Racing
shouldn’t be falsely lulled into believing it’s having a month off and will be
back by May or June. The epidemiologists are saying the coronavirus pandemic could
be a couple of months off peaking which means the racing season is as good as
over, and it may be the middle of spring or even beyond before post-coronavirus
life returns to a state of reasoning that will justify the return of horse
racing.
No sensible
owner in New Zealand will keep racehorses working, and six weeks in the paddock
for all horses will determine that racing won’t resume for at least six months.
And any restart at that point may be determined by having the numbers to stage race
meetings and a reduction in stake money.
The onset of Covid-19 is the knock-out blow to an industry that was already financially destitute thanks to a marathon run of incompetent and seemingly untouchable administrators. This time a year ago, NZRB was mutating into RITA with a new board – that mutation barely discernable to the average racing stakeholder because racing’s downward slide on the graph has continued its journey unimpeded.
…level of debt has risen from $35 million to $45 million
Since last
week’s blog, The Optimist has become aware that RITA’s level of debt has risen
from $35 million to $45 million, and this relatively recent increase in debt-level
was dovetailed with a change in RITA’s bankers from the ANZ to the ASB.
Having to dig
around to find these disheartening facts makes a mockery of what MAC, which
became RITA, told us almost a year ago when they delivered to the Minister their
Interim Report. In that report, MAC said, “The committee has engaged with the
racing industry openly and transparently. As change progresses, dealings with
the industry and communities must continue to be transparent, inclusive and
robust.”
Well, the
truth is, MAC/RITA did not engage openly nor was it transparent. Also, it was
neither inclusive nor robust which begs the question of accountability – why
has RITA failed so miserably when it promised so much. What was the plan? Was
there a plan?
Two
paragraphs later, the same report said: “The work the committee does, in the coming
months, will deliver a racing industry that benefits all New Zealanders. By
growing the sport of racing in terms of breeding stock, racing activity and
turnover, racing will increase its contribution to the New Zealand economy.”
The claims were baseless and nothing came to pass. The point is, how can you make these types of statements and expect not to be challenged on the score of sincerity – or is this sort behaviour acceptable today? Fake news and fake claims are all around us but this was as fake as it gets.
When you owe $45 million, and it costs at least $9 million per month just to keep RITA going…
The challenge to pay current creditors will be one of RITA’s immediate headaches. When you owe $45 million, and it costs at least $9 million per month just to keep RITA going in its current gravy-train form, and your income is severely impacted by the curtailment of most sports and racing – where does that leave you? Heading for administration, wouldn’t you say?
If you owe the bank $45 million, and you holding $20 million of punters’ deposits, does that leave RITA with an inability to pay if punters withdrew all their deposits at once?
The
plethora of RITA’s suit-wearing employees will gain respite and buy more time
for themselves through the Covid-19 Wages Subsidy, but surely the Government
will not be propping up racing with a hand-out to an industry in steep decline
on a failed administrative model, especially when the health of the nation is
at stake. RITA’s latest website statement, however, does not own up to the
serious issues and clearly outlines its intention to exit the coronavirus pandemic
with the current structure in place
Identifying
the real problems is the first step to a remedy. But Dean McKenzie’s Industry
Update posted on the RITA website on March 24th was written with a complete
lack of sensitivity. It began by
comparing the cancellation of the American NBA season on March 12th
as a never forget event in his memory behind his wedding, the Christchurch
earthquake and the Mosque Shootings. A poor taste comparison, I thought.
The
inference from further reading this Update is that Covid-19 is the
culprit and to blame for racing’s current woes – a shallow excuse delivered in bad
taste. McKenzie then goes on to say that even if we had “reserves tucked
away” as we once did, “it wouldn’t come close to solving all our troubles.”
Summarising this Update of 12 paragraphs is to conclude it delivers nothing. It’s loaded with all the cliches of the past including: “Things are literally moving in real time at present…We are presently talking with all the people you would expect us to be talking to, with the aim of mitigating the downside of what we are facing. We’re working closely with the Government to highlight the impact on our industry and presenting options on how the industry responds. These conversations are taking place daily, but we know we are not on our own in seeking support from the Government and we know there is no magic bullet.”
