Skip to main content
Normal View

Dáil Éireann debate -
Thursday, 16 Jan 2014

Vol. 826 No. 2

Betting (Amendment) Bill 2013: Second Stage (Resumed)

Question again proposed: "That the Bill be now read a Second Time."

I observed yesterday that the betting industry has changed dramatically in recent years. When I first stepped into a betting office, the choices available were horse racing and dog racing. Now it is possible to place a bet on soccer, Gaelic games and golf, as well as virtual racing involving dogs, cars, cyclists, horses and so on. One can place a bet even where there is no live racing from any of the race meetings in Ireland or Britain. Young people, in particular, are betting more often on virtual rather than live racing.

We support the extension of betting duty to online bets. The delay in bringing forward these provisions has, according to the experts, cost the State upwards of €40 million in lost revenue in the past three years. It is important to ensure that the licensing regime is robust and equitable in terms of the treatment of domestic and overseas operators. Bookmakers in this country have been arguing for several years for a more level playing pitch, their case being that the online business has put domestic operators at an unfair disadvantage because of the non-taxation issue.

The horse racing industry provides more than 15,000 jobs and must be supported by a secure funding model. The Government has chosen not to support the proposal in the 2012 Indecon report to increase betting duty to 2%, which would have removed the need for a continuing Exchequer contribution to the horse and greyhound racing fund. The Minister might explain why he rejected that recommendation and whether he intends to review the decision in the future.

The Bill replaces the 1931 Act and is urgently needed in order to modernise the betting industry. We have seen a major change in recent years, with a move away from the private operators and family-run businesses that were there in the past. Instead, major companies like Ladbrokes, Paddy Power and Boylesports have cornered the majority of the market and have opened offices even in smaller towns. In my home town of Enniscorthy, for example, with a population of 6,000 or 7,000, one of these bookmakers has three shops in operation. A great deal of money is being expended in the gambling industry. It would have made sense for the gambling control Bill, which is delayed until 2015, to have been introduced in conjunction with this Bill. As it collects the additional revenue accruing to the Exchequer this year and next from these provisions, the Government must heed its duty to those people who are vulnerable to problem gambling. We look forward to the introduction of the gambling control Bill as a means of setting down rules and guidelines for the industry in that area.

The provision in the Bill for extended opening hours, from 7 a.m. to 10 p.m., has been greeted with concern in some quarters. The question does arise as to why a bookmaker's office would have to open so early in the morning and stay open so late. There are legitimate concerns that these extended openings might encourage younger people to go in on their way to college or work. On a recent trip to Britain I visited a small, family-run bookmaking business which despite being able, under the law in that country, to open earlier, had chosen not to open until 9 a.m. or 9.30 a.m. That seems a more reasonable opening time. I hope the Minister will be willing to accept amendments in this regard on Committee Stage.

The extended opening hours are also a matter of concern to staff. In fact, in any bookmaker's office I visit I am asked whether I will oppose the Bill. I realise there are guidelines in regard to working conditions and so on, but many of the staff working in bookmaker's offices are employed on a part-time basis and are on low pay. They are concerned that they will now be asked to work unsociable hours. That issue must be addressed, not necessarily by the Minister but certainly by bookmakers themselves. There must be clarity for staff in terms of how the system will operate in the future.

The extension of betting duty to online and offshore telephone betting is an important step in levelling the playing pitch and allowing smaller operators to compete. It will mean additional revenue for the State, which is also welcome. Based on estimates by the horse-racing industry of Irish betting turnover in 2011, this extra revenue should be in the region of €12.1 million on telephone and online betting and €2 million from betting exchanges, provided that all remote betting is conducted through licensed remote bookmakers or licensed remote betting intermediaries. I welcome the provisions in this regard and the Minister's undertaking to enforce them stringently.

As it stands, betting revenue, together with an additional subsidy, goes to the horse and greyhound racing fund, with moneys being distributed from the fund to Horse Racing Ireland and Bord na gCon to develop the horse and greyhound industries, including by way of race course developments, distribution of prize money and regulating and promoting the industries. However, in recent years, revenue from betting duty on off-course betting has declined while, at the same time, online betting has increased. In that context, consideration must be given as to how the industry will be funded into the future. The prize money for Irish racing is very good, making it very worthwhile for horse trainers and owners to attend race meetings. That is possibly not so much the case in the United Kingdom. We do not want a situation where prize moneys are reduced, which would have a negative impact on the industry. Any moneys raised in this area must continue to go towards the development of an industry that is of particular importance in rural areas.

