Following the announcement by the Levy Board to cut regulatory and integrity funding to racecourses in 2011 by a further £6.1m from the base numbers on which the 2011 Fixture List had been agreed, the British Horseracing Authority has confirmed how the sport will deal with this funding shortfall.
The Board has decided to reduce centralised expenditure by the governing body by a further £1.5m in 2011.
The cost, in real terms, of the diverse central services carried out by the Authority has been reduced significantly over the past three years. As a guide, total central governance and regulation costs were £32m in 2005 (£37.3m at today’s prices), compared to a planned £29m in 2011. Factoring inflation, this equate to a reduction of over £8m, or 20%, covering the full gamut of our activities – the contract with Weatherbys for administration, the contract with HFL for drug surveillance and testing, all of our veterinary work, our integrity unit, licensing and medical, race planning, disciplinary and our entire team of raceday officials, as well as the major industry projects on which the Authority takes the lead.
The Board’s decision to reduce the full impact of the £6.1m HBLB grant cut lessens the need to increase fees. However, there remains a significant balance that must be met and the Board has considered this in the light of the pressures facing all involved in the sport.
From 1 January 2011:
- Charges to Trainers and Jockeys will remain as they are, unchanged since 1 January 2008.
- Prices for BHA Publications will increase by 4%, the first such increase since 1 January 2008.
- With racecourses set to lose £6.1m in Levy income, the Authority’s own fee charges to courses will be reduced by a net £3m, so that courses will bear £3.1m of the funding gap, which works out at an average increase of approximately £2,000 per fixture.
- The balance of the funding gap will be met through Owners’ fees increasing by £1.5m, or an average of £100 per horse in training – the first increase on owners charges since January 2008.
Nic Coward, Chief Executive of the Authority, said:
“The Board has had to look at an emergency budget position for 2011, taking into account the wider impacts of the economic situation, the current Levy returns as against the anticipated increases in 2011 from the 50th Scheme, and also the Board’s view on how the sport should address issues in a different way in 2011 and beyond.
“This is a complex balancing exercise involving a short and long term view of impacts, and the best way for the sport to go forward. To place the entire burden of the Levy cut on racecourses would have had a number of potentially very damaging consequences, including serious questions about the Fixture List and race programme, and impacting Owners through a reduction in racecourse contributions to prize money.
“We have reduced the cost of running the sport by driving efficiency, whilst at the same time maintaining the scope of the services we carry out for the diverse interests in Racing, and high service levels. This further change in our cost base comes on top of the considerable reductions we have made over the last three years. The changes to date have been planned through and implemented with great care, and not materially impacted the wider sport. The Board is very mindful of avoiding potentially severe mistakes and adverse impacts on the sport by not taking the time to plan thoroughly.
“The Authority has led the discussion on these complex matters between the racecourses and Horsemen’s Group and will continue to do so to ensure the best possible outcome for the future of the sport.”