I welcome the Minister for Agriculture, Fisheries and Food, Deputy Smith, and his officials. Members will be aware that Dáil Éireann and Seanad Éireann recently approved a motion to refer a draft order related to the Horse and Greyhound Racing Fund (No. 2) Regulations 2010 to the joint committee for consideration which stipulated that it report back to both Houses not later than 16 December. Members will have received a briefing note on the motion. They are reminded of the long-standing parliamentary practice to the effect that they should not comment on, criticise or make charges against a person outside the Houses or an official either by name or in such a way as to make him or her identifiable. I invite the Minister to make his opening statement.
Horse and Greyhound Racing Fund: Motion
The horse and greyhound racing industries receive financial support from the State through the horse and greyhound racing fund under section 12 of the Horse and Greyhound Racing Act 2001. Payments are made from the fund to Horse Racing Ireland and Bord na gCon. In the period from 2001 to date a total of €673.2 million has been paid from the fund to the horse and greyhound racing industries in accordance with the provisions of the Act.
State funding provided through the fund is pivotal to the survival of the horse and greyhound racing industries. The current ceiling on the fund of €673.2 million has been reached. For my Department to continue to make payments from the fund to these industries in 2011, the aggregate limit on the fund must be increased from the current limit of €673.2 million to €730.5 million to allow for the provision of €57.3 million for Horse Racing Ireland and Bord na gCon, the amount allocated for this purpose in budget 2011. Of the €57.3 million, 80% will be allocated to Horse Racing Ireland and 20% to Bord na gCon in accordance with section 12(6) of the Act. To give effect to this Estimates' allocation, it is necessary under the relevant provisions of the Act to have the increase in the horse and greyhound fund specified in a regulation. The aggregate limit of the fund has been increased in this manner in 2004, 2009 and earlier this year.
Funding for both agencies, Horse Racing Ireland and Bord na gCon, supports two very important productive industries and helps to sustain the role of the thoroughbred horse and greyhound breeding and training enterprises in the development of the rural economy. The industries together account for an estimated 27,500 direct jobs, generate substantial economic activity and make a vital contribution to the rural economy, including farm incomes. The fund has allowed Ireland to develop into a world centre of excellence for horse racing and Horse Racing Ireland to undertake a capital investment programme that has underpinned growth in the sector.
The funding being provided for the greyhound racing sector helps to sustain a long-standing tradition. It underpins the economic activity in what are, in many instances, less economically developed regions. It has also contributed significantly to the improved facilities available at greyhound tracks around Ireland.
When the fund was established in 2001, it was expected it would be fully financed from the revenue from excise duty on off-course betting. However, this has not proved to be the case. When the fund commenced, the rate of duty was 5%, but this rate was subsequently reduced over time to 1%. This reduction, coupled with the increase in online, remote betting and betting exchanges which are currently outside the tax net, has led to a severe decline in revenue from duty collected on off-course betting. This is an issue of great concern to the Government and one to which I will return.
The amount collected from excise duty on off-course betting declined from a peak of €58.9 million in 2000 to an amount of €31 million in 2009, with a similar yield estimated in 2010. Since 2002 the amount paid into the horse and greyhound racing fund has been a combination of the amount collected in excise duty from off-course betting plus a direct Exchequer subvention. The draft regulation before the joint committee provides for an amount totalling €57.3 million to be allocated to the horse and greyhound industries in 2011. This will comprise approximately €31 million from excise duty on off-course betting and the remaining €26.3million in the form of a subvention from the Exchequer. The 2011 allocation of €57.3 million compares to a figure of €59.3 million this year, a reduction of 3.3%. The allocations for the fund in 2009 and 2008 were €68.1 million and €76.3 million, respectively.
The Taoiseach stated the Government's view on 13 May that online and telephone betting should pay their fair share of betting duty. Accordingly, officials from the Department of Justice and Law Reform, together with officials from the Department of Finance, the Revenue Commissioners, the Office of the Attorney General and my Department have been meeting to see how best to introduce necessary changes to achieve this objective. My colleague, the Minister for Finance, announced in budget 2011 that he was "making the necessary arrangements to ensure bets placed on the Internet by domestic punters are subject to the same level of betting duty as applies in the high street betting shops." As recently as yesterday, the Taoiseach reiterated in the Dáil that new legislation on betting would be brought forward early in 2011.
The Minister for Finance noted that betting duty has to date only applied to bets placed in betting shops with bets placed by Irish punters either online or remotely, by whatever means, falling outside the tax net. The Government intends to include provisions in the finance Bill and to revise the Betting Act 1931 to ensure that all bookmakerstaking bets from Ireland will pay betting duty on those betsin the same way that betting shops currently do. The Minister for Finance has also indicated that betting exchanges will also be subject to taxunder the new arrangements.
