Emergency support for Racing’s recovery
Minister for Racing Winston Peters has announced a $72.5 million dollar COVID-19 emergency support package for the racing industry.
“We can’t gild the lily. The racing industry has been hit by the perfect storm of COVID-19 while in a weak financial state and in the midst of a reform programme,” Mr Peters said.
“As a result, there is a genuine risk of insolvency and the industry losing the future gains of its reforms.
“The Government has a respond, recover, and rebuild strategy for COVID-19. This announcement is the first step towards a long term restoration of racing,” Mr Peters said.
The support package consists of:
- $50 million dollar relief grant for the Racing Industry Transition Agency (RITA)
- Up to $20 million in funding to construct two new All Weather race tracks.
- $2.5 million dollars for the Department of Internal Affairs to fast track work on the online gambling revenue, and address loss of revenue impacts on community and sport groups.
“Of the immediate grant, $26 million will be used by RITA to pay its outstanding supplier bill which it hasn’t be able to do because of strangled revenue. The other share of this package will ensure RITA, and each of the racing codes, can maintain a baseline functionality and resume racing activities,” said Mr Peters.
“The racing industry is seriously underestimated for its economic contribution. For this reason the Government will also consider recapitalising the industry to help promote a quicker recovery and achieve a greater economic outcome.
“Past studies indicate Racing contributes $1.6 billion to the economy each year. There are 15-thousand full time racing industry jobs and nearly 60-thousand jobs which participate in the industry in some shape – from vets to equipment suppliers, and owners. New Zealand bloodstock is world class and a significant export earner.”
“Over the next three months officials will assess recapitalisation options. Ministers will need to be assured industry reforms are making progress to ensure any such future investment is well directed,” said Mr Peters.
The Government has also approved up to $20 million dollars from the Provincial Growth Fund (PGF) to construct two new synthetic race tracks. The intention is to have one located at Awapuni in the Manawatu, and the other at Riccarton Park in Christchurch. The construction of a track in Cambridge is already underway after receiving $6.5 million in PGF funding.
“Whilst the $20-million has been approved the next step is for RITA and the Codes to consult with the local race clubs on the terms behind these projects,” Mr Peters said.
“COVID-19 has also impacted on funding available to community and sport organisations which receive a share of gambling revenue. There has also been an increase in New Zealanders gambling offshore throughout online platforms.
“Both trends are concerning. For that reason the government is fast tracking a programme of work by the DIA to re-evaluate the gambling framework of our community, sporting, and racing groups,” Mr Peters said.