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the principle of integrating away bookmakers had been established by the levy board before the NJPC came into existence and the precise method was agreed with the NAB in the summer of 1998.
In a letter dated 4 May 2006, in response to the Departments statement, the southern area BPA maintained that it did not make contact. The Departments document said that the during the appeals process calls were made to the southern area BPA, but the latter says that it did not receive any such calls. The Department seems to have accepted everything that the NJPC said, despite the fact that a huge number of documents from the files have strangely gone missing and that no minutes were kept of the appeals process. The Department seems to be saying, Well, thats all right then. It is like asking the Department what it has to say and the Department replying, That is jolly good. We have settled the argument now. That appears to be what the Department has done.
The DCMS seems to believe that because Mr. Reams says that he informed the southern area BPA of alterations to the formula that it had indeed been informed. The Department seems to think that that was okay. In fact, the southern area had no power to change the formula. It made clear in a later press release that it did not agree with the system as reformed by Mr. Reams. Referring to the changes, it stated in September 1998:
Sadly, that has not been the case and the system in use appears to have a number of flaws.
However, it was not entitled to appeal against the process. Mr. Reams had established early on that one could not appeal against the formula; so the southern area and the bookmakers could not have appealed against a formula that had been changed without their notice. Even if they had known about it they could not appeal against it, so they were dismasted from the beginning and unable to make any progress.
I ask this question of the Department. Can it say to me and my colleagues, honestly and genuinely, that we have a system under which bookmakers who disagree with what has happened to their pitch positions are not
allowed to appeal against the process that made them go into those position, and that because they appealed on the basis that the process that had been agreed had been changed arbitrarily, their cases were dismissed?
In other words, the whole appeal was a waste of time. How can people appeal about something that is not the same as what they are appealing about? Imagine in a court of law saying to a judge, I want to appeal your decision, and the judge saying, Well, Ill tell you what the rules are after you have told me what you want. That is what we have here. It was made up as they went along. It is appalling. The rules were bent and changed, and appealing was a pointless exerciseas was discovered when most appeals were strangely dismissed out of hand.
Mr. Stevenson denies any involvement, contradicting the DCMS. Mr. Marriott denies knowing about the changes. I have even spoken to Mr. Fairbairn, who sat on the panel, but he had no recollection of any new formula being presented to the appeals tribunal. It is clear that at the heart lies Mr. Reams, who washow shall I put it?economical with the actualité.
It is absolutely clear that the chaotic state of affairs that existed when the NJPC was set up led to serious problems not only for my constituent and the hon. Member for Hove (Ms Barlow) but to those involved in the 300 other cases dismissed out of hand, not to mention those who did not bother to appeal because they had some sense of what was going on.
The levy board had a duty of care to oversee the changes and to ensure that the NJPC was set up openly, that it was in a strong position and that its affairs were conducted in an honest way. The board utterly failed in that duty, and the NJPC has since failed in its duty to clear up the mess. It is impossible to imagine any other organisation being allowed to continue like that without trying to resolve the problems.
Worse than that, the people who run those organisations are making statements in court that they know to be fundamentally untrue. The basis of the blocking was the refusal to accept and admit that such things could have happened. I am astonished that the Government have not decided to overhaul the system and to make reparation. I ask only for a full and proper independent inquiry into the setting up of the NJPC and its subsequent running.
We know that the Office of Fair Trading has been highly critical of the NJPC, including its present appeals process and its limiting access to the ring of a number of bookmakers. If we do not overhaul the system, we risk opening the door even wider to things that I know others will want to speak about, such as online betting and off-course betting, which are unregulated, are taking over and will frankly leave punters open to abuse. Far too many people involved in the process have subsequently benefited, and one has to ask to what degree fraud has taken place.
