Racing must reform or die
Report suggests shutting 20 racetracks and outsourcing TAB to make industry viable
New Zealand is set to lose up to 20 racetracks and the TAB could be outsourced to an overseas operator after the most comprehensive review in the racing industry’s history.
The report suggesting the radical changes, commissioned by Minister for Racing Winston Peters and overseen by top Australian racing administrator and breeder John Messara, was released at a public meeting in Hamilton last night.
Messara made 17 recommendations on how to fix the ailing New Zealand racing industry, concentrating particularly on the thoroughbred code.
The two hottest topics will be the closure of 20 thoroughbred racetracks around the country, including Avondale in Auckland, and the likelihood the licence to bet on racing and sport in New Zealand would be outsourced to an overseas, likely Australian operator, effectively ending the New Zealand TAB’s control of such gambling in this country.
Messara suggests track closures as a way to cut costs and his idea was not rebuffed by thoroughbred bosses, who have struggled to keep many tracks up to industry standard in recent years.
That has resulted in too many race meetings being cancelled because of poor or even dangerous racing surfaces, costing the industry tens of millions of dollars.
Peters had already promised the racing industry three synthetic, or all-weather, tracks to help, with one certain to be built in Waikato and the other two touted for Manawatu and Christchurch.
They could cost between $30-40 million for the three, with half that cost to potentially come from the Regional Development Fund and the other half to be met by the racing industry.
Those three tracks would enable racing bosses to close struggling regional tracks and transfer their racing dates even though that will meet with some resistance and even outrage in some areas.
“We will ensure that every region retains at least one track so there is racing there,” said Peters. “And we will consult with the industry on these tracks that are to be closed. But we have to change, even if it is unpopular.”
While track closures will mean minimal loss of fulltime jobs, the outsourcing of the NZRB’s gaming licence will effectively mean the closure of much of the New Zealand TAB and that could mean significant job losses.
But Peters says that will be balanced by the economic benefits and jobs retained or created by a more profitable racing industry.
A transition agency (Racing Industry Transition Agency or RITA) will be put in place to oversee racing’s changing landscape and Peters did not try to hide his lack of faith in the New Zealand Racing Board structure and performance.
“I know a dead horse when I see one,” he quipped.
The out-sourcing of the TAB’s gambling activities will be anything but a straight forward exercise though as the Herald understands the three codes — thoroughbred, harness and greyhound racing — in conjunction with the NZRB have already tested those waters after suspecting it would be suggested in the Messara report.
Two major overseas players are believed to have been involved in those talks and the money offered up front for the rights to control New Zealand’s gambling licence for 25 years as well as the guaranteed returns were underwhelming.
Peters suggested Messara could be asked for his expertise in suggesting the right people to oversees future negotiations over the licence when they get to a more serious stage.
That out-sourcing and the dismantling of the New Zealand Racing Board will not only require cabinet support but almost certainly changes to the Racing Act.
“There are a lot of technical aspects to that which we won’t or can’t get into now,” said Peters. “But change must come. This is a now or never moment for racing. It is reform or die.”
While some in the industry will be stunned by the idea of their local racetrack closing for the greater good of the industry, NZTR boss Bernard Saundry is adamant the number of racetracks in New Zealand is unsustainable.
The reduction of tracks from 48 to 28 is planned to be finalised by 2024.
As for the changes to racing governance, Peters says a firm date is not known but indicated he would like to have many of the changes suggested in the report at least under way by the Budget next year.
The ultimate short-term target is for racing stakes, particularly in the thoroughbred code, to double, raising the minimum stake to $20,000.
Many in the industry believe that level will be the absolute minimum needed to keep racing financially viable for participants like trainers, jockeys, stable staff and of course racehorse owners.