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The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stephanie Peacock)
It is a pleasure to serve under your chairmanship, Sir Edward. I begin by referring to the Register of Members’ Financial Interests, having taken part in a charity bet earlier this year and attended Donny races this time last year. I congratulate the hon. Member for West Suffolk (Nick Timothy) on securing this important debate on the future of and support for horseracing. I congratulate him and my hon. Friend the Member for Liverpool Walton (Dan Carden) on being elected co-chairs of the all-party group; the Department looks forward to working with them.
We have heard from hon. Members on both sides of the House, and the shadow Minister did an excellent job of listing all the places, so I will not repeat them. Instead, I will speak about the issue in broad terms before addressing some of the specific points made by the hon. Member for West Suffolk and others.
His Majesty’s Government recognise the significant contribution that racing makes to British culture and its particular importance to the British economy. As has been rightly mentioned, it plays a central role in the livelihood of many different communities. I am well aware from my time as the shadow Minister for Gambling of the strength of support on both sides of the House for horseracing, and of the concern around its finances. In February, I took part in a Westminster Hall debate on that subject, prompted by a petition signed by more than 100,000 people. Horseracing is a powerhouse industry that supports employment across racecourses, training yards, breeding operations and related sectors, and is respected at home and abroad.
Horseracing is the second-biggest sport in the UK in terms of attendance. According to the British Horseracing Authority, racing is worth more than £4 billion annually to the economy in direct, indirect and associated expenditure. British racing and breeding enjoy a reputation as a global leader and is promoted worldwide as part of the “GREAT Britain & Northern Ireland” campaign, recognising the cultural and economic importance of horseracing to the UK and the role it plays as a soft power asset.
I will outline the measures that the Government are taking to protect horseracing and its valuable economic and cultural contribution. I will also take this opportunity to highlight the importance of the horserace betting levy, which has been mentioned a number of times. Given the long-standing acknowledgment of the symbiotic relationship between racing and betting, racing is the only sport with a direct levy that is overseen by the Government. The levy is therefore our most direct lever for supporting the sport, but it needs to reflect the common interests of both sides of the relationship.
The Horserace Betting Levy Board collects the levy, as Members know, and applies the money raised for one or more of the following purposes: supporting breeds of horses; the advancement or encouragement of veterinary science and education; and the improvement of horseracing. The largest proportion of the levy is used to support prize money; in fact, prize money is a means of injecting funds into the wider racing ecosystem through the employment of trainers, jockeys, work riders and a whole host of people in over 500 training yards who are involved in caring for horses and putting on race days.
The ability of prize money to cover the costs of training is a key consideration for owners deciding to enter and remain in the industry. This is seen in the board’s recent announcements that it has budgeted to contribute £72.7 million to prize money for racing fixtures in 2025—an increase of £2.2 million on 2024 and around £13 million more than each of the pre-covid years of 2018 and 2019.
The horserace betting levy has evolved in step with the betting industry since it was introduced in the 1960s. In 2017, the previous Government extended the levy to online bookmakers and fixed the rate at 10% so that it no longer had to be negotiated each year. The 2017 reforms almost doubled the amount of levy collected, from £49.8 million to £95 million, and it has continued to perform well, collecting £105 million in 2023-24.
I place on the record my thanks to the Horserace Betting Levy Board, which continues to do an excellent job, especially in difficult circumstances following the sad death of the chair Paul Darling in August this year. I understand it was his memorial this week, and I send my thoughts to his family. The Government will continue to work with the levy board and the wider industry to maximise the benefits of the levy and ensure that it continues to deliver for the sector.
The previous Government undertook a review that concluded in April, and I recognise the significant work undertaken by both the racing and betting industries to secure a sustainable future for the sport. I am aware that, as part of that review, the British Horseracing Authority presented its case that there is a significant gap in its funding, stating that it is unable to compete with jurisdictions such as Ireland and France. The Minister for Gambling has met representatives from both the horseracing and betting industries, has encouraged a voluntary deal that fairly reflects the relationship between racing and betting, and will write to both parties soon. I understand that both parties agreed the value of a growth fund for the sport, and we look forward to hearing about progress on that.
