Betfair founder and owner-breeder Andrew Black warns about spiralling impact of £3 billion black hole

Owner-breeder and Betfair co-founder Andrew Black fears there is "more to come" as the spiralling impact of falling betting turnover on the sport hits British racing.

Black called on the government to protect the sport due to its cultural and economic importance by separating it from other forms of gambling such as casino products.

His comments came after new figures revealed a fall in online betting turnover on the sport of more than 25 per cent in real terms, the equivalent of a £3 billion black hole.

Gambling Commission statistics showed that online racing turnover had fallen to £8.37bn in the year to the end of March, compared to around £10bn two years previously. However, if it had grown in line with inflation over that period it would have been closer to £11.5bn.

Much of the blame for the fall has been laid at the door of affordability checks, which a number of major players in the sport, headed by Arena Racing Company chief executive Martin Cruddace, have blamed on an "unaccountable and out of control" Gambling Commission.

Black said illegal and offshore alternatives had become more attractive for punters and had become more profitable as a result.

Andrew Black with his Chesham Stakes winner Arthur KittCredit: Edward Whitaker (racingpost.com/photos)

He added: "They're able to spend more and although you can say they can't advertise they have ways around that, they get their business in a viral manner. As those businesses become more profitable that is a spiral that carries on and potentially undermines the legitimate businesses who are playing the game fairly."

Black also said that as turnover fell it meant that operators offered a less attractive product, creating a vicious circle.

"Ultimately if online is feeling the pinch then the punter is going to feel the pinch, because value is going to leave, you'll find overrounds going up, you'll find offers disappearing as they have to tighten their belts and that gets passed on to the punters," he said.

"Again it is all part of a spiral. We don't know when it comes to an end and how it's going to play out but what we do know is there is more to come."

Cruddace this week said in a statement written on behalf of British racing stakeholders including the National Trainers Federation, Racehorse Owners Association and Racecourse Association that they would be writing to prime minister Keir Starmer and culture secretary Lisa Nandy to outline their "major concerns" about the situation.

Black said racing needed to make the case to government that it required protection from being caught in the crossfire of a battle over the regulation of other forms of gambling.

"The drum that I bang the most is the argument to put to government to say that racing is cultural and needs to be treated differently to other forms of gambling that don't have that sort of cultural and social aspect," Black said. "So we need to be separated from other forms of gambling, two flies on a wall, casino-type gambling. 

"It's not just cultural, there are a huge amount of people employed in the industry for one thing and for those reasons we need to be separated out and treated differently by the government. Only then can we start to turn the wheels back the other way. 

"I think there are people who can make that argument and I think there are people in government who will listen to that argument when they look at the number of people who are employed in this industry. It's the only salvation I can see right now."

Gambling Commission chief executive Andrew Rhodes

Responding to the statement from racing stakeholders, Gambling Commission chief executive Andrew Rhodes said it was "based on significant misunderstandings" and ignored that the industry regulator was "accountable to government and parliament".

He added: "We also fully engage with British horseracing and we will continue to listen and engage, with a focus on permitting a thriving industry while protecting people from harms and unfair practices."

Rhodes said accusations about the affordability measures operators have had in place in recent years was a "thorough misunderstanding of what has been happening and what we are proposing", which were "proportionate checks to support the most financially vulnerable customers".

He concluded: "If implemented, these checks would take place for only the highest spending customers and the check would also be frictionless for the vast majority who undergo them. Further information would only be requested from customers as a last resort.

"With reference to the assumption that non-mandated operator checks have led to reduced turnover, we would urge caution as turnover will be impacted by a wide range of factors, such as changes in consumer spending power or product competition.

"Evidence informs our decision-making and we will continue to review our findings to balance our drive to protect the most vulnerable consumers and similarly protect the freedom of adults to gamble. We hope and expect others to do the same."

Read these next:

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British racing lays blame for £3bn black hole at door of 'out of control and unaccountable' Gambling Commission 

The £3 billion black hole: calls for urgent action on affordability checks as online betting turnover on racing crashes

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