RACING – THE ONLY WAY FORWARD

There’s a sudden surge of public interest in the future of the horse racing industry.  Unfortunately, there is no evidence of a corresponding grasp of what it is that drives the industry.

As a result, sincere suggestions for the way forward merely scratch the surface and are of only cosmetic use.  Nobody seems prepared to face the truth.  The first and most fundamental truth is that we must fix the economics of racing.  Unless we do this, no amount of gimmicks such as Sunday races; mandatory minimum starts; new Tote machines; infield carnivals; or slots will produce the desired results.  Here are some of the most urgent economic fundamentals without which there will soon be no horse racing industry to fight over or gimmick out of existence:

  • Government must withdraw from the business of promoting horse races.  The beaurocracy, with the best will in the world, is not structured to run a private enterprise oriented business and has failed to do so successfully year after year after year since the forced takeover of the 1980s despite the several scattered successes and steady progress made during the Danny Melville years.  And even if the Government could be a successful promoter of horse racing, it would be an unforgiveable conflict of duty and interest for it to do so for any protracted period for the simple reason that it is the Government who must regulate both the sport of horse racing and the business of betting on races.  I find it unconscionable that, almost 25 years after the hostile takeover of Caymanas Park by the Government, we are still meekly submitting to the unworkable and unethical dual role being played by Government in racing;
  • It is not enough for Government to simply withdraw.  It must pro-actively facilitate new investors (preferably divorced from any occupational licence-holders) in the construction of an entirely new race track located far from the crime ridden metropolis that currently surrounds Caymanas Park and in an environment that is friendly to the concept of an entertainment centre whose main focus is live and simulcast horse races.  The new investors must get a 15 year moratorium on Tote betting duties.  Races at Caymanas Park should be terminated as soon as this new race track is ready and the property used by the Government for other socially needed purposes such as low income housing;
  • The new Totalisator must be mandated by law and strict regulation to return a payout on win, place (and maybe show) betting of at least 85% of stakes.  Exotics should be made to return at least 75% to the punter.  This is a non-negotiable sine qua non without which no racing product can be maintained. Apart from the well-known “churn” factor which anybody with common sense (not very commonly found in racing people) can appreciate and understand, there is the even more stark competition factor.  Horse racing has long ceased to be the only game in town.  It competes against games of instant gratification such as slots (pay-out percentages of 88% plus); lotteries (pay-outs of only 50 odd% but massive jackpots); casinos with table games paying out in the 90s; and, the most important wave of the future, internet betting whereby anybody can bet into any Tote or with any bookmaker worldwide at international low rates of take-out and correspondingly high rates of payouts to punters;
  • Owners need to be treated with more respect.  Along with Punters, they are the only investors in racing (until private promoters come along).  Breeders are also investors but not in racing; they invest in agricultural farms that could, in a pinch, produce alternative crops.  We must stop this colonial structure of purse deductions which assumed that this was still the sport of Kings; that owners were multi-billionaires with oodles of disposable cash to throw around; and the occupational licence holders low class beggars in need of handouts.  If this was ever so in Jamaica, it’s definitely not the case now.  Trainers should conform to the international standard and accept a 10% bonus from their owners’ purses in addition to the daily training fees charged and collected for their services.  Jockeys should receive 7 ½% of winning rides only (except in Graded races).  Unless you win the race, the ride (which has lost the race) is a LOSING RIDE and should attract the losing ride standard fee.  Why, for example, should I reward a corrupt jockey with a bonus if he should “pull down” my horse but still manage to place in the race?  And it’s time to stop pampering grooms whose qualifications do not permit them to earn a living wage in any other industry.  They should be paid a fair wage for the critical work that they do but ought not to be dipping their hands into owners’ purses when races are won.  How much do grooms on a stud farm earn?  Do they get a cut of the yearling’s sale price? None of the above prevents individual owners from doling out bonuses to deserving workers whenever they elect to and can but this forced deduction smacks of communism and ought to be abandoned at once.  Nobody can be found on a monthly basis to assist owners to pay their large training bills and so why do these persons suddenly turn up after a small purse has been secured but the owner is still very much in the red?
  • It’s time to encourage Bookmakers to be Bookmakers and make their own Book.  It’s time to insist that only modern, online Bookies will be licensed.  Why should a cash-strapped Government pay for regular country visits to bookies intent on chicanery by refusing to computerize when proper regulation is done online everywhere else?  Bookmakers who learn how to “dutch” their books at 110% stakes/payout (or whatever percentage they feel is competitive) should be taxed at the lower end of a tax band of 11 – 17% of gross profits and those insisting on keeping their lips securely attached to the Tote while making a huge vacuuming sound should be taxed at the upper end.  This will give the punter more variety; make betting more fun; and increase interest in the game.  Sales will balloon;
  • Now that it is (hopefully) leaving the business of racing, Government should provide incentives to breeders by way of a National Stud instead of breeders bonuses; Tote Betting Duty, after the 15 year tax holiday, should be no more than 1 ½ – 2 ½% of gross sales; the regulatory bodies should be merged (too many cooks with neither recipes nor the knowledge to create any are now allowing corruption to run wild) and very strict regulation of horse racing to include amendments to the Rules to introduce modern offences relating to insider trading; stiff penalties for corruption related offences; tight due diligence on applicants for betting licences but facilitation of those who pass the tests and generally for applicants for owners permits; and a strong and comprehensive legislative framework to include detailed Regulations relating to the various betting and gaming operations (currently absent) must now be priorities.

Readers will have noted that there is no mention of more racedays; Sunday racing; infield bounceabouts; or Beenie Man in the above fundamentals.  These are gimmicks being used as smoke and mirrors to deflect attention from the above fundamentals; to protect jobs; and to keep the comfort of the status quo going.  Who will insist on taking off the blinkers, hood and cheekpieces and forcing those (with eyes to see) to see?  Who wants racing to go forward?  Who enjoys it as it is?

Good Luck!

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One Response to “RACING – THE ONLY WAY FORWARD”

  1. Paul Wright Says:

    This is an excellent spring-board for discussion. Hopefully Racing Business can do this in March 2010.
    Dr. Paul

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