Tote (Hansard, 2 March 2000)

§ Mr. Straw

The futures of the Horserace Totalisator Board (The Tote) and the Horserace Betting Levy Board have, for different reasons, been under review. I am now able to set out the Government's conclusions.

I announced in my reply to my hon. Friend the Member for Leigh (Mr. Cunliffe), on 12 May 1999, Official Report, columns 159–160W, that the Government had decided to sell the Tote and that further work would be put in hand to determine the most appropriate method of sale. That work, which included the evaluation by independent financial advisers of a range of sale options, has now been completed. The options included flotation of the Tote on the stock market, its sale by open competitive auction and a sale to horseracing. Consideration of the best option was helped by the agreement of all relevant horseracing interests to support a single proposal to buy the Tote on behalf of racing, in order to maintain the position under which all the Tote's profits are used for the benefit of racing.

Following careful consideration of all the available sale options, I have concluded that a sale to racing represents the best match, in principle, with the Government's objectives for the sale as a whole, as set out in my May 1999 statement. While the price to be paid by racing for the Tote will need to be the subject of commercial negotiation, it will be important to ensure that it is a fair one which strikes the right balance between the respective legitimate interests in the Tote of both racing and the taxpayer.

Racing's proposal to Government aims to ensure that those who are responsible for managing and developing the Tote's business do so within a fully commercial operating environment. I believe that this represents the best options for the Tote and its staff, not forgetting, of course, all those who bet with it.

We therefore propose to bring forward legislation, at the appropriate time and when Parliamentary time allows, which would enable the sale to proceed on this basis. However, a final decision will need to take account of circumstances at the time, including the outcome of commercial negotiations and relevant legal considerations.

372W

I have also today published the report of the quinquennial review of the Horserace Betting Levy Board; copies have been placed in the Library.

The Levy Board was set up in 1961 to collect a levy on horserace bets from bookmakers and to disburse it for the benefit of racing.

The Report concludes that the Levy Board is an efficient body which carries out its statutory functions well, but that most of those functions no longer need to be carried out in the public sector. In particular, the arrangements under which racing receives income from bookmaking should become a matter for settlement between the parties on a commercial basis.

The Report recommends that the Government, in co-operation with the Levy Board and the industries involved, should take forward detailed consideration of all of the associated issues including the Board's important role in the provision of integrity services and its regulatory functions.

The Government agree with these conclusions, and propose to bring forward, once again at the appropriate time and when Parliamentary time allows, legislative proposals for the abolition of the Levy Board. We shall now be discussing with the Board, the British Horseracing Board and other representatives of the racing and bookmaking industries, the steps needed to put alternative arrangements in place. As part of this process I shall be asking the British Horseracing Board, as racing's governing body, to prepare a realistic plan which shows how racing will be run as a national sport without a statutory levy.

I should make it clear that the decision to abolish the levy system is no reflection on the performance of either the Board or its staff. Both have made a significant contribution to the administration of racing over many years, which we gratefully acknowledge.

The sale of the Tote and the abolition of the levy system will together mark an important change in the relationship between the Government and horseracing. The Home Secretary is responsible for policy on the regulation of gambling, which requires consideration of its social impact and measures to ensure protection against crime and exploitation. For reasons of history, this responsibility has involved the Government in the administration and financing of British horseracing to an extent and in ways which are no longer needed.

My recent announcement that the Government are to establish an independent review of gambling offers racing, and others, an opportunity to put forward their ideas for the future control and regulation of betting on horseracing. Meanwhile, the sale of the Tote and the abolition of the Levy should enable racing to take more control of its own affairs and finances, as befits a mature sport. In preparing the legislation needed to give effect to these changes, the Government are committed to working closely with racing, bookmaking and other relevant interests to ensure that the results which are delivered match up to our aspirations. Horseracing is an important and successful national sport which gives employment and pleasure to many people. We want it to prosper.