Mary Upton (Dublin South Central, Labour)

The Minister agreed to this debate following the discussions that took place at a meeting of the Joint Committee on Arts, Sport, Tourism, Community, Rural and Gaeltacht Affairs. There is no doubt that the provision of a horse and greyhound racing fund has facilitated the development of a world class industry that supports the rural economy.

I disagree with those who contend it is a sport for the elite. Throughout the State, many small industries are working hard to retain staff and keep their businesses going. That is particularly the case in the horse industry. Small rural towns located near stables will stand to benefit from the knock-on effects of developments in the industry. It is also important to recognise the value of the greyhound industry both from an economic point of view, in terms of the substantial number of jobs it provides, and also as a sporting activity. While the provision of funding is 80:20 in favour of horse racing, the greyhound industry is of importance to many.

The Minister may have noted that I have referred to the horse racing and greyhound racing "industries". As such, it would make sense that they come under the remit of the Department of Agriculture, Fisheries and Food or the Department of Enterprise, Trade and Employment rather than the Department of Arts, Sport and Tourism. While I recognise their value from a tourism and sporting perspective, our discussion of them always takes place in the context of industry. We have referred to this on previous occasions and the Minister has responded to a certain extent.

My concern in regard to funding relates to the Act which established the horse and greyhound racing fund in 2001. The decision to establish the fund was correct, being an attempt to tackle the economic free rider principle that had beset the industry for decades, whereby its most successful commercial product, gambling, did not contribute. Bookmakers should contribute to the sports that have helped them establish themselves both nationally and internationally. However, the major flaw in the legislation was that the level of funding was benchmarked to betting levy receipts for 2000 and subsequently benchmarked against the consumer price index. Where there was a shortfall in funding, this was to be subvented by direct Exchequer funding. This is at the heart of the problem. The reductions in the betting levy from 5% to 2% to 1% meant this shortfall did not take long to materialise. As a result, in 2007, the Exchequer contributed almost €40 million more than was collected in betting levies. This is where the anomaly lies.

The Labour Party is acutely aware of the need to retain jobs. Given that this is an indigenous industry, it is perhaps even more important that we examine it clinically when we consider the issues relating to the retention of jobs. However, we cannot continue to have a situation where the direct Exchequer funding is of such a high level. In his Budget Statement in October, the Minister indicated his intention to double the betting tax to 2%. This will not cover the entire shortfall but it will go some way toward that objective. When will this tax increase be implemented? It cannot be put on the back foot and we must know for certain that it will be introduced.

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