As already stated, small and large farmers in my county are all involved in breeding, rearing or training horses. I am of the view that this industry and the greyhound industry are extremely viable.

I welcome the Bill, which represents a move in the right direction. There are some concerns with regard to the long hours of opening and how these will be policed. Will there be an increase in gambling among younger people as a result of the extension of the opening hours? The Bill has been welcomed by bookmakers, particularly those small private operators who believe it will level the playing field and ensure that major online betting companies will be obliged to pay their fair share of tax. I do not know how the relevant provisions in this regard will be implemented. Ultimately, it will be the responsibility of the Minister and the Revenue Commissioners to ensure that they are implemented. They will certainly have their hands full in the context of trying to obtain the maximum amount of tax from those involved in the betting industry, particularly as the latter know every trick in the book and will be doing their utmost to avoid the payment of as much tax as possible. I hope they will not avoid tax and that they will pay their fair share. I also hope that the moneys raised as a result will continue to be ploughed into the horse and greyhound industries in order that they might remain viable into the future.

I call Deputy Heydon, who is sharing time with Deputies Áine Collins, Connaughton and Lawlor.

I welcome this much-anticipated Bill, which has taken a frustratingly long time to come before the House. The Minister's determination to have the legislation dealt with has ensured that it has finally been introduced, which is great. The Bill, which has been welcomed by the horse and greyhound industries, is also a positive for the betting industry in that it provides a regulatory system for remote bookmakers and intermediaries. It also provides for fair and equal treatment for all bookmakers operating in the State, regardless of their location. The Bill amends the Betting Act 1931 and I am sure everyone agrees that betting patterns have changed considerably in the intervening 83 years.

While the main purpose of the Bill is to extend the licensing and taxation regime to remote bookmakers and betting exchanges, it also provides for important change to the opening hours of registered bookmakers. I very much welcome the move away from the winter time-summer time scenario. As already stated, the Bill is also designed to provide a level playing field for all operators in the industry. Until now, there has not been a mechanism for taxing remote operators. The old winter-time rules forced bookmakers to close their premises early at certain times of the year. As a result, if an evening greyhound meetings was taking place in, for example, Dundalk, those who wanted to place bets were forced to go online to do so and the State was not able to obtain any taxation revenue as a result. There is a need for a level playing field and for everyone to be treated in the same way. This might have had an impact on larger bookmaking firms with a significant online presence but those who were really being caught out were the small independent operators who employ large numbers of people throughout the country. I welcome the proposed change in this regard.

The Bill is a first step in a process to try to address an imbalance which developed as a result of a policy adopted by previous Governments. I listened with interest to the contributions of Deputies Michael McGrath and Browne, who bemoaned the fact that no attempt is being made to try to increase the tax on betting from 1% to 2%. They must remember that a Fianna Fáil Minister for Finance was responsible for reducing the tax from 2% to 1% in 2006. Colm McCarthy has stated that the decision made in this regard looks increasingly like a mistake and has resulted in inadequate funding for racing and inadequate returns for the Exchequer. In the report he compiled for the then Government, Mr. McCarthy pointed out that even if the betting tax were increased from 1% to 2% - which would generate between €60 million and €70 million in revenue - Ireland would still have one of the lowest rates of betting tax in the world.

Deputy Michael McGrath is correct in stating that the racing industry never wanted to be subvented by the Exchequer. However, it was failed Fianna Fáil policy which has led us to this point. The policy introduced by a previous Administration in 2006 in order to attract new entrants to the market has not worked. Not one new major bookmaker has entered the marketplace. What has happened instead is that betting turnover in Ireland has increased significantly, from €1.3 billion to in the region of €4.5 billion. However, the report compiled by Indecon in 2012 indicates that the tax take for the Exchequer fell from €68 million in 2001 to €27 million in 2011. Those figures are staggering. At a time when we are being obliged to make extremely difficult decisions which have an impact on every sector of society, we cannot justify such a low return in tax revenue. That is why I am of the view that the Bill should be on the first in a series of measures.

I was surprised that very few of the previous contributors touched on the key and inextricable link between the horse racing, horse breeding and greyhound industries and the Bill. The horse racing and horse breeding industry is absolutely vital to rural areas where there are not many jobs available. The industry has a turnover that is in excess of €1 billion and it employs approximately 16,000 people. Most of the jobs in the industry are located in areas in which there are not many other employment options. I know this because approximately 4,000 people in the county in which I live, Kildare, are directly employed in the industry. Ireland is the only country in the world in which the racing industry does not receive an automatic direct payment from the gambling industry. Ultimately, it relies on the product of the racing industry.

