Arena Racing Company is making cuts to its racing purses and planning to close 1,000 betting shops as it prepares for thee UK’s planned cut to the maximum bet allowed on fixed odds betting terminals.
The racing company is planning the cuts for February, which will affect 3,406 races and means that ARC’s total prize-money commitment for 2019 will be down by 16 percent from 2018, according to SBC News.
Arena also said further reductions in prize money could not be ruled out, and that ARC “simply cannot continue” to maintain its current contributions to the prize-money fund. The £3 million would have been used to access additional prize-money from the government levy funds.
According to SBC News a funding review in 2017 between the British Horse Racing Association, the Horsemen’s Group and the Racecourse Association resulted in a new mechanism by which funding was allocated was developed and was subject to investments in particular races in order to ‘unlock’ enhanced prize money allocation. It included the Race Incentive Fund and the Appearance Money Scheme which extends prize money payments to placed horses.
With the UK set to reduce FOBT stakes to £2 from £100, a number of British bookmakers are planning to close betting shops, which will significantly impact the media rights payments to racecourses that are estimated to be between £40-60 million.
“The well-publicized impact of betting shop closures on racecourses’ media rights income has already started to take effect, and will only increase in the months and years to come,” said ARC Chief Executive Martin Cruddace in a press release. “As a result of this, Arc simply cannot continue to support our current levels of executive contribution to prize-money and unlock all qualifying races, as was the case throughout 2018.”
Cruddace said he “completely accepted” the government’s decision to cut FOBT stakes, and emphasized the need for racing stakeholders to do all they can to ensure racing continues to receive financial support.
ARC’s announcement has received support from Racecourse Association Chair Maggie Carver.
“These are challenging financial times for Britain’s racecourses as the media rights landscape, in particular, has fundamentally shifted in recent months, so we can understand Arc’s decision,” she said in a press statement. “The RCA and its members will continue to work with horsemen and the BHA to try to mitigate the situation as the funding environment evolves.”
