Peter Mair
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Posts : 1497
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 Original Post 2011-Jan-17, 06:08 PM
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Service fees and prizemoney: connect the dots
Comments about service-fees being excessive may be tongue-in-cheek as well as true, but they miss the point that the fees, if actually charged, are validated by a market driven by prospective returns form prizemoney and subsequent sales of progeny -- to say nothing of the possibility of well-informed bets.
Buying and paying for horses to be trained and raced is essentially punting -- and the money owners put in is no less a risked-contribution to industry funding than the money taken from bets placed by TAB punters and others paying racefields levies.
One might expect the administrators of the industry in Australia, and elsewhere, to have a good handle on the historical relationship between service fees paid and prizemoney paid: would anyone doubt that the relationship is a close one -- and the dominant explanation.
Within the overall totals, it would be interesting to see the analysis of the relationship between the total service fees paid for the top 10% all service fees paid and the total prizemoney paid for the top 10% of all races ranked by prizemoney paid -- I would expect that correlation to be even closer.
Accordingly the key to reduced service fees has two elements.
One lower takeouts (i.e. taxes) paid by TAB punters especially and an associated reduction in industry funding and the prizemoney paid in total and for the 'best' races.
The other, a new arrrangement requiring owners wanting to contest the 'best' Group and Listed races, to pay a substantial annual registration fee: what may look like an additional impost on these owners would actually be 'paid' implicitly by the vendors of horses, expected to be contesting the best races, who would get lower sale prices for these 'best' horses -- and lower service fees for the 'best' stallions.
There are answers to the difficult questions facing the racing industry.
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