Examination of Witnesses (Questions 83
- 99)
TUESDAY 13 NOVEMBER 2007
MR DAVID
BRADSHAW, MR
TIM MOORE
AND MR
TOM CLARKE
Q83 Chairman: Can I welcome Tim Moore,
the Chief Executive of the National Joint Pitch Council, and Tom
Clarke, the Chairman, together with David Bradshaw, the Racing
Director of the Horserace Betting Levy Board. You have heard the
exchanges with the two previous sets of witnesses. As the bodies
that administered the trading of list positions, did you regard
them as being in perpetuity?
Mr Moore: Since 2002, when I was
appointed, I think it is fair to say the NJPC never considered
making a statement on security of tenure. That was basically because
it was never considered to be an issue. It was never an issue
that was brought to our attention by The Racecourse Association
or indeed by DCMS. The RCA never suggested that they were going
to review the status of the lists in the light of the new legislation.
DCMS never indicated to us that the lists were under threat in
any way. Everybody recognised and realised that the five times
rule was going to come to an end, but I think it is fair to say
that we did not associate the five times rule—or the "rent"
as was called earlier—with the status of the lists. We saw
them as two separate things which could run side by side, as Mr
Davies suggested earlier. So far as we are concerned they are
entirely different issues.
Q84 Chairman: You said you did not
consider it an issue. Does that mean that you thought essentially
it was in perpetuity?
Mr Moore: Yes, I did.
Mr Clarke: For my sins I have
been with the NJPC since it started in 1998. There was never any
mention of a time limit under the previous seniority system, nor
had there been any mention of a time limit in the Sparrow Report
which spawned us. I think we have had 90 meetings of the NJPC
over the last nine years and this did not become an issue until
the 86th meeting which was in the spring of this year. I would
also add that in the summer of last year the Acting Chief Executive—Mr
Moore was on secondment to the Gambling Commission—and I
went to see The Racecourse Association at Ascot to talk about
our possible role post Gambling Act implementation in September
this year and the word tenure was not mentioned then. This was
not an issue. There was an acceptance that there was no time limit
on this.
Q85 Chairman: So it is your position
essentially that the view taken by the bookmakers when they purchased
list positions was a perfectly reasonable one?
Mr Moore: Yes. As both of you
have commented from your side, we consider that the racecourse
bookmakers sold and purchased list positions in good faith.
Q86 Chairman: Are you surprised to
hear The Racecourse Association express a view that they should
never have taken that view and there was nothing to suggest that
it was their view?
Mr Moore: Yes indeed.
Mr Clarke: A better word would
be stunned by their letter in March of this year.
Q87 Chairman: Is that also the view
of the Horserace Betting Levy Board?
Mr Bradshaw: Yes. We were also
surprised at the RCA position. Since 2005 any discussions that
I have had with racecourses in my capacity as Racing Director
of the Levy Board have focused on the five times rule and the
implications of the five times rule for existing betting areas
and for new betting areas. The only discussions that have occurred
on security of tenure from racecourses occurred after the announcement
made in March.
Q88 Chairman: The caveat that you
inserted into the sale terms in early 2005, was that intended
to flag up the issue of tenure and the fact that there might be
some uncertainty over it?
Mr Moore: No, absolutely not.
We had become aware through the processing of the forthcoming
Gambling Act, as it was at that stage, that two things were going
to happen, the ending of the five times rule, as we have all mentioned,
and also the fact that racecourses would be permitted to allow
betting in what is known as new approved areas, in other words
areas that are not currently in use. We considered that because
of both of those developments the bookmakers would, rightfully,
need to recognise those and take account of them when buying their
positions and presumably pay according prices.
Q89 Chairman: So the caveat simply
related to those potential changes. There was no threat or uncertainty
over the position regarding tenure?
Mr Moore: No. As I think we say
in our submission, it was never intended to be a veiled warning
to the bookmakers. It was merely about the five times rule and
the increased competition from new areas.
