Following are the Chairmens' Reports presented at HRA's Annual and Mid-Season Meetings.

Chairman's Report - Mid Season Meeting 1 March 2012
Mr Geoff Want

It is only a little more than four months since the annual general meeting of Harness Racing Australia in Melbourne and there has been plenty of exciting action on the nation’s racetracks. The exploits of the grand circuit stars and emerging champions, along with the build up to the V75 ATG Inter Dominion at Gloucester Park, has provided plenty to talk about and presented harness racing in a positive light.  Unfortunately, the integrity situation in New South Wales and the on-going uncertainty about funding continue to cast a pall over the industry.

Integrity

Concern at the adverse publicity generated by the allegations that swab testing information had been leaked by two stewards to the connections of some horses prior to races in NSW was, understandably, felt by all who care about the integrity of harness racing. The fallout was not confined to NSW. 

Harness Racing New South Wales reacted swiftly and effectively and the persons charged over the matter are being dealt with at industry inquiries and in the state’s law courts. It is to be hoped that the penalties imposed on any persons found guilty of wrongdoing will be effective deterrents for anyone considering such behaviour in the future. 

Stiff penalties will also send a clear message to the punting public that harness racing will not tolerate fraudulent behaviour. 

It is important also that we undertake a marketing campaign in the near future to promote harness racing as an entertainment and wagering medium, and to reassure participants, punters and fans on the effectiveness of our integrity measures. We need to focus on the positive results to arise from this disgraceful episode. 

Industry Funding 

Nothing has happened in recent months to ease the fears of most administrators about funding of the racing industry. Totalisator turnover has been ravaged in recent years by corporate bookmakers, as well as economic uncertainty.  

All administrators are waiting for the results of two court cases which will have a significant bearing on industry funding, the most critical being the High Court judgement in the NSW race fields legislation challenge. The High Court heard an appeal in August by Betfair and Sportsbet against a ruling by the full bench of the Federal Court, in favour of Harness Racing NSW and Racing NSW in November 2010, upholding the validity of the NSW legislation.  

Sportsbet was involved in another case over race fields legislation, challenging in the Federal Court the validity of both the Victorian Act and the 1.5 per cent turnover fee imposed by Harness Racing Victoria. The case was finalised in August when the judge reserved his decision. 

The results of the court cases will have a critical bearing on our ability to charge a fair price to anyone utilising our product in a commercial undertaking, but are only part of the solution. 

Regardless of the High Court decision, we must continue to lobby state and federal politicians to develop a national funding model for the racing industry, underpinned by federal legislation, as recommended by the Productivity Commission Inquiry Into Gambling in 2010. 

HRA advocated federal legislation as the only effective means of dealing with the critical funding issue in our submission to the Joint Select Committee On Gambling Reform last July and in our presentation to the Australasian Racing Ministers’ Conference in September.  

HRA declared that wagering must continue to be exempt from the Interactive Gambling Act 2001, but that the Act should be strengthened to prevent exploitation by wagering operators who were not approved by Australian regulators. This would include forcing Internet Service Providers to block access to the sites operated by unapproved operators and prohibiting financial institutions from processing transactions from such sites.   

The HRA submission also supported the establishment of a national gambling regulator, with powers to license betting providers and ensure adherence to strict integrity, problem gambling, harm minimisation and financial measures. Racing bodies however must retain the right to determine which wagering providers are permitted to bet on their product and what product fee they pay the industry in return.  

We must continue to push for these reforms at every opportunity. 

Wagering 

HRA has long advocated the creation of a single national TAB pool and it is indeed pleasing to see that the racing ministers have appointed a working party to consider this matter. As a first step the working party has sought the views of the national racing bodies and the major totalisator operators, Tatts Group and Tabcorp. 

We will be providing a submission in the next few weeks and applaud the ministers for their initiative, but I caution that there is much to be done before we will see a national pool become a reality. 

It was disturbing to read a fortnight ago that Tabcorp expects its returns from pari-mutuel wagering to continue to decline as punters increase their spend on fixed odds betting and the Trackside simulated racing game.  

Tabcorp’s wagering revenues increased 2.8 per cent in the six months to the end of December, but totalisator revenues fell by 5.5 per cent in Victoria and 7.2 per cent in NSW. The falls were offset by the growth in fixed odds betting and Trackside. 

The company expected the totalisator to remain a dominant part of the business but predicted further gains for the fixed odds business. 

I understand that fixed odds has helped the industry’s wagering partners such as Tabcorp meet the threat posed by corporate bookmakers, but the return to racing is considerably less than from pari-mutuel wagering. There are signs that the returns to racing are improving, but the wagering operators need to continue to work to ensure this trend continues - racing must receive a similar return from both fixed odds and pari mutuel if we are not to suffer a further revenue downturn. 

Marketing 

A recurring theme in these reports in recent years has been a call for administrators to explore ways to make the harness racing product more appealing from a wagering perspective, and to consider how to grow the fan base.  

Some of these matters were canvassed in the last annual report, including a comment that marketing would benefit considerably from a co-ordinated national approach. Harness racing has few marketing resources and it was suggested we try and make the most of the very good and enthusiastic people we do have to develop a national marketing plan. 

With this objective, a meeting has been organised for later this month, but despite plenty of notice it is disturbing that not all HRA members will be represented.  

In preparing for this meeting, I reviewed the minutes from the last mid-season conference which was held in Perth, almost exactly five years ago. Not surprisingly, there was a call at that same gathering for members to support the national marketing committee. 

I believe HRA members do an excellent job for our industry at so many levels, but there are times when I wonder whether we want to tackle the tough issues such as how to deal with harness racing’s loss of relevance or how to become more adept at competing for the leisure dollar. I’m aware that our industry is particularly sensitive to change.  

Nonetheless, change we must! To paraphrase the famous naturalist, Charles Darwin... 

Successful businesses adapt to change and evolve ... those that don’t become extinct. 

Even when we want to embrace change, however, it can be difficult making progress. 

I preface my next remarks by stating that I have high regard for the staff at Sky Racing and the job they do, and I believe it is an outstanding organisation. But it is not perfect! 

On several occasions we have had representatives of Sky and Tabcorp at HRA meetings discussing the shortcomings of harness racing and encouraging us to make it more attractive as an entertainment and wagering medium. 

Their views were partly responsible for a group of us developing the Hot Shots concept three years ago. Despite a great deal of work, representations to Sky over three years and staff of both Sky and Tabcorp expressing their support for the concept, we still do not have a launch date for a trial. 

Sky staff have indicated that there is considerable work to be done before Hot Shots can be launched and it may be another year before we can commence the trial. Four years to launch a product trial, which could benefit all parties involved, is ridiculous! 

This is not meant to embarrass Sky but to illustrate the problems we have with the current business partnerships, such as the broadcast rights agreements.  

Inter Dominion 

Sky does many things very well. Indeed, they have done a fantastic job covering the V75 ATG Inter Dominion series at Gloucester Park.  

Congratulations to John Burt, Rob Bovell and everyone at Gloucester Park Harness Racing for a wonderful promotion and an excellent Inter Dominion carnival. I’m sure everyone is looking forward to a great final tomorrow night and I wish you all the best for perfect weather, a bumper crowd and exciting racing.  

Thanks also to Gloucester Park and Racing and Wagering Western Australia for your hospitality during the carnival. 

Whilst acknowledging our hosts, I must also thank a number of other people for their efforts on behalf of HRA.  

Andrew Kelly and the staff of HRA are deserving of high praise for their continuing efforts on behalf of our industry, and I must also thank HRA’s legal counsel, Dean Cooper and integrity consultant, John Shreck. 

Many thanks also to the members of the Executive for their contribution and support and to all those people who give so generously of their time to serve on the various HRA committees. And while acknowledging the Executive, I must congratulate Graeme Campbell who has just been re-elected as chair of Harness Racing NSW. 

HRA enjoys a strong working relationship with Harness Racing New Zealand and I thank chairman Pat O’Brien and chief Executive Edward Rennell for making the effort to join us here today. 

A Positive Outlook 

There are a number of other topics I could discuss today, such as the on-going work with the Australian Standardbred Breeding Panel’s report, but these will be dealt with during the meeting. There will also be a presentation on the 2013 Inter Dominion series in New South Wales, which I believe provides a tremendous opportunity for us to showcase all that is good about harness racing. 

I spoke earlier about the apparent resistance to change from many in our industry, and this has certainly been demonstrated with both the Breeding Panel’s report and the exciting Inter Dominion changes being introduced in Sydney. It seems some people – and it is only a small, but vocal, minority – have an amazing ability to ignore reality.  

The Breeding Panel was established to deal with serious issues impacting on both the ownership of standardbreds and the well-being of the breeding industry in Australia, while it was widely acknowledged that the Inter Dominion had lost relevance in the Australian sporting landscape.  

There are exciting proposals to address the issues on both these matters and I urge everyone in the industry to take a positive approach and be supportive of these proposals. Who knows, you might be pleasantly surprised with the outcomes! 

Again, best wishes to John Burt and all at Gloucester Park for a fitting finale to the V75 ATG Inter Dominion series tomorrow night – and to you all for your endeavours in the months ahead.  

Thanks, 
Geoff Want

The past year has been one of fluctuating fortunes for many participants in the Australian harness racing industry. Anyone associated with racing is aware of the uncertainty faced by connections of horses during their careers and the range of emotions experienced, including unbridled hope, crushing despair and euphoria.   Whilst there have been many highs during the year there have been some devastating lows. Every state of Australia was affected by floods, cyclones, heatwaves or bushfires during the year with the Queensland floods in January claiming the life of former Harness Racing New South Wales steward James Perry. Some horses also were lost in the floods, particularly at Cold Mountain Stud.

Harness racing participants suffered in varying ways from the wild weather in Australia, but all were shocked by the earthquake which destroyed so much life and property in Christchurch. Many in the Australian industry have close personal and business ties with New Zealand, especially in the harness racing stronghold of Christchurch, and rallied to provide support.  

This included a $100,000 donation to the earthquake appeal by HRA, on behalf of all in the Australian industry, with a proportion of this coming from the finalists in the 2011 Inter Dominion championships. 

Outstanding Racing  

The terrible damage in Christchurch forced the New Zealand Metropolitan Trotting Club to move the championships from Addington to the Alexandra Park facility in Auckland and patrons witnessed some outstanding racing in both the pacing and trotting finals. 

It is indeed unfortunate that the euphoria over the success of the championships has been dulled by the winner of the pacing division, Smoken Up, returning a positive swab to the anti inflammatory drug dimethyl sulfoxide (DMSO).  

Regardless of the circumstances, the winner of our most prestigious race testing positive to an illegal substance is a sickening blow to all administrators – and participants – who work so hard to protect the integrity of harness racing. It has rightly been pointed out that the positive swab is a clear indication that the integrity system works, but the fact remains our industry’s reputation has been tarnished in the eyes of many people. 

The interests of justice must be properly served but it is extremely disappointing it has taken so long for this matter to be dealt with by New Zealand authorities.  

Obviously, the integrity situation worsened with the recent developments in New South Wales, but more on that later. 

The brilliant West Australian pacer Im Themightyquinn was a closing second in the Inter Dominion. The Gary Hall trained Im Themightyquinn had an outstanding season culminating in being declared the Barastoc Australasian Grand Circuit Pacing Champion.  The tough Victorian Sundons Gift, trained by Chris Lang, was crowned the Barastoc Australasian Grand Circuit Trotting Champion for the second straight year. 

Misfortune dogged Sundons Gift during the Inter Dominion series in Auckland, injury curtailing his campaign for a third Inter Dominion championship. I Can Doosit gave the home fans something to cheer with a fine win in the trotters final. 

Trans Tasman rivalries were cast aside in Auckland as all fans acknowledged Natalie Rasmussen and her brilliant champion Blacks A Fake, competing in his sixth Inter Dominion final. He didn’t win but he came ever so close, being third across the line in a thrilling contest.  

“Blackie” bowed out of the Inter Dominion with the incredible record of six starts in our greatest race for four wins, a second and a third, which could be further improved by the outcome of the Smoken Up inquiry in New Zealand.   

Natalie Rasmussen drew the curtain on Blacks A Fake’s racing career after a gallant second in the SEW Eurodrive Winter Cup at Albion Park in Brisbane in July 2011. Fittingly, the crowd sent him off with a standing ovation. 

Arguably the greatest standardbred to have raced in Australasia, Blacks A Fake was retired after winning more than $4.5-million in 105 starts, with 72 wins and 24 minor placings.   

The Inter Dominion uncertainty aside, Smoken Up was responsible for two of the most outstanding performances of the year on our tracks, both at Tabcorp Park Menangle. The Lance Justice trained horse won the Miracle Mile in November against a quality field, then blitzed similar opposition in the Len Smith Mile in April when he became the first pacer in the southern hemisphere to break the magical 1:50 mark, rating an astonishing 1:48.5. 

Positive Signs 

Tabcorp Park Menangle was also the venue, in March, for one of the year’s highlights away from the racing action, when the New South Wales Harness Racing Club and Harness Racing NSW announced a raft of business initiatives. These covered funding of significant prizemoney increases and plans for the further development of the Menangle facility. 

The announcement followed the Club’s sale of Harold Park to developers for $187-million. The final race meeting at the iconic inner Sydney track in December provided the opportunity for thousands of harness racing fans to bid an emotional farewell to Harold Park. 

In another positive sign for our industry, Harness Racing Victoria is continuing to develop Tabcorp Park Melton and has exciting plans for the future of the precinct. 

The exciting development plans for Menangle and Melton, and a number of other initiatives around the nation, are a positive sign for our industry but also tend to mask some of the critical issues. Despite its economic standing and appeal to many thousands of enthusiasts, harness racing is losing relevance in the Australian sporting landscape and there are pressing funding and governance issues which need to be addressed. 

Industry Funding 

The leakage of wagering turnover from the licensed pari-mutuel operators in each state to corporate bookmakers and betting exchanges has continued in the past year, although the industry has had moderate success in extracting a fee from some operators.  

The results of two court cases which will have a profound affect on industry funding are eagerly awaited. The full bench of the Federal Court ruled in favour of Harness Racing NSW and Racing NSW in November 2010, in the latest round of the legal battle over the New South Wales race fields legislation. Betfair and Sportsbet were later granted leave to appeal to the High Court, which occurred in late August. 

The court’s judgement is expected to be handed down next month. 

