THE RACING MINISTER'S PRESS CONFERENCE (PART 1) .. HRO'S REPORT TAKES YOU RIGHT INTO THE ROOM

By Graham Potter | Friday, July 17, 2015

Bill Byrne, the Racing Minister addressed the media at Parliament House yesterday where he exposed details of the current, critical financial state of affairs at Racing Queensland. Fronting the media alongside Byrne was Ian Hall, the Acting CEO of Racing Queensland. This is an edited extract of what transpired in the forty-five minutes of presentation and question time.

BILL BYRNE:

What we are here for today is to announce a start point for the future of racing in Queensland.

The first step is to make sure that the industry stakeholders are completely aware of where we stand and what the financial fundamentals are with regard to the situation confronting racing in Queensland.

At the start of this process the Premier reflected on Racing Queensland having a projected 2015/16 deficit of approximately $21 million. After further investigation we find that now to be more in the order of $28 million.

So there is no way of sugar-coating this. There is a $28 million problem ... and it really only came to our attention with KPMG’s entry into Racing Queensland.

The future is going to be difficult for the industry.

A simple question is, how did we get to this situation?

It is not my habit of reflecting on the past and looking into the rear-vision mirror. I am not going to talk about apportioning blame.

The fact is the government and I inherited the problem, but it now falls to us to do everything we possibly can to reverse the situation, so all I can talk to you about is where we are and how we intend to fix this problem.

That, frankly, is the challenge that confronts the government and Racing Queensland.

We have to move forward to find a way to secure an optimistic and bright future for the industry which it so certainly deserves.

The only way to move forward ... the only prospects we have of moving forward with positive outcomes for the industry ... is to frankly and honestly discuss where this industry is at.

That is our intention going forward.

To that end we will be launching a full consultation process within the industry with all stakeholder groups over all three codes ... trainers, jockeys, owners, clubs, unions ... everybody who has a stake in this.

I think it would be healthy for everybody to understand what the start point is for those deliberations.

Byrne was then pressed from the floor and asked whether he could advance some reason behind the $28 million blowout.

BILL BYRNE:

The situation has been created by a fundamentally, over-optimistic sense of revenue streams ... what revenue streams were available and what was likely to mature over a period of time.

That was a core issue. This notion that there are rivers of gold associated with revenue streams for racing is simply not the case. So there have various commitments made in the past that are simply not substantiated by cash flow.

A cautious approach to business management seems to have been missing, at some level, with some decisions being made that were, from a financial perspective, overly optimistic or naïve.

In the environment of leadership of an entity, caution and appreciation of what is the worst thing that can happen and how do we cover that is needed ... I’m not sure that was necessarily there.

Byrne was asked about matters that had reportedly been submitted to the CCC.

BILL BYRNE:

It is not my intention to name individuals or to reflect on precisely what any charges might be. I simply mentioned it (previously) as an indication of the issues and some of the cultural problems that may be evident within the structures of Racing Queensland.

I can confirm that there are four matters presently before the CCC and that each one of those matters involves an individual.

I would rather not reflect on the substance of the matters before the CCC. Let’s just say they have not been referred to the CCC for matters related to tiddlywinks. We are talking about substantive, serious issues... and that’s the way they are being treated.

My point is we discovered cultural and management system problems and an indicator of that is fact four individuals have been referred to the CCC.

Byrne was asked to clarify the path moving forward.

BILL BYRNE

I’ve got to take a very deliberate stance here.

The first step is to make sure that everyone is contributing to the discussion with the full knowledge of the financial start point for the discussion.

Now we are genuinely not talking about driving over stakeholders but rather saying to them, look, this is where we are at. It is in everybody’s interest to go forward and to try and graph a path which gets the racing industry back on a firm footing.

It is a one step at a time process working towards an overall solution.

We’ve done a few things already to try and give some stability.

One, we had many representations all saying that QTIS was an absolute foundation piece that had to stay in play. So we accepted and approved that. We’ve also acted decisively in moving forward the Eagle Farm project because we recognise how important Eagle Farm is as a centrepiece for Racing Queensland.

Another question from the floor. Is it still possible to go back to three separate racing boards, three separate codes which is what a lot of people in the racing industry want?

BILL BYRNE

Mr MacSporran (the MacSporran commission) has provided a pretty thorough report and he made strong recommendations.

The government responded to those recommendations and it was the firm view that the proposed solution was the best for the industry. The government has embraced that and acted on the first three recommendations pretty rapidly.

In the financial model there is obviously a potential for prize-money cuts. Can you rule out prize-money cuts?

BILL BYRNE

I not in a position today to rule things in or out. We have shown you the position today of Racing Queensland.

It is going to be a difficult conversation going forward ... for everybody. It is not just prize-money issues. There are all sorts of areas that have to be covered, like subsidies to the clubs, and we need to have all of those conversations honestly.

It is not my intention to impose a solution or rule anything in or out right now. A proper consultation will the industry get where it needs to be and my hope is for a mature, adult discussion with all players in the industry with the full knowledge of what the facts are ... that is the intention.

My responsibility is to map a path to put racing back in the black.

Has the deal the previous Racing Queensland made with Magic Millions been approved by government?

BILL BYRNE

There are contractual obligations with Racing Queensland that are in place. That is not subject to change. That is not subject to our consideration.

One of the MacSporran reports recommendations was the particular makeup and numbers of a new racing board. What is the situation with that recommendation at this time?

BILL BYRNE

We are investigating options to put in place an interim board. I’m not going to talk about that until I’ve got firm footing.

I have already said that we accept the recommendations of the MacSporran report but I do recognise that there needs to be some supporting mechanisms to go with that.

How we craft individual codes and the capacity of all the players within those codes to influence the board ... to have appropriately representation on the board ... that is a matter of on-going consideration.

Clearly we are not saying we are going to put one thoroughbred, one greyhound and one harness person from the state that is going to have an overriding say.

We need an under-pinning support system so that the representation provided will be appropriate for stakeholders.

We are looking how we structure this, not only formally through legislation, but also enabling a liaison connection to the industry so they feel fully represented.

When I know exactly what that looks like, I would be happy to talk about it.

And Byrne’s final message.

I don’t want to get caught up with the past or pointing fingers at individual people. I want to talk about where we are and how we map a course for the productive future of the industry.

That is my entire focus of attention and I think that is where the attention of the Racing Minister should be.

Go to: The Racing Minister's Press Conference (Part 2) in the story menu