Stewart Regan fears that cutting out sectarian behaviour could cost Scottish football £4m.
The issue of strict liability has resurfaced following the Stokesy Cup Final which saw Hibs and Sevco fans fighting on the pitch at Hampden against a background of anti-catholic singing.
Scottish football currently receives £4m a year from the Holyrood government with that money at risk if the SFA refuse to hold clubs to account for the actions of their fans.
Current SFA legislation requires clubs to warn supporters about unacceptable conduct which allows them to escape punishment regardless of what happens on matchdays.
Over the last 16 months anti-catholic singing has been on the increase with the SFA refusing to step in and take action.
In February 2015 the League Cup Final was marred by constant anti-catholic singing from the Sevco support all of whom had been issued by tickets directly from their club.
During the Sevco v Hibs match on 28 December 2015 at least 20,000 fans in all four stands at Ibrox were revelling in the Billy Boys with the bulk of those involved season ticket holders who could be identified by CCTV or BT Sports coverage.
In 2006 UEFA stepped in to ban singing of The Billy Boys with no Rangers (IL) fans allowed to watch their last ever Champions League qualifier away to Malmo for breaching that rule.
The SFA have never issued any punishment for anti-catholic singing but it seems that they could be forced into action after the Scottish government were shamed into action by the fall out from Hampden.
After the AGM of the SFA yesterday Regan revealed: “We’ve benefited financially from Government for improved facilities, primarily invested for 3G pitches and grassroots development. Based on what the Government have fed back that money is at risk.
“Michael (Matheson, Justice Minister) wanted to address the members directly. We are aware of a number of issues – sectarian singing and pyrotechnics in particular – and the message today was, ‘Get your house in order, otherwise we will come forward with our own proposals’.
Explaining the need for football to get it’s house in order Matheson said: “The scenes we saw at Hampden last week were appalling and the Scottish Government condemns in the strongest possible terms the disorder and violence which scarred the end of the game.
“From those dreadful scenes there is an opportunity to address some of the negative
long-standing issues in the game and I want football to be proactive and seize that opportunity.
“We need a transparent and robust scheme to prevent unacceptable conduct and deal with it effectively if it does occur, and encourage clubs to take all action possible to address unacceptable conduct.
“That may be strict liability or a form of strict liability, or it may be something else, but the bottom line is we want to see football taking the opportunity to finally address this long-standing issue.
“All Scottish clubs competing in European competitions are already subject to strict liability so it can and does work in Scotland and a form of it could be used in domestic football.”
Hibs have already banned a number of fans from Easter Road, Ibrox director Stewart Robertson justified singing The Billy Boys when discussing the trouble at Hampden.