UK Horse Racing In Big Danger As Parliament Discusses Affordability Checks

Former UK chancellor of the exchequer, Nadhim Zahawi, has called on the government to reconsider the implementation of affordability checks, highlighting the damage they are causing to the hors racing industry.

Affordability checks have been gradually rolled out under the direction of the Gambling Commission. However, the imposition of these checks has led to a sharp decline in betting turnover on horseracing, with a staggering £900 million fall reported in 2022-23. This decline not only affects the horseracing industry but also drives betting activity towards the black market.

Zahawi, who represents Stratford racecourse in his constituency, expresses genuine worry over the potential permanent harm caused by the current situation. Affordability checks, according to Zahawi, are both blunt and damaging. Bookmakers have reported a significant decline of ten to twenty percent in racing betting revenues. Moreover, this decline in betting activity is not simply disappearing but is instead being driven underground or overseas.

Zahawi argues that affordability checks are not the most effective or proportionate way to tackle gambling harm. These checks harm not only problem gamblers but also those who enjoy a casual bet and support the racing industry. Instead, Zahawi suggests that there are better ways to identify the three percent of people who are truly in need of help. He believes that a more targeted approach based on academic research and the identification of specific markers of harm would be more effective.

The concept of “frictionless” affordability checks, promised by the government and Gambling Commission, is also questioned by Zahawi. He emphasizes that these checks are not truly frictionless and can have unintended consequences, such as affecting mortgage applications due to the credit fingerprints left behind.

The decline in betting turnover on horseracing is a cause for concern for the industry as a whole. Zahawi, who played a pivotal role in securing levy reform in 2017, expresses frustration at the lack of progress in delivering the second stage of reform to extend the levy to betting on overseas racing. The industry is witnessing a loss of business to countries like Ireland and France, eroding the relative advantage that the UK has in horseracing due to its rich history.

However, Zahawi warns against assuming that levy reform alone can resolve the problems caused by affordability checks. He calls on the Minister at the Department for Digital, Culture, Media and Sport (DCMS) to seriously consider alternative solutions and not rely solely on increasing the levy. Zahawi emphasizes the need for a comprehensive examination of the issue and a focus on finding effective and sustainable solutions.

The public outcry against affordability checks has prompted a debate in Westminster Hall, with over 100,000 individuals signing a petition calling for the checks to be scrapped. Zahawi, although unable to attend the debate, pledges his support for his parliamentary colleagues in calling for a change of policy. The debate provides an opportunity for MPs to highlight the impact of affordability checks on the sport and its participants.