I ask the Department to take this opportunity and have the courage to say, Enough is enough. Unless we clean the house and clean it properly so that those who were damaged can have reparation, the Department will not be fulfilling its own duty of care. I know the Minister. We have had conversations on a number of occasions and I have a high degree of
respect for him. I hope that in this case he will simply say to his officials, This is not good enough. You do not accept the word of the NJPC or the levy board. We want a full and proper inquiry. Lets clear this up before we establish racing in a new format at the end of the year. Otherwise, that will risk going the same way as this did.
Mr. Jim Devine (Livingston) (Lab): I congratulate the right hon. Member for Chingford and Woodford Green (Mr. Duncan Smith) on selecting this subject for debate in the week of the Cheltenham festival, where the public face of racing is at its best. We know that jockeys are trying and that horses are trying. The crowd, the atmosphere and the craic are a great advert for racing. I would love to be able to report that I managed to pick the 40-1, the 50-1 and the 16-1 winners from yesterday, but sadly I did not, although I do have a fancy for a horse called Finger On The Pulse in the 4 oclock, which might be worth an each-way bet today. I recognise that that statement could come back to haunt me, as this debate is being recorded.
The horse racing and gambling industry is at a crossroads. Allegations of fixed races, jockeys being charged and horses being doped do not present a positive image of the racing and gambling industry. My comments will concentrate on Betfair. Gambling is big business in the UK, generating £50 billion every year. Betfair takes up to 5 million bets a dayan astonishing numberand it takes those bets on the premise that every punter has a fair and fighting chance of winning, but how many people realise that they might be placing bets after the result is known, the race has been won, or the goal has been scored? That, to be frank, is where Betfair comes into disrepute.
Punters can be in a bookmakers or at home watching a so-called live transmission, not realising that the pictures are subject to a delay of six or even seven seconds. That is a long time in a horse race and even longer in a dog race, where the dog from trap 1 can be past the winning post when the rest of the dogs are not even at the final bend. I pay tribute to the News of the World campaign, which has highlighted the problem in recent months. It recently showed two pictures: one from terrestrial television and one from SISSatellite Information Services. On both the televisions, the time was exactly the same. On one of the televisions, the favourite and its market rival were coming to the last jump; that was on the delayed screen. On the real screen, which was showing the actual time of the race, the favourite had fallen at the last. People were betting in running on the favourite losing. People who knew that the favourite had fallen were betting on that. Many punters who were betting on the favourite did not realise that it had fallen at the last hurdle.
Clearly, someone who is betting in running and watching the race on a delayed screen is at a major disadvantage to someone who is at the track or someone watching on a different monitor. As I said, the problem is more pronounced in dog racing, where we are talking about one length per secondpeople can imagine the consequence of a six or seven second delay.
Horse race betting is about studying form. It is about watching the horses in the paddock and being aware of the breeding. It is about the punter versus the bookie, not about a punter versus a punter, particularly when
one individual has an in-built advantage. Horse race betting is about identifying the winner before the race. It is not about betting to lose. It is not about betting in running when an individual could, frankly, be cheated out of his money.
A constituent of mine, Henry Spurway, was a traditional bookmaker in Scotland who with his company, Easibet, entered into partnership with Betfair in October 2002. He was not aware of these issues. He got the first licensed betting exchange in the UK and initially the concept was very successful, but problems associated with in-running betting and betting to lose lost him a substantial amount of money in a relatively short time. He has initiated a campaign, which I support, to ban in-running betting and backing to lose. Henry can be contacted at henryspurway.co.uk.
The problems that I have described apply not only to horse racing and dog racing, but to all sports. Let us imagine Tiger Woods on the final green, looking to birdie to win a tournament. I am watching a screen that is showing in accurate time him making that putt. Someone else is watching a screen on which the pictures are delayed by five, six or seven seconds. If I know first whether Tiger Woods has birdied that hole or missed that putt, I have an advantage over other people who are betting on the outcome. That applies to football and the taking of a penalty kick; it applies to cricket and tennisindeed, all sports are affected and it is totally unacceptable.
