Draft Horserace Betting Levy Regulations 2017

Gavin Newlands Excerpts

Monday 27th March 2017 General Committees

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

It is a pleasure to serve under your chairmanship, Sir Alan. Given that the Scottish National party supports the legislation before us today, I will be brief in my remarks.

We accept the need for an overhaul of the system—indeed, we have voted for such in the past. In 2013 we supported a new clause to the Gambling (Licensing and Advertising) Bill, which would have made offshore bookmakers liable. The Government did not support it at the time, but I am pleased to see them come to the right conclusion on this occasion.

In addition, the Scottish Government and the cross-party horse-racing and bloodstock industries group in the Scottish Parliament also support the changes. In any event, I think all parties, both inside this place and out, would agree that a fair and sustainable instrument of reinvestment is long overdue.

Over the years, the number of bets placed online has markedly increased. In tandem with that, the proportion of online bets made using offshore bookmakers has also increased dramatically, resulting in the levy not being applied to an estimated 40% of all bets on British racing. The British Horseracing Authority has estimated that that costs the industry more than £30 million a year in lost levy receipts. The SNP does not believe that bookies can exploit the system by moving parts of their business offshore to avoid meeting their responsibilities.

It is worth noting that the levy exists for a reason. As well as supporting the nearly 17,500 people who directly work for horse-racing, it also advances horse-racing in general. Failing to abide by this important levy makes it more difficult for the sector to meet a critically important set of responsibilities, including the wellbeing of people who work in the sector alongside the horses themselves. It is right that we introduce legislation that closes that loophole.

It has been forecast that the levy will raise between £10 million and £30 million. With such a wide forecast, it is only right that we review the levy’s efficacy. Will the Minister provide the Government’s thinking on the seven-year timescale of the review? Further to the question asked by the hon. Member for Tooting, has that period been agreed by both the horse-racing and betting industries?

We must be mindful of spectators and punters across the UK who may become addicted to gambling. Problem gambling causes harm to the gambler and those around them, including family, friends and others who know them or care for them. Nearly 50% of people have gambled in the past four weeks; even though the majority of people gamble with moderation, addiction is still said to cost the UK Government £1.2 billion every year, with the impact on the individual being more devastating. Given the additional income being secured for the sport of horse-racing, we should contemplate whether additional support can be offered to those affected by problem gambling.

It is unclear how much of the funding acquired by the Horserace Betting Levy Board has been spent in Scotland. The only source of information containing a discussion of the issue is a 2015 William Hill report, which states that the betting industry’s annual contribution through the levy to Scottish racecourses for 2014 is

“£4.1 million, 6% of the total UK levy contributions”.

In addition, a 2014 document noted that the income received from the levy by Scottish racecourses exceeds that bet on Scottish fixtures. However, given that Scotland accounts for 9.8% of the betting taxes and levies collected in the UK but has 5% of the British horse-racing sector, it is likely that Scottish punters make a net contribution to horse-racing in the rest of the UK. That is estimated at £2.8 million per annum. I ask that a proportionate amount of any additional funds raised be spent in Scotland, where the country’s five racecourses attract more than 300,000 visitors annually, the economic impact of which has been valued at £170 million a year.

I welcome the new proposals set out by the Minister, and believe that they will help to secure vital resources to support the industry and horse-racing in general. They will also help to prevent aspects of the industry from moving sections of their online business to offshore accounts, avoiding their responsibilities to the levy and the sport.