Contribution from Bookmakers, Bet Exchanges Sought to Boost British Racing

Edited from British Thoroughbred Breeders' Association release
Martin Broughton, the chairman of the British Horseracing Board, today suggested a statutory contribution to horse racing from bookmakers and betting exchanges as a means of financing the industry.

Broughton was speaking Tuesday at the Thoroughbred Breeders' Association's annual general Meeting at the Churchill Hotel in London, when he made the proposal after the BHB lost its case over data rights in the European Courts of Justice in November.

"We will be proposing the introduction of a contribution to racing by betting operators," said Broughton. "That is, a contribution to the cost of putting on the racing show, which we suggest should be 10% of gross profits for bookmakers (equal to the Levy) and at an appropriate equivalent level for betting exchanges.

"Obviously, this cannot be simply a voluntary contribution. Bookmakers would only pay if all bookmakers agreed to pay and therefore it needs to be enforceable in some way. Our proposal would require a simple statutory instrument requiring licensing authorities to have proof that any betting entity was fulfilling its Contribution obligation before renewing its betting license. This is similar to the current requirement to be fulfilling the obligation to pay the Levy as a condition to licensing."

The ECJ judgment led to cost cuts of £8.7 million in the BHB's 2005 budget, including the suspension of the Owners' Premium Scheme, for which payments of £3.2 million had been anticipated this year.

But Broughton said that the BHB would be happy to listen to any proposals from the Racehorse Owners' Association, backed by the TBA, to reduce prize money in order to fund an Owners' Premium Scheme.

He added: "If the ROA were to put forward a proposal that further reduced minimum values -- principally for lower-quality races -- in a manner that could fully compensate for a reintroduction of the Owners' Premium Scheme at some level, not necessarily the current level, we would be willing to examine it.

"This would be a reversal of past ROA policy but, provided it led to the agreed £3.2 million budget reduction, we are prepared to be flexible and consider it and discuss it with the Levy Board.

"In any event, the ROA will be encouraged to survey their members to see whether there is support for reducing prize money so as to fund an Owners‚ Premium Scheme for 2006 as a fallback option."

Broughton also elaborated on previous comments about breeders' prizes. The prizes are currently funded by the Levy Board but once that organization passes responsibility to the BHB, he would want to know their exact purpose.

Broughton hinted that the prizes might be more effectively used encouraging the breeding of less-commercial staying Flat and National Hunt-type horses.

He said: "The very name suggests muddled thinking. Once a breeder sells a horse why should they receive prizes? If the buyer subsequently sells the horse on, the original buyer doesn't expect to receive a share of future prize money earned. I think what we're really talking about are breeders' incentives.

"Currently the Breeders' Prize Scheme is funded by the Levy Board to the tune of £1.9 million in 2004 and this year will see the funding for this Scheme rise to £2.4 million. We should ask ourselves what we want to achieve with this money.

"Do we want to breed more horses when we already suffer from overproduction or do we want to incentivize breeding of certain types of horse? With the current trend to speed, do we really want to breed more seven-furlong horses so we can ballot them out more frequently? Do we want to eventually find ourselves following the French and reducing the Derby to 1 mile and two furlongs because there aren't enough horses to fill a mile and a half race?

"Or do we want to incentivize breeders to forsake the higher price that's on offer for 'fashionable‚' distance horses in order to retain the sport's diversity, help the sport retain its charm, and give breeders support for breeding what we want to see on the racetrack. In other words, encourage them to produce the Persian Punches, the Ouija Boards and the National Hunt stars of the future.

"I leave it to the TBA to review the role of breeders' prizes and persuade the BHB that the current scheme is achieving its objectives if they really believe that to be the case - or make recommendations for changes to incentivize different breeding responses if that's what is needed. Don't assume breeders' prizes will be retained, but don't assume they will simply be phased out either. Make the case."

Broughton elaborated on the work the BHB was doing for stud and stable staff and said that an announcement was imminent for the launch of the Stable Staff Awards.

He also revealed that yesterday's BHB board meeting had approved a budget allocation of £100,000 for the first half of 2005 to ensure that the ongoing Equine Genome Project by Equine Genetics Research could continue.