More gobblygook!
More gobblygook!
RITA has
already been to the Government for a cash hand-out, but with the prospect of no
racing for six months or longer, and the Country in the uncharted territory of
a pandemic that is threatening the lives of everyday New Zealanders, racing will
understandably be low on the list of Government priorities.
The bottom
line for this season right now might be as low as $120 million ($136.7 million
last season) on a $165.8 million budget. Racing cannot expect to get a
life-line hand-out from the Government when racing is still unfairly considered
by a large section of New Zealand parliamentarians as the sport of kings.
Even if you
go back just five years, racing had about $40 million in cash and realisable
assets and no debt, and on that basis could have raised about $75 million. Fifteen
years ago we had over $100 million. If we get through this crisis with the same
administrative model, then racing is dead because of the debt. It’s simply called
bankruptcy.
The Racing Reform Bill legislation which was the hot topic of discussion just a few weeks ago is now on the backburner – a distant memory. The crisis is now Covid-19, a top-heavy administration with little income and no domestic racing.
Racing Queensland has already cancelled the Brisbane Winter Racing Carnival
Racing Queensland has already cancelled the Brisbane Winter Racing Carnival and to get through the three days of The Championships at Randwick will be fortuitous in light of their increasing number of positive tests to Covid-19 and the inevitability of Australia going to Level Three.
Our balance
sheet situation will be further impacted by the complete cancellation of racing
in Australia, and at that point, administration might be the best option for
RITA in the event of zero Government assistance. It might also be the best option
because it will immediately mean a deconstruction of the gravy-train administration
and an immediate investigation into outsourcing/partnering the TAB to change
the model.
Going into
administration would be helpful in that the ceiling for redundancies is
$24,000. Meanwhile, many trainers will struggle to survive six months of no
racing and the battered New Zealand racehorse owner will become a scarcer breed
after a six-month hiatus.
A new start
for racing in the spring might mean racing on only Saturdays and Wednesdays, a
major cut in the number of races with reduced stakes at a reduced number of
venues.
It sounds
terrible but at some point racing needs to face the reality of its true
position. It’s time to stop the continual practice of borrowing and living in
hope.
The September 1950s publication that says the TAB was the concept of The New Zealand Racing Conference and the New Zealand Harness Conference and was underwritten by the race clubs of New Zealand.
The good
news: the codes own the TAB!
The bad news: the TAB is broke!
by Brian de
Lore
Published 20th March 2020
Today’s stuff.co.nz
article blaming the coronavirus for RITA having to go to the Government, cap in
hand, for a cash hand-out to save the TAB is yet another blatant example of
attempting to pull the wool over the eyes of racing’s long-suffering stakeholders.
RITA is today
saying it needs a Government bail-out to alleviate a projected $14 million loss
through sporting event cancellations and a $3.8 million error they made from
offering bonus bets, but the truth of the matter is that the TAB was broke before
coronavirus cancelled most sports.
It brings
to mind that famous quote from American politician Rahm Emanuel: “You
never let a serious crisis go to waste. And what I mean by that it’s an
opportunity to do things you think you could not do before.”
Coronavirus has thrown RITA a life-line excuse – or they think it has. It will also become a matter of fact the yet to be released half-year result (ending January 2020) will show RITA was about $4 million behind budget and regardless of the Covid-19 explosion worldwide was heading for another disastrous end of year result.
In the SOI (Statement Of Intent) RITA said: “Net profit before distributions for the 2019/20 financial year is budgeted at $165.8 million, an increase of $29.1 million (+21.3%) on the net profit before distributions for 2018/19 of $136.7 million. It is underpinned by a combination of revenue growth including full-year benefits from the new Fixed Odds Betting platform, recovery in elite betting activity, growth in gaming and other key revenue initiatives, and a reduction in operating expenses.”