It is hoped that by including the high-growth area of the betting sector, namely, remote, online betting and betting exchanges, the tax base from betting will be boosted significantly. In a full year it is expected that the tax yield could grow by up to €20 million depending on the prevailing market conditions. The details will be contained in the finance Bill and the proposed amendments to the Betting Act 1931.
State funding provided through the horse and greyhound racing fund is pivotal to the survival of the horse and greyhound racing industries. Those very important industries require this funding for their survival and in order to facilitate growth and development into the future. The Government has made provision in budget 2011 to allocate €57.3 million to the horse and greyhound racing fund. In order for the Department to distribute €57.3 million to HRI and Bord na gCon the aggregate limit of the fund to date must be increased by €57.3 million pursuant to the provisions of section 12(5) of the Horse and Greyhound Racing Act 2001. On that basis the draft regulation which is being considered by the committee today provides for an increase in the current aggregate limit from €673,171,713 to an aggregate figure of €730,461,713 - the cumulative provision in the fund since 2001.
I will circulate a copy of the draft regulation to the members of the joint committee. Section 12(13) of the Horse and Greyhound Racing Act 2001 provides that a draft of these regulations be laid before both Houses of the Oireachtas and a resolution approving the draft be passed by each House before the regulations are made by the Minister. I ask members for their support in order to ensure that Horse Racing Ireland and Bord na gCon receive the funding provided for in budget 2011 so that the very important role of these industries, and the employment supported and economic activity generated, is sustained. I commend the regulation to the committee.
No one disputes the importance and the value of the horse industry, both racehorses and sport and recreational horses to the rural economy. What worries people is the fact that the Exchequer must still continue to support it from depleted State funds.
In 2000 a total of €58.9 million was collected and that was reduced to €31 million last year. The reality is that the amount of money laid on bets in the country has possibly more than trebled in that period in the take by the State in revenue. In 2001 it was anticipated that the fund would be fully financed by the industry itself through betting but the reverse has been the case. All bets laid, on-course, in high street shops or online must be subject to the same levy. Whether it is 1% or 2%, everyone should pay it. On the basis of the amount of money that is being laid on bets in this country the industry can sustain itself. It is a vital industry but it is vital also that the people who participate in it can fund it. There is no need for other moneys from the State to subvent it.
We do not have a choice about whether to provide the €57.3 million in order to keep the industry going for now but the aim must ultimately be to make the industry self-sustaining. I welcome the comments of the Taoiseach on two occasions this week but we must see action in terms of the necessary legislation or regulation being put in place as soon as we come back in the new year. People will not tolerate it. I accept that the industry is in trouble but it seems absurd that the industry cannot support itself. If everyone who lays a bet was to pay €1 in €100 the industry could pay for itself. That is the key point.
I thank the Chairman for allowing me to come to the committee meeting this morning and to speak on behalf of the Labour Party. I am not a member of the committee but Deputy Sherlock has agreed that I could deal with this issue.
I appreciate what the Minister said and thank him for his presentation. To get down to the nitty-gritty, we are looking for €26.3 million from the Exchequer. Quite honestly, that is not sustainable in the current economic climate. I am very conscious of the needs of the industry and the jobs that must be sustained. However, a couple of important facts remain. Gambling is an aspect of a number of other sports which offer a take for the bookies. That must be taken into account. We are talking only about the horse and greyhound industry. I appreciate the importance of each to the economy but gambling takes place in the bookies on lots of other sports as well. I prepared a document last year which estimated that a betting duty of 1.5% on all bets - high street and especially online - would give an opportunity to collect approximately €90 million. That calculation can be checked but it is a reasonable one. If that amount of money were available from betting it would more than take account of the need of both the horse and greyhound industry and some money would be left over to direct towards other sports and also to deal with gambling problems. They are all important issues in terms of the funding.
I welcome the Minister's comment but we have been seeking to tackle online gambling for more than a year. That is at the heart of the matter. There is a significant amount of money out there that is escaping the net. When we spoke about it last year I said I would find it impossible to support the proposal if money were to be taken from the general Exchequer this year. That is my current position.
I welcome the Minister and his officials. I endorse his position on the importance of the horse and greyhound industries to this country. A total of 27,500 people are directly employed in those two industries. That is an indication of how important the matter is. Such an industry must be subvented in some form.
In the same way as other speakers I am disappointed that we had to take money from the Exchequer, €26.3 million to fund it this year when a self-financing fund is available if we could get a benefit from Internet and offshore betting.
In my area we are on a waiting list for five years to get finances to upgrade the greyhound track. The work is dependent on the fund being available. My colleague, Deputy Coonan, will refer to another track that is in need of a few bob.
We must leave a few bob for the venue as well.
I heard on the radio that there are only three or four big players providing an Internet bookmaking service. In other countries such as America it was difficult to implement a 1% levy such as has been discussed. Those involved have to voluntarily become involved rather than through enforcement, especially bookmakers from outside the jurisdiction, for example, our neighbours across the water. There is a problem collecting such a levy in other countries. I compliment the Minister for Finance on introducing the measure. The sooner we enact the legislation the better, for example, early in January. How can we follow up on it to ensure compliance in order to get 1%, which is badly needed?
