4 hours ago
In-fighting will only speed up the demise of British horse racing
Racing is up in arms. Many trumpets are being sounded as the sport's often-divided battalions form up behind the British Horseracing Authority's (BHA) organised 'strike' on September 10. But they need to be very careful of an early fallout with the betting industry as they assault a beleaguered Treasury desperate for extra cash. They must remember it is not fury, but figures that will win the day.
I have long felt that without radical reform racing faces an existential crisis. Another 6 per cent betting tax and already serious leaks to the black market will only grow, bookmakers' profits on racing will decline, as will the £380million they provide racing via marketing, sponsorship, media rights and the Levy. All this will only hasten the game's decline. Disturbing, then, to see cracks in the bookmaker-racing relationship as we go into four of the best racing days of the year in the Sky Bet Ebor Festival.
For the BHA chose not to tell the bookmakers about the strike — which is expected to cost the industry about £700,000 — in advance and a fair degree of umbrage was taken, most notably by Michael Dugher, the former Labour MP and present chairman of the Betting and Gaming Council, who talked of 'folly' and had earlier spoken of 'lions led by donkeys' as he castigated the National Trainers' Federation's support of the Social Market Foundation's (SMF) condemnation of online casino betting.
But while Dugher is an important figure and his Racing Post article contained the magnificent line, 'In the end the crocodile gets round to eating us all', he is surely being disingenuous when he tries to equate betting on racing (taxed at 15 per cent) with that on gaming and online casinos (21 per cent). Of course they have bookmaking costs, but they don't involve communities all around the country, let alone being integral with a national heritage with 300 years of history.
It's a disagreement, but the last thing we need is a full-blown row. Good, therefore, to hear a rather milder reaction from Seb Butterworth, strategic racing director of betting behemoth Flutter, the owner, among many other things, of York sponsor Sky Bet and of Paddy Power, who back ITV Racing.
'We are concerned that some in racing are cosying up to the anti-betting lobby, and the SMF, who have no genuine interest in the long-term future of the sport and would rather see it and betting banned,' Butterworth said. 'If bookmakers are hit with a tax rise — betting or gaming — racing's finances will be impacted. We at Flutter are already looking at where we spend money given this huge uncertainty.'
Good also that on Sunday, the Jockey Club chair, Dido Harding, was out at Pontefract to impress on the importance of racing's grass roots. Given half a chance there is nothing some in racing would like to do more than to pick a fight with both the bookmakers and a Labour government. But while big demonstrations of support on 'strike day' are important to express solidarity, treasuries with massive black holes to fill are hard-hearted listeners. They have ignored plenty of other pleas in the past. By far our best bet is to find someone to persuade them that raising the tax rate would cut the tax take.
Step forward someone better equipped than anyone on the planet to link the racing and bookmaking case: the 55-year-old Glasgow-born Jim Mullen, former CEO of Ladbrokes Coral and now in the driving seat at the Jockey Club.
'It's actually quite a simple equation if you understand cash,' Mullen said. 'The modelled impact of a 'tax harmonisation' highlights a loss of £66million a year to the sport and that would be felt everywhere. It would mean less cash going into prize money, staff wages, rent and rates, diesel for horseboxes and maintenance for training yards, studs and racecourses — everything from leaking roofs to making vital improvements.
'It's a sum so significant that some businesses, even racecourses, at the heart of our sport would almost certainly be forced to shut down in time, simply due to a lack of financial resources. These would be businesses that you couldn't just start up again, because the assets are taken over by other ventures and the process of replacing them is even more substantial when starting afresh. That requires more cash and, with the tax rate so high, there simply wouldn't be a business case to do so, by which time it's too late.
'People might think that it's hyperbolic to claim that a simple adjustment to tax rates on horse racing bets will have such a devastating impact on the wider sport, but this is the reality. It's why we are asking the government to stop and think properly about the real consequences of what they are proposing.'
To govern is to choose. Having a go at what are easily termed as 'greedy bookmakers' or 'fat cat' owners may certainly seem an easy option. But the law of unintended consequences has already given this government a couple of nasty bites in the behind. It doesn't need another one. Neither do we.
