More Tough Times For NZ Racing Industry

Wednesday, 15 December 2010 07:15

Racing clubs were rocked with the news on Wednesday that forecast funding from the New Zealand Racing Board to thoroughbred, harness and greyhound codes will be cut by between $NZ5 million and $6NZ million this season.

The board had hoped to return $NZ132 million to the codes, but that was now more likely to be $NZ127 million-$NZ128 million, board chief executive Andrew Brown told delegates to the New Zealand Thoroughbred Racing annual conference in Wellington.

The continuing bite of the recession had hindered the TAB's turnover, particularly on domestic racing which was 11.5 per cent down on budget for the year to date, he said.

While the TAB had enjoyed a good Melbourne Cup day, punters did not spend up at Cup week in Christchurch, despite good crowds. Off-course revenue was down noticeably for the week.

"Activity on the tote reflects ... a reduction in the amount people are spending per bet," Brown said. "The October GST rise did not help us either."

The number of bets with a $100 spend or more was down 15 per cent, he said.

The board was doing well with fixed odds betting and revenue from showing its races overseas and would continue its efforts to drive revenue up, but the next couple of months would be crucial as far as domestic tote turnover went, he said.

The board would soon start a promotion pushing its exotic bets such as trifectas and first fours which had higher takeout rate, giving the TAB a bigger return.

While it would continue its attempts to drive revenue some of its plans, such as refitting its TAB agencies, would be delayed.

But it would push ahead with its Helix betting engine, with a phased introduction starting in April.

The thoroughbred body reacted to the forecast cut by chopping the riding fees it pays for its lower-graded "free" meetings, a saving of $NZ1.5m.

NZTR chairman Guy Sargent described the forecast funding cut as a big shock, and said most of it would have to be dealt with in its funding model for the 2011-12 season.

"We are still a long way out, we could get a really good Christmas and we might get back, but at this stage it is not positive," he said.

NZTR would continue to push for all-weather synthetic tracks but whether the racing board would see it as a spending priority was not clear, Sargent said.