Harness Racing Victoria has also been involved in Federal Court action over race fields legislation, whereby Sportsbet challenged the validity of both the Victorian Act and the 1.5 per cent turnover fee imposed by HRV. The case began in Darwin in March 2011, and was finalised in August when the judge reserved his decision.

The deregulation of the Australian wagering market in recent years has been achieved with scant regard being paid to the well-being of the racing industry.  

Advocates of deregulation have often used British racing as an example of how Australia’s funding model should work. They might care to note that in recent months British administrators have been unable to finalise the fixture list for 2012 because of grave concerns over funding, which could cause drastic cuts to prizemoney and race meetings. 

British thoroughbred racing’s primary source of income is a levy scheme, whereby bookmakers pay 10% of gross profits. The total from the levy for 2011 is forecast to be A$89-million, about half what it was three years ago. The drastic reduction has been brought about by the major wagering companies moving their operations offshore to avoid paying the levy. 

Harness Racing Australia advocates federal legislation as the only effective means of dealing with this critical funding issue.  

The leakage of wagering revenue was dealt with extensively in the 2010 report of the Australian Government Productivity Commission’s Inquiry into Gambling. HRA strongly supported the Commission’s recommendation to develop a national funding model for the racing industry, underpinned by national legislation.  

HRA continued to advocate this approach in its submission to the Joint Select Committee On Gambling Reform, lodged in July 2011, and will lobby federal and state authorities on the issue at every opportunity. 

HRA also submitted to the Joint Select Committee that wagering must continue to be exempt from the Interactive Gambling Act 2001, but that steps must be taken to strengthen the Act to prevent exploitation by wagering operators who were not approved by Australian regulators.  

Internet Service Providers should be forced to block access to the sites operated by unapproved operators and the Act should also have provisions to prohibit financial institutions from processing transactions from such sites. Similar legislation has existed in the USA for the past five years. 

Whilst the IGA currently provides a mechanism for regulations to be made relating to financial agreements involving illegal gambling services, to date nothing has been done to draft any regulations.  

The HRA submission also supported the establishment of a national gambling regulator, with powers to license betting providers and ensure adherence to strict integrity, problem gambling, harm minimisation and financial measures. Racing bodies however must retain the right to determine which betting providers are permitted to bet on their product and what product fee they pay the industry in return.  

On a related matter, HRA has long advocated the creation of a single national TAB pool. While the opposition to such a move is understood, the shift in consumer behaviour, particularly to fixed odds bet types, continues the disintegration of pari-mutuel pools, which need strengthening to provide value and remain relevant. 

These points were all stressed in HRA’s presentation to the Australasian Racing Ministers’ Conference in Perth late last month.  

Betting on harness racing in Australia exceeded $2-billion in 2010 with estimates that another $600-million was placed with corporate bookmakers and betting exchanges.  

There is still much work to be done – primarily by state and federal legislators – to ensure racing gets its rightful financial return from this wagering activity.  

Integrity 

Harness racing was rocked in early August to learn of allegations that swab testing information had been leaked by stewards to the connections of horses prior to races in NSW. This came soon after the chief steward’s car was set on fire outside his home one night. 

This issue has attracted considerable media coverage and I’m sure we all lament the fact our industry is in the news for all the wrong reasons.  

While these events are extremely disappointing, the swift and uncompromising approach by the management of Harness Racing New South Wales to address the matters raised should assure both the racing and wider community that behaviour of this nature will not be tolerated, with every effort being made to investigate, expose and suitably penalise those involved. 

Public confidence is our lifeblood.  Improvements and amplification of efforts in this area over the past decade have lifted our integrity and animal welfare model to among the most rigorous in the world - so we are acutely aware that these events are particularly harmful and show how quickly so much good work can be undermined. 

Appropriately, a police taskforce has been established to conduct its own investigation into these events.  Traditionally police have shown a reluctance to become involved in racing matters, but the presence of police provides further confidence that justice will be served with the potential of criminal charges being laid.  

Hopefully, the eventual outcome of the investigation will see penalties imposed to anyone found guilty of wrongdoing which will be an effective deterrent for future activities which attempt to influence the outcomes of a race. 

Integrity is the cornerstone of our industry and HRA would welcome the formal adoption of a national approach to deal with race-fixing – in line with recent outcomes of the Sport & Recreation Ministers’ Council meeting where it was agreed to develop criminal provisions to deter and deal with match fixing. 

The same meeting agreed to actively participate in international efforts to combat corruption in sport. To this end, HRA are close to establishing an information and intelligence exchange agreement with the Ontario Racing Commission and other international racing jurisdictions.  It would be advantageous to have formal law enforcement and customs support of such an agreement in relevant circumstances. 

We also raised this issue at the Racing Ministers’ Conference in Perth, pointing out our industry needed government support to be able to deal swiftly and effectively with any persons who breached our integrity code.   

Industry Issues 

We can lobby for legislative change to help resolve the wagering funding problems, but there are other areas where decisive action should be taken by administrators to address critical industry issues.  

Administrators must explore ways to make the harness racing product more appealing from a wagering perspective, and need also to take an aggressive approach to growing the fan base. Competition for the leisure dollar will continue to become tougher and harness racing needs to develop a new generation of fans and broaden its support base. 

A positive step towards achieving this would be to change the governance model for harness racing, akin to what has happened with other sporting industries in recent years. I have no desire for HRA to usurp the roles or powers of clubs and state controlling bodies, but there are aspects of the harness racing industry which would benefit from a more unified, national approach. 

Sports such as the four football codes have encountered significant growth since abandoning petty parochialism in favour of a dedicated national approach to rules and marketing. 

In the past decade there have been two extensive reviews of HRA’s governance structure, by Laysell Consulting in 2003 and the Incorporation Working Party chaired by Ross Cooper in 2007. The latter resulted in a name change for the organisation and the expansion of the Executive to provide a representative from each Member state, but other recommendations were ignored. 

One recommendation was for the national body to mandate rules, similar to the powers of the Australian Racing Board and Greyhounds Australasia. Two states rejected this on the grounds that it somehow undermined their “sovereignty” – a concern that the representatives of their states on both the ARB and GA apparently do not share! The result is that we continue to have the ridiculous situation where states can impose local rules.    

Marketing is another area that would benefit considerably from a co-ordinated national approach. The first national market research exercise conducted for harness racing was undertaken more than two years ago, with the objective of diagnosing the present and future health of our product.  

It was an extremely worthwhile project and there have been numerous benefits flow from it, but marketing remains a largely neglected concept in much of our industry. There are few people in harness racing dedicated to marketing, unlike similar sports industries. It is not uncommon for similar organisations to have as many as 7 to 10 people dedicated to marketing, comprising promotions, sponsorship, brand awareness, event management, membership and media/communications. 

There are some very good and enthusiastic people in harness racing, who need to be encouraged to develop a national marketing plan which will be supported by all members. This should include making progress with the media and communications project which has been discussed in several forums in recent years. 

We need to get closure on some of these matters, to determine a path and get on with the task of implementing the many good ideas which have been put forward. An early project should be turning Trots TV, launched by HRNSW in July, or live streaming by HRV in August, into a national undertaking.  

These are commendable initiatives which could provide excellent exposure for all HRA members and enable the industry to better communicate with fans and participants.   

One industry initiative which has demonstrated the benefits of a collaborative approach has been the national insurance scheme.  The insurance business was reviewed this year and put out to tender, attracting an excellent response. 

After an exacting process, Jardine Lloyd Thompson was successful in retaining the business with a far superior proposal which will continue to provide HRA members with a strong insurance program. It is extremely disappointing however that Harness Racing NSW has decided not to rejoin the national program.  

Working Together 

HRA members demonstrated during the year how effectively they can work together by undertaking a lobbying campaign with state and federal politicians to oppose the proposal for voluntary vaccination of horses against equine influenza.  

The lobbying, and much determined work by HRA chief executive Andrew Kelly, were key factors in the lengthy campaign for the equine industry to become a signatory to the Emergency Animal Disease Response Agreement (EADRA), which occurred in March 2011.  

HRA was prepared to sign the EADRA prior to the 2007 outbreak of equine influenza, but unfortunately the debate was hijacked by political squabbling, uncertainty in some recreational equine groups and a push by thoroughbred breeders for voluntary vaccination.  

The Australian Standardbred Breeding Panel, which was established to determine the current health and trends of the standardbred breeding industry and to develop a plan to stimulate future growth of breeding and ownership of broodmares and racehorses, submitted its report to the HRA Executive in July 2011 after almost a year of painstaking work.  

My congratulations to Panel chairman John Bagshaw and members Glenn Burns, David Sharpe and Harvey Kaplan, as well as secretary Andrew Kelly, for their exhaustive deliberations which have resulted in a comprehensive and innovative report. It is an outstanding body of work which I have no doubt will serve our industry well, although there will be opposition to some of the recommendations. 

The report was released for industry comment in July and the Panel has released a Supplementary Report, in which some of the recommendations have been revised. Both reports are available for discussion at the annual meeting, after which the Executive will consider how to proceed with implementing some or all of the recommendations. 

Acknowledgements 

There are many other projects and issues which are deserving of mention but these will be covered elsewhere in the annual report. I cannot finish my report however without paying tribute to the many people who work so hard to ensure that HRA continues to function in an effective manner. 

Andrew Kelly is an outstanding chief executive and leads his small but dedicated and professional team in the Melbourne head office in exemplary fashion. All are deserving of thanks, along with HRA’s legal counsel, Dean Cooper and integrity consultant, John Schreck. 

Many thanks also to the members of the Executive for their contribution and support and to all those people who give so generously of their time to serve on the various HRA committees. 

Special thanks to Grant Goodall for his contribution to HRA during his eight years as chairman of Harness Racing South Australia – and welcome to Graham Taylor, who has recently succeeded him. 

HRA also has an excellent working relationship with Harness Racing New Zealand. The two organisations have much in common and face similar issues, and the regular exchange of information between them is extremely beneficial. My thanks to all involved, especially HRNZ chairman Pat O’Brien and the chief executive, Edward Rennell. 

Harness racing is a wonderful industry which provides a livelihood for many thousands of people and entertainment and wagering opportunities for many thousands more. It is beholden on everyone involved in harness racing to protect the integrity of the industry and for administrators to address the regulatory and marketing challenges we face.  

If we do, the future will be bright indeed. 

Geoff Want
Chairman

Chairman's Report - Mid Season Meeting 18 March 2011
Mr Geoff Want

It has been an eventful five months since the HRA annual meeting in Hobart, with a series of disasters dominating the headlines in both Australia and New Zealand.  Every state of Australia has been affected in recent months by floods, cyclones, heatwaves or bushfires, with much of the focus on the wild weather in Queensland. Among those to perish in the Queensland floods in January was former Harness Racing New South Wales steward James Perry, while some horses were lost, particularly at Cold Mountain Stud.  In New Zealand, the South Island was still in shock from the Pike River mine disaster in November when the devastating Christchurch earthquake hit last month. No doubt HRNZ chief executive Edward Rennell will be discussing the earthquake in his presentation to today’s meeting.

In all of these terrible events there was damage to properties owned by harness racing participants and damage to racetracks, some race meetings were lost and turnover was further affected by small field sizes. But it appears the human spirit remained strong and there are many stories of harness racing people who put aside their own concerns to help out neighbours or assist in getting flood damaged racetracks back in action. 

We extend our condolences to all those affected by these disasters and wish them well as they recover from the trauma and rebuild their lives. 

Celebrations 

Despite the adverse weather in many parts of the nation there has been some outstanding racing in recent months and much to celebrate both on and off the track. 

The biggest and most emotional celebration was on December 17 as the final meeting was conducted by the NSW Harness Racing Club at Harold Park in Sydney. It was a truly remarkable evening, not just because it was the end of an era, but due to some of the most incredible scenes I’ve witnessed on a racetrack, as fans helped themselves to their own piece of memorabilia from the iconic track. 

Cause for greater celebration by chairman Rex Horne, chief executive John Dumesny and the board of the club was the sale price of $187-million they secured for Harold Park.  

Harness Racing NSW also had cause for muted celebration in November when the full bench of the Federal Court ruled in their favour in the latest round of the legal battle over the race fields legislation. It was a strong judgement in favour of Racing NSW and Harness Racing NSW, although Betfair and Sportsbet were last week granted leave to appeal to the High Court. This is expected to occur in June. 

Harness Racing Victoria is also involved in Federal Court action over race fields legislation, whereby Sportsbet is challenging the validity of both the Victorian Act and the 1.5 per cent turnover fee imposed by HRV. The case began in Darwin last week and was adjourned after four days. It is expected to resume in August. 

We wish both state controlling bodies well in their pursuit of a fair return from any wagering company which operates on their race meetings.  

EADRA

The long running campaign for the equine industry to become a signatory to the Emergency Animal Disease Response Agreement (EADRA) came to a satisfying conclusion early this month.  

As you are all aware, Harness Racing Australia was prepared to sign the EADRA prior to the 2007 outbreak of equine influenza, which only served to harden our resolve on the issue. Unfortunately the debate was hijacked by political squabbling, uncertainty in some recreational equine groups and a push by thoroughbred breeders for voluntary vaccination.  

HRA chief executive Andrew Kelly worked tirelessly to overcome the many issues associated with the EADRA and is to be heartily congratulated for his efforts, which have also been recognised by other equine bodies. It should not be forgotten, either, that the lobbying campaign against voluntary vaccination, conducted by HRA’s members, had a significant bearing on the final outcome. 

It also was pleasing that Andrew’s predecessor as CEO, Rod Pollock, who did a great deal of work on the EADRA prior to his retirement, was able to attend the signing ceremony in Canberra. 

Breeding Panel 

The work of the Australian Standardbred Breeding Panel has continued unabated over the months since the AGM and I have not changed my view that it will be one of the most important projects HRA has undertaken. The panel was established to determine the current health and trends of the standardbred breeding industry and to develop a plan to stimulate future growth of breeding and ownership of broodmares and racehorses.  

My congratulations to Panel chairman John Bagshaw and members Glenn Burns, David Sharpe and Harvey Kaplan, as well as secretary Andrew Kelly, for the vast amount of work they have undertaken to date. The final report is due at the end of June and the Panel has been asked to focus on recommendations that are achievable objectives – the report is eagerly awaited! 

