Prize-money: This section is based on an excellent Jonathan Harding article in the Racing Post. in which he compares prize-money funding models around the globe.

I quote: ”Prize-money is the lifeblood of racing, but there are growing fears the returns on offer in Britain are not nearly enough to maintain its position as a world-leading centre of the sport.

“The British model:

I quote: ”Prize-money in Britain is funded by three streams.

In 2019 funding from the levy – a ten per cent tax on bookmakers’ racing profits – provided 35 per cent. This encompasses fixed-odds betting and the Tote, a pool betting service whose on-course operation is run alongside Britbet.

When the UK Tote Group acquired the Tote from Betfred in 2019, it promised to pay the sport at least £50m over seven years, alongside its levy obligations.

Owners’ entry fees made up 15 per cent of the prize-money offered in 2019, while the remaining 50 per cent came from executive contributions by racecourses. These are partly funded by spectators, and are also linked to sponsorship and media rights payments.

A perceived lack of transparency over the latter is a frustration for some participants, who would like more say over such agreements. On the other hand, executive contributions from racecourses did double as a percentage of the total prize pool from 2009 to 2019.

Since March 2020 racecourses have missed out on an estimated £400m in revenue. I am guessing that this is Covid-related. This was notably reflected on the biggest stages as the returns from Britain’s top ten Flat races last year fell to just £3.8m, a 64 per cent decrease from 2019, while the Derby was worth £500,000, down from £1.6m.”

(End of quote.)

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DONEC:

If  “The British Model” sounds like a seriously over-complicated minefield,  that might not be too far from the truth. All credit to Mr Harding for providing the harsh reality of the facts as they are. The reader can now digest what is going on in the rest of the World, with confidence that it also represents the real picture.

FRANCE

Prize-money is essentially underwritten by the profits of the Pari Mutuel Urbain (PMU), the third-largest pool betting service globally.

Of its total turnover, 75 per cent is returned in winning bets, nine per cent goes to the government  through tax and eight per cent is split between France Galop and Le Trot, the two major shareholders. In 2019  €760m  was returned to racing and trotting, which covered not only prize-money but the cost of staging the sport. The remainder is spent on PMU outgoings and paying commercial partners.

AUSTRALIA

Prize-money is primarily funded by punters through betting tax, the amount of which varies from state to state and via different agreements. There is a higher proportion of pool betting in Australia than fixed-odds betting, which is provided by the country’s largest bookmaker Tabcorp, who pay more tax in exchange for exclusive retail wagering.

 

HONG KONG

The Hong Kong Jockey Club (HKJC) runs the entire betting operation, As such, prize-money is almost entirely funded by betting turnover. 

Hong Kong residents can legally bet only on racing and football, and the benefits of engaging a captive audience are reflected in its betting turnover, which is expected to reach a record HK$133 billion (just over £12bn/€14bn) for the 2020-21 season.

Of that figure, betting duty of 12 per cent is paid to the government, making the HKJC Hong Kong’s biggest taxpayer, and 4.3 per cent is retained by the club to cover operating costs, sizeable charitable contributions and prize-money, around  HK$ 1.4bn (£128m/€145m) overall, spread across 88 meetings at Sha Tin and Happy Valley.

 

JAPAN

A similar model was adopted in Japan, where the Japan Racing Association (JRA) is responsible for meetings at major tracks in metropolitan areas, such as Tokyo, and the National Association of Racing (NAR) coordinates various local fixtures nationwide.

The JRA does not rely on sponsorship deals or media rights to finance its astronomical prize-money as it is derived from betting turnover, which actually increased last year, despite Covid-19 severely impacting on-course attendances. Online betting boomed as racing continued largely uninterrupted during the pandemic.

Of this betting money, 25 per cent is deducted by the JRA, out of which two-fifths goes to the national treasury and the rest to racing, including prize-money, which increased to ¥119,538,495,110 (£775m/€897m) last year from ¥115,969,435,491.

 

DONEC’s View, based on no financial expertise whatsoever:

For 250 years the British bookmaker has been working on the principle that racing owes him a livelihood and he owes racing practically nothing. The ongoing campaign to persuade punters to bet “responsibly” has produced propaganda by the bookmakers that pumps out oodles of  lip service to the “sensible approach” to betting, while making it perfectly clear that they (the pumpers) are in business to earn, not to preach.

Interestingly enough, there is a view, strongly held and represented in parliament as I write this, which claims that gambling is a dangerous addiction to which the average citizen should not be exposed. Quite right too. The principality of Monte Carlo does not allow its citizens to visit its casino, and nobody complains. Get the picture?

Getting bookmakers off the High Street would be a good way of starting the clean-up in Britain. However the British Puritans’ attempt to make betting more difficult than climbing Everest pre-1952  is lunacy.

One way or another, bookmakers should only be allowed to interfere with the racing industry if they pay a reasonable amount for that privilege. If they can’t afford it, they really must consider getting lost. Does that not make sense?

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Here is a question for an accountant with an encyclopaedic knowledge of racing: if British racing was based on the Hong Kong formula (above), what sort of a dent could it put in the cost of the NHS each year?

. The thing is this: if by any chance the maths could produce a genuine – no cheating – huge surplus for the Treasury the Government would be unlikely to say “No, thanks.”

In addition it (the huge surplus) would provide so much new money for racing that all those extremely selfish “stakeholders” with a record for squabbling over the division of any treasure trove would be only too happy to sign on the bottom line.

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Haydock Park, 30^th July, Racing followed by a Madness Concert and no fighting.

Madness appeals to friendly (for want of a better word) people – like me, for example. Any Clerk of the Course who needs help in this regard should consult Haydock Park, or perhaps Mr Eavis of Glastonbury fame. He and his family are intelligent and musically knowledgeable, his performers are always well chosen, and I don’t think much fighting goes on at his festivals. Just a thought….. I am devoted to Suggs….. Haydock  Park, I salute you.

 

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Strawberries – I have recently discovered that if you cut your strawberries in half (top to bottom, not round the waist) the taste “rush” is ten times greater and lasts ten times longer than if you don’t. Also I am pretty sure that cream does more harm than good to the experience…..

 

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          Donec’s round-up (2006 – 2022)

 

          The Whip. The padded whip that does not hurt is (and has always been) a triumph, and the “perception” of its dedicated (but ill-informed) critics is no good reason for making further changes. However I expect more abject cowardice when the BHA next tries to make sense of the situation.

 

          The Interference Rules. The rules must be revisited and updated by someone with a brain, a great knowledge of racing and a moral compass. The wheelchair trade is in no danger of going broke as long as Stewards are allowed to get away with downgrading “Dangerous Riding” and calling it “Careless”. It is now twelve years, dear reader, with never a single “Dangerous” riding BHA prosecution, and not a murmur of criticism from anybody (apart from trainer John Berry’s excellent report on the subject (See SPORT 123,  3 Nov. 2021).

 

          Big-Field-Starting under NH rules. It was bad, now it’s worse. There will be no improvement until the Rolling Maul is eliminated from the process, and that is unlikely to happen any time soon under present management. The existing process is unfair to horses, jockeys, starters, owners, trainers and punters. Eight False starts at Cheltenham Festival 2022 – is that acceptable? When the Rolling Maul (a bad idea introduced by ex-Regulator Stier for no good reason) is eliminated, the False Starts will disappear.

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If Tesco was running racing, each of the above disaster areas (affecting vital aspects of the sport) would have been dealt with in a week (instead of eleven years and still no action… How pathetic can you get?)

 

Best wishes,

 

Donec