NZTR Announce "Significant" Stakes Increase

[Special Agent]

19 minutes ago, Chief Stipe said:

I can't see the value of this race at all.

Me neither.

[Tesio]

Wow….i cant’t believe how negative some of the responses are on here. Chief - what is wrong with having a target race for the smaller stable trainers? How is it different to “non metro trainers” races in Aus. To claim it’s not inspirational and “Let’s Reward Mediocrity” is a total disrespect to trainers like Lance O’Sullivan, Allan Sharrock , Pitman, Rogerson, Cody Cole,  etc who are not in the top ten. It gives a target opportunity to smaller stables who don’t  have big numbers and powerful owners. I personally think its fantastic for the smaller stables and owners.

[Chief Stipe]

29 minutes ago, Tesio said:

Wow….i cant’t believe how negative some of the responses are on here. Chief - what is wrong with having a target race for the smaller stable trainers?

Didn't you look at the list?  Hardly "smaller stable trainers".  The cut off is $450k at year end.  Which may not be entirely comparable to the 4 months being measures but I'd say close.

As for being negative I'd be a lot more positive if they directed stakes money at the lower grades first.

[Chief Stipe]

31 minutes ago, Tesio said:

To claim it’s not inspirational and “Let’s Reward Mediocrity” is a total disrespect to trainers like Lance O’Sullivan, Allan Sharrock , Pitman, Rogerson, Cody Cole

Two of those trainers are not in the top 10 because their OZ stakes are not recorded.

[Tesio]

5 minutes ago, Chief Stipe said:

Two of those trainers are not in the top 10 because their OZ stakes are not recorded.

do i need to reel off another 10-20 quality trainers that are not in the top 10 that have small stables and work their buts off everyday for their owners. Your comments were disrespectful.

[Chief Stipe]

1 hour ago, Tesio said:

do i need to reel off another 10-20 quality trainers that are not in the top 10 that have small stables and work their buts off everyday for their owners. Your comments were disrespectful.

I don't believe I was being disrepectful.  I can't see how this "Innovative Race"  with special conditions for both Trainers and Horses with $350,000 is going to help anyone let alone provide a betting product that will cover the costs of it.  As there are special conditions and the race entry is not on the merits of trainers and horses then it can only but promote mediocrity.

As I said and I will repeat for your benefit @Tesio wouldn't your battling trainer "working their butts off" prefer 100 more maiden races that paid $3k more in stakes?  Hell they might then even get close to paying their costs for the season and owners might consider hanging in a bit longer if their training costs are covered.

As if there wasn't enough proof/evidence from previous folly's that these special races and increased stakes at the high end do nothing for the industry.  The rich get richer and we see less and less horses in training let alone being bred.  Isn't about time we did something different?  Perhaps try the opposite instead of the same old same old?

[Special Agent]

Here's a task for you Tesio.  Get up the list of the rated horses in training for each trainer.  You might be surprised how many horses each and every trainer has, as a percentage of their overall number in training, that are R65 or below.

[Special Agent]

Money spent on those lower grades would assist everyone and may even push a few up the grades to improve the overall quality.

[Tesio]

19 minutes ago, Chief Stipe said:

As there are special conditions and the race entry is not on the merits of trainers and horses then it can only but promote mediocrity.

I guess your fav stables race…karaka 2yr old race …you put in the same boat then?

[Tesio]

21 minutes ago, Chief Stipe said:

100 more maiden races that paid $3k more in stakes? 

But you don't want to reward mediocery?

[Chief Stipe]

2 minutes ago, Tesio said:

…karaka 2yr old race …you put in the same boat then?

Yes it is a sweepstake race and should be funded 100% by the breeders, vendors and buyers i.e. not subsidised by the industry pot.

Now they are making that worse by not only taking $1m out of the pot for the 2yr old and 3yr old races but adding another $1m of industry money to create a race for 4yr olds.  

[Chief Stipe]

8 minutes ago, Tesio said:

But you don't want to reward mediocery?

Are you saying all maiden winners are mediocre?  Every horse that races is at first a maiden.

The problem is we have declining participation and are losing more and more of the crop overseas.  Wouldn't it be great to retain some more?  These special condition races that favour the selected few are not going to do that.

Haven't you noticed that we struggle to have a true Open Rated race anywhere.

[Special Agent]

Very few owners get to race in a group race so to put more money into group racing is not aiding the wider industry.  Entain's idea is to put an extra $2,000, for argument's sake, into the winning stake of maidens.  To me that is not rewarding mediocracy as indicated by Tesio.  It is rewarding the winner, not the also rans.

Historical evidence shows how when just a few big races are pumped up the foundation crumbles.  If we can keep our horses from being sold at least long enough for them to pick up 10 or so more ratings points the pool of horses will be much more solid so, a more competitive environment and a better betting product.  Everyone wins from the breeder, owner through the trainer, staff and jockey, to the punter and even sponsor.

I don't see what people aren't getting.

