by Brian de Lore
Published 24th January 2020
The broadening and noisy furore coming from the
racing industry, after getting its head around the implications of Racing
Reform Bill No.2, is symptomatic of the current parlous state of racing and
breeding in New Zealand.
Racing Minister Winston Peters has been in the
job for two-and-a-half years but today, as you read this blog, racing is in the
worst state it has been in its 175-year history. No tangible benefits have
accrued back to the stakeholders in this Minister’s term of reform despite all
the policies, promises, reviews, tax duty repeals, committees, submissions,
agencies, industry discussions, board meetings, and now this proposed
Saying the industry is worse today than ever
before means that it will be worse again tomorrow, and worse again the day
after. Today’s stakes money level set on NZRB/RITA borrowings and a $35 million
overdraft at the bank is static against a raft of exponentially rising costs
which are suffocating owners and squeezing the lifeblood from the business as
every day passes.
Need a personal example; here’s one: A syndicate
in which I am one of 20 individual five percent owners to race a filly trained
in Matamata, formed in November, has just had the fee at the stable increased
from $87.50/day to $92.50/day on a current zero potential for a prizemoney
increase in the foreseeable future. Everyone in racing is sure to be able to supply
a similar story if asked.
On the other hand, it was the late Herbie Dyke who once said, “I don’t know why owners complain about stakes money, 90 percent of them never get any.”
…the racing industry is writhing in pain on the ground after a good 15-year beating…
The racing industry is entitled to be angry. The treatment it’s taken from years of ministerial dysfunction, and a nepotistic government-filled NZRB gravy train created from political appointments is still speeding towards the genocide of racing. And while the racing industry is writhing in pain on the ground after a good 15-year beating, DIA comes along in 2020 and puts the boot in with a document that takes complete control of the three codes as well as stealing the crown jewels (IP).
The detractors will be saying racing has itself
to blame because they couldn’t come together in unity and agree on everything
for the future. But thoroughbred racing, harness racing, and dog racing are
three different sports and are diverse activities. It would be no different than
asking rugby union, rugby league and soccer to combine under one board of
administration – hell would freeze-over first!
This week I once again tried in vain to get the Minister on the phone again by inviting him to provide readers with a solution to the current item of discontent causing industry apoplexy – the DIA and its Bill. He declined but at least sent a text reply, saying, “I’m speaking at the Karaka Sales. Submissions on the latest Racing Bill close mid-February. They will be listened to, etc..”
The Optimist has been holding the Minister to account for everything promised and not operationalised since he became our Minister of Racing in October 2017. But we need always to remember racing voted for Winston on the back of a solid racing manifesto which amongst many promises said, “an urgent review of the costs of the NZRB.”
…governments are useless at running businesses – take NZ Rail and Kiwibuild as examples
A fundamental promise to address escalating
costs in a declining business. It never happened then, or has it happened since
which tells you why governments are useless at running businesses – take NZ
Rail and Kiwibuild as examples.
Last September The Optimist predicted the NZRB/RITA
financial year loss would be $27 million – a prediction mocked by a member of
the agency. They were right, I got it wrong; the damage was worse at $30
million and total expenses were $211.3 million – they missed budget by $40
The appointment of John Messara to review the
industry was potentially a stroke of genius on the Minister’s behalf, but not
to follow through with it and allow all these deviations contained in this
latest legislation, is to drop the ball in front of an open try line as stated
here in a previous blog – why that
occurred remains a mystery. The reason it happened is less relevant than what
the Minister could have been so close to achieving had he and RITA stayed
focused on operationalising the Messara Review which was the RITA brief.
When RITA tells racing participants in 2020, it is following the Messara Review; it’s a reasonably loose statement that doesn’t reflect the intent of the Review’s author John Messara. One should carefully read what Messara outlined, and then read this legislation; there’s barely any resemblance, so Messara’s name is being used only as leverage to promote this legislation. That claim is backed-up in Mary Burgess’s blog, Racing Thoughts, entitled, ‘Industry blueprint unrecognisable in Racing Industry Bill.’ Here’s the link:
When appointed, RITA was given Terms of
Reference. An excerpt from that paper says: “The Government is committed to
reforming the New Zealand racing industry and seeks the scoping up of a
detailed plan to operationalise the Messara Report, the ‘Review of the New
Zealand Racing Industry’s’ recommendations once approved by Cabinet, to deliver
better governance and economic outcomes for the industry.”