This Bill relates to the area of finance and I will not concentrate on the perils or otherwise of excessive gambling. However, in 2011 the gambling industry's turnover was €4.5 billion while it only contributed €27 million in tax revenues. Ireland's horse racing and horse breeding industry is a world leader, albeit on a shoestring budget subvented by the State. The horse and greyhound fund is probably the best value-for-money investment made by the Government in any industry. In the long term, however, we want to move to a position where the industry will again be able to stand alone financially and benefit from the funding it raises.

As stated, some 16,000 people are employed in the industry. It is not that long since that figure stood at over 20,000. I am of the view that, with proper support and investment, employment levels within the industry will return to this high. In the process, we will safeguard Ireland's position as a world leader in the horse racing and horse breeding industry. Ireland is there to be shot at and every other country wants to replicate what is done here in order that we might be taken down a peg. The level of investment being made by competitor countries such as France and Australia is both mind-boggling and frightening. We must be aware of the threat in this regard.

Racing revenue is not just for the wealthy. In that context, people have referred to Coolmore Stud and other establishments. It is an easy tag to apply but 90% of those who breed horses have four mares or fewer. Invariably, these people operate in rural agricultural areas and they are involved in real economic activity. The Punchestown racing festival in my constituency and the Galway racing festival are each worth approximately €60 million to their local economies. Ireland is the fourth largest producer of thoroughbreds in the world. It produces 40% of EU output in this regard and some 11% of world output. Irish horses are exported to over 35 countries across the globe and the total value of this activity last year amounted to in excess of €150 million. The industry is an important source of high-value foreign direct investment into Ireland, mostly in rural areas. It is not possible to have a successful breeding industry in the absence of a racing industry and vice versa. The two are interlinked. Neither industry will survive if adequate funding is not provided. There has been a massive decrease in the level of funding available to the racing industry in recent years. Obviously, all sectors of the economy have experienced similar drops. However, the low level of funding available cannot be sustained in the long term.

The Government is well on its way to ensuring that the economy recovers. The large multinationals responsible for foreign direct investment in Ireland and the smart economy are important aspects of our recovery. However, I am of the view that there is no need to reinvent the wheel in the context of seeking to get the country back on its feet. We must instead concentrate on what we are good at. In the context of the horse racing and horse breeding industry, we have the necessary expertise and individuals, the relevant soil type and the pertinent structures. In addition, we also have a reputation as being a world leader in the area. I am of the view that the industry must be protected to the very last. The Bill represents the first important step in ensuring that we will return to a position where the industry will be adequately funded and I commend it to the House.

I, too, welcome the opportunity to contribute to the debate on the Bill. In recent years the Irish people have borne more than their fair share of cost increases. No government wishes to impose tax burdens on its citizens but the vast majority of the population of this country recognise that what was done had to be done. Even thought it has been difficult, we are beginning to see a turnaround. However, we are still spending more than we take in in taxes. In this context, any indirect taxes which can be identified and which will not affect job creation must be considered either for increase or introduction.

The Bill seeks to bring all remote bookmakers and betting intermediaries into the licensing regime. The new licensing system for remote operators will serve as an important public interest mechanism in preventing crime and protecting customers against fraud. It will also ensure that all businesses offering betting services from Ireland or to persons in Ireland will be treated equally and regulated appropriately. The new licensing regime will hopefully create a level playing field between traditional bookmakers and remote bookmakers, who represent the online element of bookmaking.

This has been welcomed by many in the bookmaking world. Paddy Power makes a very fair point that the company welcomes paying any tax so long as its competitors pay the same tax at the same rate, an objective of this Bill. Boylesports has welcomed that, under the legislation, bookmakers who fail to pay out on a genuine bet can be docked in their licence. The chief executive of Horse Racing Ireland, Brian Kavanagh, has welcomed the publication of this Bill as he said it was an important mechanism to create funding for racing. He also welcomes the extended opening hours for shops which will be provided for in the new licensing regime.

The horse industry is very important to the country's economy. It is crucial to the tourism industry and it enhances the reputation of the Irish horse breeding sector. The more tax that can be obtained from the betting industry, the better the opportunity for supporting this industry. Bookmakers' representatives point out that this legislation has the potential to attract foreign investors, thereby creating more jobs and encouraging Irish bookmakers to expand their workforce. The Paddy Power company has created 2,000 jobs in Ireland and it continues to expand. While all reputable bookmakers have rigorous systems in place to verify that account holders are over 18 years of age, there is a general welcome for provisions in the Bill to protect further the young and the vulnerable.

