| Previous Section | Index | Home Page |
Chris Grayling: My hon. Friend touches on an important point. If the proposals go through, it is difficult to imagine that they will not play into the hands of a small number of commercial interests, almost certainly in the betting fraternity. That is where the change will come.
I strongly believe in the old adage, "If it ain't broke, don't fix it". Racing is not broke; it may need to evolve and develop, as my hon. Friends pointed out, but it is not an unsuccessful industry. Terrible injustices are not happening. Racing is working pretty well and is an asset to the nation. The trouble is that when organisations such as the OFT start tinkering there are unintended consequences.
In the early 1990s, for example, a report by the Monopolies and Mergers Commission on the pub and brewing industry, which was designed to improve consumer choice and competition, led directly to the disappearance of thousands of country pubs. Small local pubs kept going only because of the tie—that slightly anti-competitive arrangement—and when it disappeared, so did they. We are concerned that the same effect will be seen in racing.
Racing does not involve only a small number of centres. Of course, I do not need to worry about Epsom. The race course pays for itself many times over on just one day a year. No doubt Cheltenham pays for itself in one week of the year. So the big racing centres—the international names—will survive and flourish, and it is arguable that they would probably do better if they had more meetings each year.
Of course, racing is now a truly national sport. Small race courses are to be found in far flung parts of the country, where racing takes place on a wild winter's day. Those race courses are an integral part of the industry, but they are the ones that will disappear. Those meetings will not happen, and racing will be concentrated instead in a number of larger commercial centres and lost in many parts of the country. But this is not just about race courses; it is also about the training industry.
My hon. Friend the Member for South-West Hertfordshire made an extremely important point about the smaller courses serving effectively as a feeder network for the bigger meetings. When people buy their first horse, the smaller courses are where they go to race. They do not turn up at Royal Ascot for their first outing; they turn up on a Tuesday in February at Wetherby. That is where those people who dabble in racing for the first time—those who perhaps buy an eighth share in a
race horse—go to see their horse run. The smaller, newer and developing trainers bring those horses into the industry and start to nurture them, and they hope ultimately to enjoy great success with them.One reason why I feel so strongly about the issue is that Epsom's training industry is in a particularly challenging situation at the moment. It has declined over a number of years, partly because of the value of the real estate that it sits on. Not surprisingly, it is very tempting for those sitting on land and owning big houses inside the M25 to sell them at a large profit, taking them out of the industry. A training industry that once, perhaps 30 years ago, trained 500 horses trains only about 200 today. I have been working with many people in the local racing industry to try to find a way to reverse that trend by bringing new life back into the training industry in Epsom.
One of the things that I want to see is Epsom emerging as a training and development centre for trainers. We are talking about the possibility of setting up starter yards, where new trainers could lease blocks of 10 boxes, get into training for the first time with a few horses, begin to build a reputation and then move on— remaining in the area, we hope, but if not, going to another centre. But, of course, if the smaller parts of the racing calendar begin to be removed and the smaller courses start to be lost, the opportunity for the training industry in my area to build that starter and development role will be much diminished. The report concerns me greatly, as it seems to undermine what I hope will be an important part of the future of the training industry in Epsom.
Mr. Page: Hon. Members are looking at someone who used to ride out, first lot, for an Epsom trainer a long time ago when the horses were bigger and stronger and I was lighter, and I can only endorse what my hon. Friend says. Does he share with me the worry that, if the OFT recommendations go through and the number of trainers reduces, there will be no starter races around the country and no room for the trainers whom he wants to bring into the business to bring in new horses? There will be fewer horses and we shall end up with a power play between those people with a lot of money to buy very expensive, very good horses, and the thrill of the sport, which runs right through to the bottom end, will disappear.
Chris Grayling: I entirely endorse my hon. Friend's comments. To use an analogy, we are talking about the danger of creating a super league at the expense of the rest. There is no doubt that, if the top players in any sport are allowed to accumulate all the commercial benefits in that sport, the smaller players lose out.
Other sports have governing bodies, set guidelines and negotiate common commercial relationships in television or in other ways, and they then redistribute that money across the whole sport. We have seen the impact on some of the lower division football clubs when those central arrangements break up. The reality is that if it were not for the work done by governing bodies of cricket, soccer and rugby to push money further down the line all around the country, local clubs and local matches would disappear.
So why should horse racing be any different? Why should we suddenly say, "Actually, it's just a big business, it's operating in an anti-competitive way, so we must tear up all the existing arrangements and create a free-for-all." It makes no sense. Would the Office of Fair Trading go round and say, for example, "We insist for reasons of competition that Rangers and Celtic should be allowed to join the Premiership"? Surely that is a decision for the footballing authorities. Are we going to say that racing should somehow have a different relationship to competition authorities, and that they should have power over what happens in racing as a sport, even though it is inconceivable that they could have similar powers in other sports? It makes no sense.
There are other concerns. Both my hon. Friends have talked about the potential risks to national hunt racing. That would be a tragic loss, particularly in rural areas that will depend even more on local national hunt race courses when, as I fear that the Government want, the infrastructure of hunting disappears. That will cut a slice off the substance of those local economies. Were national hunt racing to go as well, which might be a consequence of the OFT's report, it would be even more damaging to those communities.