The $165.8 million is a pipedream and is now likely to be closer to $130 million
That appeared
on the RITA website on 12/11/19. The $165.8 million is a pipedream and is now
likely to be closer to $130 million; a budget-miss result of something like $35
million – it’s inevitable the TAB will soon announce stakes money decreases
because it’s hard to see the Government fronting with any cash.
The reason
it gets worse between now and year’s end is because the RITA budget took into
account increased profits from two new sport betting options introduced from
February, which included something called ‘hockey stick.’ But it hasn’t happened and now with sport
cancelled the budget falls into the ‘miss by a mile’ category.
The other thing about this story is that it reeks of stage-management by RITA. How else could this story have gone to Stuff had it not been sent in a press release to the media website or a Stuff staff reporter had not received an invitation to attend?
Stephen Henry: Coronavirus is threatening to bring down the TAB, which has asked for a cash injection from the Government so it can keep operating.
In the
story, it said: “Coronavirus is threatening to bring down the TAB, which has
asked for a cash injection from the Government so it can keep operating.
“It’s
serious enough that we have briefed Government today on what it means for us
and how they can help, and that includes injecting cash into the business so we
can continue to operate.
“Henry
told stunned workers that everything was being done to minimise its operating
costs, including:
* Using fewer cameras at race meetings, doing away with Trackside presenters on course, sending fewer production staff, and not operating betting totes. * Cutting a wide range of expenses like travel and overtime – “we should have cut the sausage rolls today.”
Chief Operating Officer Stephen Henry quoted above has been part of the leadership team for a considerable period and coincidentally was with the Ministry of Foreign Affairs with John Allen before arriving at NZRB – not long after John Allen made the shift.
Everyone in racing should be offended by the Henry joke about saving the sausage rolls
Everyone in racing should be offended by the Henry joke about saving the sausage rolls when he has been part of the NZRB gravy-train that over two-and-a-half years ago was earmarked for ‘urgent review of the operating costs.’
Needless to say, that review never happened, and Henry remains one of six in the RITA leadership team on a $300,000/year or above salary, and the costs of RITA according to the last annual report was $211 million. Also, Henry mentioned saving travel expenses – that shouldn’t be too difficult given the same annual report says they have been spending $54,000 a week on travel and accommodation.
A decent CEO could have gone into NZRB/RITA at any stage in recent history and slashed the costs, but no one in power has displayed either the know-how or the appetite to do it, or both. John Allen was politically appointed, and his tenure cost the industry $200 million when you consider the cost of building the FOB was $50 million and the on-going commitments to pay Paddy Power and Open Bet for five and 10-year terms.
Henry’s cost-cutting is too little, too late, and his plea to the Government for a hand-out is certain to get some eyes rolling at the Beehive
Henry’s cost-cutting is too little, too late, and his plea to the Government for a hand-out is certain to get some eyes rolling at the Beehive. If three years ago, we’d had a CEO saving just 10 percent per annum of costs – a very achievable target – today we would be $64 million better off.
Just 10 percent per annum for three years and racing would not owe the ANZ Bank $35 plus million and wouldn’t be asking the Government to bail-out an institution that is now flat broke. But the thing that racing can say to the Government is that “you have been making all the appointments and this gravy-train is full of ex-Foreign Affairs and Post Office employees – so it’s mostly your fault.’
Since NZRB finished and RITA arrived, the fortunes of racing
have continued to decline. Racing was let-down by the failure of RITA to put a
big broom through the management and start with Messara’s blank sheet of paper.
Nothing changed of any consequence which brought to mind Einstein’s definition
of insanity – ‘doing the same thing over and over again and expecting
different results.’
That definition is now a cliché in racing. Dean McKenzie replaced
John Allen in January, but on appearances, he looks to have become part of
their team rather than making any waves with the introduction of an alternative
style of leadership to turn the tide. RITA’s submission to the Select Committee
was a massive disappointment to the industry, and McKenzie’s decision to leave
the building immediately afterwards and not listen to the three-code submission
was rightly viewed with some derision.
Information received today tells a different story to the $3.8 million error on bonus bets that Hendry is claiming. And that is, it wasn’t an error but involves some creative accounting that requires an independent investigation. The word of description was ‘smokescreen.’
