Racing Minister Damien O'Connor has welcomed two key government announcements of direct benefit to the racing industry.

Prime Minister Helen Clark and Education Minister Trevor Mallard today announced $5million to create a research-based partnership with the equine industry.

Also announced was a significant increase in government tuition subsidies for years 3,4 and 5 of undergraduate veterinary science.

"Both initiatives are great news for the New Zealand racing," Mr O'Connor said. "The partnership – with Bomac Laboratories, Matamata Veterinary Services and others in the equine industry – will boost research and development and increase our ability to raise and train winners.

"The New Zealand thoroughbred industry retires almost one third of its horses every year through lack of performance, which in turn is often due to injury, illness or death. The result is significant economic loss.

"In order to attract participants to the industry and people to race days, the racing industry has to be at the forefront of equine research and we have to improve current wastage rates. Better research will mean better practice overall and greater economic gain through improved equine fertility, performance and management of disease.

Mr O'Connor said the increased Veterinary Science study subsidies would also assist the racing industry. "As an industry, we're very reliant on good veterinarians. The funding reflects the importance this government places on having qualified skilled practitioners."

The funding boost will mean the per EFTS (Equivalent Full Time Student) subsidy for years 3, 4 and 5 will increase next year by $5,684, bringing the total per EFTS funding to $24,582.