Horserace Betting Levy Board

The Horserace Betting Levy Board (HBLB) has budgeted to contribute £70.5m to prize money for racing fixtures in 2024, an increase of £3.2m on the comparable £67.3m initially budgeted for 2023 and around £11m more than for each of the pre-Covid years of 2018 and 2019.

The enhanced funding will provide a significant contribution towards the various fixture list and race programming initiatives being announced today by the British Horseracing Authority (BHA) on a trial basis.

HBLB has spent substantial time in recent months working with the BHA in evaluating and assessing the package of proposals. A series of targets and measurement criteria will be published by BHA shortly in the light of further consideration.

The Board’s increased funding in 2024 has been made possible by the significant upswing in Levy in the latter part of the 2022/23 year, resulting in higher than forecast Levy income of £100m and a small budget surplus, the first in three years.

After providing markedly bigger contributions than usual to prize money in 2021 (£81m) and 2022 (£74m) in light of Covid, the Board had signalled that it would need to scale back expenditure in 2023, in part because of the repayment of the first instalment of the £21.5m Sport Survival Package (SSP) loan taken from Government to assist with racing’s recovery from the effects of Covid.

HBLB reported in May 2023 that, over the Levy year to 31 March 2023, there had been a continuing decline in betting turnover on British racing which was being partially mitigated by profit margin exceeding recent comparative levels. This pattern has continued since.

Given the changes being made to the prize money distribution mechanism with effect from January 2024, and as HBLB’s Ratecard mechanism provides funds on a sliding scale based on how much racecourses contribute, the Board will review its financial position in May 2024.

This review will take account of the outturn of Levy yield for the year ended 31 March 2024 and HBLB’s anticipated prize money expenditure to the end of the period of fixtures covered by Programme Book 2 (23 June). On the assumption that there are no material reasons to adjust plans, the Board will maintain its planned contribution for the remainder of 2024, leading to an estimated total prize money contribution for the year of around £70.5m.

Paul Darling, Chairman of HBLB, said: ”As a principle, the Board fully supports Racing’s aspiration to make change to ensure the sport is relevant and attractive now and in the future. A number of changes are being made simultaneously for 2024 but it is recognised that a consensus has been reached through the sport’s complex infrastructure.

“The Board has been in discussion with BHA and others in the sport to probe and question appropriately. This is the duty of the Board in fulfilling its functions before the release of monies. We are pleased to see the commitment by BHA to the publication of clearly defined objectives, reasonable expectations of outcomes in key areas and regular updates through the year on progress.   

“Although Racing sees this as a two-year trial, we have given a funding commitment for 2024 with a formal review point in autumn next year before we confirm funding for 2025. We have been consistently assured by Racing that the initiatives being trialled are all capable of being unwound if deemed to be unsuccessful. This has been a key factor for the Board in its decisions.

“The evaluation of the changes will be very important but although we have been very keen to see the publication of targets and estimates, it will not be as simple as coming to a view about success or failure based solely on these numerical targets. There should be, and I believe will be, a wide-ranging series of measures through the year. As with any trial, some elements will work better than others and we will play an appropriate part in the evaluation process.”

Notes

1. The Board agreed the 2024 contribution following consideration of a joint proposal submitted by Racing organisations (BHA, Thoroughbred Group and RCA) and then taking into account 2022/23 Levy yield and the latest data for the 2023/24 year.
2. In 2023, HBLB expects to contribute around £67.3m to prize money, comprising £56.8m Ratecard Plus, £4.0m Incremental Prize Money, £3.5m Great British Bonus, £0.9m Sunday Appearance Scheme, £0.8m Divided Race Fund and £1.3m Winter Jump Fund.   
3. In 2024, HBLB expects to contribute around £70.5m to prize money, comprising £59.0m Ratecard Plus, including £0.1m towards the Sunday Floodlit Racing Pilot fixtures, £3.9m Incremental Prize Money, £3.5m Great British Bonus, £1.0m Divided Race Fund, £0.9m Sunday Appearance Scheme, £1.3m Winter Jump Fund and £1.0m towards prize money at fixtures moved to new slots.
4. The main component of the prize money budget is the Ratecard Plus system (£59.0m), the same system introduced in full from 2022. Under this system, the sum that a racecourse receives from HBLB for each race is linked directly to the racecourse’s own contribution to that race.  Every race class and type has its own calculation formula, which has been developed by the BHA in consultation with its stakeholders. HBLB pays a proportion of the Minimum Value and then a percentage of prize money contributed by the racecourse above that sum, up to a specified level.
5. The rate card allocation to prize money is intended to split HBLB funding c. 60% to Flat racing and c. 40% to Jumping in accordance with the turnover generated by each code in recent years. This split will be reviewed prior to 2025 to take account of recent outturns and other relevant factors.
6. The Incremental Prize Money scheme has been scaled back slightly to £3.9m (2023: £4.0m) in the expectation of slightly fewer qualifying races in 2024; however this still represents a significant provision of support to lower-class races and will be administered via a per-race payment mechanism in addition to the rate card payments. The Sunday Appearance Scheme (£0.9m) has been held at its 2023 level. In total, these areas of spend comprise £4.8m (2023: £4.9m).
7. The Great British Bonus Scheme will continue to receive £3.5m as in 2023, while the Divided Race Fund will be budgeted at £1.0m (2023: £0.8m) in the expectation of an increase in divisions in 2024.
8. As per 2023, a sum of £1.3m (the Winter Jump Fund) has also been allocated for additional prize money for certain January to March Jump fixtures. For ease of comparison with earlier years, the Winter Jump Fund sum is included in the initially budgeted £67.3m for 2023 and the £70.5m for 2024 referred to above.
9. There is a further prize money scheme of £1.0m introduced in a fixed-payment form for 2024 on a one-year only basis to support around 40 fixtures which will be moving their start time in 2024, with a review during the year of the appropriate support mechanism for 2025.
10. Raceday Services Grants towards regulation and integrity costs will continue to be provided to all HBLB Criteria fixtures, with the budget to be confirmed in due course.

For further information please contact HBLB Chief Executive Alan Delmonte on 07931 701536