I agree with the sentiments expressed by Deputy Doyle that the industry should be self-sufficient. We should have extra money that could be invested in other areas. It was mentioned that we could get €90 million a year if the system is properly put in place. Will we have a problem in collecting the money from international players, in particular?
We all acknowledge the importance of the racing and greyhound industries to the economy. They generate a lot of money, although this is not always obvious. It is very hard to sell the idea of the subvention at a time when there are cuts right across the board, including to disability pensions. However, the industry is capable of generating enough funds to look after itself and is, therefore, lucky to receive €57.3 million. It is obvious that the betting tax system will have to be changed. People who are prepared to bet hundreds and thousands of euro should pay for the privilege of doing so, not the taxpayer. We are pumping taxpayers' money into the industry. I have been involved in the horse racing industry for many years. I do not go to the races very much but reiterate that if somebody wants to have the privilege of being able to gamble hundreds of thousands of euro on horses and dogs, he or she should pay for the privilege rather than the taxpayer who is severely hard pressed. We go along with the funding proposal at this point but contend the industries will have to be self-supporting in the future. As my colleague stated, we should be asking for something back, as we have put a lot of money into the industries in recent years. Some €677.2 million has been invested since 2001. That is a lot of money in the current climate and would assist many people who are struggling.
I support my colleague Deputy Upton. The State can no longer justify a fund or subvention of €26.3 million, especially when we can, in this era of advanced technology, capture funding easily in an online setting. We contend that if one can raise €90 million through online and off-line activity at a tax rate of 1.5%, one is creating a level playing pitch. This is because one is not penalising bookmakers such as Mrs. Bambury in Mallow, an independent bookmaker who does not have an online presence. She has been put at a disadvantage relative to Celtic Bookmakers, Paddy Power and all the major entities which can operate online and create companies abroad in Gibraltar and such places for taxation purposes.
Considering that the IMF has already been to these shores, one cannot argue that the Exchequer must now fund the industry with another €26.3 million. I am a greyhound owner and hail from the town of Mallow which has a proud tradition of racing. In anticipation of Deputy Edward O'Keeffe's contentions about Youghal, I had a dog running there a couple of weeks ago and, therefore, know the value of that location.
If there was sufficient political will, we could capture millions of euro in an online setting. It has not been sufficient heretofore. The Labour Party, including Deputy Upton, has much forbearance in this regard. We have now created a policy that allows the Government to get off the hook and take on the larger players in the betting industry such that it can capture funding that will, in turn, fund the industry. One could increase the number of jobs in the industry above the current number, 27,000. To do this, however, one must think more laterally. That is the logic of the Labour Party's argument and why I support Deputy Upton. If we are sufficiently brave and bold, there is no reason we cannot tackle online betting. The potential is massive and nobody will convince me that one cannot capture the online market. I do not know whether tinkering around with legislation is sufficient. Does one place an onus on the industry to capture the funding or place an onus on the Exchequer? I would be happy to hear the Minister or his officials talk about how the system operates in other countries where what I propose has been achieved.
I declare an interest because I own one leg of a racehorse which may find itself in the European food chain the way things are going. I understand where the Minister is coming from and the number of jobs involved, 27,500. The racing industry has been one of the main growth industries in the country since 2000. However, that income from tax has fallen from €58.9 million to €31 million suggests somebody is codding somebody. I agree with the previous speakers that this issue will have to be dealt with and the quicker, the better. The industry should be funding itself.
I have owned dogs and horses as part of syndicates. In this instance, we are talking about the sport of kings. The subvention is big and it is difficult to argue in favour of it, given the burden on the taxpayer and the cut to the blind person's pension. A small minority support the industry, in which we have invested considerable capital in the past ten years, much of which will not be paid back. There are minor cases for NAMA. Some €6 million was spent in Mallow recently and the facility has practically never been used. Were there projections made on what would occur there? Wild corporate entertainment developments were built in Punchestown and right across the country. Where is all the corporate entertainment now? The capital was provided by the taxpayer. If I am incorrect in my contentions, I would like to know.
Who appoints the members of the boards of the racing organisations? Are changes envisaged in this area? This morning we heard news that the chairman of Bord na gCon was retiring. We are waiting to see what happens in this area.
We have too many racecourses and race days. Numbers have decreased substantially, thereby affecting economic viability. The sector needs to be examined seriously and rationalised. I want the Minister to elaborate on the extravagance of Horse Racing Ireland which has moved office three or four times in the past few years. It is now based in Ballymany. This must not continue and the problem must be addressed, in addition to the problem associated with betting. The prize fund in this country is substantially higher than in the United Kingdom. This issue must also be addressed. There is no point in having huge prize funds if only 300 people are present at a race meeting. Where is the money going?