There has been some enthusiasm at the Panel hearings and the industry workshops for introduction of a harness racing industry loyalty card, which is a project we have done some work on to date. Andrew will be briefly covering this today in his Strategic Priorities status report, along with other projects such as taxation reform. 

He will also be covering another project which I commend to you – development of an outplacement or adoption program for standardbreds in partnership with Equestrian Australia. This is a wonderful animal welfare initiative and a great promotional opportunity for harness racing. 

Industry Funding 

There are many positive things happening in harness racing, but the most critical issue facing all administrators is industry funding. There is no doubt the legal action in NSW and Victoria, referred to earlier, will have a significant bearing on our ability to charge a fair price to anyone utilising our product for commercial gain. 

But this is only part of the solution.

Administrators need to be more aggressive in promoting and protecting revenue streams – and determining how we compete for a better share of the leisure dollar.

We need to be more assertive in our decision making and realistic in our assessments of the merits of harness racing, and what we are offering fans and punters as both an entertainment and wagering product.

There are times when we seem stuck in a time warp. The late American writer Donald Marquis could have been referring to some racing administrators when he wrote … “Procrastination is the art of keeping up with yesterday”.

Unfortunately, we cannot keep up with the great things about yesterday – strong on-track crowd support and a healthy flow of off-course wagering funds – and we are going to have to face the reality of today’s market.

An important step in this process is to regain control of our own destiny.

The Executive has discussed this matter, particularly in regards to wagering, and there is a report later in today’s meeting. We also have discussed possible areas of co-operation on funding issues with the Australian Racing Board and Greyhounds Australasia.

We will be attempting to meet soon with Sky Racing to discuss broadcast and presentation issues, such as the clutter of race meetings, the effectiveness of the expanded channel offering and how we can co-operate to promote harness racing.

Most importantly, we need to discuss with Sky and Tabcorp the restrictive nature of their rights agreements which prevent us taking advantage of new technologies.

There are no easy solutions but unless we embark on a campaign to try and achieve growth we will continue to lose relevance in a competitive market.

As part of the process of looking at some of the issues we face, there is a session today on Confronting Wagering Challenges of the Harness Industry. Thanks to Russell Edwards and Doug Freeman for taking the time to participate, and to Bart Sinclair for agreeing to be the facilitator. 

Acknowledgements 

There are many challenges facing our industry but we are fortunate to have extremely competent staff who handle most of the issues for us … my sincere thanks to Andrew Kelly for his outstanding leadership of the team and to his staff for their professionalism and dedication. The thanks extend also to our hard working legal counsel, Dean Cooper and integrity consultant, John Shreck.

Many thanks also to the members of the Executive for their contribution and support and to all those people who give so generously of their time to serve on the various HRA committees.

ID11

The horrific Christchurch earthquake has already been mentioned and I must pay tribute to both the New Zealand Metropolitan Trotting Club and Harness Racing New Zealand for the pragmatic and professional manner in which they handled the decision to move the Inter Dominion pacing and trotting championships from Addington to Alexandra Park. 

As a member of the Inter Dominion Event Committee I have some understanding of the difficulties they faced, but I could not possibly comprehend the emotion of the situation – wanting to hold an event they had worked so hard to develop, in their home town, but knowing they could not do so because of the social trauma and the extensive damage to the city’s infrastructure.

Congratulations also to the Auckland Trotting Club for their professional and compassionate reaction to the Christchurch dilemma.

Best wishes to all involved for a highly successful Inter Dominions carnival and I trust we can all contribute, whether it be in Australia or New Zealand, some support for the Christchurch earthquake fund raising initiatives on grand final night.

Thank you. 
Geoff Want

Chairman's Report - Annual General Meeting 18 October 2010
Mr Geoff Want

It has been an interesting but frustrating year in Australian harness racing. Whilst there has been much to celebrate there are still several significant issues which demand the continued focus of administrators and regulators. There has been an abundance of exciting racing with established stars such as Blacks A Fake, Monkey King and Sundon’s Gift rising to even greater heights and the emergence of some outstanding juvenile pacers and trotters. Monkey King was the Barastoc Grand Circuit champion with a raft of exceptional performances, but he could not hold out Blacks A Fake in the Watpac Inter Dominion Pacing championship at Tabcorp Park Menangle.

The 15,000 spectators at Menangle that March Sunday knew they were watching a very special moment in Australian sport as Natalie Rasmussen urged “Blackie” to a record 4^th win in the championship, with Monkey King a gallant runner-up.

A month earlier, Chris Lang guided Sundon’s Gift to his second Inter Dominion Trotting championship at Moonee Valley. There was a big crowd on hand for the occasion and plenty of nostalgia for what was the final night of harness racing at the popular Melbourne venue.

Our industry is also blessed with some fabulous drivers and trainers, many of them young men and women making their mark in the sport.

Any celebration of the wonderful year of racing is however tinged with sadness over the horrific head injuries suffered by Danielle Hill in a race fall at Globe Derby Park in Adelaide in May. Dani, the 2009 Australasian Young Drivers Champion, is on the mend but will require further treatment. Unfortunately, her driving days are over but it is my understanding she wants to stay involved with harness racing and I’m sure everyone in the industry wishes her well.

Critical Issues

Off the track, much of HRA’s focus has been on the critical issues of industry funding and animal welfare.

At the time of writing this report final figures were not available, but it appeared national wagering turnover on harness racing in the 2009-2010 season through “official” channels would exceed $2-billion, a marginal increase on the previous year. Conservative estimates are that leakage to corporate bookmakers was in excess of 30% of the “official” figure – more than $600-million!

This remains a festering sore for the Australian racing industry and little has been done to treat it. The NSW race fields legislation, providing for a payment of 1.5% of turnover by any operator betting on the state’s racing, has been regarded by many as the model for dealing, at least in part, with the problem. The validity of the legislation was upheld by the court in a complex judgement handed down in June, but the judge was concerned with what he felt was discriminatory application of the charges. Appeals are before the court and the matter is not expected to be resolved until late 2010.

Regardless of the final outcome of the NSW case, the racing industry must become more aggressive in promoting and protecting revenue streams. We need to be more involved with the wagering operators and insist on being consulted on marketing plans and product development opportunities.

The TABs are partly responsible for the emergence of the corporate bookmakers as they failed to keep pace with technological change or to provide improved customer service. The industry did little to address this situation.

There is nothing to be achieved by playing the “blame game” but the racing product belongs to our industry and we need to ensure the interests of our participants are protected by all parties, including those responsible for retail marketing of wagering services. Similarly, we need to ensure the industry’s regulators provide the best possible legislative framework to protect the industry’s funding.

The Australian Productivity Commission Inquiry into Gambling, released in July, attempted to address some of these issues and agreed that “in the absence of regulation, free-riding by wagering providers would undermine the racing industry and harm consumers of wagering and racing products”.

HRA spent considerable effort on submissions to the Inquiry and appeared at the public hearings, but was disappointed with many of the final recommendations. We felt these showed a general lack of understanding of the racing industry by the Commission, but it did demonstrate that we need to be more active in ensuring decision-makers clearly understand the value of our industry to the economy and the community at large.

This was also evident in another time consuming project, campaigning against a move by a group of thoroughbred breeders for federal government approval for voluntary vaccination of horses against equine influenza.

Despite two federal inquiries in the past three years recommending that vigilant quarantine measures remained the best protection from equine influenza, it became apparent in early 2010 that the federal government would agree to allow voluntary vaccination. This in part was due to the government’s concern that the equine industry had not become a signatory to the Emergency Animal Disease Response Agreement (EADRA).

Harness Racing Australia has been prepared to sign the EADRA since before the 2007 outbreak of equine influenza. HRA has also consistently advocated that any proposal to introduce routine vaccination as a risk mitigation measure while EI is not present in Australia is scientifically flawed, is of no benefit from an economic standpoint and has serious implications from a trade perspective.

After hearing of the possible government decision, HRA organised a massive lobbying campaign, with all state controlling bodies and member clubs writing to members of state and federal parliaments explaining the ramifications for harness racing, and other equine bodies, if voluntary vaccination was allowed.

This ultimately resulted in the government delaying any decision and the matter is now the subject of a Senate inquiry. It is hoped this will all be satisfactorily resolved and the equine industry become a signatory to EADRA in late 2010.

Some of the other positives of the past year included:-

·         maintaining a strong focus on integrity

·         further refinement of the handicapping rules

·         a substantial review of prohibited substance rules

·         the introduction of new whip rules.

The new whip rules, introduced in January 2010 as a animal welfare measure and to improve the image of harness racing, were widely applauded but opposed by a group of drivers, primarily from NSW. Following a submission by the National Trainers and Drivers Association on safety concerns, the HRA Executive recommended a minor change in the whip rules for the next season to allow drivers to cross the reins when driving their horses out in the final 200 metres of a race, provided they maintained full control of the horse.

It is disappointing that Harness Racing Victoria decided not to adopt the change, but that is their right.

Far more disappointing however is the time taken up by the debate over whips. This was an operational issue which most sensible people realised was inevitable from both an animal welfare and image perspective. Admittedly, it was an important issue which affected a significant number of participants. Nonetheless, it is ludicrous that it consumed so much administrative time and attracted so much negative publicity for our industry.

Much of this time would have been better spent on more critical matters such as the threats to industry funding, how wagering turnover can be increased and how we can grow the fan base.

I have no doubt our competitors for the leisure dollar and corporate bookmakers would not be distracted by such issues. Furthermore, I trust that those commentators and participants who were so vocal during the whips debate can make a positive contribution towards resolution of other major issues affecting our industry.

The Winds of Change (Acknowledgments)

Just as rules are changing, the winds of change are blowing through the senior administrative ranks of harness racing.

Neil Busse stepped down in 2010 after ten extremely productive years as chairman of Harness Racing Victoria, including the development of the magnificent Melton complex. Neil spent nine years on the HRA Executive, including a year as Deputy Chairman. A hearty welcome to Ken Latta, whom I’m sure will be an able replacement, both as chairman of HRV and as a member of the HRA Executive.

Bob Lette, who has represented Queensland Harness Racing on the HRA Executive since 2003 and has been Deputy Chairman for the past six years, is departing the national body. Similarly, Grant Goodall, who has been on the HRA Executive since March 2009, has announced he is vacating the chair at Harness Racing South Australia early in 2011.

All three gentlemen have made an outstanding contribution to the well being of harness racing in Australia and I wish them well in their future endeavours.

I must also acknowledge Andrew Kelly for his outstanding work as chief executive of HRA. Andrew has a passion for harness racing, an admirable work ethic, a pragmatic and responsible approach to resolving issues and a pleasant personality. My thanks to him and his staff at HRA, who are dedicated to serving our industry. We are grateful for your efforts on our behalf.

My thanks also go to the members of the HRA Executive for their support, wise counsel and robust debate of issues and to the many industry figures who serve on the various HRA committees.

The Road Ahead

The road ahead is paved with opportunity, not littered with the debris of shattered dreams. Senior administrators have an obligation to make the most of the opportunity!

The Australian harness racing industry has a challenge to compete more aggressively for the leisure dollar. We need to work together – and with our wagering partners – to make our product more attractive, to grow the fan base and increase wagering turnover. We need to work with the wagering operators to improve customer service. Importantly, we need to increase returns to our participants.

The battle must continue to address issues pertaining to industry funding. We need to work with regulators to ensure the legislative framework is in place to enable us to get a fair return for our product from anyone who attempts to use it for commercial activities.

Our marketers need to concentrate on improving the relevance of our product in an increasingly competitive market. Hot Shots – One Lap, One Shot  At Victory - should be implemented as a matter of priority, along with innovative broadcast presentation and new bet types.

We need to consider the relevance of existing broadcast agreements. Sky Channel has been a valued industry partner for many years and should continue to be so, but technological change has brought new challenges. The Sky contracts prevent our industry from taking advantage of these, particularly the Internet and social media such as Facebook and Twitter. 

The focus on integrity and animal welfare must continue unabated.

The campaign to sign EADRA must continue and HRA must determine how best to capitalise on the positives which emerged from the lobbying campaign with politicians against voluntary vaccination.

The industry will be deciding in the first few months of the new season what to do with the future of the Inter Dominion pacing and trotting championships. Whatever the outcome, we must provide the utmost support to what is our flagship event and the best prospect for getting broader community understanding of all that is good about harness racing.

HRA has four other projects which it will be advancing in the years ahead…

- a proposal for introduction of an industry card for all harness racing participants

- a submission to federal authorities for reform of taxation legislation

- a proposal to simplify the registration and naming of foals, and

- a review of the ownership and breeding of standardbred horses.

The latter project is particularly significant, as breeding numbers have been eroded by the prolonged drought of recent years and the global financial crisis. The Australian Standardbred Breeding Panel has been established to determine the current health and trends of the standardbred breeding industry and to develop a plan to stimulate future growth of breeding and ownership of broodmares and racehorses. All industry participants are invited to contribute to the development of this plan by way of a formal survey and submission process.

Also in the year ahead we will see the continued development of the twin Tabcorp Parks, Melton and Menangle. Both have proved in a short time that they are fantastic venues for harness racing.

HRV has entered into a partnership agreement with the Shire of Melton to develop the remaining 81 hectares, while the NSW Harness Racing Club has ambitious plans for Menangle. These plans are based on the sale of Harold Park, which at the time of writing was imminent. The club has determined the final harness race meeting at the iconic Harold Park track will be on Friday December 17.

Perhaps we can all channel some of the past glory and massive support for harness racing, which we witnessed so often at the Glebe track, into our deliberations for the issues now confronting us.

Geoff Want
Chairman

Chairman's Report - Mid Season Meeting 5 March 2010
Mr Geoff Want

It is just over four months since we gathered at the annual general meeting in Adelaide but much has transpired over that period.   In the minds of some people the only thing to have happened in harness racing in recent times is the implementation of new whip rules. Indeed, it would be good if this was the only issue we had on our collective agenda.  The whip rules issue has certainly been time consuming, but much of HRA’s focus in recent months has been on two other critical matters – the leakage of wagering revenue and its resultant impact on the financial well being of the industry, plus the on-going bio-security debate and the potential damage some of the outcomes could cause to Australian harness racing.

I have no desire to dismiss or ridicule the concerns of some participants over the whip rules – they are entitled to be heard, and will be during the review process. But I wish there was a similar level of public concern expressed about the other issues – wagering leakage and bio-security developments - which have far greater potential to cause crippling damage to our industry.   

