The racing industry of New Zealand is seeking a legislation change to allow it to boost its national share of poker machines to no less than 10% and to also roll out betting on virtual horse races. This happens at a time when local sports bodies, community groups and problem gamblers could emerge as the major losers in the second round of racing industry reform which is expected to be officially passed into law at the beginning of 2020.
The second round of gambling reform legislation would see two reforms – the introduction of virtual horse racing and the removal of the restriction on the Totalisator Agency Board (TAB) to operate poker machines. Both of these issues are aimed at increasing the revenue generated by the horse and dog racing industry, but they have also been part of the most controversial reforms in the local gambling industry.
The above-mentioned gambling reform legislation is set to be deployed on January 1st, 2020.
As revealed in documents published by the Department of Internal Affairs, both issues were withdrawn from the first round of the massive reforms initiated by the country’s Minister for Racing Winston Peters because their complexity was seen as a possible obstacle for an immediate revenue increase for the racing industry. At the time when the Racing Reform Act was recently passed, the changes once again sparked opposition and controversy.
The Complexity of Both Issues Blocked Them from Being Released at the First Round of Racing Industry Reform
According to a Department of Internal Affairs’ briefing to Minister Peters, all but five of 1,187 public submissions on a recommendation for the local racing industry disagreed to the removal of the existing restrictions on the TAB’s operation of its Class 4 gaming license, regarding poker machines.
The leitmotif of the submissions which opposed the proposal for TAB to be allowed to operate more pokies circled around the idea that controversial poker machines would gradually drain money from communities. On the contrary, the five submissions which supported the proposed change say that the change is in line with the racing codes.
The advice of the Department of Internal Affairs dismisses the level of opposition to the repeal of the Gambling Act’s clause 33(3), under which the Racing Board is prevented from acquiring licences from operators who already have Class 4 licences.
As mentioned above, the proposal to allow virtual horse racing in the first Racing Reform Act was dismissed under the Department’s advice. A crucial aspect of the advice was related to the fact that race outcomes were computer generated, which meant these were not actual races. Because of that, the Department of Internal Affairs considered that virtual racing games may need more work on New Zealand’s regulatory settings and policy related to online gambling.
It was the complexity of the matter which sent it to the second round of racing reforms. Betting on virtual horse racing is already available in Australia, but it obviously has a long way to go in New Zealand.