The Levy Was Dry

Writing these brain dumps is something akin to waiting for a bus, you wait ages for some inspiration then everything happens at once.

Yesterday saw the Governments verdict on the latest Levy and it came up with an estimate of between £73.7m and £80.8m, effectively an uplift of 7.5%, plus a decrease in the threshold whereby bookmakers pay a reduced levy.

I have to say it is not very often I agree with politicians, however I agree wholeheartedly with the closing comments of the Secretary of State, Jeremy Hunt, where he said:-

“With the determination concluded, I would like to re-state my disappointment that the relevant parties were not themselves able to come to terms and I would strongly encourage them to develop a less adversarial relationship going forward. I have tried to be fair by listening to the advice of the Independent members of the Levy Board and I will continue to be guided by their advice in future years until what should be a straightforward commercial negotiation can be taken permanently out of the hands of Ministers. “

I would go as far as to say it not a disappointment, it is a disgrace that racing is unable sort out its own finances.

Although it does have to be acknowledged any discussions between the racing authorities and the bookmakers is akin to a 45 rated handicapper taking on Sea The Stars.

On the one hand we have British racing, a sport which has no cohesive structure, a mish-mash of various self-interest groups, all of whom have differing, often conflicting, priorities. On the other hand we have the bookmakers, multi-million pound businesses, run by financially astute individuals who know who to run successful, profitable, organisations.

 If you want to play a fun game get a blank sheet of A4 and write a list of all the organisations and groups involved in racing and, when complete, ask yourself who actually controls all these groups, who speaks or acts for a unified Team Racing?

Was the “Racing United” initiative on your list.

For something that is meant to unite the sport it does not appear to have been that successful. All it happens to be is a window dressing enterprise. Flogging the same dead horse that the Levy is unfair on racing and the big nasty bookmakers are “robbing” the sport.

According to its website it has attracted 1,502 online and 1,157 physical signatures for its campaign. Now add up all the numbers who work in racing, who go racing, who visit betting shops – all locations where the petition has been available and you will see what a waste of money the exercise has been.

Bookmakers are not robbing the sport, it’s just they are more financially astute and are able to outflank racing at every turn.

When it comes to funding those who run the sport are riding a one trick pony, it is the Levy or nothing as far as they are concerned.

Racings negotiators seem unable to accept the Levy is anachronistic, out-dated and not fit for purpose. It is indeed questionable whether it was fit for purpose when it was first introduced.

It could equally be argued the Levy is grossly unfair for bookmakers and for other sports.

A question I have asked many times, yet nobody in racing has ever been prepared to answer, is “why should racing alone benefit from a bookmakers levy?”

Why shouldn’t football get a levy? Why shouldn’t the BBC get a levy on money wagered on programs like Strictly Come Dancing?

The Levy in intrinsically wrong and unfair, it also allows for lazy financial management within the sport.

Why should racings bean counters make any effort in seeking proper commercial funding when funding is more or less handed over on a gilded plate?

Racing needs to negotiate a new funding structure that is fit for purpose in the 21st century. One which stands up in the competitive commercial world.

It should not rely on what is effectively an outmoded tax, nor should it rely on Government intervention when it proves itself to be incapable of even negotiating within a framework it supposedly knows and espouses.

Racing for Change, now there is a name to conjure with. Instead of tinkering around the peripheries and introducing larger number cloths, trying to attract Brian, Fred or whatever other fictitious racegoers it wishes to make up, perhaps it should spend time looking at the fundamentals of the sport.

Perhaps Racing For Change should look at creating a unified structure to run the sport like the multi million pound business it is and not some elitist club.

Of course it will not happen as it is an arm of Racing Enterprises, which is owned by two of the interested factions in the sport, even though they have conflicting priorities.

Interestingly it is the same two factions who are at loggerheads in the on-going tariff dispute, how will Racing Enterprises spin that one?

Racing needs financial and marketing teams who understand what is required and who can deliver what is needed.

It does not need negotiating teams who stick their heads in the sand, who go into negotiations with the bookmakers with only a well rehearsed, obsolete, Plan A and no plan B to fall back on.

It does not need leaders who put their own egos above the interests of the sport  . . .  Paul Roy.

You think I am being harsh?

We are talking here about an industry which cannot even give away its terrestrial TV rights for goodness sake.

An industry where a broadcaster has to be paid to show the sport on terrestrial television.

Yes, even Channel Four negotiators can run rings around racings great and good.

The BBC have been criticised for reducing their coverage of racing. Who can blame them? Why should they pay public money to show a sport, when their rival is actually being paid to broadcast the sport 52 weeks a year? Is that a level playing field?  

Can you seriously imagine the Premier League even contemplating turning to Sky and saying we will pay you to show our matches?

It is a joke. Much as I love this sport, one wonders if it deserves to survive the way it is currently structured and managed, although I use the latter term in its loosest sense.

No business (and racing is a business like any other) has a divine right to survive. It has to adapt, it has to live within its means.

No business should go running to Government for help just because those are supposed to manage it do not have the wherewithal or ability to seemingly organise even the proverbial piss up in a brewery.

I sincerely hope the Government has the balls to turn round and say the 50th Levy scheme will be the final scheme and it is up to racing to sort out its own finances going forward.

Racing needs to join the real world. It needs to know the full worth of what it has and to then exploit that worth ruthlessly.

The halcyon days of racing just being a gentleman’s club are long gone, the sooner those who are charged with running the sport realise that the better it will be for all concerned.

My final comment on financing relates to the tariff protests organised by the Horsemen’s Group.

So they want greater prize money in the sport – well there’s a surprise!

Presumably they accept the economic reality there is less money coming into the sport as there is less money in the economy in general, yet there has not been a commensurate reduction in the fixture list.

Umm doesn’t basic common sense then suggest there will be less money per race to go around?

Instead of going for headline catching, yet ultimately pointless tariff protests, perhaps they should address the more fundamental issues of the structure and future financing of the sport. Including ensuring the fixture list is cut back to a realistic level to reflect the funding available.

Oh silly me . . .  the Horsemen’s Group is one of those vested interest parties who are more interested in their own narrow self-interests than the wider interests of the sport.

A perfect illustration of all that is wrong with the sport.

 

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