Following last week’s racing industry funding reset announcement, there has been much written and broadcast in the media, and understandably much discussion in industry circles.
While Tasracing is set to meet and consult with industry stakeholders about how the planned changes may be implemented in the coming days, I thought the time was right to place on the record some key facts.
Tasracing staff wages has been a matter of significant interest, discussion and debate.
While it is Tasracing’s policy not to disclose these details other than as required in our annual report, for the sake of clarity and to put a line under the issue once and for all, I would make the following points:
- Tasracing staff wages are directed by either the Tasmanian Government’s wages policy, our Enterprise Agreement for tracks and ground staff or the award for relevant office staff.
- The seven Directors of the Tasracing Board are remunerated in accordance with Treasury guidelines.
- Tasracing implemented a successful cost reduction strategy in 2012/13. CEO Eliot Forbes accepted a pay freeze in the same financial year. Dr Forbes has agreed to maintain this pay freeze for a further 12-months.
- The Board is very appreciative of Dr Forbes’ willingness to maintain this position in the medium-term, particularly as Dr Forbes and his team have overseen three-years of race field fee growth of more than 53 per cent or $2.52 million which has been driven by three-years of total wagering growth of more than $100 million.
- Under Dr Forbes’ leadership, in 2012/13, Tasracing reduced its costs by more than $1 million, delivering a $2.2 million net improvement. These savings have been maintained to date.
- The current Chief Financial Officer, Mark Tarring, has been with Tasracing for six-months and is not eligible for a salary review until he has completed 12-months with the company.
- Neither the CEO or the CFO have been paid performance bonuses.
- Tasracing has this week announced several staff redundancies that will decrease office administration staff by 10 per cent. Outstanding duties will be redistributed among existing employees as part of a business-wide efficiency drive.
- A further review of training and racing venues has already commenced. A particular focus will be placed on the allocation of staff resources and operating hours.
It is also important to note the improvement achieved in Tasracing’s administration costs – in 2011/12 these amounted to 7.7 per cent of total expenditure. These costs were reduced to 5.7 per cent in 2012/13 and this reduction was maintained the following financial year.
These improvements have been achieved despite Tasracing assuming responsibility for race day staff and racing and trial operations for all thoroughbred clubs across the state, and assuming significant operational responsibility for the delivery of the Magic Millions Yearling Sale and the formation of the Yearling Sale Working Group.
As is already well understood by industry, Tasracing was established in 2009 with a $4 million funding gap.
What may be not so well known is that Tasracing also inherited a $1.5 million debt from TOTE Tasmania and incurred an additional loan of $1.6 million because of the delayed implementation of race field fee legislation. Both matters were beyond the control of the company.
While Tasracing has done much to address the issue, the recurrent gap of $3 million needed to be closed. Last week’s announcement will address this.
I have provided the above information to highlight the important background work Tasracing has already undertaken to deliver cost savings and efficiencies and to hopefully allay misinformation relating to several issues, including executive remuneration.
But there is clearly still more work to do.
Tasracing and the Racing Minister are committed to working with the Tasmanian racing industry to implement the planned changes.
We are confident that the proposed changes will deliver a sustainable business model for Tasracing and allow the company to focus on building and investing for the future.
Brian Speers
Chairman