FOBTs: prize-money cut could knock racing back years claim Newmarket trainers
Any reduction in the maximum stakes for fixed odds betting terminals (FOBTs) significant enough to trigger a reduction in racing’s prize-money would be “a very big nail in the sport’s coffin”, according to one of Newmarket’s senior trainers.
Pulling no punches, William Jarvis, one of the town's longest-serving trainers, said: "One has got to be anxious about the repercussions because the racing industry cannot absorb a drop in prize-money and that’s a fact."
That threat appears a distinct possibility as the government ponders the level of reduction to the maximum FOBT stake from its current £100 limit, with the betting and racing industry fearing a worst-case scenario after the culture secretary Matt Hancock, whose West Suffolk constituency includes Flat racing’s headquarters in Newmarket, was reported to be in favour of the lower limit of £2.
Such a reduction, according to the betting shop industry, could see the closure of 3,000 betting offices that pay up to £30,000 each for media rights, triggering a possible £90 million loss per annum for racing.
More accurately, according to Arena Racing Company chief executive Martin Cruddace, racing’s loss would be in the region of £55 million should the stake tumble to £2, and with prize-money inevitably left to bear the brunt of such a substantial shortfall livelihoods would be at stake, according to Jarvis, who has trained from historic Phantom House Stables for more than 20 years.
He said: “I thought we were making progress but prize-money is still well below the level we require and this could knock us back years.
“The money being put into lower-tier races is to be welcomed, but any reduction would be a very big nail in our coffin. The top and bottom of it is we’d lose clients and would put even more pressure on businesses that are already struggling to survive.”
Trainers fear a drastic reduction to FOBT stakes could swiftly reverse the upturn of last year’s levy reform, which helped prize-money in Britain climb to an estimated £160m this year, something that would have far-reaching consequences, according to Jarvis’s Newmarket colleague Chris Wall.
“If the government were to persevere with the £2 limit on the machines, the obvious knock-on effect would be that betting shops would close, income into racing from media rights would decrease and we’d have wound the clock back to where we started last year – and that’s not a place we want to return to,” said Wall.
“I’m hoping some compromise can be achieved that ensures betting responsibility is met but that would not adversely affect business. We’re in a very competitive industry and we’ve all got issues with shortages of staff, so the trickle-down through the system of more prize-money is a big help to trainers who can afford to pay their staff more.
"Retention rates are improving and you’d like to see that continue and not go the other way.”
While the promotion of racing supporter Hancock to Theresa May’s cabinet in the new year was widely hailed as a positive for racing a number of his constituents in Newmarket are hoping a recent report in The Sunday Times suggesting his preference would be for a £2 maximum stake for FOBTs was wide of the mark.
Wall said: “He’s done an awful lot in ensuring the levy replacement scheme is a big success, so we’ll give him a pat on the back for that, but at the end of the day he’s a politician. I’d be urging Mr Hancock not to be getting too carried away and trying to work out some kind of compromise that satisfies everybody.”
A reduction in prize-money would inevitably discourage potential new owners, according to Newmarket Trainers Federation chairman Mark Tompkins, who is fearful for his younger counterparts.
“If it did impact on prize-money, with the model and amount of racing we’ve got, it would be a disaster.” he said. “It’s hard enough to encourage new owners into the game at the moment, never mind if prize-money were slashed.
"I fear for young trainers because there’s a lot of them all in the same boat vying for the same horses and it’s very expensive to own them nowadays. The costs keep going up.
“Our racing industry shouldn’t be reliant on machines to keep us going – that’s for certain. If people aren’t betting on our industry our model is wrong.”
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