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

British racing's major powers have joined forces to blame the sport's £3 billion black hole on an "unaccountable and out of control" Gambling Commission.

The intervention followed the release of official statistics showing online racing turnover had fallen to £8.37 billion in the year to the end of March, compared to around £10bn two years previously. Had turnover grown in line with inflation over the period covered it would be close to £11.5bn, representing a decline of £3bn or more than 25 per cent in real terms.

In a statement on behalf of groups including the National Trainers Federation (NTF), Racehorse Owners Association (ROA) and Racecourse Association (RCA), Arena Racing Company (Arc) chief executive Martin Cruddace said they would shortly be writing to prime minister Keir Starmer and secretary of state for culture, media and sport Lisa Nandy to outline their "major concerns" with the sharp fall in betting turnover, which began following the Gambling Commission's imposition of affordability checks on punters.

Arc chief executive Martin Cruddace said the "Gambling Commission increasingly appears to be unaccountable and out of control"

Cruddace said: "Bluntly, the Gambling Commission increasingly appears to be unaccountable and out of control. Moreover, they continue to be unable to demonstrate any evidence as to the impact that the current affordability measures are having on problem gambling rates.

"It's well established that the commission wishes to introduce affordability checks on a minimal sum per day sitting at a similar rate to a range of everyday items from a child's Happy Meal at McDonald's or a ticket to the cinema.

"The previous government had agreed a range of more sensible interim measures with the commission and betting industry, which have still not been implemented under the guise of anti-money laundering issues."

The pressure on the sport's finances is only set to intensify according to the Levy Board and BHA, which have warned the trend for falling turnover has continued since the end of the period covered by the Gambling Commission statistics, with the BHA revealing year-to-date betting turnover was down in total by 9.5 per cent at the end of August.

That compares with an average decline of 8.5 per cent in the last two years covered by Gambling Commission figures, which go up to March 2024, suggesting the decline in betting activity could actually be accelerating.

Analysis of the Gambling Commission statistics shows that if turnover continued to fall by 8.5 per cent, it would drop to £7bn within two years, while the margin needed to maintain the current level of profitability for bookmakers would reach as high as 11 per cent, having been just 7.3 per cent in 2021-22.

This illustrates the disproportionate effect affordability checks and other stricter regulations on the gambling industry have had on horseracing betting compared to other products such as greyhound racing, football and online slots. Cruddace believes the regulatory environment has made it harder for British racing to compete globally.

Cruddace added: "We all imagine that every racing jurisdiction across the world, none of which has the concept of affordability, is looking at the UK perplexed, wondering how our government can oversee such a decline in a sport which transcends and brings so much joy to every part of society, alongside billions to our economy."

The stark decline in betting turnover has a knock-on effect on revenue streams such as media rights and the levy, which impacts prize-money. Alongside reduced returns, trainers are having to compete with inflationary price and wage increases, as well as a hike in National Insurance affecting every part of the industry.

'The Gambling Commission is in the process of doing irreparable harm to our sport'

Responding to the decline in betting turnover, NTF chief executive Paul Johnson said: "While it's correct that the budget was unhelpful for many trainers' businesses, at least we could recognise the government is seeking to resolve a specific budgetary problem and is, more generally, prepared to listen to the sport about the pressures we face.

"I cannot say the same about the Gambling Commission which, in my view, has been operating without accountability and is in the process of doing irreparable harm to our sport and all of the businesses that depend on it."

Johnson also believes the number of customers being driven away from the regulated sector by affordability checks is undermining the sport's attempts to reverse its fortunes through initiatives such as premierisation.

"Although the sport has a somewhat fragmented leadership, there's an understanding that we need to work together to protect our future," added Johnson. "I've expressed my view the pace of change is too slow but it's important to highlight the sport is at least seeking to work together on self-help.

"However, there is very little that we can do that will offset the type of impact that the Gambling Commission is having in driving large numbers of consumers out of regulated betting activity, ironically with the intent of helping to protect a relatively small number of them."

Cruddace said the intention was for the letter sent to the government to be co-signed by the RCA, ROA, NTF, Jockey Club, Thoroughbred Breeders' Association (TBA), Professional Jockeys Association and the National Association of Racing Staff (Nars).

The Gambling Commission was approached for comment on Wednesday.

Read more:

Our government is overseeing a decline in a sport which brings so much joy to every part of society, alongside billions to our economy 

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

Subscribe to Racing Post Members' Club Ultimate Monthly now and get access to award-winning racing journalism with 50% off your first three months. Patrick Mullins led the way when winning the Racing Writer of the Year award at the Horse Race Writers and Photography Derby Awards in London in December and you can read more exclusive content from the best journalists in racing by signing up to Members' Club today.

Available to new subscribers purchasing Members' Club Ultimate Monthly using code MEMBERS24. First three payments will be charged at £24.98, subscription renews at full monthly price thereafter. To cancel please contact us at least seven days before subscription is due to renew.