the first year after relegation – give them more money than the other Championship clubs could ever dream of.'

Mr Parry, who is due to give evidence to MPs this week on the Bill, added: 'Second, the Football Regulator as proposed is way too weak and would lack the necessary powers.

'For example, the Regulator can commission a root-and-branch review of the whole game's finances.

'But farcically, he or she will not be able to take action on the back of it – that would have to be done by the leagues themselves.

'It's almost like saying the referee can look at the VAR screen to check for a penalty but then not have the authority to give it.'

He added: 'If football is to get a watchdog worthy of the challenges ahead, the Government must give it the necessary powers – not hobble the regulator role before it gets off the ground.'

Tory MP John Stevenson, chairman of the Party's Northern Research Group, said: 'The Football Governance Bill is a vital piece of legislation that has the ability to drastically transform the sustainability of clubs across the football pyramid.

'It is now important we work with the English Football League to properly scrutinise the Bill to ensure the regulator can protect the future of the beautiful game.'

Prime Minister warned over threat to smaller football clubs by 'watering down' the Football Governance Bill