I am equally uncomfortable about Betfair patting themselves on the back for wrong-doers being brought to task. For while it is true that the name-sharing agreement between Betfair and the Horse Race Authority has aided the detection of corruption, this inconveniently ignores the fact that such corruption has first been facilitated by the betting exchanges. Peter Savill, in his time as chairman of the British Horse Racing Board, likened the scenario to a shopkeeper leaving his doors unlocked every night whilst also installing security cameras.
if we had no betting exchanges a paper trail would not be necessary as people wouldnt be betting to lose. If someone got rid of exchanges tomorrow, hed be doing racing a big favour.
Id prefer to see no betting exchanges. Hong Kong, for instance, wont have them.
My predecessor as MP for Livingston, Robin Cook, said that in life he enjoyed two thumpsthe thump of ballot boxes going on to a table at the end of an election night, and the thump of hooves on a race track anywhere in the UK. I share Robins love and passion for horse racing. In-race betting and betting to lose are damaging racings image. Those practices have been described as a cheats paradise and I do not disagree with that description. It is time that they were banned.
Simon Hughes (North Southwark and Bermondsey) (LD):
I strongly support the initiative of the right hon. Member for Chingford and Woodford Green (Mr. Duncan
Smith). His constituents, a constituent of mine and others have been comparing notes, as it were, to make the case stronger.
I have three points to make. First, the history of the self-employed people whom we are discussingpeople who are not employed by a great state enterprise and who are trying to conduct their business, to be productive in the economy and to use their initiativehas been marred since the arrangements were changed nearly 10 years ago by the real administrative incompetence of the National Joint Pitch Council. I have records of a litany of unanswered letters and of complaints not dealt with. They were compiled by someone who kept meticulous records in an effort to do business as a successful self-employed person should. It is not satisfactory that, when the arrangements changed nearly 10 years ago, an organisation was created that was incapable of dealing fairly with day-to-day administration. That was the first cause of consistent complaint.
The second was the subject of my intervention on the right hon. Gentleman. The location of someones pitch is a personal matter and people feel strongly about it because it can give them an advantage on a particular course. It seems to me that, if one is dissatisfied, one is entitled to an independent adjudication that is properly conducted on the basis of rules that are known in advance and of which a record is taken, so that if anything goes wrong the matter can be considered somewhere else.
In my view the appeal process should be independent. Had I been aware of the proposed arrangements before the changes were made, I would always have so argued. I am the chair of the governors at a primary school. If we turn someone down for admission, the appeal goes to a group of independent people who can tell the school to accept the applicant. I think that all hon. Members would accept that that system is the right one. The lack of proper, independent systems is a fundamental flaw that the authorities in the racing world have never dealt with. It is not sufficient for the Horserace Betting Levy Board to say that it has oversight, but that appeals are none of its business.
The third point is that there is a legacy, certainly of incompetence and arguably also of corruption and preferential treatment based on personal motives, which causes disadvantage to individuals, many of whom have worked in and served the industry for a long time. None of us is arguing for a system in which, for example, being born in Chingford or Bermondsey or Devon would confer an automatic advantage over someone born in Ireland, for example. We are arguing that there should be rules that are agreed to be fair with the industry, and which are known and stuck with. People could then join a queue to make their application for a pitch.
Cash flow is not an easy matter for self-employed people. I have been to race meetings and I have put money on horses, and my parents were keen on racing and taught me to understand its importance. However, as the hon. Member for Livingston (Mr. Devine) said, based on his much greater experience, the reality is that finances in that type of business can be really tight in
some cases. We are not talking about millionaires who have lots of money to invest and for whom the problems that we are discussing are unimportant. You can win a lot, but you can lose a lot too. Reparation is therefore an issue, and I want to add my plea for it to happen. My plea to the Minister is that, by whatever mechanism can be agreedincluding on a cross-party basis in the House, and between those whom we representthere should be an independent review of what has gone on, so that if people have clearly been disadvantaged there will be a way to give recompense.