The leakage of wagering revenue was dealt with extensively in the draft report of the Australian Government Productivity Commission’s Inquiry into Gambling, released just after the AGM last October.  

Members were consulted on the HRA response to this report, which was lodged just before Christmas. Andrew Kelly and I also appeared before the Commission, at public hearings in Canberra in mid-December, to further convey the views of the HRA Executive and Members. 

One of the key points we made to the Commissioners was that we did not believe the interests of the racing industry were properly considered in the draft report.  

Of particular concern to HRA was the well-being of more than 40,000 owners, over 7000 trainers and drivers, and the many thousands of people employed within the harness racing industry and in ancillary industries reliant upon harness racing for their income.  

We pointed out that HRA also had a keen interest in the well-being of the many tens of thousands of punters who follow harness racing, given their importance to the industry, but we could not agree with the Commission’s bias towards punters in the draft report. 

The HRA response has been made available to all Members but it is worthwhile summarising the key points:- 

• HRA strongly supported the Commission’s recommendation to develop a national funding model for the racing industry, underpinned by national legislation.
• HRA supported the Commission’s statement that in the absence of regulation, free-riding by wagering providers would undermine the racing industry and harm consumers of wagering and racing products. 
• HRA opposed a levy on wagering operators which was universally paid on a gross revenue basis. We proposed a more flexible approach which allowed each state racing authority to determine the type and amount of the levy it considered appropriate for the use of its racing product. 
• HRA opposed the establishment of an independent, three person racing and wagering tribunal to set and review any levy, arguing that as the producer of the racing product, the racing industry was best placed to determine the levy.
• HRA disagreed with the Commission’s finding that the arguments for renewing TAB retail exclusivity were not compelling. 
• We reiterated the HRA view that tote-odds betting by corporate operators should be banned, despite the Commission’s opposition to this activity being prohibited.

HRA submitted that in order for the Australian harness racing industry to thrive and provide a high quality product which was attractive to all consumers, it was imperative that the industry could charge a fair price for its racing product.  

The end result must balance the needs of punters with increased returns for industry participants, more stakesmoney for owners and a more self-sufficient and productive industry capable of making an even greater contribution to the Australian economy. 

Solutions needed to strengthen, not weaken, the racing industry which the Commission agreed in its draft report was facing increasing challenges from offshore wagering and competition for the entertainment dollar, along with a changing economic and social environment. 

Corporate bookmakers made predictable submissions to the Commission.  

HRA pointed out that the corporate bookmakers had ignored “cost of product” in their business plans, but now expected the racing industry to continue to subsidise their operations because their business model was not sustainable if they had to pay for the product.  And, because of that, racing would continue to be disadvantaged as the corporates enticed punters from the wagering retailers who were paying for the product, using their lower margins as their primary weapon. 

The Commissioners gave us a fair hearing and did comment later they had not expected their draft report on wagering to attract so much interest.

It is my understanding that it is unusual for the Productivity Commission to make major changes to draft reports, but we can only hope there is a departure from normal practise with the final report on gambling, or specifically in relation to wagering. 

The release of this report is imminent. We will then need to carefully consider the findings and determine how we move forward as an industry. 

There has been little progress in recent months on a related wagering issue, the race fields legislation in the various state jurisdictions, most likely due to matters before the New South Wales courts. We all await the outcome with great interest – Graeme Campbell is to provide an update on this critical matter during today’s meeting. 

Also scheduled for discussion at today’s meeting is “Equine Influenza and Related Topics”.  

The HRA Executive held a series of meetings at Parliament House in Canberra in November with various federal officials and, most importantly, the Minister for Agriculture, Fisheries and Forestry, Mr Tony Burke.  

We emerged from those meetings with the very clear view that the government was frustrated at the inability of the equine industry to sign the Emergency Animal Disease Response Agreement (EADRA). This was primarily due to the opposition defeating the enabling legislation, the Horse Disease Levy Bills, in the Senate earlier in the year. 

It now appears that political expediency and bureaucratic frustration may result in a significant change in Australia’s approach to equine bio-security, with potentially serious consequences for harness racing.  

Two federal inquiries following the equine influenza outbreak – Callinan and Beale – stressed the need for constant vigilance at Australia’s borders and effective quarantine measures. Notwithstanding those recommendations, the Equine Influenza Expert Review Panel set up by the Primary Industry Ministerial Council looks set to recommend vaccination as the nation’s weapon against EI.  

In the past week Andrew Kelly – whom I must commend for his outstanding efforts on HRA’s behalf on this issue – has lodged our response to this Panel’s recommendations. 

HRA strongly believes that any proposal to introduce routine vaccination as a risk mitigation measure while EI is not present in Australia is scientifically flawed, is of no benefit from an economic standpoint and has serious implications from a trade perspective. 

The scientific, economic and trade costs associated with introducing a vaccination program into an EI-free Australia must not be ignored. To short sightedly allow vaccination, just to satisfy the vigorous lobbying efforts of some commercial thoroughbred interests, is inequitable.  

It betrays the majority of Australian horse owners and will result in a financial burden as EI inevitably becomes endemic, resulting in annual vaccination for all horses. 

HRA acknowledges and shares the concerns of government animal health authorities and non-equine livestock commodity groups regarding the failure of the horse industry to sign the EADRA. We recognise the unacceptable uncertainty this situation brings to an emergency response to any future EI incursion or any other EADRA scheduled disease.  

HRA is committed to signing the EADRA - indeed, this has been our position since 2006 – and will continue to seek a solution to the current impasse that is suitable to all parties. We urge the government and the coalition parties to co-operate in this process.

This is an issue which should concern every harness racing participant. We need to lobby our political leaders in every state and federal electorate where our participants reside to ensure we are not burdened with this outrageous measure. I hope that we can agree on a lobbying campaign of this nature at today’s meeting. 

I mentioned earlier the outcry in some quarters over the new whip rules. I have no problem with constructive criticism or informed comment, but I do take exception to ill informed and inflammatory remarks.  

Most commentators have taken a responsible approach to coverage of the issue, but a couple have shown considerable bias.  

As you all know, this was an exhaustive consultative process undertaken in a responsible manner. It was never going to be a popular decision but it was necessary in the interests of animal welfare. 

Anyone who believes it is acceptable to flog a horse, for even a small portion of a race, is out of touch with reality. Not only will this inflame animal welfare activists but it is not helpful as we attempt to attract new fans, particularly families. 

The outcome of the review into the whip rules, with submissions due at the end of the month and hearings to be held in Melbourne, will be interesting.  

This is a democratic process and all parties will be given a fair hearing. I trust all the coverage of the issue from now on will be equally fair. 

It has been suggested to me that part of the problem with the whip rules is that harness racing participants do not like change. Indeed, that could apply to most of us on many issues in life!  

It is interesting that “change” has been in the news again lately, with reports from a couple of different quarters that harness racing needs to change, to move with the times. HRA Members and Harness Racing New Zealand also have to consider in the coming months whether to change the conduct and format of the Inter Dominion championships beyond the current roster. 

Change is often advocated by people who are unhappy with the performance of a product. In my experience, when this has happened in a commercial environment, there is a predictable reaction within the company… 

• The Sales department claims the product is not performing because it is too expensive and they need more sales representatives
• The Marketing department demands a bigger budget for advertising and promotions to drive brand awareness – and advocates getting an expensive consultant to give the packaging a makeover
• The Production department maintains the product is great, the problem is that the over paid “show ponies” in the Sales and Marketing departments don’t know how to do their jobs.

They might all have a point, but any review of the product must start with its relevance in the target market. If the product is no good, nothing else matters.

Good sales and marketing can make a product seem better than it really is, but not if it has serious shortcomings. 

In harness racing, I believe we have a great product, but there are some serious issues we need to address if we are to expand our fan base, grow wagering turnover and provide better returns for our participants. 

To do this, we will all need to embrace change. I trust we can do so in a spirit of goodwill, co-operation and confidence for the future. 

As part of this process, I commend to you the HRA Strategic Plan, which is scheduled for discussion today. 

The winds of change are also blowing at Sky Channel and I’m sure we are all hoping it is not an “ill wind”. Brendan Parnell’s presentation later in the meeting will no doubt be highly informative. 

There has been an “icy wind” of change blowing in New Zealand in recent months with HRNZ chairman Pat O’Brien leading the charge for a fair deal for harness racing. I’m sure HRNZ chief executive Edward Rennell will cover this in his report to the meeting today. 

It is an interesting agenda with several other important topics, including the Prohibited Substance Review, to be discussed. 

It was at the mid-season meeting on the Gold Coast a year ago that Members approved the expanded Executive and I believe it has worked extremely well. I would like to thank all the Executive members for their efforts, and a special thank you also to all the people who serve on the various HRA committees. 

Andrew Kelly and his staff in Melbourne are deserving of special mention for their untiring efforts on our behalf. 

At the AGM in October I paid tribute to Neil Busse for his contribution to the industry in almost a decade as chairman of Harness Racing Victoria. This was in the belief that Neil was stepping down at the end of the year, but he did a “Melba” and continued on. 

I’m assured he is definitely moving on next month, even though no successor has yet been announced. Once again, Neil, thanks for your efforts over many years and all the best in your future endeavours.   

On a sadder note I must record HRA’s condolences to Dean Cooper, following the death of his wife, Wendy, last month. Dean has continued to act as HRA’s legal counsel in recent years whilst caring for Wendy and we are all most appreciative of his dedication and sound advice, despite his difficulties. 

Dean, sincere condolences from all within HRA. 

It would be remiss of me not to thank John Dumesny and the staff of the NSW Harness Racing Club, along with Rex Horne and the directors, for allowing us to use this facility at Harold Park today.  

They are always generous and gracious hosts and we certainly appreciate the gesture. 

And so to ID10. 

Firstly, congratulations to HRV for staging the Inter Dominion Trotting Championship this year, won so brilliantly by Sundon’s Gift and Chris Lang at Moonee Valley last month, for the second time. 

It was a marvellous Inter Dom trot, an outstanding Hunter Cup program, and a bumper crowd for the last meeting held at the Valley. 

Congratulations to Rex Horne, Ray Sharman and all the directors of the NSW Harness Racing Club, as well as John Dumesny and his staff, for a fabulous Watpac Inter Dominion Pacing Championship. It was a unique three-venue concept, which I believe has been highly successful. 

It was great racing and an even better atmosphere at both Harold Park and Newcastle and I have no doubt we’ll see something special at Tabcorp Park Menangle on Sunday. 

Thanks to Kevin Seymour and Watpac, as well as all the other sponsors, and best wishes to Rex, Ray, John and all at the club for a sensational day on Sunday – you deserve perfect weather, a record crowd, massive turnover and great racing. 

Thank you – and best wishes for a productive mid-season meeting. 

Geoff Want
Chairman

It has been a positive year for harness racing in Australia and also for HRA.   There are some issues of great concern, especially the threat to our industry’s traditional funding model, but it is important that we do not allow negatives such as this to colour our thinking to the point we forget about celebrating the positives.  At the top of the list of things to celebrate is another season of outstanding racing, with our exciting sport showcased at some wonderful venues.

It remains a challenge for all administrators to get more fans enjoying the spectacle of harness racing, but we have a fabulous product with which to work. 

There has been much to admire and applaud on the track in the past season, including:- 

·         some outstanding racing on the Barastoc Grand Circuit and many other events;

·         the deeds of brilliant pacers such as Mr Feelgood, Blacks A Fake, Melpark Major, Auckland Reactor and some highly promising juveniles;

·         Sundons Gift dominating in trotting events and taking on the world in The Elitloppet in Sweden;

·         some admirable training feats and brilliant drives;

·         and, the continued development of talented young male and female drivers, headed by the record-breaking Kiwi Dexter Dunn. 

Venue Developments 

The opening of the Melton complex, less than a year after the commencement of racing at Menangle, gave our industry another world class facility. 

Tabcorp Park Melton is a stunning multi-purpose venue and is a credit to the vision and perseverance of Neil Busse and the Board and management of Harness Racing Victoria. 

The New South Wales Harness Racing Club is also deserving of plaudits for the continued development of the excellent Menangle facility, which is now also sponsored by Tabcorp. 

Other developments are planned or underway at several harness racing venues to provide better racing and improved facilities for fans and participants.  One such venue is Albion Park in Brisbane, where problems with the grandstand forced the transfer of the Inter Dominion Pacing Championships to the Parklands complex on the Gold Coast in March. 

Inter Dominion  

ID09 was a great success with exciting racing and good crowds and attracted considerable media coverage. 

Research commissioned by the Inter Dominion Event Committee showed ID09 delivered more than $10 million in economic benefit to the Gold Coast. 

IDEC will be putting forward recommendations for the future conduct of the Inter Dominion Championships after the end of the current roster (in Perth in 2012) following ID10 in New South Wales in March 2010. 

Other Achievements  

From a HRA perspective, other notable achievements for the past year have included:-

·         the first review of our handicapping system in more than a decade;

·         the first national market research exercise conducted for harness racing;

·         implementation of a much-improved national database;

·         progress on animal welfare issues, including new whip rules and the development of a injury and incident database;

·         monitoring several matters in the aftermath of the equine influenza outbreak;

·         maintaining a strong focus on integrity; and

·         preparation of a Strategic Plan. 

The changes to the Australian Handicapping Rules which took effect on September 1, 2009 were the result of exhaustive industry consultation and discussion.  There are those who believe the changes do not go far enough, particularly in relation to three-year-olds.  It is important the industry embraces the positive aspects and revisits other issues, if appropriate, when the rules are next reviewed in 2010.  

The proposed changes to the whip rules, from January 1, 2010, have been the subject of robust debate in the industry. 

The changes represent a common-sense approach to an issue on which many people have strongly divergent views.  Apart from industry consultation, HRA also discussed the proposed changes with the RSPCA, which is opposed to the use of whips in racing.  Nonetheless, the RSPCA recognised the new rules as a “significant improvement” and welcomed “the progressive attitude taken by HRA to implement the changes”. 

Completion of the Multi-Jurisdictional State Harness Racing Database Project in May was a significant boost to the industry.  It was achieved through considerable hard work and a great deal of co-operation between the team from RISE, HRA and all State controlling bodies.  Congratulations to all involved with the project, which will bring long-lasting benefits to our industry. 

