11. SUE BRADFORD (Green) Link to this
to the Minister for Racing
Why is the Government putting $9 million into high-stakes racing in this week’s Budget, given that in 2006 the racing industry received a tax windfall worth approximately $32 million a year?
Rt Hon WINSTON PETERS (Minister for Racing) Link to this
As my friend Mr Maharey said, it is all good news. [ Interruption] Oh, the foreign affairs budget is great as well. [ Interruption] Well, it has actually doubled in 5 years—we do not lose our debates like that member used to. The answer, Madam Speaker, is because this initiative will return New Zealand to the forefront of international racing. It will help attract world-class overseas competitors, enhance breeding values and export sales, and revive public interest in racing. The net result will be a fairer but greater fiscal dividend to the Government. The matter about which the member spoke in terms of the 2-year-old change to the taxation regime has seen this outcome: overall, premier sales at Karaka this year were up by 36 percent, at $111 million; select sales were up as well, by 33 percent; and the festival sales were up by a massive 81 percent. That is a greater return in dividends to the Government, as well.
What makes the Minister think that gifting taxpayer money to prestige racing stakes should be a priority, when according to a New Zealand Racing Board press release on 15 April this year the board currently has an operating surplus of $75 million and net assets of over $115 million?
Rt Hon WINSTON PETERS Link to this
Because anyone who knows about racing knows that the board has to have certain reserves and a contingency reserve for certain events. The board has always had itself in a reserve situation, so that at any given time the racing establishment, for capital development or for fighting a potential outbreak of equine flu if it were to happen in this country, would be in a position to handle it. That is why we have had that, which is nothing new. But what is new, of course, is a fairer tax regime, some confidence in the industry, and some enlightened policy that will see a massive return for this country in the immediate, short-term, and long-term future.
R Doug WoolertonWhat has been the economic impact on the racing industry since the changes initiated in Budget 2006?
Rt Hon WINSTON PETERS Link to this
As I said, we have received reports of an economic impact that has seen some massive changes. I have just given the House, for example, the Karaka sales results, which are of premier, select, and festival sales, and they are up a staggering percentage from what they were just a year ago. We also might note that as a consequence of having confidence in this country’s racing industry, we have won nearly every decent race in Australia in the last 6 months.
Why does the Minister not do something about ensuring that the New Zealand Racing Board’s extensive reserves—or at least some of them—are released to enable clubs like Avondale and other struggling clubs to upgrade and maintain their infrastructure, rather than see it as a priority to put badly needed taxpayer money into races that he calls the crème de la crème of New Zealand racing?
Rt Hon WINSTON PETERS Link to this
The reality is that the New Zealand racing industry is built on the provinces. That is why we have, for example, a safety fund, and it is why so many breeders and people associated with racing in the provinces of New Zealand, from whence these horses come, are so keen on this idea. For example, the biggest race in New Zealand is a co-sponsorship race in the Hawke’s Bay sponsored by Sam Kelt; its stake is $2.2 million. The reality is that with some co-sponsorship we can put ourselves back on the radar screen and have a better environment in which to sell our horses, and the Government in the long term will be the big winner.
Ron MarkHas the Minister received any reports regarding the industry’s reaction to his latest announcements?
Rt Hon WINSTON PETERS Link to this
All I can say is that the industry has been overwhelmingly positive. I want to make the point to some members here, who do not seem to understand this industry, that there are thousands of young people—teenagers—who get up in the morning at 4 o’clock, go out to the stables, and do the business because they are keen on this sort of employment. Because of the change in the racing industry’s economic environment, they are today better rewarded. We will see young jockeys and apprentices stay in New Zealand because there is more opportunity as a consequence of a very enlightened policy—so enlightened that the National Party thought it would steal it 2 days before the last election.
Will the Minister turn his attention to the way in which over $20 million a year of pokie money is being diverted away from some of our poorest communities, in places like South Auckland, and into some of our richest, like racehorse owners and trainers, and will he advise his colleague the Minister of Internal Affairs that racing stakes should be removed as a legitimate purpose for the distribution of pokie profits?
Rt Hon WINSTON PETERS Link to this
That is a matter for the Minister of Internal Affairs, but I will just say that under the Gambling Act racing is an authorised purpose and has been for a long, long time. I make one point to some of the people lining up on that issue: I personally do not see why someone who never goes near a pokie machine but has some highfalutin, self-dreamt-up public scheme should have more access to this money than the people who do go near pokie machines and are supporters of races. It comes down to fairness and equity. Of all the hundreds of millions of dollars that are picked up in racing, that is a very small amount to promote an industry that could be—and, in a short time, will be—a significant exporter of horses from this country.