In this magazine, Deputy Chairman Paul Greeves sets out the work the TBA has been doing on Brexit and how we are tackling the various issues that are likely to emerge. It follows presentations from Paul and TBA tax expert Peter Mendham at our June 15 seminar.
Ease of movement of horses, particularly to and from Ireland and France, is important to the breeding industry, which is why the TBA has taken the lead in researching the facts and why I am delighted to be now chairing the industry’s Thoroughbred Brexit Steering Group.
The best and only way to tackle the many potential problems already identified, and those that will doubtless be raised during the process, is to work together with the BHA, Weatherbys and horse transporters to ensure that the message we take to Defra and Brussels is clear, well researched and factual.
All three countries have the same aim in maintaining, as far as possible, the status quo for the movement of thoroughbreds
One significant advantage is that we already work closely with the Irish Thoroughbred Breeders’ Association and the European Federation of Thoroughbred Breeders’ Associations, which means we can be sure of taking the same message and solutions to Brussels. All three countries have the same aim in maintaining, as far as possible, the status quo for the movement of thoroughbreds that also remains tax and tariff free.
We live in uncertain times but everyone involved with this important topic will enhance contacts in the UK and Brussels, so that people responsible for making the decisions understand the issues and are as well informed and briefed as possible.
Turning closer to home, an opportunity to review all central expenditure in racing has been created as the sport moves into the brave new world of the reformed levy mechanism, which captures all betting on UK horseracing, and the Racing Authority, which will administer the funds that this revised scheme generates.
Over recent years racecourse funding has changed, notably in the substantial growth of media rights, and those under the Racecourse Media Group (RMG) umbrella will receive another major uplift in April 2018. Arena Racing Company (ARC) and its associated courses are still negotiating with some of the major bookmakers, but whatever arrangements they make are likely to reflect those of the RMG courses.
Assuming this is to be the case, it is no secret that payments to racecourses will reflect much more closely the requirements of the betting industry to produce adequate and if possible larger field sizes, and will apply a heavy penalty for small fields that do not generate turnover. Of course, this generally aligns with the aims of racing to achieve a higher levy generation, which relies in the most part on exactly the same metrics.
While racecourses have always appreciated and aimed at good average field sizes, to stimulate higher betting turnover and therefore higher levy yields, they will now be even more strongly incentivised to achieve the same result. Previous deductions to racecourses for small fields were annoying, but they could be factored into budgets. The new system, which rewards upwards and penalises downwards on field sizes, will bring racecourse management thinking into strong focus about the types of races they run and any historic underperformance in field sizes.
Horsemen, which includes breeders, should see this as a real opportunity. As racecourses increasingly compete with each other to attract runners, owner-breeders in particular should support those that make an extra effort, through whatever means, to attract us.
A significant number of racehorses, particularly females, are owned or part-owned by their breeders, and a separate prize or some form of recognition in suitable races may tip the balance in favour of targeting a particular race. Three or four extra runners in a race can bring a substantial reward to the racecourse involved, and it will be interesting to see how those with the most progressive managements try to encourage our participation.