British Horseracing Authority – Written Evidence (GAM0065)

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British Horseracing Authority – Written Evidence (GAM0065) British Horseracing Authority – Written evidence (GAM0065) Introduction 1. The British Horseracing Authority (BHA) – the governing and regulatory body for thoroughbred horseracing in Great Britain – is delighted to respond to the House of Lords Select Committee Inquiry on the Social and Economic Impact of the Gambling industry. This response is being submitted by the BHA on behalf of the wider British racing industry incorporating our racecourses, licenced personnel (including trainers, jockeys and owners) and media rights holders. 2. British racing is the UK’s second largest sport behind football in respect of attendances, employment and revenues generated annually. In 2018, 5.77 million people attended over 1,500 individual race meetings held across England, Scotland and Wales. Our largest events are not only highlights in the increasingly competitive international racing calendar, but also the UK sporting and social calendar. British racing’s cultural significance is demonstrated by the fact that ours is the only sport which has two annual nationwide events – the Grand National and the Derby – which are included on the Group A list of full live coverage protected events for FTA broadcast. 3. This translates into a significant economic benefit for the UK, with our industry generating £3.45 billion in direct, indirect and associated expenditure annually for the British economy. Much of this is focused in rural areas with over 20,000 people employed across our 59 licensed racecourses, hundreds of training yards and thousands of breeding operations – all of which play a key role in the life of the many hundreds of rural communities they operate in. British racing supports the Government’s wider trading and soft power agenda by encouraging multi-billion-pound investment into the UK, with the Minister for Arts, Tourism and Heritage Rebecca Pow MP recently commenting that: “We welcome the contribution British horseracing makes to the national economy and our quality of life. It is also a significant soft power asset to the UK and enhances the strong bilateral relationships we have with the Gulf States and many other countries around the world.” British racing and the betting industry 4. The British racing industry has limited involvement, beyond pool betting, in the operation of betting services in the UK. However, we are an industry which is heavily interlinked with the UK betting sector. Our Fixture List, race programme and many of our Rules are developed in order to provide a consistent, high-quality betting product on which people can gamble responsibly 362 days a year. 5. British racing works hard via regulation from the BHA to ensure that the sport that takes place on a racecourse – and on which significant betting activity takes place every day in Licensed Betting Offices (LBO) and online – has the highest standards of integrity and fairness. This gives confidence for betting customers that the over 10,000 races which they are responsibly betting on 362 days per year are open and trustworthy gambling opportunities. 6. Betting activity on horseracing in the UK is growing, showing its continued popularity as a culturally accepted betting product. The latest statistics from the Gambling Commission, for the 12 months prior to September 2018 (as represented in Figure 1), outline that over £14 billion was bet on horseraces in Great Britain at racecourses, in LBOs and online. Online betting now accounts for some 65.6% of turnover, and 50.4% of gross gambling yield on horseracing. This demonstrates that betting patterns now follow the general societal trend of business moving away from retail shops and onto digital platforms. Figure 1- Turnover and Gross Gambling Yield on horseracing, October 2017 to September 2018 Figure 2 – William Hill betting shops 7. William Hill, one of the UK’s largest where customers collected Cheltenham betting operators with over 2,300 LBOs, Festival winnings (William Hill H1 2019 reported in their May 2019 annual Results) report that “although there has been a shift by consumers to increased betting on football, horseracing still contributes almost half of revenue from sports betting.” This demonstrates that British racing is still a popular product for betting customers, and an important industry for the betting sector. Furthermore, as Figure 2 demonstrates, betting activity on horseracing – in particular, on our major Festivals such as the Cheltenham Festival – is truly a nationwide pursuit that crosses the length and breadth of the United Kingdom, much like the British racing industry’s economic impact. 