The Government has approved a new partnership between TAB New Zealand and UK betting company Entain which it says will deliver at least $900 million in guaranteed funding for the racing industry over the next five years.
Minister for Racing Kieran McAnulty announced the approval of a 25-year partnership between the two parties this afternoon after TAB selected Entain as their preferred partner for an outsourcing deal in March.
McAnulty said the deal is is one of the most significant days in New Zealand racing history.
"This deal will reverse falling revenues for racing and provides certainty over the coming years,” McAnulty said.
“I’m confident this agreement will help secure a solid future for the racing industry and sports in New Zealand through increased financial distributions to national sports organisations.
“TAB NZ has been facing increasing financial challenges over recent years and was facing an uncertain future, largely due to competition from offshore gambling websites."
McAnulty said the agreement will provide an upfront payment of $150 million and in addition there will be a 50% revenue share with guaranteed payments of at least $150 million per year for the first five years.
“Our racing industry is worth $1.6 billion to the economy and directly employs 14,000 New Zealanders. It’s reliant on TAB NZ distributions, and if they were allowed to fall that would hit the industry hard and jobs and revenue lost."
The Government is also extending TAB's monopoly on New Zealand's sports and racing betting to the online environment, although McAnulty said there was "further work being done" in that area.
“The TAB was set up as a monopoly to fund New Zealand racing and sports. But the onset of unregulated online gambling changed the game and our racing and sports industry has been losing money ever since," he said.
“Regulating this environment offers a significant new revenue source for local racing and sport, while also addressing the inherent risks in unregulated online gambling.
“By prohibiting online gambling outside of the TAB the Government can place greater controls over the betting environment. We would expect to also see much more money allocated to harm minimisation, a fairer deal for Kiwi punters and sports codes and a greater focus on animal welfare."
With that in mind, McAnulty added funding will be used to reduce the harm gambling can cause in New Zealand with TAB pledging a $5 million allocation for harm minimisation measures.
“Entain has better harm minimisation technologies, such as facial recognition tools that can be rolled out in TAB venues.
“The partnership between TAB NZ and Entain does not prevent the Government from putting in place further harm minimisation regulation, and I have been clear with TAB NZ that I intend to do so."
McAnulty also used the announcement to address today's public release of the Racing Integrity Board's report into the future of greyhound racing in New Zealand, saying it was delayed due to the recent extreme weather New Zealand has faced.
“It is clear to me that the status quo is no longer viable and we are faced with two options: continue under strict conditions or closure. I will continue to progress this issue over the coming months, but unfortunately the delay has meant I’ve likely run out time to bring a decision before Cabinet before the election," he said.
“While I appreciate the frustration with the delay, I have instructed the Racing Integrity Board to continue working closely with Greyhound Racing New Zealand throughout the interim period to ensure animal welfare is prioritised and improvements made."
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