Horse racing calamity on the horizon if corona lockdown continues

Salient Points
• 60 000 direct and indirect jobs to be lost if the horse racing industry continues in hard lockdown (at least 750 000 beneficiaries facing poverty)
• About 400 of horses per month face the prospects of being euthanised if racing suspension persists
• The National Command Council permission sought for eight (8 ) closed races per day totaling under 15 minutes to save the industry
• Industry has an economic impact of about R2.9 billion per year with huge foreign earnings from horse exports and global television income

Johannesburg, 07 May 2020: The horse racing industry is running against time to save more than 60 000 jobs, the welfare and lives of the almost 20 000 racing horses and much desired foreign exchange earnings currently threatened by the continued lockdown of the country due to the corona pandemic. The industry is asking the National Command Council (NCC) to give permission for the industry which is on the verge of collapse to resume controlled closed horse racing during Level 4 as the only way to starve off massive jobs losses, closures of horse training and racing facilities and to avoid potential health hazards that would result from mass euthanizing or abandoning of distressed horses.
The National Horseracing Authority (NHA) CEO, Vee Moodley, says if government allows closed racing during level 4 as proposed by the industry regulating body, this will save the majority of the 60 000 jobs in the industry. Without competitive racing, the industry is not generating income to pay salaries for personnel needed to care for the horses, training and racecourses.
“We are in dire situation as an industry because all the lost revenue impacts directly at least 6 people who look after the horses before, during and after each race. Our plea to our government at this stage is not for the industry to operate as business as usual, but to do the least to save jobs and horses. We are asking for closed racing which will involve about 65 people per racecourse and about 15 minutes of racing per day. That is all it will take to avoid the collapse of this industry at this stage,” says Moodley.
Despite the prospects of significant economic impact on racecourses, jockeys and the staff who look after horses, Moodley says the industry was one of the first active sporting codes to adhere to the National State of Disaster regulations once announced by the President Cyril Ramaphosa on 15 March 2020. Beside applying strict safety and physical distancing regulations, the industry voluntarily embarked on closed racing from 16 March 2020 to 26 March 2020.
“The health and safety of all stakeholders is of paramount importance to us, thus we acted swiftly in joining government to flatten the curve. We are proud that up until now, through the stringent enforcement of the rules, we have no reported cases of Covid-19 in any part of our industry and we intend to keep it that way,” says Moodley.
Financial Impact
Like most economic activities in South Africa, the horse racing industry has suffered massive financial losses in the last 6 weeks due to the suspension of all sporting activities. The NHA has worked out the following financial impact estimates:
• Trainers have lost about R30 million per month plus 15% reduction in business operation.
• About 4 500 grooms have lost about 1% of Stakes of R30 million and loss of income from
incentives scheme,
• Jockeys have lost 10% of stakes of estimated at R30 million per month plus R3,5 million in
riding fee monthly.
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“The most vulnerable group that has been most affected by this lockdown are breeders who breed horses for racing, which is the most labour-intensive part of the industry were some 12 are created for each R1 million expended. If there is no racing, there is no demand for the horse and therefore no money accruing to breeders,” says Hazel Kayiya, NHA’s Executive: Racing Administrator.
She adds that the loss of income has led to a 20% spike in the number of horses being euthanised with between 300 to 400 horse currently facing the fate every month, as well as, horse abandonments, resulting in the loss of jobs and bloodlines. The NHA expects the number of euthanized horses to increase by 50% per month if racing continues to be banned in SA.
Proposed restart through controlled and Closed Horse Racing Events
The racing industry supports governments efforts to deal decisively with the Covid-19 pandemic, and every decision being undertaken and considered by the NHA puts the health of the public and participants first.
The NHA has put through a request to the President and the NCC to consider a partial restart of the industry to protect jobs and the welfare of the industry’s key participants – the horses.
The NHA has proposed that horse racing be restarted under strict conditions:
• With 8 races of approximately 2 minutes each per day between 12h00 - 17h00.
• All racing to be held behind closed doors with no spectators. The races will be broadcast
under normal channels both domestically and to 42 other countries internationally.
• Approximately 65 persons are required per race meeting and these people are located at various areas within the racecourse, applying strict physical distancing protocols. These includes trainers, jockeys, grooms, officials and staff deemed necessary to host a
race meeting safely and successfully.
• All COVID-19 health and safety protocols to be always followed, including observance
of guidelines for physical distancing, sanitation and hygiene, and use of appropriate personal protective equipment as determined by the National Department of Health.
South Africa is the 8th most important horse racing market out of 65 countries, and this is significant for horse export, and profitably television rights.
“We have applied to government for financial assistance, and we are told that is under consideration. But the partial opening of industry for closed racing that we are proposing, and which poses no health risk at all, will significantly reduce the need for government financial relief,” adds Moodley.
END
For more information:
Mr Vee Moodley
Chief Executive Officer

Good luck with this application.

No time frame given for expected feedback on the application, I can only hope Mr Pres and his council members do this asap with a positive yes.

Horseracing is at an unenviable juncture. The Group has warned for several years that escalating losses could not be sustained and that a more equitable funding dispensation was crucial for the sport to survive, let alone thrive. Local horseracing on a standalone basis, the cost engine that drives the sport in South Africa, increased losses this year. The Board remains open to any realistic and constructive ideas that may benefit horseracing. During the year, management engaged with key stakeholders in the horseracing industry to discuss the challenges being faced with a vision to strive for an inclusive, financially sound, and transformed industry that flies the flag for South Africa. Phumelela also seeks to build constructive relationships with government and regulators and remains open to realistic suggestions that may benefit horseracing.

www.irphumelela.com/financials/PHUMELELA_fin_jul19.pdf

So my question is... what has changed since the beginning of lockdown? Is there some change (reduced stakes maybe) that will suddenly see Horse Racing turn a profit? - OR will Racing under lockdown cause further loses?

The elephant in the room is this :

Almost the entire initial cost of 'reviving' this activity falls squarely upon the owner; whether that be a trainer/owner or just a plain owner. The operator has already almost completely defaulted on paying meaningful stakes in the future . Should racing re-commence out of every field of 12 runners there will still be 8 who earn nothing. The owner alone, therefore, faces the bleak reality of racing for almost nothing so that the wheels can be greased and the operator's newly found friends - the emloyees - can be paid.

No matter how many owners claim to do it 'for love' that kind of patronage only stretches so far. ( I personally have now kept a horse in full training for a whole year beyond its realistic 'sell by date' for a number of unforeseen reasons but chiefly because I have been unable to find an appropriate and secure home for the animal. I'm really not sure that I want to ( or can afford to! ) spend yet another R125,000 over the next 12 months purely for humanitarian reasons ).

To be even more blunt - I would rather not lend any support or finance to any venture that extends the life of the current operator. I get the distinct feeling that they are planning to wriggle out of the present arrangement and take the viable betting and media 'bits' with them into a new venture whilst leaving the remnants of racing for a successor to try and rebuild.