Arena Racing Company (“ARC”) today confirms that the racecourse group will not ‘unlock’ qualifying races across its race programme from Monday February 11 2019 onwards. This decision is a direct reflection of the current retail betting media rights landscape.
Following a tripartite funding review in 2017 between BHA, RCA and the Horsemen’s Group, a new mechanism by which funding is distributed was developed which required investment in certain races to ‘unlock’ enhanced prize money allocation, including the Race Incentive Fund and the Appearance Money Scheme which extends prize money payments to placed horses.
Due to the nature of ARC’s race programme, this represents 3,406 races and £3 million per annum in extra executive contribution. ARC’s total commitment to prize money for 2019 will be £15.3 million, still substantially up from £11.3 million in 2015. Further reductions cannot be ruled out.
Martin Cruddace, Chief Executive Officer of ARC stated, “The British racing industry is today in a considerably different position than when we underwent the funding review of 2017 which came about as a direct result of the increase in Levy income to the sport, itself a result of the Levy being extended to cover online betting companies.
“This increase of approximately £40 million per annum to the Levy, through this extension to cover online operators was, to a large degree, a result of the Authorised Betting Partner policy adopted by British racing in 2016. ARC played a central role in leading and supporting this policy, albeit at the cost of some very significant sums in sponsorship agreements.
“At the time of the 2017 funding review it was agreed that the Race Incentive Fund and Appearance Money Scheme, paid for by these Levy increases, should be unlocked alongside further direct investment from racecourses.
“Today, however, the well-publicised impact of betting shop closures on racecourses’ media rights income has already started to take effect, and will only increase in the months and years to come. As a result of this, ARC simply cannot continue to support our current levels of executive contribution to prize money and unlock all qualifying races, as was the case throughout 2018.
“We fully understand the importance of prize money across the industry, and do not take such a decision lightly.
“It is for this reason that we are working with the whole industry to review funding and the allocation of the substantial and hard won increased Levy income to support the prize money levels for grassroots racing that we have, until now, been able to provide. It is therefore hoped, contingent on the support of our colleagues at the BHA and Horsemen’s Group, that owners and trainers who are kind enough to run their horses at our racecourses do not then see an appreciable difference.
“We completely accept the rationale behind the Government’s decision to reduce FOBT stakes to a maximum of £2 and we will continue to pursue a strategy to reflect the inescapable shift from retail to online as well as working with the retail betting industry.
Chairman of the Racecourse Association, Maggie Carver, said, “These are challenging financial times for Britain’s racecourses as the media rights landscape, in particular, has fundamentally shifted in recent months, so we can understand ARC’s decision.
“The RCA and its members will continue to work with Horsemen and the BHA to try to mitigate the situation as the funding environment evolves.”