Racing industry put money on NZ First but Peters has yet to come home a winner

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.