British racing set for £250m hit over five years because of affordability checks, warn leading industry figures

Affordability checks will cost British racing £250 million over the next five years, leaders from across the industry have warned the government.

Arena Racing Company chief executive Martin Cruddace, in a letter backed by major organisations covering the whole sport, has called on culture secretary Lucy Frazer to pause the formal introduction of affordability measures or risk Britain becoming the "sick man" of European racing.

The most significant intervention by British racing on the subject comes with the Gambling Commission consultation into proposals that would officially introduce affordability checks due to close next Wednesday.

The figure in the letter confirms Racing Post reports published last week that the annual impact of the proposed checks on the sport was feared to be at least three times as great as the £14.9m hit to racing's finances estimated by the government.

Bookmakers have already introduced their own affordability checks in anticipation of the gambling review white paper published in April that set out the government's plans for reform.

In the letter, Cruddace claimed that from the figures the sport had seen the existing checks had resulted in more than £1 billion of online betting turnover on British racing being lost since 2021. This was blamed for contributing to there being around a thousand fewer racehorses in training compared to 2020.

The checks set out in the consultation will require bookmakers to carry out what are described as 'financial risk checks' on customers who lose as little as £125 in 30 days or £500 in a year, with enhanced checks kicking in for punters with net losses of £1,000 in 24 hours or £2,000 in 90 days.

The letter reveals that industry analysts Regulus Partners have calculated the new measures will cost the industry an estimated £250m over five years on top of the existing checks.

Martin Cruddace: "Further measures will decimate our sport"Credit: Edward Whitaker (racingpost.com/photos)

In his letter Cruddace tells Frazer the racing industry has a business model that is predominantly based on a "symbiotic relationship with the betting industry".

He adds: "Over the next five years affordability checks will directly cost the racing industry £250 million. The resulting damage to the industry, which currently employs some 88,000 people, is extremely alarming."

In the letter Cruddace disputes the claim only three per cent of betting accounts would be impacted by enhanced checks, writing: "The true percentage of current active accounts affected, which includes a higher percentage of horseracing accounts due to those accounts having a greater lifetime span, is considerably higher."

He also warns the measures will have no tangible effect on preventing harm saying: "Notwithstanding that we have had affordability measures in place for two years now, these measures have had no material impact on any of the nine current indices to measure gambling-related harm."

Among the other measures announced in the white paper was a statutory levy on operators that Cruddace tells Frazer he hopes can fund research upon which "carefully considered policy can follow".

He concludes the letter by warning that the "unchecked" application of affordability checks "reduces the available funds to put into prize-money and employment, much of it in rural areas, weakening our attractiveness and will cause UK horseracing to be the sick man of Europe".

The punters' consultation response:

'That's none of their business - are they trying to insinuate I'm not mentally capable of placing a bet?' 

The letter was signed and supported by the Racecourse Association, Thoroughbred Breeders' Association, the Jockey Club, National Association of Racing Staff, Racehorse Owners Association, National Trainers Federation and Professional Jockeys Association.

Cruddace said: "We are calling for the government to pause the proposed affordability measures. The debate is crying out for objective research, which the new statutory levy can help fund. From all the research by pressure groups and trade organisations I have seen, objectivity is a clear stranger.

"There is overwhelming consensus across the industry, as demonstrated in this letter, to the government – that further measures will decimate our sport that millions are passionate about and ultimately cost the industry over £250 million. That will threaten the future of multiple racecourses across the UK and many thousands of jobs."

Cruddace said the sport supported the government's motivation to protect online betting customers.

He added: "However, our industry risks becoming collateral damage with measures that have no impact in reducing gambling-related harm, promoted by those with an ideological agenda, not an evidence-based one.

"This has and will deeply cut the primary revenue stream for our industry. There are other measures the government could take that will have a more targeted impact; the current proposals will simply not deliver the government's ambition."

Nicky Henderson: "Affordability checks are doing catastrophic damage to the rural heart of the UK"Credit: Alan Crowhurst

Leading Flat trainer John Gosden has this week voiced concerns that punters could be forced to the black market as a result of the checks, and top jumps trainer Nicky Henderson has also expressed fears about their impact.

He said: "I employ 65 people in a small village community. Racing is vital to rural communities and clumsy badly administered affordability checks are doing catastrophic damage to the rural heart of the UK."

To complete the Gambling Commission's consultation on affordability checks, visit racingpost.com/consultation and follow the instructions.

The Racing Post also wants to hear from you: What has been your experience of affordability checks since the white paper was published at the end of April, and what do you think of the government's proposals? Have affordability checks affected your betting behaviour?

It's a chance for your voice to be heard. Email the Racing Post at editor@racingpost.com with the subject 'Affordability checks' to share your experiences, your thoughts about the government's proposals, and your contact details.

Read these next:

'We believe punters are going to the black market' - BHA chief backs John Gosden's affordability checks warning 

John Gosden warns a 'torrent' of bettors are heading to black market in stark warning over affordability checks 

'I'm not sure I've been as worried as I am now - it's a real threat' - Goodwood chief speaks out over affordability checks 

Subscribe to Racing Post Members' Club Ultimate Monthly and get 50% off your first three months!

Available to new subscribers purchasing Members' Club Ultimate Monthly using code WELCOME2023. First three payments will be charged at £19.98, subscription renews at full monthly price thereafter. To cancel please contact us at least seven days before subscription is due to renew.