Can Winston Peters revive the NZ racing industry?
Last year he famously said: “I’ve got no interest in being the Minister of Racing presiding over a dead horse.” But many within the industry fear that unless he moves swiftly, the animal, despite its staying power over the decades, will indeed expire.
The Deputy Prime Minister last year commissioned John Messara, described as a top administrator and stud owner in Australia, to review the NZ industry, which has been ailing for the past decade.
After he received the report last August, Peters noted Messara’s warning that thoroughbred horse racing “is at a tipping point of irreparable damage” and declared:
“My intention is to have officials produce a Cabinet paper with a set of recommendations for decision. While it is too early to say what Cabinet will agree upon, the severity of the situation means the status quo is unlikely to prevail.It’s reform or die, there’s no off-course substitute”.
Those in the industry who had poured money into the coffers of NZ First before the 2017 general election took heart when Peters declared:
“We can turn this around very rapidly – it’ll be a thriving industry”.
Nearly six months since the Messara report was published – well, what has happened?
After receiving feedback from the NZ Racing Board and other elements in the racing industry (which is said to generate a real gross value of $1.66bn a year), Peters in December set up a five-member Ministerial Advisory Committee to “inform next steps” on the Messara reforms, (which included slashing the number of the number of racetracks and outsourcing the TAB’s commercial activities to an international operator).
In saying the government is committed to reforming the racing industry, Peters indicated the Ministerial Advisory Group would develop a plan to operationalise the Messara report to deliver better governance and economic outcomes.
“The five people appointed to the Ministerial Advisory Committee bring their personal expertise and ability to provide independent, strategic assessments of the business change proposals for the racing industry. Between them they have experience across the three racing industry codes,”
The committee has been chaired by Dean McKenzie, an experienced racing administrator, Peters said, whose dedication and passion to improving the industry make him the ideal choice to lead this very important work. Other committee members were Bill Birnie, Liz Dawson, Kristy McDonald and Sir Peter Vela.
“Collectively, they will identify the technical, legal, financial and process-oriented decision points for racing reform and return the industry to a well-managed and sustainable economic growth path. They will also take into account the feedback received during the public submission process.”.
He said in that December statement the committee would provide an interim report by the end of February 2019, to be followed by Cabinet decisions, and legislation to modernise the industry.
“The Committee is being created as a potential precursor to the establishment of a Racing Industry Transitional Agency (RITA), subject to future government decisions”.
But the existing Racing Board contends there is no need for a Racing Industry Transitional Agency (RITA).
“The Board already has an established mandate that can operate as a transition agency up until legislation is enacted that formalises any new arrangements. There are a number of vacancies on the Board to which new appointments can be made. Furthermore, the Board is leading two existing programmes with all Codes which are progressing venue consolidation and evaluating outsourcing. These programmes would be slowed, and business continuity would be lost by the establishment of a new agency”.
And then there’s the issue of closing 20 of the race tracks, most of them in the provinces which, according to NZ First, are suffering from economic deprivation.
Hopes were high in the industry that the betting levy collected by the government would be abolished, if not immediately, at least in the budget. But time seems to be running out on that one.
As for NZ racehorse owners (who got a collective return of 22.9% in 2016/17, while NSW owners received 48.1% in 2017/18), their hopes of seeing prize money lifted to $100m a year remain in limbo. Stakes have been maintained with the help of a borrowed $12m for the last two years.
The TAB, despite investing $40m on a new betting app, is losing out to bigger international betting units. Messara was adamant the TAB continuing on its own could lead to isolation, particularly if TabCorp secured West Australian wagering, a development which NZ could sensibly join.
So the industry cheered when Peters declared:
“We’re not here to please the Racing Board, or another bunch of bureaucrats – we’re here to please the industry that pays the money, that shovels out the crap at 3 o’clock in the morning and takes all the risks–It needs to be turned around now and the benefits will start flowing quite quickly”.
But the cheering has subsided as the months have passed.