Equine influenza wreaked havoc on our industry two years ago and there are still grave concerns about a number of matters.  Australia’s equine industries have been unable to sign the Emergency Animal Disease Response Agreement as the Horse Disease Response Levy Bills were defeated in the Senate in February.  HRA and all major equine bodies supported the Levy Bills, recognising the need for certainty and comfort should there be another equine disease outbreak. 

It is of grave concern that standardbred owners could face crippling financial exposure should there be another equine disease outbreak without harness racing being a signatory to EADRA.  Hopefully, the Federal Minister For Agriculture, Tony Burke, will continue to review this situation and the matter can be satisfactorily resolved in the months ahead. 

HRA has also written to Minister Burke recently seeking an undertaking that the Australian Government will continue to provide, control and operate post arrival quarantine stations for imported horses.  This was prompted by concern that the closure of Spotswood in Victoria and uncertainty over the Eastern Creek facility in New South Wales could lead to the establishment of privatised quarantine stations. 

We are also keenly awaiting the recommendations of the Primary Industry Ministerial Committee on the vaccination issue.  HRA remains opposed to vaccination against equine influenza, even on a voluntary basis, due to the cost to participants, the lack of compelling scientific evidence and the effect it would have on the free movement of horses between Australia and New Zealand.  

The market research exercise has resulted in a strategic road map for future growth of our industry.  Few would have been surprised by many of the findings of the research, but it was an extremely valuable exercise.  Every Australian administrator must now ensure we work together, as a national industry, to develop and implement policies which will foster growth of our fan base and wagering turnover. 

There is little our industry can do about the global economic crisis which has impacted on discretionary spending and resulted in many companies taking a more frugal approach to sponsorship spending.  We can, however, and must work together to develop policies for the long-term benefit of our industry. 

Funding Threat 

Everyone is acutely aware of the critical issues facing harness racing – indeed, the three Australian racing codes – headed by the threat to our traditional funding model. 

The leakage of wagering turnover from the licensed pari-mutuel operators in each State to corporate bookmakers and betting exchanges is a malignant cancer which regulators and administrators seem powerless to treat.  

Growing the fan base is also a challenge, along with the related issues of fostering new participants and addressing the breeding downturn. 

The deregulation of the Australian wagering market accelerated in the past year, but with scant regard being paid to the well-being of the clubs putting on the race meetings, or their licensed wagering retailers.  In no other field of endeavour are producers treated so poorly.  If someone pirates a song or copies a “brand” t-shirt, they are prosecuted.   Anyone suggesting that a producer must sell their goods to a competitor of Coles or Woolworths at a fraction of the true cost would be ridiculed.  How is racing different? 

The leakage of wagering turnover has become a flood as corporate bookmaker and betting exchange services have become more accessible.  And this accessibility, mainly through the internet, has been aided by the lifting of advertising bans on them in Australia.  Some thoroughbred clubs even allow the corporates to advertise on their racecourses, which is astonishing. 

Why anyone would give a competitor direct access to their supporters is beyond me!  It is inconceivable that Woolworths would allow Coles to display advertising in their supermarkets. 

The only weapon used in the battle to date has been the Race Fields Legislation, with most administrators closely watching the outcome of a legal challenge in New South Wales.  The NSW legislation provides for a fee of 1.5 percent of turnover to be applied to the corporates, although some codes and States (especially the thoroughbred code in Victoria) favour the bookmaker preference for 10 percent of gross profit.  This equates to about half a percent of turnover.  

Regardless of which scheme is adopted, the returns to racing are considerably less than the industry receives from the TAB’s  – and despite claims from some misguided souls that the corporates and betting exchanges are bringing in new revenue, most of their turnover is moved from the TAB’s.   It is estimated that the turnover with corporate bookmakers and betting exchanges in the past year was $4.5 billion, up from $2 billion in 2006/07.  In 2007/08, turnover on Australian harness racing fell by $218 million, or about 12.5 percent. 

Some of the downturn was attributed to the outbreak of equine influenza, but there was evidence much of it was diverted to corporate bookmakers and betting exchanges. 

There was evidence of some improvement in 2008/09, with turnover returning to the pre-EI levels.  Total national turnover on harness racing was almost $2billion $1,997,501,561), which was a heartening recovery.  Nonetheless, it was only 1.7 percent growth over a two year period – or negative growth if taking account of CPI movements. 

It is interesting that British racing has been used as an example of how Australia can benefit from a deregulated wagering market.  British thoroughbred racing’s primary source of income is a levy scheme, whereby bookmakers pay 10 percent of gross profits.  The two biggest bookmaking firms, Ladbrokes and William Hill, have announced plans to move their operations offshore by the end of this year to avoid paying the levy.  It is estimated this will cause a reduction in levy funds of at least 30 percent. 

This is not just a problem for Australia and Britain.  In New Zealand the racing industry has lost an estimated $50 million in the past year because of wagering revenue leakage and administrators are now coming to terms with funding cuts.  At the International Trotting Association Conference in Norway in May this year, the threats to racing’s traditional funding model – licensed pari-mutuel operators in each European country – dominated the agenda. 

A select committee of the European Parliament has been examining the issue and each member State has been attempting to find a solution.  In France, it is estimated that 75 percent of bets made on the internet are processed by illegal sites.  France has responded by enacting legislation that stipulates any company wagering on French racing from the beginning of 2010 must be licensed and pay a product fee of eight percent of turnover to the racing industry and taxation of 7.5 percent.  It was not clear how the French authorities proposed to enforce the legislation. 

HRA’s concerns regarding wagering turnover leakage were conveyed to the State Governments at the Australasian Racing Ministers’ Conference in Melbourne in December 2008.  The Australian Racing Board and Greyhounds Australasia expressed similar concerns. 

In a communiqué issued after the meeting it was reported the Ministers had agreed to work with their respective Heads Of Treasury to examine “the financial arrangements underpinning Australian racing and wagering”.  We can only wait and see if anything constructive, from a harness racing industry perspective, comes from these deliberations.  To date, there has been nothing and there is little cause for optimism. 

HRA also lodged a submission with the Australian Government Productivity Commission “Public Inquiry Into Gambling”.  HRA was one of many organisations to seek Federal control of the racing industry, noting that technology such as the internet and mobile telephony challenged the effectiveness of State-based regulations.  

The Productivity Commission is not likely to report until early 2010, but it is unlikely to give the racing industry any joy.  It is expected that the Commission’s recommendations will cover problem gambling and social ills, rather than the problems afflicting the Australian wagering landscape. 

Meeting The Challenge 

Regardless of the action taken in the past year, or the possible future form of the Race Fields Legislation, it is imperative racing administrators come to terms with the changing wagering environment.  There also needs to be recognition that the industry and its wagering retailers, the various State TAB’s, have failed to adjust to change or to adequately service our customers.   

There is no need for a witch hunt, but critical evaluation of what has occurred is long overdue.   We must also develop our Strategic Plan to include how we tackle funding issues in the immediate future and how we develop a National Marketing Plan for harness racing. 

Harness racing administrators should determine the best funding model for the future and present a proposal to regulators, instead of relying on Governments to legislate us out of a problem.  We need to take control of our own destiny.  Once we have determined what is best for our industry, we should start a campaign to get Government action to ensure we get the funding we rightfully deserve. 

We need to present our case at all levels of State and Federal Government in Australia and to ensure our voice is heard – and that bureaucrats and politicians clearly understand the issues.  HRA has appointed lobbyists in Canberra to assist in this process.  

Most importantly, we must challenge in public the rhetoric of the organisations which are unjustly profiting from our industry.   

For a major industry, we don’t make much noise.  We are going to have to start making plenty of noise if we don’t want to start concerning ourselves more with the problems of diminishing funding, such as prize money cuts, postponed or cancelled capital works programs, and losses of jobs.   We are a major industry and we should use all our resources to ensure we are heard, from grass roots politics to the most senior Federal Ministers. 

National Disasters 

Australia has endured another year of disasters and the drought still plagues wide tracts of the nation. 

Few people at Moonee Valley for the Hunter Cup meeting in February realised that one of the worst disasters in Australian history was taking place in close proximity to Melbourne.  The loss of 173 lives, hundreds of people injured, thousands of animals killed and wounded and many tens of millions of dollars damage to property caused by the Victorian bushfires was distressing. 

We are grateful to the many harness racing participants and fans in Australia and New Zealand who gave generously to the relief appeal and provided offers of support. 

World Trotting Conference 

Australia was represented at the ITA World Conference in Oslo in May by Executive Member Ross Cooper and myself. 

As stated earlier, the threat to the traditional funding of harness racing dominated the agenda.  Australian harness racing stalwart and former AHRC Chairman Mick Lombardo (attending the conference as an observer) was honoured with Life Membership of the ITA. 

HRNZ Conference 

Andrew Kelly and I attended the Harness Racing New Zealand Annual Conference in Christchurch in August. 

Pressure on funding due to the twin evils – the economic downturn and the leakage of wagering turnover – was the major topic, although the industry in New Zealand is still in a healthy state.   The relationship between HRNZ and HRA has strengthened in recent years with considerable dialogue between the two entities, and this brings benefits for harness racing in both countries. 

Acknowledgements 

HRA is an effective organisation due largely to the efforts of the many people who serve on the national body’s various committees.  You are all deserving of the highest praise. 

The Executive has functioned extremely well since it was expanded in March to have a representative of each State. 

My thanks to the members of the Executive for their efforts, especially to Ray Sharman who is stepping down after three years as Treasurer.  I have valued Ray’s wise counsel and professional guidance – and also his dry sense of humour! 

It has also been announced that Neil Busse will be stepping down as Harness Racing Victoria Chairman at the end of the year, after almost a decade in the role.  I have known Neil throughout his tenure and have done business with him as both a business partner and a harness racing colleague.   We have not always agreed but I have great admiration for the way he has taken HRV forward.  He is a man of vision, tenacity and integrity who, hopefully, will not be totally lost to harness racing.  Our industry can ill afford to lose people of Neil Busse’s calibre.  

Thanks also to the HRA staff for their dedication and achievements over the past year and especially to Chief Executive Andrew Kelly.  Andrew’s diligence and enthusiasm have been warmly welcomed by everyone he has encountered in his first year in the role. 

There are plenty of positives to celebrate and some critical issues to address, but I’m confident harness racing will rise to the challenge. 

Geoff Want
Chairman

It is only four months since the annual meeting in Sydney but it has been a busy time, with some outstanding racing over the summer months and plenty happening off the track.  At the AGM I expressed my belief that harness racing in Australia is facing its biggest threat in decades, primarily due to the downturn in wagering turnover, a further fall in the standardbred foal crop and the global financial crisis.  Nothing has happened since then to alter my views, although I would add complacency – by governments and administrators – to the list of concerns.

Whilst on misfortune, I must record HRA’s condolences to the colleagues, friends and family of the late Peter Baldwin following his untimely death in a road accident earlier this month. Our paths crossed many times over the years and I had the utmost respect for Peter’s passionate yet professional approach to his work. 

This was reinforced during the equine influenza outbreak when Peter represented HRA at numerous meetings, dedicating many hours to the cause on top of his duties with the GHRRA. 

There are some post-EI issues on the agenda today for discussion, most importantly how we should proceed regarding any horse disease response levy. This appears to have become a political football in Canberra and we need to ensure the harness racing industry is not the one being kicked around. 

There is also an update today on the appointment of our Canberra lobbyists – even more critical in the current climate then when we first discussed it at the mid-season meeting in Melbourne last year – and a presentation on the national research project. 

Broadcast issues have been listed for discussion, given the concerns of several members at changes being proposed by Sky Channel. These concerns may well prove to be unfounded, but until Sky’s plans are known it is difficult to feel comfortable. We also do not want to be presented with a fait accompli by Sky. 

This is a vital issue, as the stakes are high. Our Members cannot afford to take another hit to turnover such as in the Sky broadcast rights stoush with TVN, yet this is the likely scenario if harness racing’s exposure on the main Sky service is diminished. 

A special welcome again to our friends from Harness Racing New Zealand, chairman Pat O’Brien and chief executive Edward Rennell. I look forward to Edward’s presentation later today on how the industry is travelling across the Tasman. 

On the HRA administrative front, we need to approve at today’s meeting the changes to our Rules of Association and standing orders to provide for an expanded Executive, as requested at the annual meeting. This has effectively been the case since the annual meeting with all states involved in Executive business, but needs to be formalised today. I have no doubt it will result in a more effective national body with improved communication with Members. 

Also before today’s meeting is the draft of HRA’s strategic objectives, prepared by Andrew Kelly following written submissions from, and meetings with, all Members. This is the first step in developing HRA’s strategic plan, which will be finalised over the coming months. 

My thanks go to Andrew for his untiring efforts since becoming chief executive and I also thank his dedicated staff. Thanks also to the members of the Executive for their input and support and to all who give of their time to serve on the various HRA committees. 

Congratulations to Harness Racing Victoria on the official opening of the $45-million Tabcorp Park facility at Melton earlier this month.  Neil Busse and the HRV Board, and John Anderson and his team, have done a tremendous job in developing a facility which will provide enormous benefit to our industry for many years to come.   

We wish HRV every success with the Melton venture and eagerly await the commencement of racing at the track in July. 

Congratulations also to HRV for staging the Inter Dominion Trotting Championship this year, won so brilliantly by Sundon’s Gift at Moonee Valley on 7^th February. We’ll all be cheering Sundon’s Gift and Chris Lang when they take on the world’s best trotters at the Elitloppet in Sweden in late May. 

In the meantime, we have a far more important engagement at Parklands on Saturday night. We lost the grandstand at Albion Park and major challengers such as Safari, Divisive and Melpark Major in the lead-up to the Watpac Inter Dominion Pacing Championships 2009. 

But what a series it has been so far. A super venue and brilliant racing, auguring well for a fantastic final to Watpac ID09 on Saturday night. 

Congratulations to Warwick Stansfield, David Fowler and all at the Albion Park Harness Racing Club, and Bob Lette, Mike Godber and the crew at Harness Racing Queensland, along with Andrew Kelly and Richard Smith from HRA for your efforts to date.  

We wish you perfect weather, a record crowd, massive turnover and great racing on Saturday night. 

Thank you – and best wishes for a productive mid-season meeting. 