Let us consider the capital costs involved. I attend greyhound race meetings occasionally. I was at the Irish Greyhound Laurels meeting in Cork and at another there even more recently. The number who attended the Irish Greyhound Laurels meeting was half what it was last year and there were only three bookmakers present on the night. This sends a message loud and clear that must be addressed, just as every other economic problem must be addressed. It is the biggest night of the year in Cork. Limerick race track which cost €23 million was opened the night before. From where did the €23 million come and what was the State's contribution to it? This happened in the middle of the economic crisis.
The industry has not grown naturally. It has grown through the investment of taxpayers' money. When one looks at the enormous contribution made in that regard, it is frightening. All of the small bookmakers are moving out quickly, whether at the track or in towns. This is an issue that needs to be addressed. One only has to look at the financial pages of the British newspapers to see the way share prices are moving in the bookmakers' and turf accountants' sector and the profitability of such organisations. I do not want to name them, but there are about four altogether. That is an indication that there is money on which the Exchequer is missing out.
There has to be a fair distribution of money and income in this economy, particularly at this time. I am asking whether the current number of racecourses, including dog tracks, can be sustained. We have a number of dog tracks which have been in existence for a long time. We also have too many race days, as indicated by the numbers. However, there were practially no race meetings since November until last Sunday.
Putting in this amount of money at a time when public representatives have to face tenants' associations and the masses on social welfare payments, including blind pension and disability benefit, is absurd. I sympathise with such individuals. Some €730 million has been invested in the sector over a period of ten years. There is a significant question mark against this investment since there will not be a payback in an industry which has grown on the basis of State subsidisation. How long can the State continue to do this?
There is a need for more discipline within organisations in terms of office changes to achieve efficiencies. Prize funds should also be brought more into line with those in Britain. We are seeing a downturn in flat racing which does not attract big crowds in this country. I seek an explanation from the Minister as regards the accounting system in use in both organisations and whether it is up to date as they change over from one Department to another. When will the annual reports of Bord na gCon and Horse Racing Ireland be available? I have a couple of them and seek an update in that regard to confirm that their figures are in order.
I understand the capital requirements of some racecourses and dog tracks are met from the Central Fund. We have a small track in a seaside town, at which there is a need for investment. It is to be found in a small town which is in trouble as it has no industry. I am looking for capital in this regard - even begging for it - although I do not want to go cap in hand looking for a few hundred thousand euro for the track which has been in existence for many decades and has done a good job for dog owners from west Waterford to as far as north Kerry and east Cork. I do not breed dogs, but I have an interest in them. I have a first cousin who is big into coursing. However, I want the track in question saved because the bigger tracks such as those in Waterford, Cork and Limerick want to see smaller tracks killed off in order that they can have the business to themselves. That is not my policy, nor was it ever of the party I was elected to represent.
This issue of betting and racecourse involves a massive industry. Like other speakers, I have to declare an interest in the ownership of a horse which ran on St. Patrick's Day, on which day at 10 a.m. he was being tipped at odds of 20 to 1. By 2.30 p.m. they were down to 5 to 2 and he won by ten lengths. I did not even have a penny on him.
Do not tell us that now. The Deputy should have talked to the trainer.
Going racing was always a good day out for people, but now it all has to do with betting. The big gamblers do not attend the race tracks anymore and it was they who attracted others. Gambling is now like a takeaway business; it is a massive industry which is growing. Every village in my area has a bookies and every five minutes there are dogs or horses running. We have been lobbied by the small betting shops which do not mind paying their fair share, but when the money from the big bet in the big shops goes abroad, that is when the problem arises. This is wrong. I have seen many football fans in north Meath in the bookies to place a bet on Manchester United winning by a goal. They will even bet on who will score the first goal or whether one team will beat another by one point or two goals. Such betting actually cleans out houses. I know of cases in which houses have been put up for sale because of online gambling and the wife and family are not aware of what is happening until it is too late. This problem has to be tackled.
We all love a day out at the races. I shall go during the Christmas period, as usual. It was always a good day out, but now hardly anyone goes. The catering industry and the bookies on the ground are suffering as a consequence. In the past two or three years we have discussed the issue of how we can get the big bet taxed. There is no point in the State throwing money at industry in which, as Deputy Edward O'Keeffe rightly said, the stock market is the only beneficiary. There are a good many trainers' yards in my area which cannot survive. The racing industry is fantastic in the employment it provides but money is leaving the country. Young people do not mind paying 50 cent per bet. We always did this when we were younger. As long as the horse won, one did not mind paying the tax. What the Minister is proposing to do is good, but there is no point in half doing something. We should go the whole way.
I, too, welcome the Minister. This debate is timely and long overdue. There is a need to take a serious look at the whole industry. The issue of State funding has to be examined.
