by Brian de Lore
Published 17 January 2019
The Ministerial Advisory Committee or MAC as it has become known is currently hard at work to meet the deadline and produce its interim report for the Minister by the designated date of February 28th.
The detail of MAC’s progress is unlikely to be discussed openly either by the chairperson Dean McKenzie or the Minister Winston Peters prior to its completion by that date but working out what is on the MAC agenda is simply a matter of a closer scrutiny of the Terms of Reference.
When Minister Peters announced his committee on December 13th, he stated in the press release, “This government is committed to reforming the racing industry. The Ministerial Advisory Group will develop a plan to operationalise the Messara Report to deliver better governance and economic outcomes.”
The key word for the industry to digest is ‘operationalise’ – the role for MAC is not to review the Messara Report as some industry pundits have interpreted but to put it into action and expedite the Messara vision of reform this industry so badly needs.
When the Minister made the announcement on the Beehive website, the press release came with an attachment entitled ‘Terms of Reference’ which in simple terms is a task-list and a time-schedule set out by the Minister for completion by the committee.
The Minister’s decision to appoint MAC and not immediately replace the NZRB board has been a point of contention for some racing people but the reasoning is all about the parliamentary process and getting the Racing Act of 2019 written as an acceptable document that will serve the industry for the decades to come.
During the process of re-writing the Act and getting it to its first reading, the matter of parliamentary lobbying will also be taking place. The Bill will require cross-party support from MPs for a smooth transition into law, and this will also have been a consideration in the Minister going down this path.
The political wheels within wheels are always turning and while the industry raises doubts about the process the Minister is following, those doubts are not based on the knowledge the Minister has accumulated from decades of successfully negotiating the uncertain and murky game of politics – not just surviving it but successfully winning on more occasions than not.
The racing industry is emotional after decades of neglect, decline and more recently despair. Our one ray of hope is Minister Peters leading the industry through the mire without too much explanation while humming the Frank Sinatra tune ‘My Way.’
About a year ago Peters stated that he ‘wouldn’t be leaving port with plotting the correct course.’ The Terms of Reference has defined that course on the map and MAC is the ship he has selected to reach the Messara dictated destination.
Under ‘Context’ in the Terms of Reference shown below, he refers to meagre prizemoney, declining foal crops, less wagering due to field sizes, infrastructure and poor governance. Under ‘Purpose’ the emphasis is clearly about prioritising the areas identified as the main drivers, and at the top of the bullet point list, is governance and finance and distribution to the codes.
MAC is charged with scoping up the operational decision points for racing reform – that’s the key sentence!
We are already experiencing smaller field sizes and less wagering as a result. The industry knows how poor the governance has been; if it had been any different we wouldn’t today be in the ‘serious state of malaise’ which is the language extracted verbatim from the Messara Report.
Few people in the industry have read and have fully absorbed the Terms of Reference and that’s why the salient points are printed below. The Messara Report is a very comprehensive document and the Minister is sticking with his edict that it wasn’t commissioned to strip the value from it.
To have a full understanding of the Messara Report and then juxtaposition it with the Terms of Reference is to know the direction this industry is heading towards by the middle of the year.
MAC has now met twice, the second of which was a two-day meeting on Sunday and Monday of last week. They will meet again for a full day on Tuesday next week. No amount of urgency or commitment is being left unused in its endeavours to meet the requirements of the Minister.
The current state of the industry triumvirate is tantamount to the juggler with three balls in the air – MAC, NZTR and NZRB – a situation that’s unnerving to the industry stakeholders. MAC is making the recommendations but officially has no power. NZTR supposedly runs the thoroughbred industry but presently is nothing more than a thoroughbred register for births, deaths and marriages. NZRB has been defrocked and limps its way through a luke-warm reception to the launch of the FOB platform.
To some it might seem like a rudderless ship but within a month of the conclusion of the Karaka Yearling Sales series, the shroud of secrecy should at least be raised to a point in which industry participants will see a renewed level of confidence in the direction MAC is taking us.
The salient points contained in the Terms of Reference are as follows:
Terms of Reference for the Ministerial Advisory Committee
Context
The racing industry is responsible for generating more than $1.6 billion in value-added contribution to the New Zealand economy, although this value has been eroded over time because the New Zealand industry is in a state of serious decline. Prize money is meagre, so returns to owners are significantly below other jurisdictions. Foal crops are declining which inhibits future field sizes, leading to less wagering and less revenue for the racing industry. Industry infrastructure and governance is poor.
The Government is committed to reforming the New Zealand racing industry and seeks the scoping up of a detailed plan to operationalise the Messara Report, the ‘Review of the New Zealand Racing Industry’s’ recommendations once approved by Cabinet, to deliver better governance and economic outcomes for the industry.
To enable the timely delivery of a racing reform programme, a Ministerial Advisory Committee (the Committee) is being created as a precursor to a Racing Industry Transitional Authority being established in legislation (subject to future Government decisions on the recommendations of the Messara Report).
Purpose of the Committee
The Committee is a ministerial advisory committee appointed by the Minister for Racing. The Committee will be charged foremost with setting a sense of direction for the intended racing reformswith particular focus on prioritising those recommendations that have been identified as the main drivers required for successful industry reform. This will provide the basis for a prioritised work plan for the Committee, to be provided to the Minister of Racing early in 2019. It is also charged with scoping up the operational decision points (whether technical, legal, financial or process orientated) for racing reform, engaging with industry throughout, and offer analysis to the Minister for Racing on opportunities (i.e., the industry’s untapped potential) as well as roadblocks to returning the industry to a well-managed and sustainable economic growth path.
It will involve the Committee gathering and analysing a wide range of inputs and carrying out engagement, investigation, and analysis about the effects of specific proposals under core areas of the Messara Report, including:
- the governance and structure of racing;
- finance and distribution to the codes;
- new legislation to support the various dimensions of racing reform;
- wagering and the TAB;
- club consolidation, racecourses and prizemoney; and
- any other matters that the Committee considers relevant to its work, including establishing the Racing Industry Transitional Authority (RITA).
Outputs
Interim report
The Committee will provide an interim report to the Minister for Racing by 28 February 2019.
The Committee’s interim report should include:
- Advice to the Minister based on the Committee’s analysis of the six core areas listed immediately above;
- A detailed plan for the Committee’s remaining work until RITA is established in legislation; and
- Any other matters the Committee wishes to raise with the Minister for Racing.
Further direction may be provided by the Minister for Racing in March 2019
The Government is expected to make decisions on the recommendations of the Messara Report in March 2019. This will identify which of the Report’s recommendations the Government agrees to implement and at this time the Minster of Racing may provide the Committee with further direction about its direction of travel.
Final Committee Report
The Committee is to provide its final report to the Minister for Racing no later than 30 June 2019. The purpose of the Committee’s final report is to support a transitional agency to manage the implementation of the changes approved by the Government, particularly any structural changes.
The requirements for the Committee’s final report are:
- final advice on any operational or other matters that the Government should consider in its response to the Report; and
- a draft transition plan for the racing sector, identifying key steps, processes, and timings.