The original intention this morning wasn’t to write any of the material you have read above. The focus was intended to be a document entitled ‘NZ Racing and Trotting Conferences Off-Course Betting Scheme,’ which came into my possession about three weeks ago. It’s possibly the most important paper for New Zealand racing’s future if indeed it can survive the immediate issues of coronavirus, insolvency, and the prospect of racing closing for a period.
The document sets out the formation of the TAB – it’s dated 20th
September 1950. It clearly states that the New Zealand Racing Conference and
the New Zealand Trotting Conference came together to start the TAB and that the
start-up costs were underwritten by the racing clubs of New Zealand.
Racing has said this anecdotally for years, but to see it in writing is a big deal – it’s proof the codes and the clubs own the TAB and that the tail has been wagging the dog for years, and that now needs to change. The document is 70-years-old, but unless a subsequent paper exists which cedes the ownership to the Government (and none exists), racing is the rightful owner.
The beautiful thing is it makes the proposed legislation of the Racing Reform Bill redundant. The Bill at its first reading can be summarised as a paper that took away all of racing’s rights and decision making, stole the IP, provided the Minister with the eternal right of interference and control, and opened the door for sports to come in and be a partner in the business at no cost to them. It did nothing to improve racing.
Ownership of the TAB means that racing can, with pride and a
significant degree of scorn towards the pretenders, hold up its middle finger
to all that nonsense and say, ‘we’ll have back what’s ours, thank you very
much.’
The Transport and Infrastructure Select Committee had a meeting yesterday with the PCO (Parliamentary Counsel Office) to initiate the Bills rewriting, which is expected to incorporate something like 120 changes and became a document far more acceptable to the needs of racing.
The second reading of the Racing Reform Bill could now be by mid to late April – that’s if Covid-19 hasn’t closed down parliament by that time?
After
900 written submissions and around 90 oral submissions, the Transport and Infrastructure
Select Committee will now deliberate and adjudicate the changes required to
panel beat the proposed Racing Bill legislation into a more acceptable shape.
Some
hefty blows with a sledgehammer in this instance will be more appropriate than
a few taps with the rubber mallet. An impeccable source of information tells me
the alterations will be substantial and far more acceptable to the codes than the
diatribe put to parliament in that first reading in December.
Collectively,
the weight of all the submissions presented by the industry sent a strong
statement to the Select Committee, which to its credit, listened intently to most
arguments at the hearings. They also asked many searching questions, and will
now complete the process by penning new wording the racing industry can not
only live with but can take with them into a sustainable, future-proofed period
of recovery.
The relationship between codes has a history of disagreement, but in the past month they have displayed more unity, especially in their almost unanimous rejection of the first reading of the legislation which was serving only to keep racing on the path to poverty. Even blind Freddy could see that.
“…if that was presented as a paper by a law student in an exam, I would say try again.” – Judge Clapham
Former
racing administrator and owner-breeder, Judge John Clapham, projected a similar
theme in his oral submission. He said, “It takes courage to make decisions. I
think you have been poorly served by the legislation put in front of you. It is
not fit for purpose. I bluntly said (in my submission) that if that was
presented as a paper by a law student in an exam, I would say try again, or do
you want to take up another industry.
“It’s
very, very poor,” Clapham continued. “You need to ask yourselves why it is
presented to you in such form, and I suggest there are people in the background
who are endeavouring to take over in a bureaucratic way the functions of what
is known as the TAB.”
Shadow
Minister of Racing Ian McKelvie responded by asking Clapham: “Why do you think
the RITA submission has basically supported the propensity of this Bill and no
one else has done the same, and the RITA board was officially appointed to
design the Bill?”
Clapham responded: “I don’t know the personalities, but my dream was this – this Bill would have provided you with clarity and incisiveness about where you are going with the legislation – and I ask myself, why doesn’t it do that? And I would suggest that they have misunderstood their role. They should have presented you with a Bill that certainly may have needed fine-tuning, but you shouldn’t have had to be asked to start from square one, surely to God, assuming people have been paid to carry out that function. If it were a lawyer doing it, I suggest I wouldn’t pay the Bill.”
