Reforms implemented by the government to the levy system have generated positive returns for racing stakeholders, as the UK Department for Digital, Culture, Media & Sport (DCMS) published The Horserace Betting Levy Board (HBLB) annual report & accounts 2017-18.
Coming into force in April of this year, the new levy forced all UK licensed bookies, whether that be land-based or remote, to return 10% of gross profits on racing wagers to the sport’s central system.
Supporting its introduction, UK racing would implement its authorised betting partner program, allowing contributing bookmakers to sponsor UK-wide horseracing events and meet-ups.
The revamped system has seen the highest yield for over a decade generated, with total income for 2017/18 coming in at £94.7m, up 45% on corresponding 2016/17’s £65 million.
This represents the highest income generated by the racing levy since 2007/08’s £115 million, with Paul Lee, Levy Board Chairman, commenting: “I am delighted to report that the first year of the operation of the new Levy Scheme has been successfully implemented.
“This is due in no small measure to the cooperation of the bookmakers who have been most constructive in their attitude.”
Before discussing government changes: “The Government’s proposals for the modernisation of the Levy were effectively in two parts. First, the extension of the Levy so as to capture offshore income.
“Second, a proposal that the Levy Board be abolished with its collection functions to be carried on henceforth by the Gambling Commission and distribution by a newly created Racing Authority.”
Despite abolishment having been long mooted, the board stresses that it seeks a smooth transition amidst the challenging situation, which will see ex Sports Minister, and British Olympic Association (BOA) Chairman, Sir Hugh Robertson take up Chairman duty of the Racing Authority.
Total expenditure for the 2017/18 period saw a slight rise, from £72.5m to £73.7m, with total surplus reaching £20.9m as opposed to 2016/17’s deficit of £7.4m.
As a result of this surplus turnaround, the board also details that is has significantly raised its reserves from £25.4m at the culmination of 2016/17 to £46.3m as of March 31 of this year, an 82 per cent jump.
The total 2018 prize money pot is also subject of a huge boost, being set at £57.6m from £48.1m, also attributed to levy reforms.
Concluding, Lee stated “It has been suggested that changes to the regulation of Fixed Odds Betting Terminals, including a lowering of maximum stakes, may have a secondary impact on the amount of money that racing receives from betting.
“With reserves at their current levels, the board and its successor will be well placed to react judiciously if market changes occur.
“Ending on a positive note, whatever these challenges, we are hopeful that progress made over the last few years in terms of a constructive dialogue between betting and racing will provide a strong and secure platform for the future prosperity of each. That is their mutual interest, and I am sure it will be their guiding principle.”