Martin Cullen (Waterford, Fianna Fail)

I move:

That Dáil Éireann approves the following order in draft:

Horse and Greyhound Racing Fund Regulations 2009,

a copy of which order was laid before Dáil Éireann on 6 April 2009.

Under section 12 of the Horse and Greyhound Racing Act 2001, the horse and greyhound racing industries receive financial support through the horse and greyhound racing fund. Under the provisions of the Act, the fund has received a guaranteed level of funding each year from 2001 to 2008. In 2004, the Government put in place regulations to increase the limit of the horse and greyhound racing fund from €254 million to €550 million and to continue the fund for a further four years to 2008. By the end of 2008, a total of €545.8 million had been paid out of the fund.

Funding of both the relevant agencies, Horse Racing Ireland and Bord na gCon, supports two productive industries and helps sustain the role of the horse and greyhound breeding and training enterprises in the development of the rural economy. These industries together account for an estimated 27,500 direct jobs, generate substantial economic activity and make a vital contribution to the rural economy, including farm incomes.

The funding being provided to the greyhound racing sector helps sustain a tradition that has existed for hundreds of years. That funding underpins economic activity in regions of the country that are often less affluent. It has also contributed significantly to the sum of almost €90 million that has been invested in the improved facilities now available at greyhound tracks around Ireland. The fund has allowed Ireland to develop into a world centre of excellence for horse and greyhound racing and has allowed Horse Racing Ireland, HRI, to undertake a capital investment programme that has underpinned growth in the sector.

Prior to budget 2009, a review of the fund was under way. As the review had not yet been completed, provision had to be made for the extension of the fund and its subsequent continuation into 2009. The total allocation for the fund for 2009, both current and capital, as provided for in the Horse and Greyhound Racing Act 2001, would have been calculated on the basis of the excise duty on off-course betting in 2000, which was €58.89 million, multiplied by the relevant CPI figures. Taking a figure of 4.5% as an estimate of the annual average CPI for 2008, the 2009 fund allocation would have been €79.72 million. Of this, HRI would have expected to receive €63.78 million and Bord na gCon would have expected to receive €15.94 million. However, in view of the current economic climate, it was decided and announced in budget 2009 on 14 October last that the provision for 2009 would be €55.7 million for HRI and €13.9 million for Bord na gCon, a total of €69.719 million. This represents a reduction of almost 9% on 2008 funding and a reduction of almost 13% on anticipated funding. A further reduction of €91,000 was made in the context of departmental savings in February 2009, bringing the allocation to €69.628 million.

Given concerns about the funding gap between the income generated through duty on off-course betting and the amount of funding stipulated in the Act, it was decided to make changes to the off-course betting tax. In the Finance (No. 2) Act 2008, the tax was increased from 1% to 2% with effect from May 2009. Given recent trends and projections for betting tax receipts in 2008, this will serve to reduce significantly the amount of direct Exchequer subvention required.

The review of the fund is nearing completion and will be submitted to the Government in due course in the context of decision process on the future funding of these industries. In the meantime, so that HRI and Bord na gCon can draw down their allocations in the 2009 Estimates, provision must be made for the extension of the fund and its subsequent continuation during 2009. As I have already stated, an amount of €69.628 million was provided for the fund for 2009 in the Vote of the Minister for Arts, Sport and Tourism. The remaining balance in the fund at the start of 2009 was €4.2 million. Of that, €3.4 million was paid out to HRI and €0.8 million to BNG in February. In order to pay out the balance of €65,407,713 in 2009, the aggregate limit of the fund must be increased by that amount. On 3 March last, the Government agreed to increase the aggregate limit on the horse and greyhound racing fund by €65,407,713, pursuant to the provisions of section 12(5) of the Horse and Greyhound Racing Act 2001. On that basis, the draft regulation considered by the Joint Committee on Arts, Sport, Tourism, Community, Rural and Gaeltacht Affairs provides for an increase of €65,407,713 in the aggregate limit to give an aggregate figure of €615,407,713, which is the cumulative provision for the fund since 2001.

Deputies will be aware of the difficult budgetary situation facing the country. Over the past month, the Government has examined every line of public expenditure by Departments. In finalising the Estimates for my Department for 2009 in preparation for this week's budget, I was obliged to identify additional spending reductions in my Department's Vote. On this basis the Government decided that the horse and greyhound racing fund should be further reduced by €1.5 million. Therefore, the aggregate limit of the fund will be increased by €63,907,713 to €613,907,713, the cumulative provision in the fund since 2001. The level of funding available to these important industries will be €68.128 million, comprising the balance remaining in the fund of €4,220,287 plus €63,907,713 million.

The joint committee considered the proposed regulations yesterday and, following an extensive debate and another debate last week, approved the regulations. Committee members, while supporting the funding the horse and greyhound sectors have received in recent years and realising the importance of its continuation through the horse and greyhound racing fund, raised a number of issues with regard to the level of the fund in the current financial climate and the manner in which it is being spent. In the finalisation of the review of the fund, the issues raised will be fully examined so that when this subject is next considered by the joint committee and the House some of the concerns of members can be addressed.

Section 12(13) of the Horse and Greyhound Racing Act 2001 provides that a draft of these regulations be laid before both Houses of the Oireachtas and a resolution approving the draft be passed by each House before the regulations are made by the Minister. As I mentioned earlier, I will be making a submission to Government regarding the future funding of the industries in due course, but in the meantime I ask Members for their support to ensure that HRI and Bord na gCon can receive their funding provision for 2009 and that the very important role of the industries and, more importantly, the employment supported and economic activity generated is sustained.

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