McKelvie’s question pigeonholed RITA as a committee dressed in the emperor’s new clothes
McKelvie’s
question pigeonholed RITA as a committee
dressed in the emperor’s new clothes as it contradicted the overall industry
view by supporting 80 to 90 percent of the original legislation. It also
demonstrated that had RITA consulted racing’s stakeholders and grassroots
participants for the first writing, then this whole process of angst could have
been avoided.
RITA
and the DIA between them concocted the content in the first instance. This latest
process, however, was between the industry people and a representative
committee of parliamentarians who will eventually pass this whole thing into
law – passionate people in racing dealing with the lawmakers – a far more
sensible system.
The hearings provided a good insight into the potential for racing to run its own business without government interference – that message was made loud and clear to the Select Committee, and they appeared to take it on board. Poor industry governance in the past dozen year or so has included some racing people, but 90 percent of the personnel disasters have resulted from political appointments, nepotism, non-racing Directors’ Institute graduates, and others even less qualified.
Racing Industry Bill hearing of evidence – part 2 (5 March 2020)This bill finalises the post-transition governance structure of the racing industry, creates a legislative framework to enable property to better benefit the racing industry, and enables new ways of seeking approval for betting products. Read more: 👉 https://bit.ly/38L8zHk
The John Messara oral submission on Thursday, 5th March may be viewed here
Racing
should steadfastly refuse to put up with that nonsense in the future. And in
the legislation rewriting, an arbitrator should be installed to ensure all
appointments are within the strict guidelines of qualification. NZRB appointments
in latter years, including a Chair, were outside those guidelines, but the
codes displayed a lack of strength by allowing them to proceed. Also, why
should someone who has never stepped inside a TAB or ever placed a bet in his
life, and is mainly interested in playing Mozart on a Saturday instead of
watching Trackside, take charge of wagering – that’s the 21st-Century’s
new definition of insanity.
Getting
rid of the ex-civil servants on massive salaries from racing is just one tiny
part of the problem alongside the panel beating of this legislation. The real
issue today is our current financial state, which is one of insolvency – the
TAB cash flow keeps tiding things over, but recent information coming to The
Optimist also says the facility of a floating-line above the $35 million debt
is in place for reason of no interruption to paying the bills.
The
three codes annually cost $40 million and NZRB/RITA $211 million. Total $251
million annually for a business that returns the three codes only $100 million
for prizemoney. Salaries at RITA amounts to more than NZTR dishes out in
prizemoney. If it were a public company, the shareholders would be baying for
blood and demanding resignations.
The
simple business principle of maximising income and reducing costs is still on
the backburner.
It doesn’t matter what excuse is given to stakeholders for that lack of incisiveness in dealing with the issue of costs; no genuine excuse really exists; it’s unacceptable.
John Messara has always said that the fix for New Zealand racing is a relatively simple one
John
Messara has always said that the fix for New Zealand racing is a relatively
simple one, but it requires someone strong who will roll-up their sleeves and
do a hatchet job for the greater good. RITA has already advertised for a new
CEO of the TAB, but it’s unknown if they used the word ‘testosterone’ in the
advert – probably not.
Both racing and breeding’s immediate problem is to keep its current level of clientele. The anecdotal evidence suggests owners and breeders as a group is in a state of shrinkage. Any good news coming from the Select Committee cannot come fast enough because confidence in racing badly needs a repair job.
As
of today, the Select Committee expects the rewriting of the legislation to be
completed by March 19th with the second reading taking place in early May, and
the third in June. By July 1st, the entire process should be complete
with legislation passed into law.
As
John Messara said in his oral submission, printed below, this is the last
opportunity New Zealand racing will get to put the vital changes in place that
will resurrect the industry, and New Zealand can ill-afford to pass up on that
opportunity.