The Bill provides for a new and improved licensing regime. It does not deal with the rate of duty on betting services as this will be dealt with in future finance Bills. The funding of the horse and greyhound industry will continue to be a matter for the Minister for Agriculture, Food and the Marine. I commend the Bill to the House.

This legislation represents the enactment of a provision of the Finance Bill 2011 to extend betting duty to remote betting and online betting. It establishes the necessary infrastructure or regime for collection of this tax. It will be an offence to take a bet from an Irish person by remote means unless the betting facility has a bookmaker's licence or remote betting intermediary's licence. A person with an ordinary bookmaker's licence will also be permitted to take bets by remote means up to a certain value of betting turnover and prosecutions under this legislation can be taken in the District Court in the first instance.

A number of national conversations are taking place about our drinking culture, the obesity epidemic and future health implications. It may be high time that we had a national conversation about the devastating effect of gambling on many families. I refer to the innumerable television advertisements for online poker and online casinos and the number of betting applications available for use on smart phones as evidence that it is time the Government took firm action to regulate this industry.

The boom saw an increase in the prevalence of betting shops on our high streets, but these have become a casualty of the downturn and the move to online betting. Horse Racing Ireland has estimated that bookmaker betting expenditure fell from €5.4 billion in 2006 to €3.7 billion in 2008 and €2.7 billion in 2011. These are staggering figures. Horse Racing Ireland estimates that the online betting industry takes €1.6 billion from Irish residents although it is difficult to estimate how much revenue is leaving the country by way of online betting. I note that tax experts believe that the enactment of this legislation should raise €14 million a year. A portion of this expected €14 million revenue, if it materialises, should be ring-fenced to provide funding for addiction centres dealing with gambling.

Like many other Deputies I have heard harrowing accounts of families trying to pick up the pieces when a loved one has become addicted to gambling. The move to online gambling has made the problem more difficult to manage as smart phone applications mean that gambling is available at all times.

I acknowledge the great work of addiction centres but these centres need further support in their work and the funding that should accrue from online betting sources should go some way to help to pick up the pieces when the relationship with gambling gets out of hand. If €1.66 billion is being spent by Irish residents in online betting and a percentage of those people encounter problems with gambling, then it is only right and proper that the tax duty accruing should be used in part to support those providing services to people with gambling problems instead of promoting the gambling industry.

I note the Department of Justice and Equality is preparing the gambling control Bill which will update the legislation on gambling and regulate Internet gambling. One aspect of gambling I hope to see addressed is the matter of the regulation of casino opening hours to ensure all-night gambling sessions in casinos do not become a regular feature of Irish life. Many other issues relating to the supervision of casinos are being addressed in the forthcoming legislation.

This Bill reflects the Government's determination to change and adapt in the face of changing economic circumstances. The move to online gambling is one facet of life that will take many years to address properly. However, I welcome this legislation which aims to license those involved in online betting in Ireland and which will institute a tax collection regime for these bets in order that the revenue will accrue to the State. The Government will need to provide services to those for whom gambling has become a problem.

I acknowledge the need to protect and enhance the Irish horse and greyhound industries. The Irish thoroughbred horse industry was estimated to be worth €900 million to the economy in 2010. It provides employment for more than 15,000 people. This legislation is timely and welcome but I urge that moneys should be set aside to address gambling problems.

This Bill has been in the offing since the Finance Bill 2011 and it is a redrafting of the original 2012 Bill. I appreciate the work undertaken by the Minister in this regard.

I come from an area which has two of the biggest race tracks in the country. There are two training establishments up the road and a stud farm across the road from my home. People regularly walking their greyhounds is a common sight. I am immersed in the horse and dog industries. I support the views of my colleague, Deputy Connaughton, with regard to gambling addiction, which I acknowledge is a serious issue and must be dealt with. I agree with his point that a portion of the revenue generated through the increase in the betting levy should be applied to help those with a gambling addiction.

In my view there needs to be a level playing field for everyone in the betting industry. Many small bookmakers are not fighting the same fight as the large bookmakers who have offshore and online betting facilities. Bookmakers who provide a service in small towns in rural areas are not playing on the same pitch as many of their competitors. This Bill attempts to level the playing field as much as possible by the use of enforcement.

