Memorandum submitted by Patrick Nixon
INTRODUCTION
I am Patrick Nixon, Secretary to the Bookmakers'
Committee at the Horserace Betting Levy Board. The Bookmakers'
Committee is a statutory body charged with making annual recommendations
to the Levy Board in respect of the terms and conditions to be
applied to the annual Levy Scheme. The Committee's membership
includes two racecourse bookmakers, both of them members of the
National Association of Bookmakers who are thus affiliated to
the Federation of Racecourse Bookmakers.
I have some expertise in the issues before the
Committee having written a detailed paper for DCMS in December
2006, drawing attention to what we saw as a lack of progress in
resolving what were then the many outstanding issues relating
to betting on racecourses after the Gambling Act came into effect
on 1st September 2007. Most of the issues raised have been addressed
by a Working Group established by DCMS for the purpose; however,
the matter of bookmakers' lists proved quite intractable for reasons
which the Committee will understand only too well.
I attended the Oral Evidence Session held by
the Culture, Media and Sport Select Committee on 13th November
2007 as a member of the public. Having heard the proceedings,
I felt it might be helpful to Committee members to clarify certain
issues raised in evidence. I am doing so because, as Committee
members present clearly understood, the issue of recognition of
the bookmakers' lists going forward is of crucial importance and
it is thus vital that the Committee has a clear view of the key
points when forming its own judgements.
PREAMBLE TO
THE NATIONAL
PITCH RULES
Mr Atkin said in evidence that the preamble
to the National Pitch Rules, no longer extant since the Certificate
of Approval was removed as an authority by the Gambling Act, made
it clear to bookmakers that they had no right of tenure.
The relevant section of the preamble is worded
as follows:
"Nothing contained in these Rules relating
to the allocation of pitches at horse racecourses shall confer
upon any bookmaker any right of entry to any betting ring or entitlement
to occupy, whether by licence or otherwise, any area or areas
in any betting ring."
The Committee will have understood that the
trading of positions on the picking list at any particular racecourse
results in the acquisition by the purchaser of a non-tangible
asset, ie, a position on a list and thus the priority enjoyed
in the order in which a bookmaker chooses the pitch at which he
will stand on a given day. Whilst it is usual for the bookmaker
who is first on the list at a racecourse to choose the No 1 position,
he/she is, of course, free to select any other pitch on that particular
occasion if he/she so wishes.
What is referred to in the preamble is the actual
ground, owned by the racecourse, upon which the different pitches
are located which would, if it was available to purchase, be a
tangible asset. However, bookmakers are not claiming that they
have tenure of any particular pitch or piece of ground. Perhaps
the usage is unusual but "tenure" in this context relates
solely to a non-tangible asset, ie, a position on a list; not
a right to enter upon or stand at a particular location on a racecourse.
For this reason, the preamble is thus not really
relevant to the issue of the lists.
THE LEVY
BOARD CERTIFICATE
OF APPROVAL
On two occasions, the Committee heard evidence
that the lists were not provided for in the previous legislation
and thus there was no reason to have provided for them in the
2005 Gambling Act.
That is correct, insofar as there was no such
provision on the face of any of the previous Acts. However, it
may be said that the legal position changed when the Levy Board,
led by its Chairman and Government-appointed independent members
and with the full knowledge of the Home Office (the responsible
Government Department at that time) intervened in 1998, and created
the NJPC and the administrative structure which went with it,
including the National Pitch Rules, now abolished as a consequence
of the Gambling Act.
So, whilst it is correct to say that the matter
of lists, tenure etc were not originally the subject of legislative
provision under the 1963 Betting, Gaming & Lotteries Act,
this ignores the subsequent fact that the NJPC system was introduced
by the HBLB in 1998 and given statutory backing under the
Board's certification of racecourses provided for under s13 of
that Act.
Mr Farrelly perceptively asked whether, had
the Gambling Act not been passed, the racecourses would now be
in a position to, in effect, tear up their Certificates of Approval
and the attendant conditions.
The answer of course is "no", which,
after some prevarication, was conceded.
Therefore, because the list system was contained
within the National Pitch Rules, recognition of which was a condition
of the Certificate of Approval, the system was, indeed, statutorily
backed.
THE DCMS 2003 POSITION
PAPER
There were several references to the clarity
or otherwise of the DCMS Position Paper published in 2003 but
few, if any, to the responses which it elicited. One of these,
The Impact of Licensing Changes on Racecourse Bookmakers
was forwarded to DCMS in March 2004. This paper has already been
submitted to the Committee in evidence and clearly sets out the
issues relating to tenure. No action was taken in response to
this paper.
Following an enquiry by a former Head of the
Betting and Racing Team on 28 October 2004, the then Chief Executive
of the Levy Board, Mr Rodney Brack, articulated the Levy Board's
opinion clearly in a letter dated 29 October 2004, of which the
Committee also has a copy as part of the Levy Board's written
evidence.
At the oral session, you quoted a relevant extract
from this letter which read:
"It is our view, therefore, that bookmakers
have no security of tenure over anything. All they have is their
seniority positions on the various Bookmakers' Lists as a basis
for choosing their daily standing positions while the current
Certificates of Approval remain in place."
However, as you will be aware, the letter went
on to say:
"As and when the Board's Certificates
of Approval are revoked, the related conditions, incorporating
the National Pitch Rules, will cease to exist and will, no doubt,
be replaced on the following day by new arrangements to be determined
by the Gambling Commission."
In fact, the Gambling Commission has shown no
interest in the National Pitch Rules except insofar as they applied
to the objectives of the legislation.
However, the significant point is that there
was an expectation at a senior level at the Levy Board that, when
the National Pitch Rules ceased to have validity, an authoritative
structure would replace them.
This helpful letter received no response and
never achieved wider circulation. Had it done so, it is arguable
that the important issues it raised would have been fully addressed
at the time, ie, before the Bill passed into law.
THE FIVE-TIMES
RULE
Mr Atkin pointed out that the current "five-times
Rule" takes no account of the ability of bookmakers to pay,
saying that smaller bookmakers lower down the picking list must
pay the same as the senior players at the top. Whilst there is
no suggestion that the current policy regarding the abolition
of the Rule in 2012 should be changed, the Select Committee may
wish to note that the law relates to a maximum charge of five-times
the entry fee.
If Mr Atkin's concern for the lowlier brethren
of the on-course bookmaking fraternity were genuine, he could
have mentioned to you that his members are perfectly free to charge
them less than 5-times the entry fee and always have been.
CONCLUSION
Because of this substantial investment made
by many people subsequent to the introduction of the list system,
there was, at the very least, a prima facie case for addressing
the situation in the 2005 legislation (or its Default Conditions),
given the legal status of the Certificates of Approval and the
conditions attendant upon them. In fact the Department either
omitted to address the matter or chose not to take any steps to
prevent the current situation occurring, which is why the issue
has escalated to the level it has.
I must be clear in stressing that no responsibility
for the manner in which these issues were handled by the Department
in 2003-04 can attach to those currently in office, either at
ministerial or official level. All the personalities have changed
during the intervening period.
In conclusion, I should say that no bookmaker
believes that, when it passed the Gambling Bill into law, Parliament
intended for a situation to evolve whereby racecourses would,
as a consequence of that legislation, be in a position to render
the investments made by bookmakers worthless by refusing to recognise
a legitimate asset which, whilst it may be intangible, is none
the less real for being so.
November 2007
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