Geoff Want
Chairman

Now is the time for all good men to come to the aid of the party ….  This quote would be familiar to anyone in the room who ever had formal typing lessons, along with “the quick brown fox jumped over the lazy dog”.  “Now is the time for all good men to come to the aid of the party” was first used in 1867 at a demonstration of one of the earliest model typewriters and became a key phrase in typing training and speed tests. It also was regularly modified to illustrate points, and has been used as a rallying call in everything from corporate sales training days to war time recruiting drives.

Today, it is apt to modify it to “Now is the time for all good administrators to come to the aid of harness racing”. 

The typewriter has been relegated to the annals of history and virtual oblivion by technological advances. We must ensure harness racing does not suffer a similar fate.  

I’m sure some – if not all – of you feel this is alarmist and melodramatic.  

I agree, it is, but I make no apology. Everyone involved in our wonderful and important industry needs to be aware of the critical issues we are facing and work together to overcome them. 

Harness racing in Australia is facing its biggest threat in decades. 

·          In the past year wagering turnover with the TABs and on-course bookmakers has fallen by $218-million, or about 12.5 per cent. 

·          There has been a further fall in the standardbred foal crop. 

·          The world is experiencing the greatest financial disaster in more than half a century. 

The international financial meltdown is beyond our control, but we have to deal with the ramifications of it such as a loss of consumer confidence and a reduction in sponsorship dollars. 

We can however work to overcome the downturn in wagering revenue and the reduction in breeding activity. 

If we do not tackle these issues and reverse the trends it is inevitable that there will be considerable cuts to prizemoney, which will only accelerate the demise of our industry. Already, it appears we have lost market share – critical to the distribution of funds in some states – to greyhound racing. 

The greatest threat to the funding of the three codes of Australian racing is the leakage of turnover from the state totalisator operators. Some of the downturn in wagering turnover in the past year can be attributed to the outbreak of equine influenza, but there is evidence a considerable amount has been diverted to the corporate bookmakers and betting exchanges. 

What started as a trickle of money from the TABs when the first corporate operators began in the Northern Territory a dozen or so years ago has become a flood in recent times, as the services offered by them have become more accessible. TABs have struggled to address this problem while state governments, major beneficiaries from wagering through “soft” taxes for many decades, have been unable to stem the flow.

The only weapon used in this battle to date has been the race fields legislation. Western Australia’s legislation was successfully challenged in the courts while the NSW race fields legislation is also to be challenged. 

NSW authorities, despite being unable to enforce a 1.5% turnover charge on major unauthorised users of industry data, have imposed the charge on interstate harness racing bodies. Apparently, this is to avoid being accused of discrimination under the Trades Practices Act. 

It is difficult to comprehend how legislators could not have overcome this ridiculous situation.  

Every fair minded person must applaud the endeavour to extract a fee from every organisation which bets on Australian racing, or profits from the industry’s information. It is difficult however to find justification for billing other state bodies, all of whom contribute to the national good of racing. 

We now have the unpalatable situation of NSW imposing a 1.5% turnover charge on other states, while unable to extract anything from the unauthorised users. Other states are planning similar action which will inevitably lead to so-called exporters of racing product benefiting financially from racing bodies in states which are net importers. 

At least NSW imposed a fee with a fair return to the industry. Only this week, Racing Victoria announced a different product fee – 10 per cent of gross profits, rising to 15 per cent during the Spring Carnival months of October and November. 

I’m told this equates to no more than half of one per cent of turnover. 

Not surprisingly, the corporate bookmakers applauded the decision. To most of us however it is an act of bastardry by RVL, displaying an arrogant disregard for the rest of the Australian racing industry.   

HRV has still to announce its policy but has advocated 1.5 per cent of turnover in the past. 

Some TABs have decided to absorb the additional NSW fee for the time being, presumably while they watch developments unfold in other states, although Unitab is passing it on to the industry in Queensland and South Australia.  

The South Australian Government late last year announced it was passing on millions of dollars to the racing industry from wagering tax reform measures. It has been estimated that most of this additional money, designed to assist a struggling racing industry, will be absorbed in payments to other states. 

It is inevitable that various state TABs will become selective in operating on interstate race meetings, rather than the full national program for each code as at present, to minimise the impact of turnover fees. This in turn will lead to further punter disenchantment and frustration, driving them away from harness racing or forcing them to find an alternative betting avenue. 

HRA will be proposing two courses of action at next month’s Australasian Racing Ministers’ conference in Melbourne. 

All Ministers will be urged to liaise on framing legislation in each state which will be effective in extracting a 1.5% turnover fee from corporates and betting exchanges, but which does not cannibalise racing industry wagering revenue from the licensed off course operators in each state. 

Furthermore, and subject to ratification at today’s meeting, HRA will be requesting that the Ministers investigate, as a matter of urgency, approving the merging of all totalisator wagering pools throughout Australia.  

It is HRA’s firm view that this would result in an increase in wagering turnover with the TABs, especially on harness racing. It would also effectively remove one of the greatest attractions of several corporate operators – best tote price!  

Harness racing needs government support, but we also need to become more focused in tackling this issue. The corporates are astute marketers but they are not smarter operators – they are however more focused on achieving their objectives. 

While our regulators have many important issues to deal with, the corporates and their lawyers have only one. 

While racing administrators are concerned with staging race meetings, ensuring the integrity of the industry, organising insurance cover and dozens of other necessary tasks, the corporates are focused only on how they can profit from our endeavours. 

While we spread our available funds across prizemoney, administration and venue maintenance, the corporates spend money on lobbyists, public relations consultants and lawyers. 

We need to become just as single minded as we address the issue of ensuring that anyone who trades on our product pays a fair price for the privilege.  

Race and venue sponsorship is fool’s gold … it is good advertising for the corporates and uses our product to promote their services to our customers, while bolstering their argument that they are supporting racing.  

There is a session devoted to the race fields legislation at today’s meeting and a presentation by Unitab. I also urge Members to put forward their views on how we can best tackle the wagering leakage issue. 

Apart from the issues which have caused a fall in turnover and reduced funds for the industry, Harness Racing Victoria is gravely concerned that it will be adversely affected by new funding arrangements to be implemented by the Victorian Government post 2012. The scheme whereby racing receives a share of gaming revenue in Victoria is to be discontinued, but a satisfactory alternative is still to be negotiated.  

In most jurisdictions – Victoria has been the exception because of the gaming revenue – wagering is responsible for more than 90 per cent of industry funding. The recently formed HRA Wagering Committee has identified issues to pursue, including getting greater control over our brand, and I am hopeful we can make some meaningful progress in the coming months. 

The effects of the drought, equine influenza and rising costs, especially for fodder and fuel, have all had an impact on industry participants in the past year. 

The breeding sector has been particularly hard hit and foal numbers continue to fall, a trend that may continue for the next year or two. 

In 2007-2008  there was a foal crop of 5,038 – down by almost a thousand on the previous year. The number of services this year was only marginally below last year, so it is to be hoped the slide in foal numbers will be halted next year. 

The Breeding Committee is continuing to look at ways to address the problem. 

The disruption and damage caused by the outbreak of equine influenza has been well documented throughout the year and there is a full report on latest developments in the Agenda papers. The best news during the year was the declaration that Australia was EI free. 

The true cost of the equine influenza outbreak, in both financial and social terms, will probably never be known. 

HRA commissioned Pricewaterhouse Coopers to work with all state controlling bodies on a national study into the financial impact of the EI outbreak on harness racing participants. The findings have been evaluated and there will be a report to today’s meeting on the recommendations of the sub-committee appointed at the mid-season meeting in Melbourne to review the matter. 

There have been some positive signs for the Australian industry however in the past year. 

One was the fantastic promotion by Harness Racing Victoria of the Watpac Inter Dominion Championship and another the opening in late June of the outstanding 1400 metre track at Menangle. It was fantastic to see plenty of positive publicity in the Sydney media prior to the event – and even better to see almost 16,000 people at Menangle on the opening day. 

It has been a mixed year for the NSW Harness Racing Club. It started with the disruption of EI, although they kept the Harold Park faithful entertained with camel racing, then they battled atrocious weather to complete Menangle. It has ended with the Club receiving approval from members to sell the Harold Park facility which will, when completed, provide a massive boost to the industry in this state. 

In Victoria, HRV is preparing for the opening of their impressive $45-million Melton Harness Racing and Entertainment Complex. The commercial facilities, which include a motel, will be operating in February/March and the first races should be conducted at Melton in July 2009. 

Queensland harness racing had a setback mid-year when structural problems caused the closure of the grandstand at Albion Park. The Albion Park club plans to totally rebuild the facility, while we may also soon see major redevelopment projects at Globe Derby Park and Gloucester Park. 

There are many matters I could cover in this presentation, but we will be touching on most of them as the meeting progresses. These include the Inter Dominion Event Committee and planning for the 2009 Watpac Pacers Championship on the Gold Coast … the excellent work of the Integrity, Rules and Handicapping Committee on the national handicapping review … governance reviews in several states … the national marketing group’s market research exercise …. the multi-jurisdictional database project, due for completion in April … and the push for taxation reform. 

I also draw to your attention the report which has been prepared for the Australasian Racing Ministers’ Conference, to be held in Melbourne on the 5^th December. This covers much of our activity in the past year and I thank everyone who contributed the compilation of the report. 

It would be remiss of me not to thank everyone who contributes to the work of the various HRA committees. We have many dedicated people who devote considerable energy to these committees. 

Likewise, sincere thanks also to the team at HRA in Melbourne who make such a valuable contribution to the industry. 

We paid tribute to Rod Pollock last night and I would again like to record my appreciation for Rod’s eleven years of service to HRA. 

Welcome also to Andrew Kelly and his first annual meeting as chief executive. A major priority for Andrew is to prepare a strategic plan for HRA for approval by Members at the mid-season meeting to be held on the Gold Coast next March.  

One of the saddest moments of the past year was the untimely death of John Penney, chairman of Harness Racing New Zealand, who was well known to most of you here today. HRNZ was indeed fortunate to have a man of the calibre of Pat O’Brien to move into the chair and I’m pleased to welcome Pat, and his popular chief executive Edward Rennell, to the meeting today. 

HRA enjoys an excellent relationship with HRNZ and Edward is going to provide an update on happenings across the Tasman later in the meeting. 

It is also appropriate that we welcome Mike Godber to his first HRA annual meeting as an Aussie. New Zealand’s loss is certainly Queensland’s gain! 

Many thanks also to Rex Horne, Ray Sharman, John Dumesny and all at the NSW Harness Racing Club for allowing us to use this excellent facility for our annual meeting and, in advance, for their hospitality tonight. 

It has been a demanding and challenging year and there are some significant issues to be addressed in the months ahead.  It has not been my intention today to be pessimistic. But I believe quite strongly that we need to work together to tackle the critical matters that threaten our industry. 

I’m reminded of a slogan I saw on a T-shirt in America many years ago: “When you’re up to your ass in alligators, it’s too late to remember the first priority was to drain the swamp”. 

Let’s get our priorities right and not be distracted by peripheral matters. 

Thank you – and best wishes for a productive annual meeting. 

Geoff Want
Chairman

Please Note:  On 1st March 2008 Harness Racing Australia Inc (HRA) replaced Australian Harness Racing Council Inc (AHRC) as the organisation's name.  All AHRC's formal structures, rules, regulations, policies, processes etc., now pertain to HRA, and any reference to Australian Harness Racing Council Inc, AHRC, Council or The Council shall mean Harness Racing Australia Inc or HRA.

It is only four months since the annual general meeting in Melbourne but it has been an extremely busy period for most people involved with the harness racing industry, regardless of what form their involvement takes.  Obviously the devastating equine influenza outbreak created a stressful environment and it is pleasing to see the worst appears to be behind us. The national strategy of “control and eradication” of the outbreak appears to have been successful.  Nonetheless, there are still many challenges ahead as we negotiate the road to recovery.  Hopefully yesterday’s EI forum will provide some clarity on the many issues we need to tackle in the months ahead and it is vital we work together as an industry to meet these challenges. There were some excellent presentations.

The findings of the Callinan Inquiry, due in late April, will be critical to our future and we need to aggressively pursue matters such as compensation, if our lawyers deem this a possibility. The cost of protecting our herd in the future is also a vital issue and we cannot allow our industry to be burdened by expenses over which it has no control.  

Rod Pollock, who has represented the AHRC on various EI committees and in discussions with other equine bodies, will be updating Council members today on some vital matters, including the federal horse disease levy bills and our submission to Animal Health Australia on re-categorisation of EI, which could have a significant bearing on industry costs. 

The levy bills are extremely inappropriate in the circumstances, especially with the costs already incurred through no fault of the equine industries – and with the Callinan Inquiry still to hand down its findings. 

It is difficult to draw positive conclusions from the destructive EI outbreak, but one must surely be the magnificent way in which harness racing administrators and participants responded to the crisis. Whether they were in the hardest hit areas of Queensland and New South Wales or in other states, their reaction was positive, professional and deserving of the highest praise. 

This praise must be extended to the state and federal regulators and agencies, who were well prepared and efficient. We may disagree with some of the things that happened, but we cannot argue with the effectiveness of their actions. 

 Despite the distractions of EI the Queensland Harness Racing Board progressed towards incorporation and I wish Bob Lette and his team all the best as they venture forth as an independent entity. At the federal level we have not been able to agree to turn the AHRC into a company limited by guarantee, despite the recommendations of the incorporation working party headed by Ross Cooper.

I accept that several members are opposed to the concept.  

Nonetheless, it is worth remembering why the working party was created – fundamentally, to strengthen the national body and make it more effective. If we are still committed to this objective, as I believe we should be, then we must explore how it can be achieved. 

To date, all that has been achieved by the exercise – and a lot of work by Dean Cooper and Ross Cooper and the working party – is that we are changing our name to Harness Racing Australia as of this weekend. 

Some of the issues advanced in responses to the proposed new constitution covered an expanded executive, voting, funding, and effective implementation or mandating of national rules. These should not be ignored. There also are aspects of the proposed constitution which should not be abandoned simply because of opposition to other elements of the document. 

I believe we should now focus on reviewing the overall structure and objectives of the national body. It is 34 years since formation and the Laysell Report contained some pertinent recommendations, but little (if anything) has been done to change the formal structure or the objectives. 

Sir Frank Ledger, the first president of the organisation, said when it was created in 1974: 

“The establishment of a national council of trotting is one of great historical significance to the trotting industry in Australia and it is to be hoped that the progressive spirit of the founders will continue to grow through the years to build the Council into a national body of the highest administrative standard. 

