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Racing in danger as BHA, Gambling Commission and Government lack appropriate response. 07/08/2011
Richard Whitehouse
Governing bodies too slow to avoid dissaster

This week the BHA (British Horseracing Authority) announced a cap of 1,400 to the number of fixtures that will be scheduled in 2012, a reduction of at least 80 fixtures. This is in response to the falling number of horses in training in the British/Irish racing world. But they have missed the mark by a long way.

In 2007 there were 15,573 horses in training (averaged over the year), the figure for this year is expected to be near the 14,700 number, a drop of around 6%. More importantly, over the same period the number of foals has dropped from 18,472 to an estimated 11,300, or a drop of 39%. The number of horses in training can only decline at a much faster rate than over the previous few years.

Another statistic that draws a picture is the number of races with fewer than 8 runners. In 2007 it was 20% for the flat and 30% for the jumps. This year its 36% for the flat and 40% for the jumps. So even though the number of race horses hasn't yet declined dramatically, those in existance are just not turning up to the track and competitive racing is what brings punters to the turf and betting shops.

Worse still for racing is the exit of big bookmakers from Britain and Ireland to the relative tax havens of Gibralter, Isle of Man, Malta and the Channel Islands. This has allowed them to use a loophole in the government legislation and avoid paying money to the Gambling Commission and more importantly avoid paying the Horse Racing Levy. The levy is a large slice of the sponsorship that provides prize money and that has declined from £110m in 2007 to this years expected £75m.

Recently the government moved to introduce new legislation requiring offshore bookmakers to be licensed in the UK. The heritage minister John Penrose said the move would protect consumers, strengthen sporting integrity and level the playing field between British bookmakers and their offshore equivalents. This still seems some way off and there is no recognition of just how difficult it will be to enforce overseas operators to pay up, or if that is even possible.

Penrose went on to say that the new rules would also assist the Gambling Commission in the fight against match fixing. "Previous work by the Gambling Commission has highlighted deficiencies in some remote operators' arrangements for preventing underage play and, for the first time, overseas operators will be required to inform the UK regulator about suspicious betting patterns to help fight illegal activity and corruption in sports betting."

What he seems to be saying is that the whole world will take on standards set in the UK, an outcome as likely as England winning the World Cup.

The truth about racing is that the whole fabric of its funding is in meltdown. The average owner will return 22% of their investment in prize money and so owners either treat the sport as their hobby, or they rely on "helpful" trainers who set a horse up for a race. This cannot continue without further decline. In France, prize money is 4 times greater than in the UK because races are funded by the government's ownership of their version of The Tote and the racecourses themselves. Racecourses in the UK rarely contribute anything to prize-money and the sale of The Tote has been so badly mis-handled that it has gone for a song and is such a small part of todays racing turnover.

The Gambling Act (2005) created a Gambling Commission with so little real power and even less ability that many racing pundits fear they are watching the complete demise of the Sport of Kings whilst toothless bodies tinker with the law without respect to basic economics. Many observers do not care about racing and the lack of pressure from the public means government can fail on this issue without too much consequence. However, racing employs 50,000 people, mostly on very low incomes, and its way past the time those in power stod up and did the job they were elected for.