[Chief Stipe]

5 minutes ago, Special Agent said:

Very few owners get to race in a group race so to put more money into group racing is not aiding the wider industry.  Entain's idea is to put an extra $2,000, for argument's sake, into the winning stake of maidens.  To me that is not rewarding mediocracy as indicated by Tesio.  It is rewarding the winner, not the also rans.

Historical evidence shows how when just a few big races are pumped up the foundation crumbles.  If we can keep our horses from being sold at least long enough for them to pick up 10 or so more ratings points the pool of horses will be much more solid so, a more competitive environment and a better betting product.  Everyone wins from the breeder, owner through the trainer, staff and jockey, to the punter and even sponsor.

I don't see what people aren't getting.

They haven't "got it" for the last 30 years.  I'd admit I didn't "get it" for the first 10 of those.  I didn't "get it" until I got a horse that cost me practically nothing to breed (we won the service in a raffle and bought the mare off the knackers truck) - wins five races only once out of the stakes in two seasons and still behind on the balance sheet.  Should have taken the $200k Hong Kong money damn it after its first win. 

[Huey]

6 hours ago, Special Agent said:

Very few owners get to race in a group race so to put more money into group racing is not aiding the wider industry.  Entain's idea is to put an extra $2,000, for argument's sake, into the winning stake of maidens.  To me that is not rewarding mediocracy as indicated by Tesio.  It is rewarding the winner, not the also rans.

Historical evidence shows how when just a few big races are pumped up the foundation crumbles.  If we can keep our horses from being sold at least long enough for them to pick up 10 or so more ratings points the pool of horses will be much more solid so, a more competitive environment and a better betting product.  Everyone wins from the breeder, owner through the trainer, staff and jockey, to the punter and even sponsor.

I don't see what people aren't getting.

Have to agree with CS, they have no idea and they only care about the top end and the sales. Thats why I don't think in the medium term this is that positive an outcome for NZ racing.

[Huey]

6 hours ago, Tesio said:

But you don't want to reward mediocery?

$3k for industry type races and thats rewarding mediocrity...wow just wow!

[Chief Stipe]

How NZTR has failed the racing industry

 

by Brian de Lore

 Published 14 June 2023

 

 

The worst case of administrative incompetence in the history of New Zealand racing. That’s my view on the performance of the New Zealand Thoroughbred Racing Board (NZTR) over the past three years.

 

The board has failed big time to serve the best interests of thoroughbred racing, and if they had any semblance of self-judgement and conscience they would all resign and refund their directors’ fees.

 

In simple terms, they have failed to use advantageous legislation written into the Racing Act of 2020.

 

The board’s failure to understand the Messara Review, relate it to the legislation, and lead all three codes through the process of a commercial agreement to devolve the decision-making for self-determination, displays a blatant lack of leadership, attention to the legislation, and doubt they even read it.

 

No excuse for failing to act

 

The NZTR board has performed poorly through its lack of action; there’s no other way to look at it.

 

Five years ago when John Messara wrote his ‘Review of New Zealand Racing,’ he recommended a change in the structure of racing with a separation of wagering and racing functions and a devolvement of decision-making power to the codes.

 

In Part 1 – Structure, Finances & Legislation on page 13, it states: “…it appears obvious that the industry is in need of an overhaul. The racing and wagering functions of the NZRB (TAB NZ) should again be separated with all racing regulatory functions devolving to the three Codes and NZRB being renamed and solely responsible for wagering on racing and sports…”

 

The then Minister of Racing Winston Peters at least took notice of that part of the Review and had the DIA write into the Racing Act of 2020 a provision for the codes to convene and put together a commercial agreement (or more than one) to govern themselves and stop the tail wagging the dog.

 

The relevant Racing Act of 2020 Clauses 15 and 58 appear at the bottom of this blog.

 

Codes failed to seize the opportunity

 

In summary, it opened the door for the codes to empower themselves for regulatory decision-making and leave the TAB with the simpler role of collecting the TAB profits from betting, gaming, racefields (Betting Information User Charges), Point of Consumption tax, excise duty rebate, etc, to fund the racing industry and sport from sports betting.

 

A commercial agreement would surely have insisted on involvement in forthcoming negotiations for partnering or outsourcing TAB NZ, but they failed to seize the opportunity.

 

Did they not even read the Messara Review and therefore failed to relate it to the legislation, or did they not read either, or are they just dumb? – take your pick.

 

Or did NZTR’s focus get distracted because of a COVID relocation to Australia which didn’t deter drawing down the directors’ fees? Whatever the reason, it’s an appalling lack of judgement and opportunity that calls for the resignation of the entire board, particularly Chairman Cameron George, as well as CEO Bruce Sharrock.

 

No accountability

 

Where is the accountability for such a damaging oversight?

 

Of the 17 recommendations Messara made in his review, he even allowed for the establishment of Racing NZ as a forum to adjudicate on matters of commercial agreements with the TAB.

