Bookies have had a tough year in horse racing, particularly after Tiger Roll did the unthinkable and won the Grand National for the second year in a row. This meant that there was a large payout to customers, and the bookmakers took a considerable loss on the race. But does this have a knock-on effect for the sport? Bonusbets.com takes a look at the future of prizes in horse racing.
It might not be widely known, but most of the horse racing’s prize money is funded by bookmakers profits, and this year there has been a number of factors that are contributing to a £17m shortfall in the total prize fund available to horse racing this year.
There are also other factors that have fed into this. Most notably, the reduction in the cap of fixed odds betting terminals. The government recently changed the maximum bet that can be placed on one of these machines from £100 to £2. This has greatly reduced the amount of profit that these terminals take in at the betting shop, and have had the knock-on effect of lowering footfall at the premises as well. Meaning that a number of betting chains that were planning expansions have put those plans on hold, or are actually reducing the number of shops around in total. This coupled with the ever growing presence of online betting, isn’t helping matters.
The government have tried to assist in rebuilding the prize purse by extending the levy to include companies that operate from overseas but terminate in the UK. This means that there is a wider pool of monies from which to draw.
Profits for 2017-2018 hit the heights of £95m, and this was projected to be £87m for 2018-2019. Though recent forecasts have suggested that it will miss this mark quite significantly and is likely to only be at around the £78m thus explaining the £17m shortfall this year.
Race leaders, who consist of Andy Clifton from the Race Courses Association, Justin Richmond-Watson of the Horsemen’s Group and Nick Rust from the British Horseracing Authority will be approaching ministers about the problems that their changes to funding sources have caused and trying to come up with a proactive solution to the problem, so that race winners will still see the same level of prize money that they have always received.
A spokesman for the leadership triple recently said ‘We were shocked to see the big drop in levy yield for 2018-19, which was significantly below the previous forecast at the end of March. The bulk of the levy income is distributed as prize money. At a time when there is already significant debate in the industry around levels of prize money, we appreciate that any potential reduction will cause further concern.’
It is clear that something will need to change going forward, and all options will be on the table as discussions are ongoing. It is safe to say though that interest in the sport of kings will continue to drive money into the sport.