I refer to the portion of the betting levy given to the horse and greyhound industries. Currently the portion is split 80% and 20% between the two sectors. The horse industry was worth €900 million in 2009 while the greyhound industry is worth €500 million but it only receives 20% of the levy. I ask the Minister to consider a fairer distribution to reflect the number of people employed and the revenue generated for the economy by both industries.

For the first time a number of race meetings will be held on Good Friday, including Lingfield Park in the UK. I can foresee that race meetings will be held on Good Friday in this country because it is a public holiday when families want to participate in activities. I ask the Minister to consider including Good Friday as a day on which bookmakers are permitted to do business.

It has been argued that the 15% levy suits the bigger bookmakers. In my view, a bookmaking firm of any size which offers an online service and is working hard to generate income is being penalised by the 15% levy.

I have always looked on this as a transaction with a client or a customer, whether in a bookmaker's shop or online. I would much prefer to see an exchange tax but that is for another day.

I am very encouraged by racetracks which are actively pursuing customers, whether they allow them in for nothing or charge them a small fee, which I have seen in the US and in France. They do not get the same return from bookmaking. The main beneficiary of this is Tote Ireland, which should make a greater contribution to the racetracks because they actually pull in the customers to the benefit of Tote Ireland which will have more punters coming up to their stands. However, Tote Ireland is not making a significant contribution to the racetracks which are actively trying to encourage more people into the industry.

I welcome the Bill and am just throwing out a few ideas to the Minister. I would like to see a level playing field going forward but the key aspect is that we have proper enforcement so that all bookmakers pay the same.

There is a need to protect vulnerable people, such as those who are under age and those who have an addiction. There is something odd about asking an industry - the gambling industry or the drinks industry - to fund efforts to deal with the difficulties and problems that arise from the activities of that industry. I agree with it, but I think it is something of a contradiction. We know that gambling can attract illegal criminal activity. I hope the next Bill will tackle that in a comprehensive way.

We have seen an increase in the number of casinos. It is frightening to listen to people in their late teens or early 20s speaking about going out for a few drinks to a pub or a club. It seems that they often go to casinos as part of their night out. I do not think we are looking at the accessibility and availability of such facilities. In itself, the Bill can be accepted. It has been welcomed by the bookmaking industry. I am waiting to see the next Bill because I think it needs to go much further.

I would like to share time with Deputies Seán Kenny and Aodhán Ó Ríordáin.

I would like to make some comments on the Betting (Amendment) Bill 2013 that are informed by a different school of thought. I would like my suggestions to be considered. I have listened to many of the contributions that have been made this morning. Deputy Maureen O'Sullivan spoke about the gambler, as opposed to the industry. Deputies Connaughton and Heydon spoke about the industry and the individuals.

I would like to highlight a couple of problems that relate to online gambling, as opposed to the form of gambling that takes place when those who have the funds to do so walk into a shop and place bets using cash from their pockets. Most of those who use the Internet to try to make a profit from gambling use credit cards. I believe the online gambling business will be forever a cash cow for those involved in it, especially in light of the levels of advertising and engagement associated with it. The number of people employed in this sector of the industry is minimal, when considered in the overall context, because it is not as labour-intensive as running a bookie's shop.

I welcome the efforts to gather taxation from anybody who is betting in this country. This was a big problem in the US, where some forms of gambling are prohibited in certain states but were being facilitated internationally through online services. It is fundamentally wrong that somebody can go online and begin a process of gambling using several accounts with various credit card companies. I have met people who have lost houses, businesses and farms as a result of gambling. I have met people from the Money Advice and Budgeting Service who have told me about the collapse of people's lives and families, largely due to gambling addiction. They were not betting what was in their pockets - they were gambling with money they did not have.

I ask the Minister and the Department to consider whether it would be appropriate to restrict online gambling to those using debit and laser cards, rather than merchant cards such as MasterCard and Visa. One should not be allowed to gamble online unless the money is in one's bank account to begin with. People should not be permitted to go into credit for the purposes of following this habit, which is particularly addictive during times of economic hardship. I would agree that the last thing the betting industry, which has many aspects, needs is a Minister for Finance who is a gambler, is completely addicted to gambling or is involved in gambling. People need to be able to do a risk assessment or adjustment.

I am prone to the odd bet. I like the idea of going into a betting shop, meeting people, watching television and placing the odd bet, probably along the lines of the teams I support. I come from a sporting family that follows football, hurling, golf, rugby and everything else that is going on. I have an interest in betting small amounts of money in an accumulator fashion, which means there can be high returns if it kicks off. Irish people enjoy betting and gambling as a means of having fun. I am vehemently opposed to the idea of people sitting at home at 2 a.m., 3 a.m. or 4 a.m. watching a race in the US - one can watch imaginary or electronically manufactured races on certain channels - and going online to use credit cards for the purposes of fulfilling their needs. It does not serve society well.

