The Starting Price Regulatory Commission


Synopsis of the 2016 Chairmans Statement

2017 has been a year of turmoil in the gambling industry. The government’s consultation on its plan to cut the maximum stake on FOBTs, perhaps to £2, represents a threat to betting shops. Meanwhile local government has sought greater planning controls over new openings. The horserace levy has been extended to bookmakers based outside Great Britain which should lead to increased payments from betting to horseracing. Online betting continues to grow: it is now a fiercely competitive international industry. Corporate changes, both in top management and in company structures continue, with betting increasingly seen as a technology driven business, more and more removed from the traditional racecourse bookmaker. Concern about problem gambling has risen.

Bookmakers have been criticised for closing winning accounts. Gambling advertising has given rise to a stream of complaints, sometimes claiming that children are being targeted. Some would argue that against this emerging backdrop, the starting price is a dead duck. Its origins date back to the 18th century. Today, with the myriad of alternative prices available to punters – exchanges, best odds guaranteed, we pay if your horse is first past the post – what purpose does the SP serve?The SPRC would propose: as important a purpose as it ever served. Yes of course many punters out there will search high and low for the bargains in the market place, and good luck to them. Equally however there are many punters who see their bets as a bit of recreational fun. These punters don’t want to spend their leisure hours pouring over arcane new products, hunting out the best value. Many of them – particularly in LBOs – want to be able to take a price – the SP – which is transparently calculated, and which accurately reflects the racecourse market for each race. That the way of returning it is updated to take advantage of emerging automation to do it, even better; and that, at the end of the day, the price concerned is [fair] to bookmakers and punters. We understand that the majority of bets struck in LBOs on horseracing are
still placed at SP.

One confusion was rife during the year. There are occasions on which the returned SP seems generous to the bookmakers due to a high overround. There are then calls from punter bodies for the SPRC to intervene.It may be that the “regulatory” in “Starting Price Regulatory Commission” leads to an exaggerated view of our powers. To be clear: we do not set prices, overrounds or margins. Indeed, we would not wish to do so and substitute our judgement for that of the on-course marketplace. Our responsibility is simply and straightforwardly to set the parameters by which the SP is calculated and to ensure, so far as within our power, that racecourse bookmakers are operating within the framework we have specified. The purpose of the SP is to provide an accurate reflection of the prevailing odds available in the racecourse market at the time a race starts. If there are imperfections in that market, that is not something which is within our power to rectify. We can identify concerns – such as the declining number of racecourse bookmakers – and can facilitate dialogue between interested parties but we are not a statutory body and have no power to compel anyone to do or not do anything.However this does not mean that the SPRC is indifferent to the prices returned. Our contention is that the SP strikes a [simple and fair] balance between the conflicting interests of punters and bookmakers. If evidence is produced which suggests that for whatever reason that balance is not being struck in the right place, we are bound to be concerned. As 2017 turned to 2018, for example, punters complained about the overrounds on returns from Ffos Llas. The racecourse is rightly on the case.

But the SPRC is of course watching closely what is going on. We have a strong vested interest on punters’ behalf in a trusted SP. Otherwise the SP will lose credibility. We are in constant discussion therefore with all parties. Relations with on-course bookmakers are cordial. We are always open to discuss the views of bodies which seek to represent punters and we welcome the new Chair of the Horserace Bettors Forum Matt Bisogno, and look forward to a productive dialogue in 2018.Meanwhile the SPRC continues to refresh itself. Richard Hayler the managing director of IBAS, the Independent Betting Arbitration Service, has joined the SPRC bringing his unrivalled knowledge of betting and unchallenged independence to our table. The SPRC membership will evolve further combining experience with the most modern knowledge.

Bernard Donoughue

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