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January 6, 2011 8:27 pm
Ministers’ hopes for a solution to horseracing’s funding crisis remains out of reach after a compromise proposal in the dispute over the size of the annual levy the betting industry pays to the sport was rejected by both sides.
Racing, which in recent years has seen income from the levy fall by two-thirds to £65m, wants a settlement somewhere between £130m and £150m. The bookmakers, who argue that they already pay £50m to racing for TV rights, want a figure closer to £50m.
After the Horserace Betting Levy Board failed to get the two sides to thrash out a deal in the autumn, the size of the levy will be determined by Jeremy Hunt, culture secretary, in a decision that could come by the middle of February. A proposed compromise, put forward by the three government representatives on the levy board, suggests a figure of £75m-£80m.
However, the Bookmakers Committee – which includes Ladbrokes, William Hill, Gala Coral and Betfair – warned that the proposals, which include removing thresholds aimed at protecting small betting shops, would result in the loss of more than 400 independent operators and 2,000 jobs.
“The proposal to eliminate protection for small betting shops is an attack on small businesses and jobs up and down the country,” said Will Roseff, chairman of the Bookmakers’ Committee.
Although the levy board members proposed cutting the rate of the levy from 10 per cent of bookmakers’ gross profits to 9 per cent, the betting industry prefers to keep the levy rate at 10 per cent and maintain a threshold for smaller shops.
Racing industry representatives, while welcoming a threshold abolition and a suggestion to apply the levy to bets on non-British racing, said the proposed levy yield was unacceptable.
“There is a real danger of owners walking away from the sport completely, with major owners . . . having the option of transferring sizable strings of racehorses out of Britain,” the racing industry’s submission said.
“The viability of many trainers’ businesses is being called into question, and significant changes to breeders’ behaviour could have damaging and irreversible effects on our sport.”
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