I agree with the Deputies who have argued that there are too many betting shops on certain streets. There is an adequate number that we should try to attain. I prefer to see small shops where the person who is running the floor and managing the place has an intimate relationship with the individual who goes in to place a bet. A person who is excessive in his or her gambling should be pulled aside in a socially conscious manner and told to deal with that problem.

Much of what other Deputies have said is accurate. One of my bigger problems with the online industry is that it closes the accounts of winning gamblers. The watchdogs need to be on top of this. I have been made aware that it is imperative for people to hedge their smaller shops if they become exposed. They sometimes use the online industry for these purposes. They close winning accounts as part of that process. Where is the fairness? Where is the ability of betting shops to compete with industries that close accounts? One cannot say to someone who walks into a betting shop to place a bet on a horse using a betting slip that his or her money is no good in the shop. By contrast, online bookmakers are watching people's accounts and closing them down.

Our approach to gambling should be socially conscious rather than taxation-orientated. I like the idea of more taxation being generated for the horse and greyhound racing industry. This will also affect football, hurling and everything else.

There is an imbalance in how jobs are created in this sector. On-street bookmakers' shops in small rural towns are losing out to the online industry. As we know, companies that have an online presence, such as Paddy Power, Betfair and Betdaq, are recruiting people in Dublin. The number of jobs in these online companies is far greater than the number of jobs in the on-street network, which is preferable from a societal perspective. I have a problem with the fact that this is another example of jobs being relocated to Dublin.

In the betting world, the races mentioned by the Deputy are referred to as "virtual" races rather than "imaginary" races.

This Bill is designed to provide a regulatory system for remote bookmakers and betting exchanges that offer betting services in Ireland, regardless of location. It provides for the fair and equal treatment of all bookmakers and betting exchanges, including corporate bodies, that offer services in Ireland. It will bring all remote bookmakers and betting exchanges into the licensing and taxation regime. This is to be welcomed.

Betting needs to be regulated extensively. If it is abused, it can be dangerous. Betting can lead to gambling, which can be very addictive. It can destroy families and lives. This development needs to be observed carefully. Steps should be taken to try and guard against gambling addictions being formed. We must also guard against existing gambling addicts being enabled to continue to feed their habit, which is immensely self-destructive.

I recall the misery caused in Dublin by the scourge of the slot machines and one-armed bandits, which were mentioned by a previous speaker. The decision of councillors on Dublin Corporation in the late 1980s to rescind the adoption of the Gaming and Lotteries Act 1956 in the Dublin city area was widely welcomed at the time. In addition to the problem of gambling in the physical world, the digital world is increasingly capable of facilitating betting and gambling. The effects of this form of gambling are less visible because it can be done in private.

The new licensing system for remote operators will serve an important public interest. It will prevent crime and protect consumers against fraud. It will ensure all businesses that offer betting services from Ireland, or to persons in Ireland, are regulated appropriately and fully. Section 2 of the Bill makes a number of amendments to various definitions of the Betting Act 1931 and inserts new definitions to allow for the regulation of remote operations.

Section 9, which inserts a new section 5A into the principal Act, provides details of the process of applying to the Minister for Justice and Equality for a certificate of personal fitness to hold a remote bookmaker licence or a remote betting intermediary licence. This section also sets out a timeline for the issuing of such certificates, clarifies the basis for refusing a certificate and details the penalties for making or providing false or misleading statements in the course of an application for a certificate.

Section 29 inserts a new section 32A into the principal Act and provides for the Minister for Justice and Equality to apply to the District Court to make orders where sections 2, 2A and 23 have been breached.

This is designed to offer a means of enforcing compliance with a licence requirement and includes an order that credit institutions do not transact business regarding certain accounts used in the conduct of bookmaking and remote bookmaking, a prohibition of advertising and sponsorship, and a requirement for telecommunications service providers to block access to certain Internet sites.

I support the Bill.

I appreciate the opportunity to speak on this issue. I wish to address two main issues. Many Members have already discussed the dangers of online gambling and that the social interaction in the bookie's shop in the main street would be replaced by a more private engagement online which, as Deputies Spring, Seán Kenny and others have already said, is particularly dangerous and worrisome.

