British Government to Mend Broken Horserace Betting Levy Talks

Online bookmakers of Britain and Racing officials have failed to set up a new horserace betting levy, as each stakeholder directly held the other party responsible.

Secretary of State John Whittingdale of the Department of Culture, Media and Sport is to take up the duty of mediating the issue. The 55th Levy scheme was set to take effect from April 1, 2016, but the Horserace Betting Levy Board (comprising British Horseracing Authority, the Racecourse Association and the Horsemen’s Group) and Bookmakers’ Committee could not reach an agreement and formally exited the dealing attempt on Saturday.

A statement issued by the Levy Board mentions, “This is a matter of deep regret for racing, whose representatives have worked hard – and in a completely united manner – for a number of months to reach an arrangement with the betting industry on an appropriate contribution from the digital betting market, which currently costs the sport around £30m a year owing to the long-standing deficiencies in our central funding mechanism.” “The proposals were rejected because they would see such crucial income to the sport continuing to decline from an already challengingly low level, despite racing continuing to provide and represent an important seven-day-a-week betting product,” it said.

The online rate of horserace betting revenue would have heightened to 8.25% in the 56th scheme and to 9% in the 57th. The British Horseracing Authority (BHA) had been looking for a 10.75% cut of racing revenue from retail betting operators and 7.5% from offshore operators.

The bookies had allegedly countered with a flat sum offer covering the coming four years. Though the suggested sum worked out to a little over 4% of revenue rate, this would go downhill with time as an increasing number of race bettors chose to wager online. However, Racing’s negotiators’ demand is a percentage of horserace betting revenue instead of the lump sum payment. Besides, Racing asked for transparency in terms of the contributions from individual bookies, so as to correctly designate which operators had acquired the suggested Authorized Betting Partner tag.

BHA chief Nick Rust stated the offer made by the contributing online operators “represented around 3p in a £10 bet. It’s not a fair contribution and we couldn’t accept it.” Besides, two or three of the major operators had been ready to offer a significantly higher rate though consensus could not be reached, according to Rust. He told ‘At the Races’ that the BHA would pressure UK government to keep their promise of inflicting a Horserace Betting Right to replace the racing Levy.

Mike O’Kane, Bookmakers’ Committee chairman expressed his frustration at Racing’s rejection of his group’s “very good” argument that realistically addressed the challenges faced by bookmakers and Racing. He mentioned that the Racing needed to admit that the bookies’ participation to racing as a whole – via levy, media rights and sponsorship – was going up each year, instead of continuously looking for substantial increases from the levy. He grieved over the failure to reach a deal as it “brings more uncertainty when both racing and bookmaking would benefit from a period of stability.”