The people whom we are talking about are alive and well and have not given up battling. They have merely failed to succeed in breaking through the existing mechanism, so we need another one. We look to Government to intervene, because it must be better to act politically and in the public arena than to go through the courts. There is huge interest in the success of the racing industry in this country; it is an important industry. If our race courses are to be places where people, including tourists and visitors, want to go, they need to know that the system is fair; and if we are to produce employment in the racing industry for people from this country, it is important that they, too, know that the system is fair. People will not enter the business if they think that they will be disadvantaged or that information will be withheld from them without recourse.
I hope that the Government response will be much more positive. Many people have been fighting this battle for a long timeyears and yearsbut it is not too late to put things right. It is not too late to create a system that, when the arrangements change in the autumn, will be fair and will be seen to be so, with independent processes for dealing with complaints.
I congratulate my right hon. Friend the Member for Chingford and Woodford Green (Mr. Duncan Smith) on having procured the debate. I know from my own experience of initiating Westminster Hall debates that it is often on the second or third bite of the cherry that one sees action. He is absolutely right that the Department has a duty of care to ensure that the allegations of preferential treatment are put firmly to bed. He did not use the word corruption, but the hon. Member for North Southwark and Bermondsey (Simon Hughes) did. There should certainly be a level playing fieldthat is essential. Many of the concerns that were brought to light in my right hon. Friends speech would undoubtedly be open to judicial review.
I suspect that outsiders who are watching the debate might think that some of the discussion has been at cross-purposes. I say with the greatest respect to the hon. Member for Livingston (Mr. Devine) that he was talking about online betting. I shall do so, too. I believe that online betting is here to stay in this country. It should be encouraged and promoted to ensure that the best managed, most innovative and most ethical players can succeed, so that players who would tar the industry can be pushed away, rather than pushed underground. Remarkably, as the hon. Gentleman pointed out, some
5 million bets a day are made on Betfair, and I suspect that we aint seen nothing yet. We shall see far more online betting. However, that is not to say that the antics of the National Joint Pitch Council can be relegated to the past, because the sector of betting with which the council is connected will remain an important part of betting.
I confess that I am not a great race-goer. I was offered the chance to go to Cheltenham today, but because I am not a race-goer and because of the important debates that are taking place in the House today, I turned the offer downalthough, as it happens, I shall miss the vote tonight because I have to attend a state dinner with the President of Ghana at the Guildhall, which gives me an excuse on matters of conscience. None the less, I should like to say a few words about the in-running betting that is offered by the UK betting operators.
I am close to Mark Davis, who is one of the managing directors of Betfair, and he has alerted me to some of the issues. It is only fair that some of them are put on the record, because when all is said and done I think that Betfair does a tremendous job. It is at the cutting edge of online betting, which is the way of the future. We need to embrace online betting, because it could bring tremendous tax revenues into the country. More importantly, we need to ensure that there is an acceptable regulatory framework so that those tax revenues do not go offshore, as has happened in the past.
All betting operatorsincluding all the traditional high street UK bookmakersoffer in-running betting on most sports. Punters who bet on those sports generally watch the relevant events by means of what might be described as live TV pictures. The hon. Member for Livingston alerted us to the high-profile campaign in the News of the World about some of the problems that can arise in that regard. Depending on which TV channel an individual is watching, they might see the action with a few seconds delay. That applies also to normal television, if one compares satellite transmission with terrestrial channels. By definition, that means that other punters, or traditional bookmakers offering services to those markets on a race course, might have a slight advantage if they are watching the event on a different channel with a smaller time delay. However, it has always been the case that a host of variables can give an advantage to one gambler over another. The punter who has a copy of Racing Post might have an advantage over one who looks only at The Daily Telegraph. Likewise, an online punter with access to a broadband internet connection will have an advantage over another who relies on a slower connection, such as a dial-up service.
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