“Its long overdue formation will enable Australian trotting controlling authorities to achieve greater unity of purpose.” 

I urge Council members to embrace “the progressive spirit of the founders” and undertake a review to determine what our organisation should be 34 years on. Rather than what members do not like about the recommendations put forward by the incorporation working party, I would prefer each member to determine what they want from the national body and to identify issues which should be addressed. 

I strongly believe this will result in a more relevant and proactive national body. 

There are other topics in the agenda for today’s meeting which will require some discussion or which will update members on key matters which are being progressed on their behalf. There is an update on insurance, a status report on the RISE database integration project and a copy of Council’s submission to the Australian Taxation Office for taxation reform for industry participants. 

I also commend to you the submission from the WATA on syndication of standardbreds, to help in attracting new owners to our industry. Whilst I have some questions on the WATA proposal and don’t agree with some aspects of it, I support the concept. It is imperative we strive to grow our fan base and attract new owners to harness racing. 

There has been considerable debate at Council meetings in recent years on possible changes to stakemoney thresholds and at the Perth mid-season meeting a year ago it was agreed that the Graduation handicapping threshold be raised in stages, to $2,500 last September and to $3,000 from the 1^st September 2009. Our members have been divided however on the merits of increasing the Metropolitan Class threshold in excess of $8,000. 

Racing and Wagering Western Australia is currently considering a local handicapping rule change to raise this to $10,000 whilst Harness Racing NSW has also prepared a revised submission on this matter. This submission was not ready in time for inclusion in the agenda for this meeting, but it is to be presented to the Integrity, Rules and Handicapping committee for consideration. It is to be hoped this issue can be resolved in the near future. 

It is pleasing to again welcome HRNZ chairman John Penney, chief executive Edward Rennell and their colleagues to our meeting. Several delegates to this meeting were in Christchurch in November for the World Trotting Conference, which HRNZ did an outstanding job hosting. It was a productive and informative conference and all the Australian attendees played an active role in the sessions and committee meetings. 

Whilst our major immediate challenge is the recovery from the equine influenza outbreak, the world conference showed most countries have similar issues, including building brand awareness and market relevance and growing the fan base.  

In Australia I also believe we need greater control over our brand – it is imperative we work closely with our wagering and broadcast partners but we must retain some control over what they do with our product, especially in terms of presentation. We must continue to review and adjust our product to improve presentation and market acceptance, to embrace emerging technology and to make wagering more appealing. 

I hope we, as an industry, will continue to strive for unity of purpose, in the manner envisaged by Sir Frank Ledger and the founding fathers of our organisation. Most of all, I have a fanciful notion that one day the Australian racing industry will unite to compete for a greater share of the leisure dollar. Unfortunately, too many people in racing see the other codes as competitors, rather than poker machines, casinos, lotteries, other sports and so on. 

I understand the importance of market share in some states, but that should be a secondary consideration. I have no doubt some thoroughbred programming is designed to impact on the wagering turnover – and therefore, market share – of harness and greyhound racing. Such behaviour is not only petty, but shows a lack of initiative and confidence in their own marketing and a lack of understanding of racing’s true competition in the battle for the leisure dollar.  

There are some good things happening in harness racing around Australia and I have had the pleasure in the past fortnight of inspecting two of our most exciting projects – the NSW Harness Racing Club’s redevelopment of the Menangle track and complex and the Harness Racing Victoria development at Melton. I have no doubt they will be tremendous venues at which we can showcase the very best of harness racing and wish both organisations well in bringing the projects to a successful conclusion. 

The Inter Dominion has occupied a great deal of time in the past year with the debate over the future of the event, the creation of the marketing fund and the dissolution of the IDHRC. My thanks to everyone involved in what, at times, has been a difficult process. Special thanks go to Robert Marshall for his stewardship of the IDHRC in recent years. 

The success of the Inter Dominion initiatives will be reviewed in the coming weeks and there will no doubt be adjustments to such things as marketing plans, but no-one should under-estimate what has been achieved in the past year, despite the disruption caused by EI.  

We will not rebuild the Inter Dominion brand or grow fan awareness in a few months, but I strongly believe we are heading in the right direction. 

Thanks to all members and HRNZ for their co-operation on the marketing fund and thanks also to all the sponsors who continue to support harness racing, including Barastoc who recently signed up to sponsor the Grand Circuit.  

Special thanks to Watpac, SEW Eurodrive, Australian Pacing Gold, Tabcorp, Sky Channel, the Metropolitan Harness Racing Club and Seelite for their sponsorship of the ID08 pacers and trotters series. 

Best wishes to all clubs conducting Super Saturday meetings this week and thanks for their efforts in trying to build the Inter Dominion brand nationally.  

Most of all, congratulations to Neil Busse, John Anderson and all at Harness Racing Victoria for the hard work they have put in to making this year’s series a success and best wishes for a fantastic final night on Saturday. 

You deserve good weather, a huge crowd and strong wagering turnover and, hopefully, two grand finals that will be talked about in the days and months ahead for all the right reasons.  

Many thanks to the AHRC staff for their dedicated efforts on our behalf and to Bob Lette, Neil Busse and Ray Sharman for their support and hard work on the Executive. 

Again, thanks for your attendance and best wishes for a productive meeting.

Geoff Want
Chairman

It is often said that a year can be an especially long time in racing and this has certainly been the case with the Australian harness racing industry in the past twelve months.   The industry will always have issues to deal with and for a time it looked like this year’s could be the commencement of testing for HPC. One participant protested in an email that administrative decisions such as the one on HPC testing would bring harness racing to its knees. The HPC issue was confronted and resolved as part of the mission for harness racing to be a level playing field in all jurisdictions.  Without wishing to trivialise the HPC debate or any other issues that have confronted harness racing in recent times, it took something far more sinister to bring our great industry to its knees.

There is no need for me to document how the equine influenza disaster unfolded, as every person in harness racing has lived the nightmare. But there are a few points I would like to make. 

Early in the crisis, Council publicly expressed its gratitude to all controlling bodies and clubs for the professional manner in which they handled this grave problem. It is appropriate this endeavour again be recognised, especially in the hardest hit areas of Queensland and New South Wales.  

We should all be very grateful that the other states suffered only minor loss of races and were able to soldier on in difficult and costly circumstances. 

The AHRC is appreciative of government assistance provided to date but will continue to campaign for a better deal. There is ample evidence many of our political leaders do not fully appreciate the economic and social impact of harness racing. And for that, we, as an industry, must shoulder some of the blame.  

We are currently finalising letters to federal political leaders seeking assurances the plight of the many thousands of equine influenza victims will not be lost in the federal election campaign. 

The AHRC has joined with the Australian Racing Board and other equine bodies to appear before the Callinan Inquiry and the findings, due in March, are keenly awaited. Apart from HOW it happened, we need to be looking hard at everything that has unfolded and the success of the measures taken to plan for the future. It would be naïve to believe our industry will not encounter threats such as this ever again. 

 Our immediate focus must be on three key areas:- 

1.      How we rebuild the harness racing brand. There is evidence of disillusioned participants walking away from our industry, which makes it less likely many less passionate supporters will “stay solid”. We should try to get the most positive approach and see this as an opportunity for a national re-launch of harness racing. 

2.      The Executive has discussed the appointment of a working party to compile, in conjunction with all state bodies, a full report on the cost of the EI crisis. Furthermore, to consider possible areas for compensation claims, should such action be deemed appropriate at some future time. 

3.      How we share our experiences of this disaster and understand the extent of it. I believe a national summit should be held over two days early in the New Year, involving a variety of industry interest groups. It could improve our knowledge from various perspectives. Inter-Dominion grand final week in Melbourne would seem an appropriate time and venue, with many people in town for the carnival. 

I urge Council to consider these matters – as well as any others deemed appropriate – at the annual meeting and make some decisions on how we tackle the Road to Recovery. 

The Inter Dominion occupied a great deal of time this year with the wide ranging discussions on the future format of the event, the proposed  marketing fund and the dissolution of the IDHRC. Hopefully all of the debate is behind us after today’s meetings and we can focus on what is really important, restoring the Inter Dominion to a position of eminence on the Australian and New Zealand sporting calendars. 

My sincere thanks to everyone involved in the Inter Dom projects over the past year and to the sponsors who have stepped forward to back the new concept, especially Kevin Seymour committing Watpac as Naming Rights Sponsor. 

Heartiest congratulations to Harness Racing Victoria for having the courage to press ahead with ID08. I’m aware not everyone shares this view but frankly, harness racing needs to be attracting attention post-EI and the Inter Dominion has too many positives to be ignored, even if prizemoney is reduced.    

There have been other significant undertakings this year which should not be overlooked because of EI. 

At the Perth mid-season meeting, Council appointed a working party to consider what would be involved in becoming a Company Limited by Guarantee. The working party,  ably chaired by Ross Cooper, examined a range of issues and prepared a draft constitution for consideration by Council members. The Executive felt there needed to be a greater understanding of what would be achieved by incorporation, and the impact such action could have on existing Members in terms of their legislative requirements in the various states. The report has been distributed to Members for comment. 

A recommendation will be put forward at today’s meeting to change the name of the AHRC to Harness Racing Australia. I also favour expansion of the Executive to include a representative of each state. Perhaps these matters can be reviewed and, if they are as simple to implement as I’m led to believe, adopted at the next Mid-Season meeting. They need to be thoroughly researched but both measures would assist in improving our image, relevance and governance. 

Council will finalise the contract for the integration of each State’s HaRVEY databases with RISE, our industry’s service provider in the near future.  

A draft of the Council’s first ever Strategic Plan has also been produced … this will be circulated for comment after some further work is done on it. 

The appointment of Richard Smith as National Business Manager has been well received and the Industry Development Group was doing some good work, prior to being distracted by EI. 

I must welcome HRNZ chairman John Penney and his colleagues to the conference. The Australian and New Zealand Executives have commenced regular meetings to compare industry issues and I thank John for his input to this process and his valuable contribution to the debate on the future of the Inter Dominion. 

Best wishes also to HRNZ in conducting the World Trotting Conference in Christchurch in just over a week’s time. 

Good luck to Kerryn Manning, who represents Australia in the World Drivers’ Championship starting in Victoria next week, then moving to New Zealand. 

Many thanks to all Council Members for the contribution you make to the well being of the national body through our various committees and working parties, and to Rod Pollock and the AHRC staff for their dedicated efforts. 

Most of all, I’m indebted to Bob Lette, Neil Busse and Ray Sharman who have provided encouragement and wise counsel to back up their hard work as an Executive. Thank you for the opportunity to chair Council this year – and for having the confidence to return the Executive unopposed. 

The year in review has been a lot tougher than we all envisaged in Brisbane last October. Despite the devastation caused by equine influenza, there have been many positives through the year – and we must focus on these as we head along the Road to Recovery. 

Certainly, harness racing faces some big challenges, but I can see no reason why we should not be positive and look to the future with confidence. I have no doubt meeting these challenges will be easier if we form a united front and do it together. 

Thank you. 

Geoff Want
Chairman

It has been an interesting and eventful five months since I assumed the Chair at the Annual General Meeting in Brisbane in October, particularly becoming familiar with the issues in our industry.  During this time we have also witnessed some outstanding racing, including the Grand Circuit events, highlighted by the exciting Inter Dominion Grand Finals in Adelaide in January. Congratulations to the South Australians for their efforts in staging a well conducted and promoted carnival which provided great exposure for harness racing in Adelaide.   Unfortunately however, the Inter Dominion generated little excitement outside the South Australian market. It provided further evidence that the Inter Dominion is a tired brand and we must strive to reinvigorate it as expeditiously as possible.

The AHRC Executive supports the endeavours of the Inter Dominion Harness Racing Council to revive the Series and endorses the proposed fund to help finance promotion of the Inter Dominion and related Grand Circuit events. The Working Party’s recommendations on the fund will be discussed later in this meeting. 

The AHRC Executive also advocates that the Inter Dominion Harness Racing Council be dissolved. We do not understand why it is necessary for so many people to be involved in overseeing what is, quite simply, a major event. It is our belief that the interests of the stakeholders in particular, and harness racing in general, can best be served by a small management committee. The guidelines can be determined when the committee is formed, but it should have responsibility for liaising with the host club each year to ensure the Series is conducted in accordance with the desires of the stakeholders, and the brand is protected. 

It is important we get closure on these Inter Dominion issues, which have become a festering sore for harness racing. 

The Executive also believes that the AHRC must be reorganised as a company limited by guarantee. Harness racing is a dynamic industry which has considerable economic impact and the national body should reflect this standing. The shareholders would determine the constitution and a board would be appointed to protect their interests. It is imperative that harness racing have an effective national voice and that certain decisions are mandatory for the overall good of the industry. 

The drought continues to have a debilitating effect on harness racing and there are already indications it will cause a reduction in the number of foals into the future. The views of the Council’s Working Party on this critical issue are keenly awaited. 

The Executive is seeking information from the Australian Racing Board and other equine bodies on what measures they are taking in regard to the impact of the drought. Of particular interest is a proposed approach to government to have harness racing participants classified as primary producers, to qualify them for drought relief. It is felt a joint approach by all interested parties may have a greater chance of success. 

Last September, the Executive wrote to the Federal Treasurer advising of the New Zealand Government’s relaxation of taxation arrangements for their racing industry, specifically reductions in the write down period for stallions and broodmares. It was felt this gave New Zealand industry stakeholders a significant competitive advantage over their Australian competitors, and Treasury was asked to consider similar changes here. 

Treasury advised in January that the “Government is not predisposed at this time to amend the tax law to change the depreciation arrangements applying to the horse racing industry”.  

Council is also maintaining a watching brief on an Australian Tax Office review of tax issues relating to the horse industry. 

I strongly believe that the AHRC should be lobbying the major political parties in the months ahead on any desired changes in federal legislation which we believe can benefit our industry and stakeholders. Now is the time to act, with a federal election due soon and a revitalised opposition forcing the government to take notice. 

With the ownership of RISE now resolved, the Executive has given approval for the development of a specification and project plan for the integration of the state controlling body databases and for the creation of a national registration system. Funds which have been held in reserve for this purpose will be utilised for the initial work, which will be subject to further approval processes and considerable scrutiny. 

On other matters, the Maxxams Analytics contract with Council on DNA genotyping was finalised with the revised pricing commencing at the start of the year and the Chief Executive has worked hard implementing the new insurance arrangements. 

