Examination of Witnesses (Questions 100
- 113)
TUESDAY 13 NOVEMBER 2007
MR DAVID
BRADSHAW, MR
TIM MOORE
AND MR
TOM CLARKE
Q100 Paul Farrelly: Was there no
legal advice? Lawyers tend to make it very broad and sweeping
so that they cannot get sued themselves.
Mr Moore: That was not the source
of the advice.
Q101 Paul Farrelly: The industry
is now where it is. Do you think with hindsight it was reasonably
foreseeable that this position might have been reached? If we
just put aside the histories of custom and practice and what might
have seemed reasonable then to expect because it simply was not
raised, do you think it was reasonably foreseeable that you might
have got to this position or is that an unfair question?
Mr Moore: It is a difficult question
to answer because hindsight is a wonderful thing, as we all know.
All we can rely on is the way that the bookmakers themselves conducted
their position and the sales of their pitches between themselves.
They certainly did not realise at that time that this would come
about and I think it is fair to say that, therefore, it would
not have been reasonable for them to have assumed that.
Mr Clarke: Mr Farrelly, I do not
think anybody, the bookmakers, the racecourses, NJPC, had any
idea until March of this year that the lists would no longer be
useful.
Paul Farrelly: So nobody really missed
a trick. It is just the tricks are being played now.
Q102 Mr Sanders: In 1998 the Levy
Board intervened in the matter by making compliance with the pitch
rules and list positions a condition of certification of racecourses.
Why did you get involved, and should you not have left it to the
parties to sort out?
Mr Bradshaw: We were in effect
asked to get involved in the situation because the racecourses
and the bookmakers had been in discussions for a number of years
and had not been able to find a way forward. So in effect the
Levy Board was asked to use its offices to intervene on the basis
that it had the certificate of approval and therefore had the
powers to administer anything that might result from the review.
This was in fact, as was mentioned earlier by the bookmakers,
challenged and it was found on judicial review that the Board
had the powers to use its certificate. The Sir John Sparrow review,
whilst we are talking about security of tenure here, was a very
wide-ranging review on a range of issues.
Q103 Mr Sanders: Were the Government
among those who asked you to get involved?
Mr Bradshaw: I am not aware of
that, no, Sir.
Q104 Mr Sanders: Is it possible to
find out because it is a very crucial thing? If the Government
had put pressure on you to get involved that might explain why
there is some confusion amongst people as to your role in this
and whether this might not set a precedent for the Government
intervening to preserve lists.
Mr Bradshaw: Yes.[32]
Q105 Chairman: You expressed the
view that the desirable way forward would be to move to commercial
negotiation between racecourses and bookmakers but on the basis
of preserving the lists. You will have heard the evidence from
The Racecourse Association that that does not seem something which
appears to be very likely in terms of how they see the way forward.
Do you think that Government should intervene to ensure that is
what happens?
Mr Clarke: Government seems reluctant
to intervene. If I were to offer a very personal opinion here
but an opinion based on nine or 10 years' involvement with this
sector of the industry, I think there is a unique body which has
representation from the betting industry and the racecourses and
that is the Levy Board, which does have a continuation of life
and it may well be that the Levy Board could act as the arbiter
in this. I emphasise that is a personal view.
Q106 Chairman: Is that something
that the Levy Board would be willing to do?
Mr Bradshaw: Since October 2006
the Board has had a policy of returning to its primary functions,
which are the collection and distribution of the levy. Against
this background we have divested ourselves of responsibilities
for areas such as the Horseracing Forensic Laboratory and the
National Stud. Obviously the Board was very clear under the late
Chief Executive, Sir Tristram Ricketts, that we move away from
involvement on the on-course or even the betting rings and the
racecourse betting areas. It would require a rethink for the Board
to get involved in Mr Clarke's suggestion.
Q107 Chairman: So at the moment that
is not something which you would see as appropriate now for the
Levy Board to do?
Mr Bradshaw: No. The Board has
not given an indication or a willingness to continue its involvement
since October 2006.
