The Horsemen’s Group, together with the British Horseracing Authority (BHA), today announced a significant development for the sport and its participants in the signing of Prize Money Agreements with 27 racecourses. The racecourses which have signed include all those run by The Jockey Club, including Aintree, Cheltenham and Newmarket, Scottish Racing, and a number of independent courses, led by Ascot, York, Goodwood and Newbury.
The signing of Prize Money Agreements signals a change from a racecourse’s own contribution to prize money being a discretionary payment to a contractual minimum commitment between racecourses and horsemen. The Agreements mark the creation of commercial partnerships, underpinned by the governing body, between racecourses and horsemen in which the sport’s participants are guaranteed a share in betting-related media revenue generated by racecourses.
The six large independent courses, Ascot, Ayr, Chester, Goodwood, Newbury and York, together with Bangor, Ffos Las, Hamilton, Kelso, Musselburgh, Perth, Salisbury and all the courses run by The Jockey Club are the first to sign the Agreements that will deliver an agreed proportion of their income to horsemen through prize money.
In the event of all racecourses signing up, it is estimated that this would result in an uplift of almost £5 million in prize money contribution by racecourses compared to 2013.
Philip Freedman, Chairman of the Horsemen’s Group, said:
“These are landmark Agreements for the sport and we view their introduction as a welcome first step towards delivering improved returns for horsemen. Until now a racecourse’s contribution to prize money has been totally discretionary and even though racecourse revenues have grown significantly in recent years, it has been left to them to decide how much should be passed on to the participants.
“We hope that they represent the start of a new era of collaboration and trust between the sport’s key stakeholders. These contractual commitments will lock in the amounts that racecourses are currently investing in prize money and, for some, require significant increases. Racecourses will also contribute, as a minimum, an agreed share of future growth from the sale of rights for betting.
“I am delighted that twelve independent tracks with varying business models, ranging from Ascot to Ffos Las and including all Scottish racecourses, as well as the Jockey’s Club’s tracks, have recognised the importance in working with the Horsemen’s Group and the BHA to strengthen the relationships between the industry’s stakeholders and to create a partnership approach to developing racing’s revenue streams.
“Should all courses sign Agreements, this would increase racecourses’ contribution to prize money by around £5m in 2014. While this would obviously be a positive development, nobody should be in any doubt that there is still much to be done before British Racing offers levels of prize money that adequately finances an industry into which owners inject nearly £500m every year. We view these Agreements and the principles they establish as an important stage in a journey that will also require working with the government, Levy Board and bookmakers to provide a fair return to the people without whom racing cannot take place.”
The three-year deals, which take effect from 1st January 2014, commit each of the parties to working together, not only in terms of a racecourse’s prize money contribution but also in a range of areas designed to bring benefits to all in the sport. Other topics addressed include racecourses having a special fund to enhance prize money according to field sizes in certain races and facilitating racecourses’ access to bonus schemes to top up prize money. In addition, whether a racecourse has signed a Prize Money Agreement will be a key consideration in the allocation of BHA-controlled fixtures.
The terms of the contract are structured to enable all courses to sign the same Agreement, with the course in question choosing either the ‘Premier’ or ‘Standard’ Tier option. A ‘Premier Tier’ racecourse contributes at least 40% of income from the sale of rights specific to betting into prize money and a ‘Standard Tier’ racecourse contributes no less than 33%. A racecourse’s previous contribution to prize money is also a key factor in their eligibility for the Premier Tier. In addition to making a greater commitment to prize money, a ‘Premier Tier’ racecourse receives further benefits, such as the option to increase entry fees for Group races with associated increase in prize money and to develop media protocols with Horsemen to enhance promotion of the sport.
Charles Barnett, Chief Executive at Ascot speaking on behalf of the large independent Racecourses, said:
“The large independent racecourses are delighted to be at the forefront of the new formal contractual Prize Money Agreements with the Horsemen, who will share in elements of our successes under the new Agreements. The Horsemen have shown genuine enthusiasm to understand the complexities of our businesses and I know appreciate what we have done collectively to produce high prize money in the past, especially during 2011 when much of the significant levy shortfall that year was plugged by additional racecourse contributions. We can now move on together, alongside the Jockey Club, current and future signatories, with promotion of racing and the overall health of the sport as our common goal.”
Simon Bazalgette, Group Chief Executive of The Jockey Club, said:
“This is an important and positive step forward for our sport. The Jockey Club exists solely for the good of British racing and in 2013 we are contributing the largest amount ever to prize money from our own resources, which will increase further in 2014.
“The basis of these Agreements is partnership and a shared interest with Horsemen in the long-term health of British racing, where all parties receive a fair share of growth and success. Our 15 courses have attained Premier status on the basis of our future commitment and our track record of reinvestment, and I welcome the move from the independent courses who have met the terms, who make a significant contribution to our sport and with whom we share common values.”
Paul Bittar, Chief Executive of the British Horseracing Authority (BHA), said:
“The signing of these Agreements is excellent news for the sport and one we, as the governing body, very much welcome. We will be working closely with the horsemen and racecourses to optimise the potential provided by the creation of genuine commercial partnerships between the sport’s key stakeholders.