Nevin Truesdale: Jockey Club bracing itself for 'material' impact from budget measures

This week's budget will have a "material" impact on the Jockey Club, chief executive Nevin Truesdale has warned, and will make decisions on areas of investment such as prize-money more difficult.

On Wednesday chancellor of the exchequer Rachel Reeves delivered a budget statement which is set to raise £40 billion in taxes, with employers facing a major increase in the amount they pay in National Insurance contributions. The measures announced also included a 6.7 per cent increase in the national living wage.

Truesdale said changes to National Insurance and the national living wage would have the most impact not only for racecourses but trainers, breeders and the entire hospitality and leisure sector.

"The headline on what it means for us is that it's just going to tighten and squeeze our investment choices again for next year," he added. "We certainly felt we had a reasonably well-balanced financial plan for next year and now we are going to reopen bits of that.

"We haven't got a number yet but the impact is material for us and is going to lead to some discussions internally that we thought we'd resolved.

"Prize-money is our single biggest investment every year. I'm not going to say one way or another on that because our first commitment is to maximise our prize-money while keeping our business sustainable. It's always on the table when we are setting our budget framework, you need to look at everything."

Jockey Club chief executive Nevin TruesdaleCredit: Edward Whitaker (racingpost.com/photos)

Truesdale said changes to business rates contained in the budget would provide a "very small saving" against the negative impact of other changes.

He added: "The other thing to remember is it's not just people who work for us directly that are impacted by this, nearly all of our suppliers will see the impact so they will need to decide what that means for their business.

"We might not see that in the short term, but in the long term they will have to work out what that means for their pricing for customers like us."

Truesdale said he understood the government had to raise money, but the budget had made the commercial environment "even more challenging".

He added: "We have definitely seen a stabilisation of our trading in the last six months or so, things have improved on that front, but it still feels like there's an uncertain consumer confidence out there as well, and this sort of thing does not help.

"The only blessing of this is that we know this now, given our budget cycle, rather than finding out about it in February. At least we can plan for it, even if we don't like what that planning looks like."

Trainer Nick Alexander described the changes to National Insurance and the living wage as something of a "double whammy", and said it would have consequences for training fees.

He added: "The rise in National Insurance will cost us ten grand a year and the minimum wage rise will also have an impact, so we'll have to put our training fees up. I had to increase our fees this year to accommodate the rise in minimum wage and I'll have to do it again.

"We have to give the horses the care they need so these rises become yet another burden for the owners, and at a time when prize-money has not been keeping pace with the rising costs."

Fellow trainer Kim Bailey said running a small business was going to be "very tricky".

He added: "I'm having to pay more to employ people and my wages are going to go up as well, so it's not a great moment. 

"Other companies we work with, like the smaller feed companies, employ people and are going to have to put their costs up accordingly, so the price of things coming into us will go up. It's the knock-on effect as well."

Read these next:

Warning that many trainers could be put out of business as British racing examines budget announcement 

It could have been worse - but the budget heaps more pressure on British racing's leadership 

'Trepidation' as racing industry braces itself for impact of chancellor Rachel Reeves' budget 

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