Riding to racing's rescue not easy for Priti Patel's brunch companions

The warmth of relations between racing’s most significant stakeholders – the tracks and the “horsemen” – has varied between frosty and glacial for as long as anyone can remember. The people who own, train and ride the horses tend to think that the tracks are awash with cash, and media rights money in particular, relatively little of which finds its way into prize funds. The racecourses, on the other hand, sense that some owners would cheerfully have the shirts off their backs if it meant another fifty quid in the pot for a mediocre midweek race.

Yet now it seems that all that was required to get people talking was for Priti Patel to call in at John Gosden’s yard for brunch. As the Guardian revealed on Tuesday, the home secretary’s visit to the champion trainer’s Clarehaven Stables a couple of weeks ago, accompanied by her family, happened to be on a day when several more of Newmarket’s leading lights were in attendance.

Related: Drive to rescue horse racing finances launched after Priti Patel meeting

The extent to which this was an orchestrated attempt by the senior trainers to get their point across to a senior member of the government is difficult to divine. Both Gosden and Rachel Hood, his wife, are donors to the coffers of local MP Matt Hancock, as is Steve Harman, the former British Horseracing Authority chairman, who is a personal friend of Patel and her husband, Alex Sawyer. Harman, who is understood to have organised the home secretary’s brunch date, donated £8,000 to Hancock’s short-lived campaign to become party leader last summer.

The extent, if any, of Patel’s influence is also moot (racing is, after all, not her territory) but her trip to Newmarket to have her ear bent by Gosden, William Haggas and others was followed a few days later by a “group call” involving not only the trainers concerned, but others leading names from further afield. These included individuals with links to the sport’s two biggest racecourse groups – Jockey Club Racecourses and Arena Racing Company (Arc).

The gap between the sport’s major players and the businesses that give them somewhere to play has always been the deepest of racing’s factional divides. On that basis, the fact that both sides were prepared to engage on an informal basis and seemingly did so without falling out can only be seen as a positive.

They found some common ground too: the urgent need to stabilise the sport’s finances after two-and-a-half months of complete shutdown and three more with no crowds. And it was at this point, as so often, that heads on both sides swivelled towards the bookmakers, as all concerned seemed to decide that wholesale Levy “reform” could be the answer.

If it seems like only three years ago that the Levy was “reformed” to include overseas operators, that is because it was. But the devastation wreaked by coronavirus, not to mention the potential mayhem that could result from a no-deal exit from the single market, makes the betting industry – or, more precisely, the punters who bet with it – an the obvious candidate to plug the hole.

Plans are already afoot, with the support of the BHA, to extend the Levy to bets placed in Britain on foreign racing. But the nascent planning on the group call is, apparently, to go further, and seek a return to at least an element of turnover, rather than pure profit, in calculating the Levy.

This is not an entirely new idea. It has, however, (at least) three major obstacles to overcome, regardless of how persuasive the Clarehaven brunch party might have been.

The first is that it would require primary legislation, and there quite a few other pressing issues on the government’s mind just now.

Another is that turnover takes no account of whether a bookie has won or lost on a race. If they are forced to trim prices and trade more defensively, to avoid a situation where they lose twice, punters will get a raw deal and turnover will decline. That would potentially wipe out much or all of the benefit while driving fans away from racing.

The third is that a simple turnover charge is very difficult to apply to an exchange like Betfair, where many users both back and lay horses to lock in profits or cut losses. If someone has 100 £10 bets on the same horse but ends up losing £1, what is their turnover? £1,000, or £1? And if Betfair is treated differently to bookmakers, the bookies are likely to call foul. The current situation, where both pay Levy on profits, is the obvious way to keep them on a level playing field.

So while any warming of relations between the horsemen and the tracks is welcome, even the involvement of one of the cabinet’s big beasts is unlikely to make much practical difference in either the short or medium term. The current Levy system, perhaps with an extension to cover bets on foreign racing, is the only immediate lifeline racing will have as it tries to find its way out of its current crisis.

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