However, I wish to concentrate on where the money raised through levies on betting ends up. Anybody who takes a cursory glance at the horse and greyhound racing fund and the Horse and Greyhound Racing Act that underpins that fund will probably be surprised at the mechanisms behind it. Most people would be unaware that the levy from every bet laid on anything, including soccer, rugby and the GAA, goes directly into the horse and greyhound racing fund even though only 10% of bets placed in Ireland are on horse or greyhound racing, which is remarkable. When I discovered this a number of years ago, it struck me that this must be the most cosseted industry in the State in terms of public funding. No other sporting organisation gets this type of support; it is unbelievable. If the majority of people began to realise this they might believe we should re-evaluate this funding mechanism. Can it be justified in the new age? Can it be justified when we have such social unease, social problems such as childhood obesity, problems such as hunger among schoolchildren, anti-social behaviour and children being dragged into various different courses in their lives that are destructive?

The 2001 Act introduced by the former Minister, Mr. Charlie McCreevy, still rules the roost in this House and levies from all bets placed in the country go to that fund. Two years ago the fund was worth €57 million and on average the Irish Sports Council gets about half that from the State each year. I would be horrified if this new online betting levy were to go anywhere near the fund. I understand that many Deputies across the House will fundamentally disagree with me on this point. Many Deputies, including some from my party, feel very strongly about the horse racing industry and what it adds to the economy. I have heard figures of €900 million mentioned for the horse racing industry and €500 million for the greyhound racing industry. I am willing to accept those figures, and the employment and tourism that come therefrom. However, we cannot let this lie without re-evaluating it.

On drilling deeper into the figures we discover that approximately 80% of the money from the horse and greyhound racing fund goes to the horse racing industry. The vast bulk of that is spent on prize money, which is much more lucrative in Ireland than elsewhere in Europe. I am led to believe - I am open to contradiction on this - that five named individuals are the main beneficiaries of that prize money and their tax status is open to plenty of controversy every year.

I strongly welcome that we are regulating the industry, placing a levy on it and bring it out from the darkened bedrooms of people and into the light by focusing attention on it. If the State is to benefit from a levy on it, we need to be open and transparent as to where that money will be spent. In view of all the social ills that are caused by gambling and other excessive behaviour in society, if we are to continue to funnel such a level of levy receipts from the existing betting arrangements to the horse and greyhound racing fund, we need to have a more honest and open debate on it. We need to have an honest and open debate on sports funding and what it is for. Is it for participation of children? Is it for the betterment of society? Is it for connectivity? Is it for health and exercise? Alternatively is it for this industry? Perhaps we have not had a sufficiently open discussion on that.

I welcome the Bill which is justified in its purpose. However, I would have a deep distrust of the types of individuals and companies behind this. There is a difference between a person having to go into a bookie's shop where one must engage socially and doing it in one's own bedroom. Doing it behind a computer screen using credit cards and not engaging with anyone is very dangerous and worrying, as Deputy Spring has already said.

The connectivity between the levy we will receive from this and the expenditure on the other side is key to this. Like everything in Irish society and public policy, people have more belief in the taxation system and the society in which they live if they can see the connectivity between the charges they pay, including the levies placed on things and the services they get as a result. We need to be much more open and honest about the horse and greyhound racing fund, the Horse and Greyhound Racing Act that underpins it and the type of sports funding that is available. We need to have discussions with every other sporting organisation in the country as to what they need. We should not be afraid of talking honestly and truthfully to those powerful individuals in the horse and greyhound industry who may have a different point of view.

I welcome the Bill, but it needs to represent the beginning of a discussion as to where our levies go, how we support sport and leisure, and with whom we are willing to talk tough.

I am pleased to speak on the Bill. I have got a flavour of what previous speakers said. I start by saying I do not believe I ever placed a bet in my life in a bookie's shop or anywhere else.

That is why the Deputy has all the money.

I wish I had. I gave it all away.

I have never had any involvement with horse racing or horses in general. I do not believe I was ever on a horse's back. I believe I have been to the races twice in my life. I am not into horse racing.

The Deputy should go more often.

When talking about an industry it is easy to cast aspersions and refer to someone having a personal interest. Deputy Maureen O'Sullivan made a very balanced and reasonable contribution when she spoke about the challenges of gambling addiction. I have met people addicted to everything from bingo to scratch cards and whatever. The problem with addictive gamblers is that they will find a way of gambling. It is a major challenge and some of the money collected from this levy should be used to help those who are working with people who suffer from this addiction. As has been pointed out it is a very silent problem and is not very visible. Often the first symptoms are people showing up with incredible debts that are unexplainable based on the rest of their lifestyle and income. Therefore I am disappointed that the control of gambling Bill is not before us in parallel with this Bill. It is very important to keep this issue in mind in the debate.

