Shock new fall in Fund income causes crisis

A SHOCK new £1.5m drop in betting income to the sport is to prompt a crisis reappraisal of Greyhound Board of Great Britain spending.

Income from off-course bookmakers to the British Greyhound Racing Fund is now expected to only reach £8.5m, compared with the 2009 budget of £10m, and £12m in 2008.
That £2m cut in the budget of last year was then seen as savage, and it leaves the Greyhound Board and Fund with few easy choices.

It is also bad news for the new chief executive of the GBGB, whose identity is expected to be revealed within the week. He takes over in a period of severe austerity and cost cutting – the Irish Greyhound Board is in a similar bind – with optimism as its lowest ever ebb.

A Greyhound Board statement on the budget crisis – there is expected to be a meeting of the Fund Tuesday – explained: “After analysis of year-end receipts from its major bookmaker contributors, the BGRF and the GBGB will have to rebudget this year’s expenditure based on an anticipated fall in the ‘voluntary levy’ in 2010. The £8.5m now made available in 2010 compares to £10m made available at the same stage in 2009 and £12m in 2008. The implications of this news are currently being considered by the GBGB Board.”

GBGB chairman Maurice Watkins said: “This substantial reduction in BGRF income is of significant concern for greyhound racing. It will mean that all those areas which benefit from BGRF support will probably incur significant reductions from the budgets previously agreed by the GBGB Board when anticipating a similar income to 2009.

“The Board and its committees will review the position in the coming weeks seeking to achieve a fair distribution of available monies, but also prioritising future rises in investment should forecast income prove unduly negative.

“The Board will also consider its response to the fact that, while live greyhound racing is an important betting product, some bookmakers choose not to contribute to the Fund – given the voluntary nature of the betting levy. This has not beenhelped recently by certain online betting operations moving off-shore.

“Greyhound racing is a great night out but also a fantastic off-course betting product. GBGB will be seeking to maximise both these propositions to address this disappointing fall in income.”

Last year, incoming Greyhound Board chief executive Ian Taylor, at the time of the then £2m cut, said: “It has been tricky for a brand new Board, whichhas created all sorts of aspirations for change, to immediately have to deal with a significant fall in income, and the emotion that surrounds any possible cuts. In that context, I am delighted that we have been able to protect prize-money and retired greyhound spending.”

Although Bob Betts in this week’s Sporting Press, before news of the dramatic fall, was arguing for an increase in prize-money and that too much is spent on welfare, initial soundings suggest any significant cut in this latter area is going to face resistance on the basis of acceptability to contributing bookmakers, welfare carers and Government.

With capital spending support for promoters – always a controversial area – already slashed to £0.5m, the room to manoeuvre is limited.

Headline spend areas in the 2009 budget were: Prize-money £2.5m, retired greyhounds £1.8m, marketing £1.5m, sampling £1m, vets support £1m, racecourse integrity £0.5m, track safety, other welfare and trainers’ assistance £0.6m, other areas including IT, training etc £1.1m.

There have been other calls for prize-money to be revisited in terms of whether major open events should be boosted as these are seen as the shop window for attracting new owners, but with many trainers operating on the breadline, any prize-money cut anywhere will be resisted.

Marketing is always a target in difficult times, with one trainer at Crayford on Saturday morning voicing criticism of the 2for1dogs.com campaign – Crayford notably refusing to take part.

Sampling policy – and the pooling debacle which led to Taylor’s departure – is already under review by a panel led by Dr Andrew Higgins, which is expected to report shortly. But the pooling idea, presumably intended to save costs, alone indicates the desperate strait-jacket the sport is being forced into.

Insiders say the core problem is not so much the popularity of greyhound betting in the shops, but the way it is being presented by bookmakers given the chaotic nature of the service with two competing channels in SIS and Turf TV,  which has led to lack of space and time for greyhound racing, which is also being further squeezed by bookmakers relentlessly promoting life-like virtual products that in some shops not only involve greyhounds but include bike and car racing.

One key player said: “Anyone who has worked through a recession knows that all areas of expenditure have to be reviewed, and VFM [Value For Money] becomes paramount.”

However, a task for the new GBGB chief executive will be to review the platform the sport receives and study the opportunity of a betting relaunch with the anticipated arrival of jackpot and other exotic bets – which immediately differentiates greyhound racing from virtual competitors.

The fact some bookmakers, mainly independents, get a free ride, becomes increasingly contentious in the current climate – and this is likely to receive higher priority. There is possibly £2m failing to reach the sport here. The Fund is based on a 0.6 per cent voluntary payment on turnover, originally set in place when Parliament began to reduce tax on the betting industry and asked for evidence of bookmakers putting something back.

Ladbrokes last week reported a significant downturn in all business, with amounts taken over the counter in betting shops (ie horses, greyhounds and sport) as over “seven per cent down . . . with a deteriorating trend as the economic environment has worsened and unemployment has continued to rise”.

Greyhound Board chairman Watkins mentions the move off-shore as a factor – Hills and Ladbrokes have just switched their net and telephone operations to Gibraltar to save on taxation – but the reality is little is generated for greyhound racing in this area.

Race by race turnover in cash betting shops remains the principal driver of the Fund, although contributions from Betfair have become more important.
They are thought to be giving the Fund around £1m a year – if anything, that figure is growing.

OPINION (by Paul Brown)
ANOTHER big percentage drop in Fund income is surely more than “disappointing” as it has been described by GBGB chairman Maurice Watkins.
To see the projected yield drop from £12m two years ago, through £10m in 2009 to just £8.5m now is pretty dramatic, even allowing for the underlying problems of the economy.
It is very likely that the loss of a hardcore punting track like Walthamstow has had an impact, but it is difficult to get away from the view that years of treating punters like fifth-class citizens has finally come home to roost.
The promoters might not grasp it, believing that greyhound racing is a numbers game, but the beauty of the sport is that hard work brings rewards.
Yet obstacles are constantly put in the way of those willing to put that graft in to find an edge.
Many promoters, some bookmaker tracks included, want it both ways. They are only too happy to benefit from the Fund, but through their actions actively discourage the off-course betting which finances it.
There needs to be a complete mindset change. First up, just like in Ireland, advance form and video replays of all races should be available on a central GBGB website – such requirements should be preconditions for a track to receive any Fund money.
Next, the GBGB should investigate whether backing a Monday-to-Thursday television channel wouldprove self-financing, or otherwise actively seek backers for such a project.
And if the effect on attendances is a consideration here, the question has to be asked whether that is a significant consideration in any case.
The appetite for betting on greyhound racing is still there, but for how much longer when other gambling media are so much more accessible?Over to you, Mr Chairman.

Paul Brown