John
Messara’s impressive presentation may also be viewed in the second half of the video
link shown above:
JOHN
MESSARA
PRESENTATION TO THE NZ SELECT COMMITTEE ON THE RACING INDUSTRY
BILL
THURSDAY
5TH MARCH 2020
May I thank the Members of the Select Committee for
the invitation to appear before you, on this, the last day of submissions.
I am mindful that I am not a stakeholder in the New Zealand Thoroughbred Industry and that submissions are a privilege of industry participants. However, with the Select Committee’s indulgence, I will make some observations and explain the underlying objectives of my 2018 Review of the New Zealand Racing Industry.
Let me firstly confirm that after all of this time, I still stand firmly behind my 2018 Review and all of its recommendations.
NZ Racing was a jurisdiction that was batting “way above its average” for a long-time last century, enjoying great respect from its Australian counterparts and beyond. The renowned expertise of its participants and its famous grazing pastures made the NZ Racing and Breeding Industry an icon of the 20th-century horseracing world. As a young lad, I clearly remember how my family and racing friends would speak with trepidation, year after year, of NZ invaders, plundering Australia’s major races. The NZ Yearling Sales, in those days held at Trentham, was nothing less than a rite of passage for any aspiring investor in thoroughbreds in our region….. of which I was one. Trentham was a veritable pilgrimage of owners and trainers from around the globe, with Aussie breeders looking on in awe as their NZ competitors dominated the Australasian bloodstock market.
So much so that in 1985 Australian breeders, led by the late Colin Hayes, lobbied the Hawke Government to amend the breeding stock provisions in the Tax Act specifically “to enable Australia to compete with NZ.” The 1985 Federal Budget did bring in the changes sought, and this heralded the beginning of a long period of sustained reform in the Australian industry, with the obvious benefits being enjoyed today.
Ironically, I was the person who authored that submission to Treasury in 1985, on behalf of the industry.
And yet today, the boot is on the other foot, with NZ
breeders and trainers thinking of abandoning the industry here in order to survive
and you can imagine the consequences of this on direct and indirect employment.
The 2018 Review resulted from an approach from Minister
Winston Peters, who like the late Bob Hawke, has a real interest in racing. I
was commissioned to undertake the Review by the Minister because of the poor
state of Thoroughbred Racing in NZ which is the result of a 30-year gradual
slide. The Minister made it clear that he wanted a full review, warts and all,
of the problems of your industry and the solutions to turn it around. It was also clear
to me that the Minister sought recommendations that would make
the industry sustainable into the future and independent of government.
At first blush, it appeared to me that your industry was suffering from a paucity of revenue, shortage of capital and a sub-optimal governance structure, but I also felt that this situation could be righted with a reform program aimed at modernising the industry, introducing new revenue measures and maximising the use of existing assets.
I then sought the assistance of three experienced racing & wagering administrators: John Rouse, a previous CEO of the Australian Jockey Club and currently a Trustee of Randwick Racecourse working on racetrack consolidations; Darrell Loewenthal, a retired senior public servant in NSW, who was responsible for a number of legislative changes and is a consultant to Racing NSW to assist on governance and structure; and Craig Nugent, the recently retired CEO of Tabcorp to assist on wagering. I am very grateful for their input.
We live at a time when the racing and wagering worlds are globalising when horses travel around the world to compete in feature events, and when wagering operators are consolidating to form international corporate wagering giants. It is also a time when Asia is emerging as a big player in our region. These factors represent opportunities for NZ.
Also, racing here, like everywhere else, is facing growing
competition from other forms of leisure and gambling, as well as continuous
attacks from the animal welfare lobby. These are challenges for NZ and for every
other jurisdiction.
The Review recommendations seek to arm the NZ industry
to deal with these factors but this will necessarily mean change, and in some
cases that change will be profound. It will be the willingness of stakeholders
to focus unselfishly on the wellbeing of NZ Racing as a whole that will
determine the success of the reforms.
