Lord Lipsey
Main Page: Lord Lipsey (Labour - Life peer)
Viscount Astor (Con)
My Lords, I thank my noble friend for bringing forth this amendment instead of the amendment that I moved on Report; this amendment in lieu is better drafted than mine. I am very grateful for the support that both he and the Minister for Sport in another place, Helen Grant, have given on this issue. The amendment has been widely welcomed by the racing industry and by the majority of the betting industry. Of course, the hard work of looking forward to a replacement of the levy now begins, which will require a great deal of movement from all those parties involved in racing to come to a conclusion that will work and is a commercial agreement. In the mean time, I thank my noble friend for bringing forward this amendment.
Lord Lipsey (Lab)
My Lords, I am aware that the House is keen to get on to the important debate that we will hold on the Ukraine this afternoon, so I will not detain it longer than I have to.
I start from a position that may not be widely shared in this House—I do not know—which is that I am against the levy, and I have been for years. When I started off being against it I was in a minority of one, but now a large number of people have come round to the view that it is not desirable. The two Members of the House of Commons who have most knowledge of these matters—Mr Philip Davies and Mr Laurence Robertson, who chairs the Racing and Bloodstock Industries All-Party Group—are both anti-levy. On their good days the Government are anti-levy, since they have explained that they want a replacement of the levy. I hope that it will be a commercial replacement that comes along.
I am against the levy for two reasons. First, for my sins I am by training an economist and, like all economists, I believe that subsidies, ceteris paribus, are a bad thing. They distort markets and interfere with the generally beneficial results in industry of free competition. The statutory levy on horseracing betting is an exemplar of this; it means that racing spends much of its time lobbying for more levy instead of putting its house in order and modernising the sport. It leads to bigger prizes, which in turn lead to inflated prices for the best bloodstock and then demands for even bigger prizes, so that that investment in inflated-priced bloodstock pays a dividend. Supernormal profits are made by some participants in the sport, including successful trainers, but I observe that little of that money trickles down to stablehands.