I come from Tipperary, a county with a very proud tradition in horseracing. It has many stables and trainers, as well as a dog track in Clonmel which is badly in need of funding. Like Deputy Edward O'Keeffe, we believe we should not be left out in the cold, while the bigger tracks such as the one in Limerick are being developed at our expense, although I wish them well. There is a long and proud tradition of owning greyhounds in south Tipperary, west Waterford and east Cork.
Certainly, we have to look at the issue of online betting. In terms of State investment, as cuts are made in the budget, we have to achieve value for money and ensure everyone receives a fair share, not just the precious few who are represented by the movers and shakers. Online betting presents a problem, as the previous speaker said, as people are betting from home or work and no longer going to the dog or race track and in the process they are getting into serious debt which can happen so easily. There are tragic stories of families losing everything, including their homes. Therefore, it is time we had a full debate on the issue and took action, rather than just talking about it.
I thank the Chairman for allowing me to speak at this meeting. I recall that we debated this issue last year and some of the issues that arose then still arise today.
I congratulate the Minister, Deputy Smith, for the work he has been doing since he first took the horseracing industry under his wing. It is a complicated industry because there are so many facets to it. It comes under the aegis of Horse Racing Ireland, the CEO of which made a comment at the time of the budget to the effect that the allocation to the organisation was the yoke of a curate's egg. I took exception to this because social welfare payments were being cut at a time when a very small cut was being made in the funding of Horse Racing Ireland. I heard today that the same individual had received a bonus of €40,000. That is wrong in this day and age since he is already on a good salary. I know most of those on the board of Horse Racing Ireland. They are very good people who are doing their best for the industry. The Minister should look at the board in the future. New blood needs to be introduced on the board of Horse Racing Ireland. We have seen the tremendous work the GAA has done in reorganising itself over the past ten years. A similar amount of work needs to be done on the racing industry.
I fully support the idea that horse racing should be funded from betting duties. It is not right that we in the Oireachtas make an allocation to supplement the industry. I compliment the Minister for Finance on the work he is doing to tax offshore betting. He has a big task on his hands but he should be in the position to do it. There was an indication today that some of the betting shops are doing very well. I have a passing interest in the betting industry and I can assure committee members - I am sure the figures from the Department of Finance will show this - that betting shops are not a very profitable business to be in at present. The 1% levy, which must be paid by the operator and not the punter, is a burden that shops currently are able to bear, but if is increased any further, they would not be able to bear it. Perhaps the punter should be made pay part of the tax. Were we to do that, however, we might force some of the punters from the shops to online betting, so that is an issue to be addressed.
Deputy Edward O'Keeffe mentioned the issue of prize money in Ireland versus prize money in England. I have a copy of a newspaper from 8 December and I note from it that in Dundalk, the prize money on that day was €92,000 for seven races while for 12 races in England, the prize money was €49,000. That is a big discrepancy. I am sure representatives from Horse Racing Ireland will provide good reasons for keeping the prize money high. A delegation of representatives from Horse Racing Ireland should attend a committee meeting and go through everything they do with the horse racing industry. They also run the Tote and my understanding is that this loses money and they do not have to pay the tax.
I thank the Chairman and the committee for facilitating us with this presentation. All the comments made have been supportive of the industry in general. We are all very conscious of the substantial level of employment provided through the horse and greyhound racing industries. Being an irregular attender at tracks in the past, I was not as familiar with the huge level of employment these industries generated until the industries came back to the Department last May. There are 9,500 breeders in Ireland, 770 trainers and 26 courses for horse racing. We then have local suppliers such as feed merchants, transporters, grooms, jockeys and farriers. They are very common throughout rural Ireland and it is an industry that needs support at this time.
I recall speaking to Deputy Upton when she produced the Labour Party proposal on the industry and she raised a few issues with me. We are all aware of the pressure on the public finances as well as on other sources from which Horse Racing Ireland derives its income, including attendances. It is desirable that a more sustainable funding arrangement is put in place for the horse and greyhound racing industries. The proposed taxation of all betting platforms is an essential step in that direction and the Government will shortly publish the necessary legislation.
The responsibility for these two industries was handed over to our Department in early May. On 13 May, the Taoiseach and I met a large number of the representatives of the different interests within the industry and we outlined our desire to extend the betting taxation base. The Minister for Finance outlined some of the details of that in the budget last week. The Department of Finance will bring forward that legislation in early 2011. In the meantime, the Department of Justice and Law Reform has been doing work on the Betting Act 1931. Officials from the Department of Finance and the Office of the Attorney General have all been working together to ensure we get robust legislation put in place. It is not easy but we are determined to have it enacted early in 2011. We want to put in place the necessary arrangements to ensure bets placed on the Internet by domestic punters are subject to the same betting duties that apply in high street betting shops. When I meet different representative groups within the sector, they all tell me they want a level playing field. I have met representatives of the small bookmakers more often than any other group. I have met them at weekends in my own constituency and throughout the country. They are concerned about the change in the pattern of how bets are placed, and I fully appreciate their concerns.