This makes no sense. The OFT is trying to do something in an area where it does not belong. It is trying to create the sense that a market exists or should exist in an area which I do not believe is all about markets. It will take away a sport and pastime from many parts of this country and will concentrate money and resource in a small number of locations in the hands of big players, and the small people will lose out—the small emerging trainers, the local race courses, and perhaps even the small on-course bookies who will have fewer opportunities to do their business.
What possible benefit could there be from the OFT looking after the interests of the big guys at the exclusion of the small guys in an area where it should not be in the first place? That is why this issue is so important, why it is right that my hon. Friend the Member for Tewkesbury secured this debate, and why it is appropriate and, I hope, essential—as I hope that the Minister realises—that he watches over the shoulders of the OFT and that he does not let this happen.
4.7 pm
Mr. George Osborne (Tatton): Like my other hon. Friends, I congratulate my hon. Friend the Member for Tewkesbury (Mr. Robertson) on securing this debate, and on the good fortune of securing it on the day when the Arms Control and Disarmament (Inspections) Bill passed its Second Reading at remarkable speed.
I must confess, as I do not write to my hon. Friend the Member for Tewkesbury when I do so, that I am an annual visitor to his constituency, and almost an annual visitor to the constituency of my hon. Friend the Member for Epsom and Ewell (Chris Grayling). Indeed, I am also a visitor to the constituencies of my hon. Friend the Member for Windsor (Mr. Trend) and the hon. Member for Knowsley, North and Sefton, East (Mr. Howarth), who has an excellent race course and arguably one that competes with Epsom, certainly in my book.
I do not have a race course in my constituency, although I do have quite a few owners among my constituents, including Alex Ferguson, who is perhaps the most famous race horse owner at the moment—
Mr. Osborne: Or notorious, perhaps, as my hon. Friend suggests. I do not mind saying that, as he appeared all over my Labour opponent's leaflets during the last general election, and I am not here necessarily to defend his interests.
I confess that I have a personal interest in racing. That is why, when I saw the opportunity to speak today, I took it. I come from a family that has been involved in racing. My grandmother had a full-page obituary in the Racing Post when she died, my family business sponsors a race at Goodwood every year, and my uncle runs a bookmaker. Although I have no pecuniary interest in racing or gambling, many members of my family do.
I was alerted to the threat that the OFT report poses to British racing not by any of those family members—indeed, as half of them are in the betting industry, it would not have been in their interests—but by a lady called Mrs. Paton-Smith whom I sat next to at the Cheshire agriculture show in June this year. She is an owner, and she lives in the constituency of my neighbour and hon. Friend the Member for Eddisbury (Mr. O'Brien). Over lunch, she talked to me about the OFT report. I asked her to send me details, and she subsequently wrote to me enclosing details of what she feared the OFT report would do to the sport in which she participates.
- "Without doubt this is the biggest threat to the conduct of racing that we can recall and we would be most grateful"—
- "if you agree, if you could lobby the Government to prevent such a scenario emerging."
As one who is uninitiated in the intricacies of how racing is organised, I must confess that I was initially sceptical of Mrs. Paton-Smith's complaint. As a Conservative, I believe in freer markets and competition in principle and am instinctively against monopoly and restrictive practices. If one examines the proposals in the Office of Fair Trading report, they are superficially attractive. They would allow race courses to set their own fixtures and permit data such as television images to be bought directly from race courses. They would provide that the collective selling of the rights of racing was not acceptable and say that race courses should be able to set their own race programmes and prize money.
If one starts to consider the implications for the horse racing industry and looks under the surface of the OFT report to examine the unintended consequences that the changes might bring about, the full threat to racing becomes clear. My colleagues said that the OFT report would effectively dismantle one monopoly and replace it with an arguably more dangerous monopoly that would be run by the bookmaking industry, which is also my
judgment. Rather than the British Horseracing Board setting fixture lists to ensure a balance of interests throughout the industry, the betting industry would effectively control which race courses were granted which fixtures, which races would be run and when they would be run. That is because, as Peter Savill, the chairman of the BHB said earlier this year, one can
- "count on 2 hands the number of fixtures that can take place profitably each year without bookmaker funding."
- "The OFT thinks it is helping racecourses to operate as healthy commercial enterprises when in fact its strategy, if allowed to be implemented, will result in a deterioration in the financial position of every single racecourse and racecourse group—without exception."
There are alternative ways of dealing with some of the genuine conflicts of interest and problems that the OFT report identified. Indeed, the British Horseracing Board has made several proposals on changing its function, removing itself from commercial activity or creating a separate entity that would commercially promote racing and negotiate with bookmakers. Indeed, the board's racing review committee has come up with several imaginative proposals to improve the integrity of support, to establish a better meritocracy, to strengthen jumping and, importantly, to put British breeding on a level playing field with our Irish and French counterparts.
In the past year, British racing has had record attendances, record prize money and a significant expansion of listed racings, for example. It has exciting plans for the future. Those of us who care about racing and enjoy going to race meets—even if we do not have a financial interest in racing or are involved in the industry—do not want the OFT report to wreck it.
| Next Section
| Index | Home Page |