Editorial: Victoria Has the Right Ideas for Bookmaking Reforms

21 March 2002

Last week Victorian Racing Minister Rob Hulls announced both the release of Bookmaking Reforms Working Party's final report and the government's acceptance of its six recommendations.

The Working Party released a discussion paper last November addressing a number of issues and canvassing support or opposition of a number of options on each. A total of 22 submissions were received, 13 of which were from Victorian bookmakers.

The report states that the "recommendations formulated. . . aim to achieve the following outcomes:

  • preserve the traditional identity and color of bookmaking through maintaining the race meeting presence of individual bookmakers;
  • create viable mechanisms for bookmakers to provide a continuous service to their clientele with improved access to the off-course market;
  • allow bookmakers to gain the advantages of modern business structures; and
  • ensure that further extension of bookmaking into the off-course market has full regard to responsible wagering practices particularly in relation to access to credit betting."

The Working Party's recommendations were:

  1. that trading hours of bookmakers be extended to allow them to commence betting at a race meeting from the official scratching time (generally 8 a.m.) on the day of the race;

  2. that the location restrictions for bookmakers not be relaxed given the need to maintain and encourage a bookmaking presence at race meetings and having regard to the reforms contained in the remaining recommendations; and

  3. that Internet betting be approved in principle with any final approval being subject to the racing industry and the bookmaking profession developing a whole-of-industry system and an associated body of rules that ensures:
    • probity and integrity of the system;
    • delivery of responsible wagering practices, including restrictions on access to credit betting and the imposition of minimum betting limits consistent with the telephone betting service; and
    • protection for customers lodging money into betting accounts;

  4. that individual registered bookmakers be allowed to form partnerships subject to approval by the Bookmakers and Bookmakers' Clerks Committee and licensing requirements of controlling bodies (of racing).

  5. that individual registered bookmakers be allowed to form restricted corporations where only bookmakers may serve as directors or hold shares and for the operation of such corporations be subject to approval by the Bookmakers and Bookmakers' Clerks Committee and licensing requirements of controlling bodies (of racing).

  6. that an additional member be appointed to the Bookmakers and Bookmakers' Clerks Committee who has expertise in corporate law and finance.

The Minister said, "These reforms have collectively raised the performance of the bookmaking sector and its status within the Victorian racing industry. . . . That's also why I am delighted that the Victorian Bookmakers' Association has adopted the National Code of Practice for Australian Bookmakers to ensure the provision of responsible wagering services."

The ARBAC Code already contains measures that address in detail the three essential criteria required for approval of Internet betting.

All that is required then is for the racing industry and the bookmaking profession to agree on a "whole-of-industry system." That shouldn't be too difficult because the Working Party's report details what it expects of such a system.

"Internet race betting should be developed on an industry-wide basis rather than through the construction of individual systems," the Working Party stated in the report. "It is expected that use of the system on any given day would be confined to those bookmakers fielding at a race meeting. The development of a common system will create the potential for a Victorian virtual betting site possibly linking the activities of Victorian bookmakers and perhaps Tabcorp (the exclusive pari-mutuel operator in Victoria).

"The common system would also facilitate the uniform delivery of responsible wagering services such as access to problem gambling support counseling, application of maximum and minimum betting limits, self-exclusion facilities and restricted access to credit betting."

While these reforms are far reaching, they are broadly in sympathy with the National Competition Policy Review in New South Wales--it's just that Hulls has taken Victorian bookmakers down the road more quickly--and basically laid the challenge at the doors of the Racing Victoria and the Victorian Bookmakers' Association to find the way to move forward together, without further interference from government.

There is no doubt disappointment from the handful of corporate bookmaking operations in the Northern Territory and ACT that are desperate to move to both a bigger market and more hospitable climate. It's fair to say that Australian "corporate" bookmaking in the vein of the William Hills or Ladbrokes is now a pipe dream, with Victoria and New South Wales soundly rejecting that mode of operation/licensing.

Both Victoria and New South Wales (and others) are maintaining their restrictions on out-of-jurisdiction wagering operators advertising in their states; therefore, the move to provide a legal and accessible intra-state product, along with the Australian Racing Board's commitment to jurisdictional integrity means that things are only going to get a lot tougher for rogue wagering operators (bookmakers or totes).

While Tabcorp feels threatened by decision to allow Internet betting, with its representative on the Working Party putting on record, "his dissent to the majority-supported recommendation that Internet betting be approved in principle," I believe that in years to come, these reforms will mark a turning point not just for bookmakers but also for Tabcorp and the whole racing industry.

Why? Because with Internet betting comes the release of bookmakers prices to the public--prices that have until now been the sole preserve of the (dwindling) on-course punter.

Wagering information drives wagering as sure as night follows day. And wagering information doesn't get any better than on-course fixed-odds prices.

Tabcorp, with its "bricks-and-mortar" high-street monopoly will still have enormous competitive advantages over bookies with "clicks and bits" operations, so it's now up to the whole industry to use these reforms to revitalize wagering as a preferred form of discretionary entertainment expense and regain lost market share to gaming and pokie machines in particular.

The Victorian government and its racing minister have done a great job with these reforms and they are to be congratulated for putting up a framework that provides for the future, not just for bookmakers, but for the whole Victorian racing industry.

It's now up to the other states to follow their lead. Click here to view the Bookmaker Reforms Working Party' discussion paper.

Tim Ryan is a graduate of Agricultural Science, though he is probably best described as an innovator. He has worked in consumer online information and transaction systems since their inception and was the Australian pioneer of television data broadcast and is still the Consultant General Manager of the Seven Network’s teletext and datacast services – the principal provider of real time wagering information in Australia. Tim was an innovator of integrated wagering information and transaction systems. He has also consulted to a number of wagering system developers on the internationalisation of their systems. Tim became a NSW licensed bookmaker early in 2000 for regulatory reasons associated with the development of wagering systems. Despite not being a ‘working’ bookmaker Tim was appointed to the Australian Registered Bookmakers Advisory Council, Australia’s peak body representing all its 800 bookmakers. In this capacity he was instrumental in lobbying the independent Senators and the Government to ensure the exclusion of wagering from the Interactive Gambling Act.