EFL chairman Rick Parry believes the introduction of an independent regulator to football could be a “game-changer” which attracts more credible owners to the game.

The long-awaited Football Governance Bill was introduced at parliament yesterday with hopes high that it will be passed as law by the time of a General Election.

In the shorter term, establishing a regulator could force through an improved funding deal from the Premier League to the EFL projected to be worth an extra £900million over six seasons.

But in the longer term, Parry believes that reducing the pressure on owner funding will also lead to a more stable and fairer environment for “good owners” including fan-run clubs.

The regulator will also be given added powers of authority to track club finances, with tests and measures currently applied only at the start of an individual’s tenure now able to be repeated periodically.

Parry said “bonds and guarantees” would also be required to ensure that owners cannot switch-off funding and that those in breach of regulations could be removed from power in the most extreme circumstances.

That, said the EFL chairman, could help guard against the sort of situation faced by Bolton Wanderers in the 2018/19 season when previous owner, Ken Anderson, failed to find a buyer for the club in the Championship, allowed the business to run up huge tax bills and failed to pay wages.

The league changed its own constitution, including the previous ‘fit and proper’ test applied to new owners after Bury’s demise in 2019 but recent examples like Wigan Athletic and Reading – whose owners had previously invested heavily but then cut off the funding – show a different approach is needed.

“The regulator is clearly going to have an input into owners and directors tests,” Parry told EFL reporters in a briefing yesterday. “We think our current tests are pretty robust, and have definitely improved it over the years.

“Regulators will have greater statutory powers, criminal prosecutions for people who make false declarations etc, so the test will be sharper.

“But the key thing is that we get a fairer redistribution of revenues. The government has talked about Bury and Macclesfield but we tend to talk just as much about Derby, Reading, Bolton, Wigan – the biggest inequities come in the Championship and they float from the need for clubs to try and compete with the parachute clubs.

“You have parachute clubs receiving £50-odd-million, wage bills of £60-80m, all the other clubs receiving £10m in central funding and losing £15m a year trying to compete with wage bills of £30m or less. It is no surprise that in each of the last six years that two of the three promoted sides have been parachute clubs. That is where the major tension arises.

“If you look at what happened at Wigan, Derby or Reading, it isn’t that the owners came in with bad intentions or they were bad owners. In each case lots of money went in chasing the dream but it gets to the point where either the owners cannot continue funding or they don’t want to. And it leaves the clubs high and dry.

“What the regulator will do – and we have never been able to do – is they are going to require guarantees, bonds and assurances that the funding will be in place, that they can’t just turn the tap off. The big issue for me is not the badges or the colours – as important as those things are – fans really want to know that their club is going to be sustainable and exist in the long-term, so that is where the big benefit comes.

“The regulator is not going to do one-off tests, but periodically, to make sure they are still fit and proper, making sure they are honouring their commitments and putting the funding in that they said they would put in. if they don’t, they have the ability to tell them to divest, to put in trustees to run the club in the meantime. They will have powers that we don’t currently possess.”

One of the biggest challenges faced by the EFL and any incoming regulator is to try and mend a disproportionate economy in the Championship, and one that Parry believes has contributed to “blips” in the last several years which have threatened the existence of clubs like Bolton, who have spent time in the Premier League.

“It is not a simplistic solution, and the regulator is not going to be able to wave a magic wand overnight,” he said. “The whole system has to change.

“One of the problems with Bolton, at least until Sharon (Brittan) and the new consortium came in, was that there wasn’t a queue of new owners wanting to jump in because of all the financial challenges in the Championship.

“When you are told after talking over a club that you must writing out cheques for £15m a year just to stand still and survive, there isn’t an enormous pool of people who are willing to do that.

“The redistribution and reducing the dependence on owner funding, going hand in hand with the owners and directors, becomes really important. One of the points we have made to government recently is that it is brilliant to have a new licensing system, brilliant to look at the solvency of clubs, but actually just losing £15m a year just because redistribution isn’t sorted all we are going to do is find out that half the clubs are insolvent, and what happens then? Does the regulator just not licence them? That can’t be the answer because it just puts them out of existence.

“Unless we get the redistribution right, hand in hand, you can’t have a partial solution. It is a total picture.

“You don’t want to stifle ambition, or investment, but at Championship level it is that catastrophic view that you have to be prepared to write out cheques of £15m a year just to stand still, let alone think in terms of competing with the parachute clubs.

“It is a big, big reset that is necessary, not a tinkering around the edges, “It really is a gamechanger.”

One of the arguments levied against the introduction of tighter regulations on ownership and the introduction of an independent regulator is that it could dissuade some from investing in football, knowing that there is scope for greater outside interference than before.

Some see it as a restriction on enterprise but Parry believes a more predictable economy outside the Premier League will help to bring more of the right people into the game.

“We have been asked whether it will stop good owners coming in – but why would it do that?” he said.

“It is a better environment with more certainty and clarity. It is fairer, so surely that will produce better long-term investors and, in reality, it will make fan ownership more viable if you don’t have to write out enormous cheques and run clubs on a break-even basis, you can spread the net more widely.”