 

Racing NZ came into existence through the legislation but NZTR has never used it for the purpose intended.  

 

Recommendation 2 stated: “Establish Racing NZ as a consultative forum for the three Codes to agree on issues such as entering into commercial agreements with TAB NZ…”

 

Recommendation 1 said, “Change the governance structure with racing responsibilities devolving to the individual codes. This will sharpen the commercial focus of TAB and improve the decision-making and accountability of the codes.”

 

It didn’t happen.

 

Legislation should have put NZTR into driving seat

 

The legislation allowed for it, but no, NZTR sat on its hands and failed to move in the best interests of the stakeholders. It failed to carry out a straightforward legislative instruction that should have placed it in the driving seat.

 

The Members’ Council has two tasks: appointing the board and reviewing its performance. It does a poor job in the first instance and apparently sits on its hands for the second.

 

NZTR’s failure to act meant the codes had no say in the TAB NZ-Entain partnership deal which is appalling when you consider the TAB has signed the industry up for 25 years and the man who did the deal, Mike Tod, has resigned and scarpered with his massive bonus after only 14 months in the job.

 

NZTR also had no say in TAB NZ retaining $40 million of the upfront $150 million, which is in addition to the $90 million of retained cash and equity at the end of last season. A commercial agreement could have prevented this from happening and rightfully sent it down to benefit the codes.

 

We still don’t know enough about the fine print of the Entain deal to know how good it is, and not enough about Entain to feel at ease with a 25-year marriage when 10 years with a right of renewal might have provided more comfort.

 

Stakes announcement increase of 30% to 35% expected

 

On Thursday this week at Karaka, NZTR will announce stakes levels for the 2023-24 season, but it will not be the game-changing doubling of stakes the Messara Review envisaged five years ago. Too many blackbirds have pecked the pie before the codes arrived.

 

Based on the figures released by the dealmakers so far, my prediction is the NZTR stakes will go up by $20 million, from $61 million to $81 million, a rise of around 33 percent with the minimum stake rising from $14,000 to perhaps $17,500. I’m guessing.

 

Any rise is better than nothing considering the massive inflationary period racing has endured since COVID arrived, but when you have a $900 million deal with another $100 million contingent on geo-blocking, and it’s a one-off 25-year deal, and you need to shock this industry back into life, a 30 to 35 percent increase won’t be enough in June 2023 to cause recent industry defectors to rejoin.

 

The decline of our industry on a graph needs the line to bottom out and begin to rise again, but this deal falls short of that happening in either this or next season.

 

Slashing the TAB operating expenses

 

A glimmer of hope comes in the knowledge that Entain will take the slasher to TAB operating expenses. This season they will reach a record-high figure in the vicinity of $130 million. However, we know the wage bill will continue for two more years.

 

And without the Entain deal, the betting downturn this season would almost certainly have resulted in a reduction in stakes for 2023-24.

 

TAB NZ is anything but transparent. Management stopped producing the Monthly Trading Updates after February because I pounced on them each month and reported how poorly they had traded for the first six months of the season – down $9.4 million at the halfway mark on last season and heading for a non-sustainable industry result by July’s end.

 

TAB NZ has since changed its website and removed all previous Monthly Trading Updates. They did not hold an AGM after the late production of the Annual Report (January), and no half-year report has surfaced, and probably won’t, for the current season.

 

Opaque is more appropriate than transparent, and could anyone be confident it will improve with Entain steering the ship? We are sailing into the unknown but the alternative painted a very bleak picture.

 

Excerpt from the Racing Act of 2020:

 

15 Functions of racing codes

 

(1) The functions of each racing code are—

 

(h) to enter into commercial agreements with TAB NZ:

 

(i) to collaborate with the other racing codes to achieve the objectives of the racing industry as a whole:

 

(j) to carry out any other functions that are necessary or desirable to assist the code in achieving its objectives.

 

(2) Each racing code has and may exercise all the powers that may be reasonably necessary for carrying out its functions.

 

58 Functions of TAB NZ

 

(f) to enter into commercial agreements with each or all of the racing codes or Racing New Zealand (acting on behalf of the racing codes):

 

[Special Agent]

I don't know how many other ways it can be said but, there are still disbelievers.

[Chief Stipe]

9 hours ago, Special Agent said:

I don't know how many other ways it can be said but, there are still disbelievers.

Then there is the group that has says "oh well lets be positive and hope for the best"!  I've given up counting how often that strategy hasn't worked.

[Huey]

22 hours ago, Chief Stipe said:

Then there is the group that has says "oh well lets be positive and hope for the best"!  I've given up counting how often that strategy hasn't worked.

Is that the same crowd who want to raise the minimum bet in this country?

[Chief Stipe]

14 minutes ago, Huey said:

Is that the same crowd who want to raise the minimum bet in this country?

Yep the same Fairy Flash group that obviously has no idea about yield management or sunk costs.  The operator gets paid for being behind the window oncourse regardless of how many bets they take or the amount of each bet.