It is disappointing that New South Wales withdrew from the national insurance scheme. I appreciate that New South Wales saved money and respect their right to do so. Other States have received approaches from insurance brokers and the Chief Executive has been instructed to inform the insurance industry the AHRC will be prepared to negotiate with all parties next time around. 

I had the pleasure of chairing the Conference of Chief Executives held at Harold Park last month and found it an invigorating experience.  

There was robust debate on a wide range of issues. The previous day we held the first meeting of the Industry Development and National Marketing Committee. 

In my view, harness racing in Australia does a good job with regulatory issues but lacks cohesiveness and unity of purpose in many areas, especially when it comes to commercial matters. It is my fervent hope that the Industry Development and National Marketing Committee can be a catalyst for change.  

As a result of the first meeting, each Chief Executive has taken responsibility for scoping an issue. Some of the resultant discussion papers will be considered later in this meeting. Of paramount importance is that we focus on achievable objectives and get closure. 

In line with the Executive’s desire to adopt a more commercial approach, we are currently in the final stages of employing a Business Development Manager. This person will be responsible for devising strategies to expand harness racing’s revenue and fan base, working closely with the State Bodies and Principal Clubs. I commend this appointment to you and believe we will reap rewards as an industry in due course. 

The Executive has also initiated regular discussions with the Executive of Harness Racing New Zealand to consider issues of mutual concern and compare notes on a range of other matters. The first meeting was held in Auckland earlier this month and was extremely productive. Similarly, I have endeavoured to speak with as many Australian industry stakeholders as possible since assuming the Chair and hope to continue this process in the months ahead. 

I’m sure we gave a collective sigh of relief when the broadcast rights dispute was settled last year and you may all be aware that the agreement has still to be approved by the Australian Competition and Consumer Commission. The Executive recently wrote to the ACCC endorsing the proposed agreement between Sky Channel, Tabcorp and ThoroughVision, because of the devastating impact the broadcast rights dispute had on wagering turnover. We did however highlight some areas of possible concern and trust the ACCC will take this into consideration when processing the approval. 

On a related matter, I’m well aware that the owners of intellectual property – Principal Clubs and/or State Controlling Bodies – currently conduct all negotiations on broadcast rights, and that some States have legal obligations to get the most extensive coverage possible to support their wagering license holders. I have no desire to be involved in that process! 

Nonetheless, harness racing needs to be mindful of the term of the proposed Sky-TVN agreement – until 2012 – and other existing or potential broadcast rights issues (specifically, emerging technologies) to determine the approach the industry as a whole should be taking.  

There’s strength in numbers and we need to consider our options to ensure the industry gets the best possible result when contracts are next negotiated – which will be well before 2012 in most cases. 

Whilst on Sky, I’m aware that harness racing generally enjoys a good relationship with the broadcaster and Ray Sharman, John Dumesny and myself had a productive meeting with them last week on the racing product review. 

I would like to take this opportunity to thank our Chief Executive, Rod Pollock, and his small team in the Melbourne office for their untiring efforts on our behalf. Also, many thanks to my fellow executive members Bob Lette, Neil Busse and Ray Sharman for their contributions, support and words of wisdom. 

In particular, I’d like to thank your Chief Executives for their co-operation and willingness to contribute on a host of matters. I realise we are resource hungry and they all have Boards to answer to, but I value their input.  

I have great confidence in the future of harness racing and firmly believe that if we all work together, to take advantage of the accumulated talent and knowledge at our disposal,  we will all benefit and the industry will progress. 

I thank you for the opportunity to chair the AHRC and look forward to the future with confidence.  

Geoff Want
Chairman

During the period under review significant progress has been made on a number of fronts; matters which we have been grappling with for some time are now either resolved or nearing resolution.  The most pleasing thing that has happened since our last meeting has been settlement of the TVN/Sky Channel dispute.  All racing is back on Sky Channel and the consequent gradual recovery in betting turnover for all racing codes is being achieved.  Considerable irrecoverable revenues have been lost to our industry and it is our participants who are now suffering as a consequence.  This dispute and its impact on turnover, has served to illustrate just how vulnerable and dependant on television coverage we now are and just how important it is that our Racing Product is constantly reviewed to ensure we maximize the positive image and financial returns from our invaluable partnership with Sky Channel and its national exposure.

The licensing of a Betting Exchange in Tasmania has raised a number of integrity and intellectual property protection issues in all jurisdictions.  Many of these issues are not as yet resolved. You may also have noticed that Racing Victoria Limited has amended its local rules of racing to make it an offence for any person associated in any way with the ownership or training of a racehorse to bet on a horse to lose. Unfortunately there is no entity with the power to speak on behalf of all jurisdictions in either Thoroughbred or Harness Racing as each jurisdiction is trying to protect itself and cope with the impact of betting exchanges in its own way.  Today’s Agenda papers, together with any updated information provided to the meeting will give the current position in each State. 

A special Working Party, chaired by John Anderson, has been working to solve the unsatisfactory situation whereby betting on Tabcorp closes approximately 10 seconds before the start of a harness race and when the field is coming into line, but on Unitab it closes when the field is released.  It is hoped that agreement will soon be reached with Tabcorp and the Regulators to ban the cancellation of bets after the field lines up but allow bets to be accepted until the field is released. 

You will have read the success of Council’s negotiations on DNA Genotyping and our extended continuing agreement with Maxxam Analytics of Canada together with our National Public Liability Insurance with Liberty International Underwriters and ACE Insurance for Personal Accident Insurance.  These important ongoing partnerships have produced and will continue to produce significant savings in the millions of dollars together with added benefits for our industry’s participants and you as Members.  It is satisfying to report that after considerable perseverance, two further modern protective vests have recently been submitted by manufacturers.  These vests have passed the International BETA 2 Standard and are undergoing our own laboratory’s testing. One is now approved for use.  Drivers, in future, will have a wider choice in meeting their comfort needs without compromising their safety.  

You will notice on our Balance Sheet that we have funds in reserve, earmarked for the integration of the State Controlling Body Databases and progressing the development of a National Registration System.  Commencement of this project was suspended pending resolution of the ongoing structure and ownership of RISE.  I understand that the future ownership structure of RISE is in final negotiation and will be finalized shortly.  On this basis, I believe it is now time that we reviewed and re-confirmed the economic viability of this project.  A  Working Party can then be formed to finalize the specification of a comprehensive system that will meet the requirements of all jurisdictions. An updated feasibility report is now in preparation for consideration by the Executive Committee.  I would advise that, when formed, this Working Party consist of a representative from each jurisdiction [the customers] together with a representative from RISE [the supplier]. 

My congratulations go to my predecessor, Mick Lombardo, the proud breeder and owner of Lombo Pocket Watch; certainly the most exciting Australian 2 year old I can recall in my many years as a harness racing enthusiast.  I rank the experience of being at Ballarat, watching Lombo Pocket Watch win the Breeders Crown, comparable with that when I was at Lexington in 1980 and saw Niatross time trial in 1.49.2.  The Lombardos are the Inghams of Harness Racing, and to own the best 2 year old ever bred in Australia is a fitting reward for their contribution to our great sport. 

Over the last year, I have been very pleased with the smooth functioning of Council and the progress made on many fronts as detailed in the Agenda Papers now before you.  This has been the result of a team effort.  I would particularly like to thank those who gave of their time to participate in the various Committees and Working Parties.  I would also like to thank my fellow Executive Committee Members Neil Busse, Bob Lette and Garry Scott; Rod Pollock, our Chief Executive Officer and all the Members of Council for their 100% support throughout my two year term of office.    

In closing, to Geoff Want, your new Chairman and to all Council Members, good luck and my best wishes in leading Harness Racing through the challenges that lie ahead.

John Bagshaw
Chairman

October 2006

		Since our Annual Meeting in October 2005, a number of important issues and events have taken place.  Of most significance is the decision of the Tasmanian Government to grant a license to Betfair to conduct a betting exchange in Australia despite opposition from all three racing codes and all other Australian states and territories.  With Betfair now licenced in Australia, and more licensed betting exchanges likely in the future,  we must now work to ensure that any potential impact on the integrity of our sport is minimized.  Individual jurisdictions must take whatever steps are necessary to protect their existing revenue sources and to negotiate a fair product fee from those who use or intend to use their proprietary product data.  You will notice from the Conference papers that major concerns still exist with respect to access, by Stewards, to full betting information from Betfair.  It is hoped that these concerns are quickly resolved and dispelled through commercial negotiations.

During the period under review, South Australia indicated that it intended to allow the use of Frusemide under controlled conditions.  I am pleased to report that after discussions with the AHRC Executive, veterinarians and our insurer that the plan has now been abandoned.  This exercise has raised the question re whether our insurance cover for industry participants will remain effective if jurisdictions do not conform to Australian National Rules.  The simple answer is that our insurance cover is based on Australian National Rules and any jurisdiction that does not follow them, or brings in local rules, runs the risk of a situation occurring where, in that instance, their insurance is invalidated.  This is no different from any other insurance.  If you go outside the conditions of the policy, you run the risk of having a claim rejected.  It is not possible to include local rules into a national insurance policy. 

The TVN/Sky dispute has caused racing product images to be split between two TV screens for nearly 12 months.  This has lost us many punters and much revenue.  Both of which will never be regained.  All jurisdictions must continue to remind Governments just how much revenue is being lost by both Government and the racing industry in this commercial struggle for market share. 

After a great deal of effort on the part of our Chief Executive Officer, Rod Pollock, I am very pleased to report that a National Personal Accident Insurance Scheme has recently been implemented for the Safety and Well-being of Licensees. 

With a new Commercial Board now in place in NSW it is hoped that the future ownership structure of Rise can be quickly resolved and we can establish a working party to progress the development of a National registration system which will materially benefit all jurisdictions.  

Ray Sharman has been leading the discussions on our Racing Product and how to improve it for today’s consumer. A wide ranging survey, seeking input from all participants in our industry, has recently been launched.  It is planned to establish a small Working Party to review all survey responses and present a draft Product Review Plan for discussion at our Annual General Meeting later in the year. 

In order for our Chief Executive Officer to participate more actively in the decision making process of Council, our budget for 2006-7 will include an additional part time assistant to take over much of the secretarial role that he currently performs in addition to his other National responsibilities for members.  This will enable the CEO to prepare discussion papers on important issues under consideration by Committees and Working Parties.

This is a further step towards improving the effectiveness of Council for all Members. 

We have again been invited to attend the Racing Ministers Conference in May. This is our only opportunity to liaise with Governments collectively and to raise current issues that affect us all as well as reporting on matters raised at previous meetings. 

In closing, my thanks go out to all of you, who have devoted your time and energies to furthering the progress of our great sport.

John Bagshaw
Chairman

31 March 2006

Chairman's Report - AGM October 2005 Mr John Bagshaw
		The past year has been a very eventful one for Harness Racing.   Whilst Betting Exchanges and the TVN/Sky Channel dispute have attracted most of the media attention, a huge amount of work has been accomplished by the various Chairmen, Committees and Working Parties culminating in the issues for discussion and resolution at today’s meeting.   Council is a recommendatory Body and can only play an effective role if issues of importance are considered, debated and recommended by our various Committees and Working Parties.   We owe all those who participated a deep gratitude.

This year, a very satisfactory continuing Agreement has been reached with Liberty International Underwriting for Public Liability Insurance for drivers, trainers and clubs which, together with a new National Personal Accident Scheme with ACE Insurance Ltd for drivers, trainers and stable hands in which all States have participated to the extent possible, has resulted in substantial cost savings.  I must commend Rod Pollock and Jardine Lloyd Thompson, our Brokers, for this incredible achievement which has a significant financial saving for our industry nationally and provides considerable benefits to our licensed participants and registered clubs. 

During the year the AHRC and its Members have actively opposed the granting of any betting exchange licence in Australia and has made representations initially at the Racing Ministers’ Conference in Auckland, to the World Trotting Conference in Rome and more recently to the Premier of Tasmania and our Tasmanian Members. Our opposition has primarily been based on Integrity Issues.  It is the view of the Executive that no financial reporting system in the world can detect which bets to lose have been made with ‘ inside information’ before a race is run.   Even if you find out after a race, it does nothing for the betting public other than further undermine integrity. 

In June, Australia played a leading role at the World Trotting Conference [now re-named International Trotting Conference {ITC}] in Rome, chairing four of the five working committees.  At the Conference, it was unanimously agreed that all member countries would respect the jurisdictional integrity of every other signatory in the provision of wagering and would take whatever steps were possible to protect their intellectual property.  This has united the World Harness Racing and Thoroughbred Racing Industries on this issue and is the greatest weapon we have in opposing unlawful betting on our racing product. Steps were also taken to achieve greater participation by CEO’s of member organizations in debating issues of common concern and preparing recommendations for consideration and decision at the following ITC meeting. 

The resolution of the ownership of RISE continues to hold back the expansion of our computer systems into areas of common benefit, such as Registration.  The current RISE Partnership expires in 2008 so when the ownership is resolved, a new agreement will need to be reached between the co-owners to ensure that future funding is available to meet the needs of our members.  Importantly Members are also customers of RISE and the system must canvass their needs and meet their expectations. 

The constant change and differing financial circumstances of individual Council Members continues to cause concern. An open and free exchange of ideas and information between members is desirable in the national interest. In this regard, Council is available to assist as a catalyst, if required.  The gaming and wagering environment in which Members operate poses considerable opportunity and threat unless concerted unified action is undertaken. 

During our national representation with the Racing Ministers at their Conference in Auckland an undertaking was given to come up with an acceptable solution to when betting cease on Mobile start Harness Races.  It seems that this problem is peculiar to Tabcorp Betting only.  After a number of well intentioned but ineffectual attempts at resolving the issue, it has been now accepted that Tabcorp betting will cease 10 seconds before release.  A working party is currently investigating the best method of communicating to punters when that point is reached. 

We are moving towards a national approach to the Unpaid Forfeits List with all industry participants being required to meet their financial responsibility.  A working Party is using elements from the New Zealand System as a model and I would expect you will see the result of their deliberations for your consideration at our mid-year conference in Hobart. 

My thanks again go to all those who have sacrificed their time to work on our many committees and working parties. It is very encouraging to see all sections of our industry, through our Members and supported by their Chief Executives and staff resources, working together for the common good.  

John Bagshaw
Chairman

October 2005