I have a friend who puts on a bet in a bookie's shop the odd time. He used to say to me that I should look at the floor of a bookie's shop before placing a bet. I asked him why I should do so and he responded by saying I would see all the tickets thrown on the floor from the gamblers who have lost.

The Act we are amending dates from 1931. When one thinks of the technology we have today compared with that available in 1931 it is time to address this issue. It is time to bring the online betting into the mainframe. We will not stop gambling and we will not stop people in the modern world placing bets online. Just as people drink on their own, people can do things in the privacy of their own home that would have been undreamt of many years ago because of the dramatically changing nature of society. Online betting will continue to be a feature of society. In that situation it is much better to deal with it as a mainstream activity rather than deny that it is happening.

I am disappointed that it has taken so long for this Bill to come before the House. We in the previous Government had approved the heads of a Bill. When this Taoiseach took office he said that the Bill would be before the House much sooner than now. Why has it taken 1,000 days to get it this far? This legislation has two purposes, one, to control, license and regulate which is very important. We need to regulate the way that online betting companies operate. The second purpose is that it gives us the chance to raise revenue and the question has been asked what would happen this revenue. Deputy Ó Ríordáin was right that this is unusual. It is a hypothecated revenue, in other words, it effectively goes to one industry although the Department of Finance prefers that money goes into a general pot and it then distributes the money. I am very much in favour not only of introducing the Bill but also of increasing the rate of betting tax, which I believe is very low. It is 5% in Germany, 2.8% in the UK, 3.8% in Italy, 15.5% in France, 7% in Spain, 15% in Bulgaria and 17.5% in Japan. I am not proposing any of those higher rates. We could set a rate of 2.5% or 3%. The online betting companies, the bookmakers, will say that they will fly the country if the Government does that but where will they go? Only tax havens have a lower rate than ours. Every industry, whether the cigarette or drinks industry, will say whenever the Government proposes a tax that it will destroy it and that it will move away but that rarely happens.

Should the money be used for the development of horse and greyhound racing? Should we continue effectively with hypothecation or should it just go into general taxation? Before the money is divided it must be collected. I believe we should raise the tax. We should invest more in horse racing and the sport horse industry, down to dealing with horse issues in urban Ireland. It would be great if we could do that in a way that will not only be self-funding but that the money comes from the Exchequer because the betting tax is not adequate to fund the horse and greyhound racing industry. It would be very sensible to use this extra finance to develop these industries.

The horse industry, from the high end all the way down, is very important to Ireland. We should develop this industry because we have many natural advantages in it. We should never be complacent that our place within the industry will be maintained unless we are willing to invest. Our natural advantages are tradition, technical knowledge, the rain, the grass and many other factors which have given us an incredibly good horse industry. We should do this across the board. Our thoroughbred industry is important worldwide. We are disproportionately large players traditionally in that industry but there is continuing competition from various parts of the world and if we want to retain our place and all the jobs in the industry we must continue to invest in it, including in facilities and services. Many thousands of people are involved with the thoroughbred industry in Ireland. Most of the breeders are not big operators and it is important to support an industry which provides so much employment in rural Ireland.

The sport horse is also very important. To judge by the reports we have received on sport horses they are major contributors to the economy but they are crying out for further investment. That includes the native breeds such as draught horses and Connemara ponies and so on which are associated with this island and have made such a contribution to it. The Connemara pony is indigenous to the region in which I live. Many very ordinary farmers have been engaged in that industry over many years although it faces huge challenges. Many people are attracted to the region because that horse is indigenous. While we are talking about the common agricultural policy programme and the billions of euro to be invested there we need to recognise that it pays equally to invest in horses.

The Minister of State at the Department of Finance, Deputy Brian Hayes, is familiar with the problem of horses in urban areas. That is a major challenge where people have horses in inappropriate settings. There are many things we can do to give people in urban areas who are interested in horses a legitimate and well-managed outlet for getting involved with them, such as the horse projects in Fettercairn and elsewhere. Money from the betting tax could be invested in the horse industry down to that level and the urban horse problem could be resolved by getting funding from the betting tax such as I have proposed.

I understand the ratio is about 90:100 so one could pick the rate to get the extra-----

I am sorry to interrupt but, as it is 12 noon and we must move on to Leaders' Questions, I must ask the Deputy to move the adjournment of the debate.

I will do so, but I will not be resuming.

Debate adjourned.
Top
Share