Q90 Philip Davies: Is it right that
the RCA are represented on your body?
Mr Moore: Yes, they are.
Q91 Philip Davies: Despite that,
their view, as you heard earlier, was that it was blindingly obvious
that these things were not to last forever. You do not see that
that has always been their position, do you?
Mr Moore: I do not see that it
is blindingly obvious, frankly. It is an interpretation. The 1963
Act, the situation with the Levy Board's certificates of approval
and the National Pitch Rules are all tied in with the same situation.
We all realised that the bookmakers' lists were operating under
the auspices of the National Pitch Rules. However, there is nothing
in the new Act which, as we said earlier, abolishes the lists
per se. There is nothing there that says anything about the lists.
I personally see it as an interpretation by the RCA that the lists
will not continue.
Q92 Philip Davies: You say it was
only raised at the 86th of the 90 meetings that you have had.
Was there a time before then at which, if this was clearly the
view of The Racecourse Association, it would have been pertinent
for them to point that out at one of those meetings?
Mr Clarke: Certainly. Right from
the early days when the auctions and then later the private sales
began to generate major prices for positions on the list there
would have been an opportunity for racecourses and the bookmakers
to query exactly what they were buying, if in fact there was any
doubt about what they were buying. They were buying something
without a time limit as we understood it. The phrase "in
perpetuity" did not exist in our vocabulary until quite recently.
Q93 Philip Davies: Is your view that
when bookmakers were paying these fantastic sums for pitches The
Racecourse Association knew very well that they were buying them
on that basis?
Mr Clarke: That would be my personal
belief, yes.
Q94 Philip Davies: How do you explain
their current position? Do you see them as being opportunistic
in trying to make the most of the new Act?
Mr Moore: Their position became
clear only after the mandatory and default premises licence conditions
were issued in February 2007 and that was discussed at a subsequent
NJPC meeting. I take that to mean that their final position was
only decided at that stage, hence why the letter on 14 March came
when it did, in March 2007 and not when the Act was published
in 2005 or indeed back in 1998.
Q95 Philip Davies: Given the situation
we are in, what is your view as to how this can best be resolved?
Mr Clarke: I think, Mr Davies,
you hit the nail on the head yourself when you said earlier, "Why
can't the racecourses honour the lists as well as negotiate commercial
deals?" I am paraphrasing you but that was the gist of it,
I am sure. That would be our position in a nutshell.
Q96 Philip Davies: Does the Levy
Board take the same view?
Mr Bradshaw: I think the Levy
Board position is slightly different in that, as was made clear
earlier, our authority rested principally with our certificates
of approval which bound everybody together. From 1 September this
year we have no longer had any locus on the racecourse at all.
Realistically, as far as I can see, it is entirely possible to
go down the route that is suggested. Equally, it may be entirely
possible to introduce commercial arrangements as well.
Q97 Paul Farrelly: I want to ask
a question regarding the caveats that seems to be at the fore
of this questioning. It is a pretty broad and sweeping, is it
not? You have mentioned that you are only intending to refer to
two particular instances, the ending of the five times rule and
the fact that there might be a less restricted supply of gambling
opportunities. Why did you not make the caveat more specific and
add at the end that it was in respect of the ending of the five
times rule and this other thing?
Mr Moore: We had no idea at the
time exactly how the Act would affect the future of the NJPC.
The NJPC as an administrative body is no longer in existence.
It actually finished when the Gambling Act came in on 1 September.
We had no idea how the provisions of the Act in the regulations
would pan out, therefore we just made a general statement. We
had those two specific issues in mind, but we did not know what
else might come through the Act. The Act itself and the regulations,
until a very late stage, did not actually address the on-course
issues hardly at all.
Q98 Paul Farrelly: Did you insert
that caveat on legal advice?
Mr Moore: No.
Q99 Paul Farrelly: Were lawyers involved
in drawing that wording up?
Mr Moore: No.
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