SBC News Voice of the Sports Betting Industry
The funding of UK racing is to be reorganised as the Horserace Betting Levy Board (HBLB) commits to a new three-year business plan to ensure long-term financial stability for all stakeholders.
The launch of the Business Plan had been delayed to 2023 due to the levy board factoring post-COVID realities, impacting the sport, government and British society.
HBLB maintains its 60-year duty to serve as the body charged with the collection and distribution of “around £100m a year in direct funds for British racing stakeholders, programmes and projects.”
Although it maintains its statutory objectives, HBLB recognises that it needs to operate in a flexible and adaptive manner to meet the demands of horseracing’s changing circumstances.
The new Business Plan 2023-2025 has set out three strategic priorities in which the HBLB concedes that its ‘financial planning’ must consider the effect of pending changes brought on by the Gambling Review on customer behaviour.
Beyond meeting its financial planning duties, HBLB will review “how prize money funding is directed and whether it appropriately complements contributions from others in the sport.”
The third objective is to ‘improve with rigour’ the effectiveness of the board’s internal operations and duties including the collection of the levy, project assessments and reporting for stakeholders.
Despite expanding its strategic objectives, HBLB will be maintained as a small 16-staff unit, that with operating costs managed at 2% per year of Levy funds raised.
The Levy is paid by bookmakers with annual gross profit on British horseracing revenues in excess of £500,000, at a rate of 10%. All licensed bookmakers must agree on the amount of monthly payments on account ahead of an end-of-year reconciliation.
COVID-19 unprecedented events have influenced the financial approach of the board, which saw its 2020 cash reserves “reduced by almost half from £51.5m to £33m” during the pandemic.
In 2021, the board was granted a £21m loan from the government’s Sports Survival Package (SSP), to help UK racing survive the peak impact of the pandemic.
Noting that racing’s yearly fundraising target cannot be guaranteed, the HBLB has pledged to maintain a yearly available cash reserve in the range of £21-to-£31m.
The 2023-2025 Business Plan has outlined 26 projects/reviews that will be undertaken by the HBLB to improve its operating processes, funding controls and structures.
As such, 2023 agenda will include an assessment of the Gambling Review’s legislative outcomes and their impacts on betting, fundraising and customer engagements.
HBLB Chief Executive Alan Delmonte said: “We are very pleased to publish the Business Plan. The Board agreed it during 2022 but decided to hold off its public release until there was more stability following the economic effects of COVID.
“HBLB is a small but busy organisation which has a significant reach, with its collection and distribution of £90m to £100m a year involving close working relationships with the Racing and Betting industries.
“The Business Plan sets out in one place the key areas of activity and focus that we have identified for the period ahead, recognising as always that there will be new items that arise that we will address with Racing, Betting and Government. It is a further commitment by HBLB to transparency in our operation and we will regularly provide an update on performance against the plan.”
