Mr. Neville O'Byrne:

Deputy Heydon asked for an explanation of how there would be a conflict between our rules and HRI directives. That relates to head 5. As I said, the way the head is drafted could lead, effectively, to HRI being allowed to make directives which could conflict with our rules. This is largely a drafting point. If this is not intended, and I cannot understand how it would be intended, it is very easily cured by simply inserting a clarification that HRI directives cannot override our rules.

Under the current legislation, the HRI is subject to our rules. There is a convoluted history of directives, which I will not go into, that ironed out the conflict between HRI and ourselves when, in 2001, HRI took over a large number of our functions. A composite agreement was entered into in 2006. We want clarification that there will be no conflict and that, as the head says, we are solely and independently responsible for the making and enforcement of rules in Irish racing. That is all we are answering for.

One of the points raised included how our financial independence can be affected. The drafting is very simple. These heads say that all licensing income is to be paid to HRI and will be returned to us. Anyone who sells a product would not be happy with a third party collecting the money and then having to get it back from the third party. It goes further in that our licensing income, which includes all of the point-to-point money, will be taken into account in calculating the size of the integrity budget we get. There is no explanation or guidance on what this means and, theoretically, it could mean all of the licensing income could be taken into account, leaving no surplus and no money for anything else. If we want to do something outside the budget for the good of racing, we may have no money to do it. We are asking that someone has a look at this and clarify the point. It would leave us without any financial independence and no regulator could operate on that basis. If that is not intended in the drafting, it is easily cured but the wording in the current head is very clear.

The Deputy's final point was about the arbitration clause. We suggested this as an improvement on the existing arbitration clause. The Deputy asked whether it was ever used and I am not aware that the current arbitration clause was ever used but it is a cumbersome clause and requires us to go to a arbitration under the Arbitration Acts, which can be a drawn-out process and involves all sorts of people, including all sorts of expensive lawyers and senior counsel. We suggested an expert be appointed to resolve any disputes with HRI, including disputes about the budget. Naturally, when somebody is supplying an organisation with a big amount of money, there are always questions about what they are doing with the money and what they are spending the money on. We have no problem with that, except to be clear that there is a simple and inexpensive way of resolving disagreements that arise. That is a sensible solution and would help the smooth operation of the relationship we have with HRI. We have an ongoing relationship with HRI and the Government supplies a big chunk of our integrity budget through HRI. We want to make it work as smoothly as possible at all times.