It is fair to say that racing and betting should maximise income from other sources, as the levy represents just 6% of income, with far greater proportions earned from owners, breeders, racegoers, media rights deals and sponsorship. The Government welcome recent changes to the fixture list that are designed to grow the sport, engage new and existing customers and bring an additional £90 million to racing by 2028. I was also encouraged to see horseracing showcased in the recent TV documentaries “Horsepower” and “Champions: Full Gallop”.
Let me address the specific points raised by the hon. Member for West Suffolk. Several other Members made similar points. First, as I have hopefully made clear in my speech so far, I absolutely agree that British horseracing is an international success story. I am delighted to put my support for it on the record. As I said, I was at Donny races last year. Indeed, the year before that I was at York races with my good friend, the late great Jim Andrews, who was my agent. That was one of the last days we spent together before he sadly passed away— I pay tribute to him—and I have very fond memories of York races for that reason. I know of the huge contribution that horseracing makes not just to our economy but to communities up and down the country.
On the hon. Gentleman’s second and third questions, in the absence of any current legislative opportunity to impose changes to the levy, the Government are inviting the betting and racing industries to resume negotiations on a voluntary deal. We think that is the best and fastest option to get additional money flowing to the sport. I share the hon. Gentleman’s hope that we will not go back to square one, and that the parties will reflect on areas where there was agreement.
I do not think the previous negotiations were publicised at the time, but they have been discussed in detail today. I believe they resulted in an offer of an additional 1.5% from the betting industry, which racing agreed was reasonable. There was further agreement that the majority of those additional funds should be targeted towards a growth fund to generate interest in the sport. The Minister for Gambling is happy to continue dialogue with both parties, and if racing would like to hold its own independent review, the Government would welcome that.
The hon. Gentleman’s fourth question was about reforming the scope of the levy to include international races, which a number of Members discussed. There are strong arguments on both sides, but we should focus on what is achievable in the short-to-medium term. Although it is true that racing in other jurisdictions benefits from British racing in a way that is not reciprocated, the funding mechanisms in Ireland and France operate more centralised, state-led systems, and there are fewer opportunities for the commercial deals that we have in the United Kingdom.
On the hon. Gentleman’s fifth question, he might be new to this place but he is an experienced and seasoned actor or character—I am trying to be diplomatic—in the Westminster and Whitehall world. He tempts me, but he knows that I cannot comment on plans for the upcoming Budget.
The hon. Gentleman’s sixth question was about addressing problem gambling proportionally. He will have heard the answer that the Secretary of State gave him in the Chamber last week. I think that, as the hon. Member for Glastonbury and Somerton (Sarah Dyke) said, it is incredibly important to strike a balance when dealing with problem gambling. Nearly half the population gambled in the past four weeks, so although it is of course important that we provide support to tackle problem gambling, we must do so in a balanced way.
A number of hon. Members raised frictionless checks. As they will know, the Gambling Commission is leading the pilot work on financial risk checks. We will be watching those pilots with interest, but I have heard Members’ concerns and will reflect them to the Minister for Gambling.
I will make representations to my colleagues in the Department for Environment, Food and Rural Affairs on animal welfare and the number of vets. I will ask the Minister for Gambling to write to the hon. Member for Cheltenham (Max Wilkinson) on the question he asked.
The shadow Minister, the hon. Member for Old Bexley and Sidcup (Mr French), made an important point about loneliness. I have visited most of the betting shops in my constituency of Barnsley South, and I have seen at first hand the difference they make in helping to combat loneliness. As the Minister responsible for loneliness, I take that seriously. I say gently to him that we do not have a part-time Gambling Minister; we have a Gambling Minister who sits in the other place. I have answered a number of questions about the Government’s broad support, but I am happy to facilitate a meeting or a letter from the Gambling Minister to him.
The Government remain committed to supporting British horseracing. We believe it is vital to our economy, and it brings joy to many people. I know the Gambling Minister will look forward to continuing to engage with stakeholders in this area. This debate has highlighted the huge benefit that racing has for communities up and down the country.
Sir Edward Leigh (in the Chair)
Does Nick Timothy wish to say a few words to sum up?