I inserted a specific sentence into the National Recovery Plan 2011-2014 that states "An alternative funding model to support the horse and greyhound industries will be introduced." That is laid down in the four year plan and in the budget. We want to tap that potential source of income. We all want to see the day when the new stream of income from betting will ensure we do not need to draw down State funding to support these very important industries.
Deputy Doyle asked which Departments were involved in this. The Department of Agriculture, Fisheries and Food, the Department of Finance and the Department of Justice and Law Reform are all involved in this legislation. Deputy Upton spoke about the need to sustain jobs in the industry, and that is very important. Deputy Sherlock asked whether there was a political willingness to tackle the issue. There sure is. No one can accuse me of ducking the issues in the few short months since this industry has come within the remit of our Department. We will ensure proper, robust legislation is put in place to bring about the desired effect. Deputy Sherlock said that other countries had systems in place, but the only country that may have done some work is France. The French had a totalisator system, so they came from a different starting base than we did. Their actions have been more like tentative steps than an all-out approach and their operating procedures are subject to review. We want to get the legislation right and we want to ensure the potential stream of income is available to us.
Deputy Edward O'Keeffe posed a number of queries. Horse Racing Ireland is a commercial State body. The nominees are set down in the legislation that established the body. The Minister of the day only has the right to appoint one person. It is very restrictive in respect of the Minister's right to nominate people. The Minister nominates representatives of different bodies that nominate people for appointment. Bord na gCon is completely different because the Minister nominates all the members of the board. It is laid down in legislation that the relevant body, namely, Horse Racing Ireland, decides on the race courses and the race days. Some Members spoke about closing race courses. Someone else can advocate where we can start because I will not be doing that.
Senator Carty will outline the value of investing in Ballinrobe and everyone else will put forward their own case, and I understand that.
The annual reports for Horse Racing Ireland and Bord na gCon for 2009 were submitted recently to the Department. They are under consideration and I hope to bring both of them to Cabinet for approval and subsequent publication. Deputy McEntee observed that people were betting and losing considerable amounts of money through online betting. The same is true of those who use bookmakers' shops. I understand provision for the protection of vulnerable groups will be incorporated in betting legislation. That is a welcome measure.
Investment in particular tracks is a matter for the individual board rather than the Department. Deputy Edward O'Keeffe has spoken to me before about the need to invest in his favourite track in east Cork. I have mentioned this to the relevant board and asked it to correspond directly with the Deputy. I seem to have no friends on this committee because members have not given me a tip when their horses or dogs are running. There is on an onus to them to inform the Department of any good tips in the future.
There could well be more bad tips than good ones.
Deputy Fitzpatrick has consistently advocated the importance of having a level playing field in the industry. He has outlined on numerous occasions the need to advance the legislation on online betting and ensure revenue is raised in order to make the industry self-sustaining. There has been a substantial investment in infrastructure throughout the State, although in our line of work we do not get as many opportunities as we might like to visit race tracks. There are fabulous facilities for punters, as well as for the horses and dogs, in terms of housing facilities, tracks and the various standards applied. Our race tracks are a valuable tourism asset, attracting some 80,000 visitors in the course of the last year. In the same year horse racing events attracted an attendance of 1.25 million. We are rightly renowned for the value and quality of our bloodstock industry, exporting horses to 35 countries worldwide. In recent months I met potential purchasers from far distant countries. Irish Thoroughbred Marketing, under its chief executive, Mr. Michael O'Hagan, is making huge efforts, with significant success, to secure new markets in North America and Arab countries.
Horse racing and greyhound racing are important industries throughout the country. The Government is committed to bringing forward legislation in this area which will provide for a new stream of income. We all wish to see a situation where the industry will no longer be dependent on Exchequer grant-in-aid. Provisions in this regard are laid down in budget 2011 and were specifically inserted, at my behest, in the section dealing with my Department in the four-year plan. Considerable work has already been done in this regard. As I explained to Deputy Upton last May when responsibility for the two industries was transferred to my Department, we immediately set about, in co-operation with the other relevant Departments and the Office of the Attorney General, ensuring the issues in regard to online and telephone betting would be tackled and that those operators would contribute their fair share of betting duty. That will be good for the industry, the economy and the public finances.
I ask members to be brief in their supplementary questions because there may be a vote on the Order of Business in the Dáil.
To what extent has the Minister explored the issue of online capture from a technical point of view? While I acknowledge the reference to the French model, as far as I can see, we have no choice but to pursue online betting. If we do not, the industry will falter in a situation where it will remain reliant on the Exchequer. What technical advances have been made in this regard? To whom in the industry is the Department talking in terms of such capture? Is it only a legislative change that is necessary? Will the onus be placed on the industry to capture its own fund or will the State be responsible?