8. Betting on horseracing is also an intrinsic and social element of a day’s racing – either with on-course betting operators or pool betting services. In June, Ascot Racecourse’s Bet With Ascot pool betting service handled over 577,000 bets from the nearly 300,000 attendees over the five days of the Royal Ascot meeting. The average bet size during the meeting was £13.57 and means that the average amount wagered per attendee at the event was £26.75. From this the Government would have earned significant tax revenue, while the event provided an employment opportunity to 500 members of staff from Bet with Ascot and over 100 on course, independent bookmakers with their own staff. This demonstrates the economic opportunities and benefits which betting activity at a major event Royal Ascot provides. 9. We are clear that British racing’s relationship with the betting industry is positive for the sport but believe it is also vital that it receives a fair return from betting activity. Our historic relationship with the betting industry has been recognised on numerous occasions by Parliament including through the introduction of the Horserace Betting Levy in the 1960s when betting away from racecourses was first legalised, and most recently in 2017 when it amended the Levy to ensure it captured a return from online betting activity on the sport. 10.Racing’s symbiotic relationship with the UK betting industry also means that it can be greatly impacted by changes to the wider regulatory environment around gambling. We believe that it is critically important that policymakers are aware of the depth and complexity of these connections as they make future gambling policy. Figure 3 outlines the range of links between the betting industry and elements of the British racing sector. Figure 3 – Key links between the Racing and Betting industries in the UK Racing Industry Sector Link to Bookmakers Racecourses Race sponsorship & prize money, for example Ladbrokes recently assuming sponsorship of the King George VI Chase at Kempton Park on Boxing Day; on-course bookmaker pitches; TOTE; course/bookmaker exclusive deals. Trainers/Jockeys Individual sponsorship deals with bookmakers. All deals are registered with the BHA. Horserace Betting Levy Racing’s central funding body primarily funded by Board a 10% levy on bookmakers’ gross profits on horse racing. This income totalled £78m in 2018. It allows HBLB to invest money back into the sport through prize money, industry training and equine research. Money also funds the BHA’s raceday services and fixture incentive payments to racecourses for racing at certain times of day. BHA Working with bookmakers for anti-corruption purposes in the integrity department, mostly by data sharing of any suspicious betting trends. The BHA Intelligence Team then work to try and disrupt any potentially corrupt activity. Media Companies (RMG, Betting companies contribute significant sums of ATR, ITV, SIS) money in media rights deals to broadcast racing in their shops & also stream races online. Right holders also receive income from betting adverts during broadcasts. Attendees and off On and off course betting activity on racing – in course TV viewers Licensed Betting Offices and online. 11.British racing is a sport with a strong social conscience. We are acutely aware of the social and economic damage that problem gambling can cause to individuals and communities. As a sport which generates a significant amount of revenues from betting, we keenly recognise our social responsibility and encourage all efforts to reduce problem gambling in the UK. It is important that we as a sport work towards the Government’s ambition for the betting sector of the “right balance between a sector that can grow and contribute to the economy, and one that is socially acceptable and doing all it should to protect consumers and communities.” 12.We have responded to the questions within this consultation based on ensuring that the Committee has all the evidence it requires relating to aspects of gambling policy affecting British racing. Please note that not all questions are answered as we have only given responses to questions that we felt were relevant to horseracing. Q1) Are the three primary aims of the Gambling Act 2005 (to prevent gambling from being a source of crime or disorder, to ensure that gambling is conducted in a fair and open way, and to protect children and other vulnerable persons from being harmed or exploited by gambling) being upheld? 13.British racing is very keen to ensure that racecourse betting environments are places of integrity, and where fair and open gambling takes place. Every bookmaker that operates on a racecourse must act in accordance with the Gambling Commission’s rules, and British racecourses have a zero-tolerance policy on Under-18 betting activity on racecourses. We look forward to continuing to work with the Gambling Commission on ensuring that racecourses are safe environments at which people can gamble fairly and responsibly. 14.The BHA’s world-leading intelligence department works closely with UK Gambling Commission licensed bookmakers in order to identify, prevent and disrupt any potential betting-related corruption in the sport, which could otherwise undermine people’s faith in British racing as a fair betting product. The BHA uses the ‘Racestraight’ website which provides an anonymous opportunity for anyone in the sport to report corruption.
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