Q108 Chairman: Are you encouraging
Government to get involved in that area?
Mr Bradshaw: Historically the
Levy Board has taken quite an active role in the on-course betting
areas principally because we have looked to maintain the integrity
of the SP, which is obviously what the majority of the off-course
bets are involved around and that has shaped our policy pretty
much since 1963 up until the time when our responsibilities were
removed. The legislation from 1 September in effect appears to
have a somewhat lighter touch than perhaps what the Levy Board
would have done with on-course betting areas in that less emphasis
is put on approving areas through the statutory mechanism and
now racecourses have the ability to do a number of things on the
racecourse as a result of this legislation. Government is still
involved but I think to a lighter touch than perhaps pre-1 September
2007.
Q109 Chairman: All three of you have
said that you administered the trading arrangements believing
that what was being sold was in perpetuity and it was perfectly
reasonable for bookmakers and therefore I assume you have quite
a lot of sympathy with the feelings of the bookmakers who appeared
before us today. Given that you have a responsibility and that
it has resulted in their apparently having their livelihoods threatened,
what do you think should be done? Mr Clarke has given one suggestion
but it does not seem to have been greeted with total enthusiasm
down the other end of the table.
Mr Moore: We made a proposal in
our written submission to the Committee which in essence is something
that Mr Davies touched on earlier, which would be to keep the
lists as they are now and for the bookmakers and the racecourses
to negotiate on their commercial terms. The bookmaker then in
any list position, as I see it, would have three options. One
would be to sell his position on the list to another bookmaker
if he did not like the commercial terms. Secondly, he could choose
not to work at the racecourse or to cherry-pick the days between
maybe weekends, Bank Holidays and not go on other days. Thirdly,
he could seek redress, as Budd suggested in the report, through
the competition authorities. That seems to me to encapsulate the
best of both worlds in that racecourses get to negotiate a rent
free from the restrictions of the five times rule and bookmakers
get to keep or to liquidate their assets and pay appropriate fees
for working at the racecourse. Also, and who we must not forget
in all of this, the racegoers get to participate in a busy betting
ring. It is very competitive, as we all know, and it is an important
part of the British racing heritage.
Q110 Philip Davies: Mr Bradshaw,
do you anticipate that these changes will lead to bookmakers on-course
having to pay more?
Mr Bradshaw: No, I do not think
that is necessarily true. As was mentioned earlier, it is conceivable
that a number of racecourses might choose to charge less than
the five times entry fee to the racecourse and, depending upon
any commercial arrangements or existing arrangements which continue,
that may mean that the actual bookmakers may pay less on occasions.
It is difficult to make a definite statement because obviously
racecourses have a great deal more latitude now in their ability
to create new betting areas. As was mentioned by both the bookmakers
and the racecourses, that could have a commercial impact on costing
charges for the main betting rings.
Q111 Philip Davies: Do you think
there will be more or fewer on-course bookmakers as a result?
Mr Bradshaw: I really could not
answer that; I do not know.
Q112 Philip Davies: The point that
you made was that one of your responsibilities is the integrity
of the SP which comes from the racecourses and therefore the better
value for the punter back in the betting shops presumably drives
better levy incomes. Presumably you have a vested interest in
ensuring that the on-course market is as vibrant as possible and
that any additional cost or any cost that bookmakers are incurring
may lead to higher margins and therefore worse prices for the
punter. Is that not a concern that you have?
Mr Bradshaw: I think that is a
perfectly reasonable assessment of the situation. If the Levy
Board was continuing with its present role I am sure that is exactly
the position that the Board would wish, that the on-course market
and the integrity of the SP is as robust as possible.
Q113 Philip Davies: Do you consider
at the moment that the on-course market is robust and gives a
fair deal for off-course punters?
Mr Bradshaw: Yes, at the moment
I do.
Chairman: I do not think we have any
more questions. Can I thank you very much.
32 Note by witness: The Government did not
ask the Levy Board to get involved. Back
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