It is easy to quantify the number of bets in an online setting. Likewise, it is not difficult to ascertain how much is being bet on exchanges and so on. Exchanges which are currently exempt from tax should also be part of the capture. There is a somewhat nefarious system, whereby operators, by forming exchanges, exempt themselves from payment of the betting tax. The bottom line is that the State needs this revenue capture and that the very future of the industry depends on going after online betting. I am neither a technophile nor a technophobe, but I would like to know who in the State agencies is talking the language of online capture from a technical point of view.
We are all talking about the future of the industry. As far as I am concerned, the future was this time last year when we discussed the same issue. The question of betting levies has been raised on numerous occasions in the Dáil. The transfer of responsibility to a different Ministry does not take from the net point that an issue on which action was promised a year ago persists. The initial intention was that funding for the horse and greyhound industries would come from gambling. That changed in 2002, from which time funding has been topped up via the Exchequer. Now, however, we have arrived in a new era in terms of where Exchequer funding can be wisely spent. I acknowledge everything that has been said about the importance of jobs, including spin-off jobs, in the horse and greyhound racing industries, but we must have some perspective in this regard. We can no longer afford to take €26.3 million out of the general Exchequer fund for this purpose.
In regard to the technology for capturing data, I accept it is not simple. If it were, it would have been done long ago. Nevertheless, there has been sufficient time to at least examine how the technology might be initiated. It has been put in place in Italy and work has been done in France. It can be done but only if the Internet service providers are on board. Who in the Department has been looking at the issue and has any progress been made? Unfortunately, it appears no substantial progress has been made in the past year.
I am surprised by the number of members who own or have a share in a horse or a dog. I am disappointed to say I own neither a leg of a dog nor a tail of a horse. I must have missed out somewhere along the line; too long holding the hurl perhaps.
I agree with Deputy Sherlock that it is a question of compliance and enforcement. I heard a discussion on the radio recently in which a speaker from the United States spoke about the experience in that country of imposing a levy on online betting. The impression I got was that what was vital was an adequate level of co-operation from the bookmakers in question. I understand many of those in operation in Ireland work from the Isle of Man. It seems that, unless they are willing to pay the 1% levy on offshore and Internet betting, there will be a problem of enforcement, as Deputy Sherlock observed. However, I assure Deputy Upton that while we might be a little late in dealing with the issue, we are moving the right way in ensuring the industry will be self-financing and that it will not have to return to the Exchequer for funding. We can be confident the Minister will not be coming back next year seeking supplementary funding to keep the industry going. If we do it right, there may even be money to be made for the Exchequer from online betting.
There must be change in the process of board appointments by means of a restructuring to ensure boards will no be longer a club with the same members constantly being recycled. There must be new blood. There is no point, in the current difficult climate where some €27 million is being given by taxpayers to the industry, in talking about race courses. If they do not make the required margin, they cannot be subsidised. They can pay in their own right.
Deputy, a vote has been called in the Dáil.
I accept that but I wished to make those two points.
I note from the Minister's last couple of comments that he is determined to deal with this and I support Deputy Fitzpatrick's suggestion. Many people on boards are very interested in this business and they are better informed than are members. As Deputy Upton noted, the entire betting issue must be tackled. I propose that the joint committee should bring before it those to whom the money is being given. They should account for themselves and as Deputy Fitzpatrick suggested, new blood should be put into it. I propose they be invited before the joint committee rather than asking in two years' time the reason they were not asked where was this money. The joint committee should get their advice and new people should be put on the board that have an interest in the Exchequer, racing and betting.
I call Deputy Doyle.
Change the legislation.
Deputy, a vote has been called in the Chamber and I want to conclude the meeting.
The legislation pertaining to the board should be changed.
Can the meeting resume after the vote?
The Minister cannot return.
I have been locked away for the last two days at the Agriculture and Fisheries Council meeting concerning fisheries.
I will synopsise this issue quickly. In 2000, the revenue take from excise on betting was approximately €58 million. This year, the same amount of money is being sought to run it, through a combination of €31 million from excise and €26 million from the Exchequer. In 2000 or 2001, whenever the system changed, it was anticipated that this would be self-financing, which, based on those figures, was the case that year. Put simply, this is the position to which we must return. There is an onus on the Minister, whose Department is in charge of the fund, and on this joint committee to get answers from the Department of Justice and Law Reform, the Revenue Commissioners and the Department of Finance as to how they are progressing in this regard. As Deputy Upton noted, the scenario must be avoided whereby whoever is sitting here in 12 months time will face the same shortfall between revenue taken from excise or betting levies and the amount the Exchequer must pony up to supplement it.
I remind the Deputy of the vote.
There must be movement and this must not be allowed to continue. The public will not and members should not tolerate the status quo. People are betting hundreds of euro and a contribution of €1 out of €100 would not affect them by a single iota.
The Minister, to respond briefly.
Betting exchanges will be included in the proposed legislation and an enormous amount of work has been done by the Departments of Justice and Law Reform and Finance and by the Office of the Attorney General. The Government's aim is to catch all bets placed by punters in Ireland. That is the bottom line.
