News

NSW State Govt calls for wagering regulation summit

11th Jun 2009

ANZ Bloodstock News - Friday, 12 June 2009

The simmering tension between corporate bookmakers and racing bodies’ looks set to escalate after the NSW Government called yesterday for a national approach to the regulation of wagering as part of its response to the Productivity Commission’s Inquiry into Gambling in Australia.

NSW Gaming and Racing Minister Kevin Greene was forthright in setting out his stall, saying the entry of corporate bookmakers and cross-border leaking of revenue makes it problematic for any state to operate independently.

Greene said there were now major differences in gambling regulation on a state-by state basis, like betting exchanges being licensed in some Australian jurisdictions but not in others. “The NSW Government wants to see our state’s ban on corporate bookmakers offering tote odds taken up across the country.

We are calling for a ban on tote odds betting by corporate bookmakers because we believe this diminishes the level of funding brought back to the racing industry. “This ultimately hurts employment opportunities, particularly in regional areas.

“Responsibility for Australian gambling laws is fragmented between traditional state and territory legislation and the Commonwealth’s Interactive Gambling Act 2001. Australia must adopt a national approach to internet wagering to provide consistency and consumer protection,” he continued.

Unsurprisingly, the corporate bookmakers were quick to respond, defending their position. Betfair and Sportsbet have launched a legal challenge to a product fee of 20 per cent on gross revenue as opposed to the 1.5 per cent of turnover as set down by the Race Fields legislation which will be heard in November.

Betfair’s CEO, Andrew Twaits said Racing NSW could generate more than $10 million a year in extra product fees if all operators paid 20 per cent of gross revenue.

“There’s been some heated debate around the issue of industry funding, with stakeholders quite naturally expressing concern about the future viability of the racing industry. In all the hysteria, some of the facts have been lost or distorted, including the basis on which Betfair believes it should contribute to the funding of the racing industry.

“Let me be very clear on this. We have offered to pay the industry on gross revenue – that is, on the same basis as the TABs in NSW, QLD and Victoria. Further, we think 20 per cent is the right amount and we’ll pay at that rate if everyone else does the same.

“Racing NSW has set the fees for TABs at just 9.375 per cent of their gross revenue. If Racing NSW sets its product fees at 20% (of gross revenue) for all wagering operators, we believe they would be likely to generate more than $10 million per year in extra product fees for the industry. That is in addition to the undisputed element of the product fees Racing NSW is already charging interstate operators.”

Twaits was unequivocal in defending Betfair’s stance. “Whilst no one likes paying more tax, we’ve consistently said that 20 per cent is the right amount for race fields. We’ll pay it if our competitors do the same,” he said, adding, “What we won’t do is pay tax at a rate that’s six times higher than our competitors. That’s a recipe for us going out of business.”

Greene countered by saying the Rees Government welcomed the Productivity Commission’s inquiry because it would update the last gambling study that is a decade old. “A lot has changed since the Productivity Commission’s last gambling inquiry in 1999, like the introduction of many responsible gambling and harm minimisation measures in NSW.”

“Since 1999 the NSW Government’s Responsible Gambling Fund invested $77.4 million in problem gambling counselling services, research and education and awareness initiatives.

“Our submission outlines recent initiatives like reducing the state-wide cap on machines by 5,000, restricting machine increases in high-density gaming areas and banning credit card cash withdrawals from ATMs in gaming venues.

“We have also introduced strict gaming laws to protect local communities by banning 24-hour gaming in pubs and clubs and prohibiting gaming machine advertising. We’re committed to reducing the harm associated with gambling and I look forward to the Productivity Commission’s findings,” he concluded.

Twaits meanwhile was continuing his line. “We’re determined to see the nation’s racing industry prosper, and we’re prepared to pay our fair share to help achieve that result.”