John O'Donoghue (Kerry South, Fianna Fail)

I move:

That Dáil Éireann approves the following Order in draft:

Horse and Greyhound Racing Fund Regulations 2004,

a copy of which order in draft was laid before Dáil Éireann on 22 September, 2004.

The Government is committed to the ongoing development of the Irish racehorse and greyhound industries. In 2001, following the establishment of the horse and greyhound racing fund under the Horse and Greyhound Racing Act 2001, a major period of development of both the horse and greyhound racing industries commenced. In the four years to date, this fund has provided a guaranteed level of funding to Horse Racing Ireland and Bord na gCon, which by the end of 2004 will amount to €206.4 million and €51.6 million, respectively. This money has been well invested leading to undeniable benefits for both sectors and has marked a revival of interest in both sports, to the benefit of the economy. It has not only helped towards providing some top class racing venues and facilities, but it has underpinned significant employment in both industries and the prize money it has facilitated has been an important boost for both horse and greyhound breeding.

The reason for bringing these important draft regulations before the House is to enable the horse and greyhound racing fund to be continued to allow Horse Racing Ireland and Bord na gCon to progress their important development plans, which have already yielded tangible results but which require a further period of investment to reach completion.

When I presented these regulations to the Joint Committee on Arts, Sport, Tourism, Community, Rural and Gaeltacht Affairs on 6 October last, I was heartened by the cross-party support the motion received. In particular, spokesmen from Fine Gael and Labour gave the motion their complete backing and were fully supportive of the funding that both the horse and greyhound sectors have received in recent years and the importance of its continuation through the horse and greyhound racing fund.

Under the provisions of the Horse and Greyhound Racing Act 2001, the horse and greyhound racing fund is guaranteed a level of income based on accrued excise duty on off-course betting, subject to a minimum level based on the 2000 level adjusted for inflation. Any shortfall in the amount generated by the excise duty is made up by direct Exchequer subvention.

Under the existing legislative provision an aggregate total for the fund is set at €254 million, £200 million. This limit will now be reached before the end of 2004. Therefore, unless action is taken, the fund will lapse and support to these industries will cease, leaving both the horse and greyhound industries facing severe financial difficulties. In these circumstances, both industries would be forced immediately into reducing significantly their current levels of activity and I am convinced their long-term viability would be precarious.

The development strategies of both Horse Racing Ireland and Bord na gCon are predicated on the continuation of the fund and neither are in a position to generate enough income to replace the fund in the short term. In the discussions with the racing bodies leading up to the establishment of the fund in 2001, security of funding over time was a central issue, and the 2001 legislation sought to address this matter. Failure to ensure the continuation of this fund while neither industry has yet completed its development plans would be a breach of faith.

Since 2001, income from this fund has been used to increase prize money levels and meet administration and integrity costs, in addition to a programme of capital investment which has underpinned a growth in both sectors. The growth of both these industries has also helped generate and support significant employment and income, particularly in rural Ireland in a period when direct farm employment has been in decline. It is estimated that the bloodstock sector provides 4,700 direct full-time job equivalents with a further 11,875 full-time job equivalents arising in the racing and betting industries. The total number of people earning an income from horse racing, betting and breeding, both full and part-time, including those employed in related industries, has been estimated at 25,000 or approximately 1.5% of the country's workforce. Horse racing is also a significant element of Ireland's tourism product, attracting an estimated 50,000 overseas visitors a year.

Racecourses at Limerick, Cork, Fairyhouse, Listowel and Galway have all seen major refurbishment. There are plans for major developments of horse racing's flagship tracks at Leopardstown and the Curragh with the purchase of strategic land attached to Leopardstown racecourse. There are also plans to develop Ireland's first all-weather racetrack.

The recently published Indecon report validates the economic contribution made by the bloodstock and horse racing industry in Ireland. In 2003, the total attendance at about 280 horse racing meetings rose to more than 1.3 million people, generating more than €23 million in gate receipts. Off-course betting in 2003 totalled €1.9 billion and total on-course betting was €237 million. The gross output of the breeding sector is estimated to be worth €330 million per annum. Bloodstock production now accounts for approximately 10% of all livestock production in Ireland and 4.4% of total agricultural output. Ireland is now the third largest producer of thoroughbreds in the world and accounts for more than 42% of all foals born within the EU. These statistics serve to underline the international importance of the Irish bloodstock and horse racing industries. While it is estimated that the gross cost of the tax incentives for the thoroughbred breeding sector is around €3 million per annum, conservative estimates put the combined tax contribution of the stallion and broodmare sector to the Irish economy at €37.5 million.

The success of Bord na gCon in repositioning greyhound racing as an attractive night time recreational experience can be attributed to a significant extent to the standard of the facilities available at new or refurbished greyhound stadia in Dundalk, Galway, Lifford, Cork, Newbridge and Waterford. In 2003, attendance figures once again achieved double-digit growth, with more than 1.125 million people attending greyhound racing in Ireland, generating on-course betting turnover of €118 million. This is an increase in attendance of 25% since the turn of the millennium and this growth is expected to continue with future plans to build a new stadium at Limerick and complete stadium refurbishment works at Clonmel, Enniscorthy, Kilkenny and Thurles. The industry currently provides employment of 600 direct full-time jobs and 10,000 indirect and part-time jobs, and an estimated 10,000 bed-nights in Irish hotels and guesthouses are directly generated by greyhound racing activity.

Given their successful track record, both horse and greyhound racing deserve a continued period of support to enable them to reach their full potential. The fund has reached its limit under the existing provisions. However, there is a provision in the Horse and Greyhound Racing Act 2001 to allow an increase of the aggregate total of the fund. This may be done by regulations made by the Minister for Art, Sport and Tourism with the consent of the Minister for Finance, together with a resolution approving such draft regulations passed by both Houses of the Oireachtas. The draft regulations now before the House, which have the consent and support of the Minister for Finance, provide for an increase in the aggregate limit of the fund from €254 million to €550 million. This would allow for continuation of the fund for a further four-year period to 2008. During the next three years, a shortfall in the excise-generated funds will require a decreasing level of subvention up to the end of 2007, at which point predicted rises in the volume of off-course betting will see the fund revert to being fully financed from betting.

I ask Members of the House to join me in supporting this motion to ensure the continuation of this system of funding, which gives both the horse and greyhound racing sectors a secure financial framework for the next four years to enable them to bring to conclusion their major development initiatives. It is vital that these sectors continue to receive support in terms of their impact on the 35,000 people employed, both directly and indirectly, and the significant levels of tourism generated. However, just as important are the dozens of high quality racing facilities all over Ireland providing hundreds of thousands of ordinary people with an enjoyable day out at the races and a fun night at the dogs.

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