MPs warned about potential impact on horseracing from gambling reforms

MPs heard on Tuesday that the British racing industry was worried about the potential financial impacts contained within the government's proposals for gambling reform.

Michael Dugher, chief executive of gambling trade body the Betting and Gaming Council, told the Culture, Media and Sport select committee that the sport had received a "warning" of what might come through affordability checks on punters already put in place by bookmakers.

However, Dugher also warned the committee there was only so much money available for racing from the betting industry should ministers press ahead with levy reform to make up for any shortfall in the sport's income caused by its plans to bring in financial risk checks for customers.

The comments came as the select committee held its second oral evidence session since it launched its inquiry into gambling regulation in December.

Since then the government has published its long-delayed gambling review white paper, which included proposals for punters to undergo what have been described as "frictionless" financial risk checks in order to prove they could afford their level of spend on betting.

The committee's chair Dame Caroline Dinenage asked Dugher: "What impact will these reforms have on the viability of the UK horseracing and breeding industry?"

Dugher said: "If you hit our revenues and our turnover, that has a direct and corresponding impact on horseracing funding.

"As an industry we provide £350 million a year in funding to racing. There is, perhaps more than any sport, a symbiotic relationship between racing and betting. That is something that we have been worried about, that racing has been worried about.

"A lot of MPs will have seen the majority of any correspondence on this issue will have come from racing punters, or from those with racecourse interests, or owners and trainers worried about the future of the sport."

Michael Dugher: chief executive of gambling trade body the Betting and Gaming Council

Dugher said racing had already seen a reduction in betting turnover which he blamed on affordability checks, adding: "So they have already had a warning of things to come."

Gambling minister Stuart Andrew has said the government has begun a review of the levy, British racing's central funding system, to make sure it is appropriately financed.

Dugher said: "The government admits in the white paper that there will be a reduction in the money going to racing. What it says is it will have a conversation by the end of the year in terms of looking at the horseracing levy."

However, Dugher warned that racing had been overtaken by football as bookmakers' most important sporting offering.

He added: "It's also for the operators an increasingly expensive one, particularly because media rights have also gone up. There is only so much money available from one way or another to racing."

Dugher and his BGC colleague Wes Himes were also questioned about the potential threat to customers presented by the black market.

Himes pointed to the examples of Norway, France and Italy, claiming restrictions there had increased the size of the black market and produced higher problem-gambling rates than Britain, and that blocking such sites just led to them reappearing in another form.

Dugher added that the biggest thing the government could do was to "stop the traffic" to black market sites, which they could achieve by not asking customers to hand over documents.

He said: "If you are being asked by the people you used to bet with for documents and you are not prepared, as most customers wouldn't be, to hand over personal, private financial information like that, you look for an alternative and the first thing you do is just do a Google search. It's how can you get round the system and it pops up in seconds."

The Gambling Commission is expected to launch a consultation on how financial risk checks will be carried out by the end of this month.

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