At last we are seeing some real action from the government. The setting up of a formal consultation process that asks whether the levy should be reformed or replaced indicates a real determination to transform the way in which British horseracing is funded.

The relevant government office, the Department for Culture, Media and Sport, says that doing nothing is not an option – which is music to my ears. After years of inaction, deliberation and obfuscation, this consultation process puts us on the first step to achieving a funding system for racing that is fit for purpose.

Whatever is eventually adopted must be enshrined in law so that any notion of voluntary systems is consigned to history.

The basic questions are simple; not so the underlying complexity. In this consultation we are being asked to choose between a reformed levy and a completely new system. A new system would demand that betting operators have an agreement with a body representing the whole of the sport that allows them to take bets on British horseracing, wherever those bets are struck.

It would be premature for me to pre-judge which of these two systems racing will eventually opt for, but it is my firm belief we should now adopt an entirely new system.

Of course, I appreciate that reforming the levy would probably be a cleaner process and might therefore represent a faster way of getting onto statute books. It also has already established the principle of the betting industry’s payments to racing being VAT free. But, to my mind, whatever the extent of the reform, the levy comes with too much baggage and would be unlikely to ever entirely sever its links with government. And, as ever, the European Commission will also no doubt take an interest in whatever system we choose to adopt.

A new system, broadly, would involve two proposals being evaluated. One is based on the establishment of a property right (the so-called ‘right to bet’); the other a regulatory-based system where betting operators have to pay British horseracing for the administration and integrity services of the sport.

The consultation is not primarily about increasing or decreasing the amount of money going from the betting industry to racing; it is about finding a modern model that works for all participants. It is also about creating a level playing field that ensures it is not just the good corporate citizens who pay a fair share back to the sport their customers are betting on.

The old concept of the levy being based on ‘racing’s needs’ and the bookmaker’s ‘capacity to pay’ would also be supplanted by the fundamental principle that the betting industry pays a sum that represents the value of British horseracing to them.

This, of course, is not without its dangers for our sport. It will be crucial to get the balance right between payment and value because in a wholly commercial world racing must also act reasonably and responsibly.

The fact that the betting industry is more likely to opt for levy reform than replacement immediately raises suspicion. Either way, the need for primary legislation will ensure that the process will not be expedient.

We are certain the VAT issue will not prove an impediment to the new system, which would also allow racing to distribute its money for the betterment of the sport, and the mutual benefit of the racing and betting industries.

Thanks to the government’s recognition of the economic impact of our industry, racing has the opportunity of a lifetime. Working collaboratively, the horsemen, racecourses and governing authority have never been in a better position.