I call for the approval of the allocation.
Have members views on whether there should be further debate on the motion in the Dáil or Seanad?
Yes, there should.
Is that agreed?
This must be done before the end of 2010.
As money is being allocated, I propose that this motion be supported today.
I second that.
It is needed straight away.
This measure is needed before the end of the year.
Members must return after the vote in the Dáil.
I have other commitments and there is very little time.
Just before the meeting was suspended, different views were expressed. I again seek members' views on whether there should be further debate on the motion in the Dáil and Seanad.
This measure is important and the Minister has pointed out that he wants it through before the end of the year. Both industries under discussion, namely, the greyhound and horse industries, are important and have contributed much to Ireland. We have already discussed what will be needed to keep them going at a normal level, including farming, horse breeding, racing, etc. Besides the money and the 27,500 jobs they provide directly, they sustain numerous indirect jobs. This is the week before Christmas and the Dáil session is ending. I propose that the motion be passed by the committee. I also spoke with the Chief Whip during the vote. He told me there will be no time in tomorrow's schedule to debate this motion. As such, I propose that it be passed without debate on the committee's recommendation.
We dissent from that position. The Labour Party believes there has been more than enough time for the Government to seek to get an online capture and to expand that capture's remit. It is not fair to other taxpayers that the Government would now seek to extract the €26.3 million. We strongly believe that this amount could be obtained through other means. On this basis, we oppose the procedure.
Is Deputy Aylward proposing that the committee agrees the motion?
Yes.
I second it.
We should agree the motion and recommend that it be passed by the Dáil tomorrow without debate.
We oppose the motion.
This concludes our consideration of the motion. In accordance with Standing Orders, a message will be sent to the Clerk of the Dáil and the Clerk of the Seanad stating that the committee has completed its consideration of the motion. A report on the proceedings of today's meeting will be laid before the Houses of the Oireachtas. Is that agreed? Agreed.
I thank the Minister and his officials for attending this meeting. Before I adjourn, I would like to wish members, the Minister, his officials and the committee, editorial and broadcasting staff a happy Christmas and a prosperous new year. Does the Minister wish to comment?
I thank the Chairman and members for their consideration of this issue. I assure the committee that the issue of betting taxation will be addressed by the Government in robust legislation to be introduced in the new year. We are determined to put the betting levy on all punters who place a bet in this jurisdiction. The greyhound and horse industries are run from the Cavan office of the Department of Agriculture, Fisheries and Food. My colleague on my left, Ms Emer McGeough, is head of the Cavan division. In the best tradition of Cavan people, we are determined to ensure we get the maximum amount of money from punters in this regard. The Chairman and Deputy McEntee, who are from neighbouring counties, concur with our determination.
I thank the committee and its staff for their co-operation and assistance during the course of the year. I hope we can all get a few days off over the Christmas and new year period.
On behalf of the Labour Party, I wish the Chairman, members, the Minister, his staff, his colleagues and the secretariat a happy Christmas. I thank the Minister for his forbearance throughout the year. I also thank his staff and colleagues for all of their hard work and great co-operation. They were helpful at all times. I wish the Minister well.
On behalf of the Fine Gael Party, I wish everyone a happy Christmas. Deputy Aylward and I were members of the Joint Committee on Climate Change and Energy Security at the same time and we tabled a report on protecting forestry in the context of climate change. The report was endorsed unanimously by all parties on this committee. It was also endorsed by a second committee, which has never occurred previously. We like to believe the report played a part in influencing budgetary figures in recognition of the forestry sector. This proves that, when committees are given a role and the control of the political party system is loosened, they can function productively. This idea should form part of the political reforms we must consider.
I wish the Minister well and thank him for his office's co-operation. Whenever members contact him seeking information, he has endeavoured to give it to us. I wish everyone else well, including the clerk, Ms Briody, and the staff.
On behalf of the Sinn Féin Party, I wish the staff, Chairman, Minister and members the best for Christmas and the new year. The Minister will be looking forward to the coming year, with Mr. Val Andrews going to Cavan to look after it on the football front. I wish Cavan well in that regard. Deputy McEntee would also be in favour of that, in that he would like to see counties Cavan and Louth doing well just as Kerry were generous towards Cork this year. I wish everyone the very best for the new year and I look forward to meeting them next year.
On behalf of the Fianna Fáil group, I wish the Chairman and the committee's staff a happy Christmas. I wish members and their families all the best for Christmas. I wish the Minister and his departmental staff a happy and peaceful Christmas, good health and good luck, which the Minister will need in the Cavan-Monaghan constituency in the near future.
I am sure the Senator will be working hard for him.
A couple of important Meath men are in attendance. Deputy Ferris mentioned his coat, but we have sent a man from Monaghan to Meath who will bring the latter Sam Maguire this year.