Perhaps the Terms of Reference gave RITA room for deviation, but why would they have deviated unless they knew better? The Agency collectively holds limited administrative experience in racing and governmental racing matters compared to Messara who has been internationally awarded (Longine) for his achievements, yet they incorporated changes and overrode and diluted recommendations.
Cabinet: agreed to the overall intent of the Messara Report as providing the best approach to delivering a New Zealand Racing Industry that is financially sustainable, internationally recognised and competitive
In approving RITA’s Interim Report, Cabinet last April used this wording:
“On 15 April 2019, Cabinet:1
to the overall intent of the Messara Report as providing the best approach to
delivering a New Zealand Racing Industry that is financially sustainable,
internationally recognised and competitive.”
When it came to RITA’s Final Report to the Minister which was presented to him by June 30th but not posted on the DIA website until late last year, RITA on the Messara Review’s 17 recommendations was deviating from ‘strongly support the recommendation’ to ‘support the recommendation in principle’ – saying you support something but carrying it through to a conclusion isn’t going to happen.
When MAC became RITA on July 1st 2019, the first thing expected but not executed was a clean-out of the gravy-train but, no, the gravy-train rolls on and the only change seven months hence is that John Allen is gone and replaced by interim CEO Dean McKenzie who, like his predecessor John Allen before him, will be reliant on the advice of an executive team that decided to build the FOB platform and has a proven record of incompetence under the NZRB label – Mckenzie is getting guidance from the same people as Allen, and history tells us it was flawed advice.
When English football managers fail over time, they get the sack. When NZ racing CEO’s fail over time, they stay employed with a pay rise
When English football managers fail over time, they get the sack. When NZ racing CEO’s fail over time, they stay employed and get a second and third chance with a pay rise.
Yesterday I trekked the Karaka Sales grounds,
looked at numerous yearling parades, and saw very passionate New Zealand horse
people who have devoted their lives to thoroughbred horses, plying their
talents and proudly displaying the quality horses they have bred, to an
annually diminishing buying bench of trainers and owners from Asia and Australia.
These people are the lifeblood of an industry the Minister promised to reform,
but the offer of reform has been traded, forgotten, shelved, postponed,
reversed or cancelled. It doesn’t matter what you call it, Racing Minister
Winston Peter’s hasn’t yet come through, but still has an opportunity to step up
to the plate by supporting significant changes to this legislation.
The proposed legislation offers those good
people in racing no future and that is the point so far missed by everyone,
including and especially a nebulous and nameless DIA. Like any start-up or
reform, the igniting flame for a flourishing business is the incentivisation of
participants coupled with the potential to attract industry investment. What
this legislation says is don’t participate, don’t invest, and go away!
RITA was a ministerially appointed agency and primarily, RITA works for the Minister. But the problem is Winston Peters’ preoccupation with other governmental duties such as Deputy PM and Foreign Affairs hasn’t allowed him time to devote to racing – no question he’s out of touch and has relied on delegation and his office.
The Minister’s instructions to RITA in his July Letter of Expectation were: “Work with the Department of Internal Affairs (the Department) to develop the second Racing Reform Bill …
The Minister’s instructions to RITA
in his July Letter of Expectation were: “Work with the Department of Internal
Affairs (the Department) to develop the second Racing Reform Bill and implement
the regulations enabled by the Racing Reform Act 2019.” But in a recent communique
to NZ Harness, Dean McKenzie stated: “While RITA was
consulted in the development of the Bill, this is the Government’s legislation…”
That statement would suggest RITA has
some major issues with the Bill, but in this week’s industry discussions at Awapuni,
Invercargill, Cambridge, Karaka, and Pukekohe, Mckenzie has been telling stakeholders
that RITA supports between 80 and 90 percent of the contents of the Bill.
On January 10th on the RITA website, Dean McKenzie stated in his Industry Update: “This is a very significant and comprehensive Bill and reflects a determined focus and commitment from this Government to the racing industry. The RITA Board welcomes the Bill and the opportunities it presents for everyone connected to racing in New Zealand.”
No one is capable of supporting
this Bill if they have the long-term survival of the racing industry a primary
objective. It needs major surgery on top of the fact that it’s a very poorly
written document that contains a considerable number of errors in the
cross-referencing of clauses.
Submissions for the Bill will close in 18 days time on February 11th, and while the weight of protests needs to be made loud and clear by racing in the most assertive fashion possible, the government process of calling for submissions doesn’t mean the Select Committee will adhere to them. Seventeen months ago the majority of submissions were in favour of the Messara Review, but here we are in January 2020 dealing with a document that says something completely different and undermines the sustainability of the industry.
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