All the 17 Review Recommendations can be categorised
under three major headings:
Industry Modernisation
Revenue Enhancement
Better Utilisation of Industry Assets
I note that some of the revenue recommendations
requiring legislation have already been passed and that the Bill now under
consideration contains a number of clauses related to other recommendations
in the Review. Given that prizemoney is the single most effective
lever available to reinvigorate the NZ Thoroughbred Industry, I would encourage
the government to expedite arrangements for Racefields
Fees and Point of Consumption Tax, and I urge the industry
to make a serious commitment to negotiate an advantageous TAB NZ outsourcing
deal. These are all new sources of much-needed industry revenue.
I do not wish to take issue with the current Bill on a
clause by clause basis; however, I should advise that this is not a time for
compromise on matters that go to the thoroughbred industry’s sustainability and
its independence from government. A number of the Review’s modernisation
recommendations relate to the devolution of power to the Codes, and I still
hold firmly to the belief that this notion is fundamental to the success of the
reform package.
I do
want to comment on the recommendations made in Part 3 of my Report because I believe that
racecourse consolidation is critically important to the reform package. Various
independent reports on the NZ Thoroughbred Racing Industry dating back to the
Reid Commission on Racing in 1965 and the McCarthy Royal Commission on Racing
in 1969 have all recommended the importance of a significant rationalisation of
NZ Thoroughbred Racing venues, but little has been done. In relation to this,
the work we did as part of the Review in 2018 showed that many clubs, if
looked at on a stand-alone basis, would not be able to afford current
prizemoney levels without the subsidies provided by NZTR. That said, most
venues and tracks are also in a state of disrepair. Against this, we estimated
that total capital expenditure required to bring all 48 operating venues up to
an acceptable standard in terms of tracks and facilities was $294m, and for the
28 tracks we recommended to be retained plus new synthetic tracks our estimate was
$190m.
I would like to assure the Select Committee that this rationalisation is not
proposed as a cosmetic exercise. Better tracks and facilities will better
showcase NZ Thoroughbred Racing to domestic and international audiences,
provide for more consistent form lines and ultimately give a boost to wagering
turnover. Currently, much of NZ Racing on TV and on smart devices looks
somewhat shabby by international standards. Thus, a consolidation of tracks,
including the sale or closure of surplus tracks and the investment of any
proceeds into the remaining tracks, is a priority.
I also note that mention was made in submissions to the Select Committee that a rationalisation of venues had not occurred in my home state of NSW. It is definitely arguable that there should be rationalisation in NSW. However, the extraordinarily strong financial position of racing in NSW has not made that an imperative. This is not the case in New Zealand.
In the light of all this, I commend the submission of NZTR to the Select Committee [and similar submissions from the other Codes], as it summarises the final amendments that need to be made to the Racing Reform Act to reach the goals of the Reform Program I have recommended.
I have two final comments:
The 17 recommendations in the Review were designed to work as a matrix to reverse the fortunes of your industry, and any significant departure from them will affect the ultimate outcome. Simply put, cherry-picking the reform program will compromise the future success and prosperity of the entire industry, and such is the pace of progress & competition in global racing & wagering that New Zealand will be permanently left behind. This is, quite literally, your industry’s last chance to secure a vibrant & successful role in 21st-century racing.
These recommendations are based not on theory or ideological conviction, but on the real, practical experience of what works, based on my time as Chairman of Racing NSW, and then as Chairman of Racing Australia, leading the Australian thoroughbred industry through a period of deep reform. I know exactly how much effort, passion, and courage is required to enact the recommendations in the Review, but the rewards are immense. Australian racing now has the kind of prizemoney, facilities, events, integrity & leadership that makes people from across Australia & around the world want to be part of it as owners, punters, breeders, trainers & jockeys, and all the many other roles our industry can offer the next generation.
I have no doubt that the NZ Industry, with its
illustrious history, its expertise, its natural assets and its favorable time
slot in the Asia Pacific region is well poised to regain its mantle as a leader
in the region, if it can be transformed into a viable, independent, modern industry
with its racing capable of being marketed competitively outside of NZ.
I believe this process is underway, and a beneficial
resolution of this Racing Reform Bill
will quickly create an atmosphere of confidence in the industry from within New
Zealand and beyond, with all the attached economic, social & community
benefits.
