It gives me a sense of purpose to share with the Industry an update on a number of important matters currently before the Harness Racing Victoria (HRV) Board for determination. Decisions on these matters follow on from the recommendations of the 2015 Audit of HRV, which were adopted by the Racing Minister.
Appointment of Chief Executive Officer
In governance terms the most important decision a Board can make, in its lifetime, is the appointment of a Chief Executive with all of the necessary skills and expertise. It was therefore with great pleasure that I was able to recently announce the appointment of Mr David Martin to the role of Chief Executive of HRV effective Monday 9 January, 2017.
David is an experienced CEO with a track record of success in transforming organisations, including the key areas of consultation, engagement, product development and revenue growth. HRV issued this media release on the announcement
It would be remiss of me if I did not thank and pay due credit to Kay Rundle who has served as interim CEO since July 2016. Kay has provided wise counsel to the Board and achieved in her short time in the interim role all that the Board could have expected. Kay's work critically will enable our new CEO to hit the ground running with a 2017 agenda that will herald an era of positive change for harness racing in Victoria.
Kay will end her time as HRV interim CEO on Friday December 23. Following that date Shane Gloury will act as CEO until David starts on January 9.
Review of HRV Organisation and Operations
The Board engaged Colgan Bauer and its principle Mr Joe Colgan to undertake a total review of HRV and to make recommendations for the Board's consideration to set up HRV and the industry for the future.
The Board will consider the Colgan report at its December meeting. I can advise that importantly the report has highlighted a number of value add changes which will significantly benefit the Industry as well as streamlining HRV's operations to make them more customer friendly while at the same time delivering financial benefits from the review.
This major piecework will be critical to enable the Board to plan for the future with the roll out of a new strategic plan for harness racing in 2017. The plan inherited from the previous Board and management is being reviewed and it is the intention to consult widely with the industry including the Harness Racing Advisory Council (HRAC).
Announcements were made last month with respect to the review of HRV's organisational structure and proposed changes therefrom. Importantly the Board will be seeking the input of the incoming CEO David Martin with the proposed new structure to ensure the organisation is responsive to the needs of the industry and all stakeholders.
Risk management will be a key focus of the Board in 2017. Currently risk managements practices within HRV are rudimentary to say the least. All decisions taken in future will take account of mitigating risks for the industry as well as ensuring that as a statutory body we have best practice compliance procedures.
Consultants have been engaged to assist the Board and management to establish best practices in risk management and compliance, which will go hand in hand with making good decisions as well as ensuring that HRV lives by a creed of integrity in everything it does in the future. This work will be completed in early 2017.
Wagering and Prizemoney
Results from the racing season completed have provided the new Board with a reality check.
Actual revenue from wagering, largely from the Tabcorp Joint Venture, was down by $3 million from the budget inherited from the previous HRV administration. In total the three (3) codes' distributions were down by $23 million compared to JV budget expectations.
Needless to say current prizemoney levels were predicated upon higher budgeted wagering revenues for HRV, which were further eroded by declining market share in 2015/16.
Unless wagering revenue outcomes improve, pressure will be placed on HRV's ability, as a financially responsible Statutory Authority, to maintain prizemoney levels and the current racing schedule and programmes.
Importantly the work associated with the Colgan review mentioned earlier has identified a number of new revenue opportunities together with cost savings which will be needed if wagering revenues from the JV do not improve.
Needless to say increases in prizemoney will not be possible in the immediate future unless the industry can turn around continued reductions in wagering outcomes from betting on harness racing. There is no comfort from the fact that this reduction in market shares for harness racing is a national problem.
National Focus on Improving the Racing Product
At Harness Racing Australia's (HRA) most recent AGM in Adelaide there was overwhelming acknowledgement of the need for change in the industry. The relevance of harness racing is seriously under threat and it has been overtaken by greyhound racing as the No.2 racing code in Australia, by a significant margin.
It has been identified that our core racing product is the primary lever available to reverse these trends. Principally more even racing with significantly less short-priced favourites will improve wagering outcomes and revenue back to the industry.
HRV's tiered racing strategy is one attempt to improve competition and reduce short-priced favourites. Already, since its introduction in September, the number of odds-on favourites has been trending down by 11%. The Board is committed to reviewing this strategy after six months; however where clear programming changes can be made to refine the strategy in the interim, HRV will not be averse to making such changes. HRV today announced some changes to conditions of Victorian races that have been in place since the introduction of tiered racing. Click here to read that media release.
From the HRA AGM two important decisions were taken which I believe will have a profound and positive impact upon the quality of our racing product nationally.
Firstly it was decided to follow the example set by thoroughbred racing and introduce a national rating based racing system to enable harness racing to program much more effectively to the available horse population with the desired impact of ensuring more even and attractive racing. HRA with the national handicappers' advisory committee will lead this critical piece of work. I hope that the new system can be up and running within 18 months after trialling in unison with the current programming system.
Another important benefit from a ratings based system should be that the industry will be able to ensure all horses bred for racing are provided with racing opportunities, which is not presently the case. The recently averted crisis for greyhound racing in NSW resonates with the Principal Harness Authorities in this regard.
Secondly a somewhat watershed decision was taken to introduce a new racing season for harness racing nationally. The date for establishing the commencement of a "calendar year racing season" has yet to be decided but HRV is pushing for this to be sooner than later.
Critically this move will mean a total review of the national calendar and should enable HRV to reset its feature meetings currently conducted in the winter months to later in the year, ideally at the back end of the Spring racing carnival when the weather is much more conducive to attending and wagering customers are more activated to participate.
One major benefit of the new racing season will be that we will be able to program two-year-old racing with a focus on the welfare of the horse with feature races in future being conducted much later in the two-year-old season.
The HRAC considered these two proposals at its most recent meeting and expressed overwhelming support them as offering the hope for a healthier and more vibrant harness industry. The Board will continue to consult with the HRAC with the implementation of the strategies. HRV plans to take a lead role nationally with these strategies as they both offer the hope to arrest the decline and grow the industry.
Critically from HRV's perspective the strategies provide hope that it can grow returns to industry participants, which the status quo or "do nothing" approach does not offer.
Board Meetings and Attendance at Race Meetings
It has been decided that at least once per year Board meeting(s) will be held at a country track. The first such meeting was held at Kilmore on 28 October. Apart from the Board's agenda this afforded HRV directors the opportunity to meet with Kilmore Club officials to discuss that club's continued involvement as a key harness racing facility in Victoria. Kilmore's plans for the future, including its successful non-racing revenue opportunities with gaming, were discussed and are supported by the Board.
It is the Board's intention that at least one HRV director will attend every country cup meeting, each racing season, to ensure that Club and local participants have the opportunity to meet and raise and discuss racing issues. Importantly the Board is keen to meet with and be available to the industry so that open lines of communications become entrenched between HRV and the industry.
Awards Nights
Gordon Rothacker Medal
On behalf of everyone at HRV I would like to thank all those who attended this wonderful evening for their support. Harness racing was showcased in magnificent fashion and I feel that whilst the current Board did not make the decision to move to the Palladium at Crown, the decision was vindicated.
The evening set a benchmark comparable with any gala evening I have ever attended. In my mind it lifted the profile of harness racing.
Most importantly I learnt much more about the family of harness racing than I could have hoped to by attending race meetings and other events. The reverence shown for those receiving awards, and there were many, I have never experienced before. It was heart-warming.
Congratulations to all those involved at HRV for organising the event. Likewise thank you to Crown Casino which I think exceeded in delivering a wonderful experience, better than I have ever experienced in the Palladium Room… And I have been to many functions there.
Hall of Fame Celebration
More recently the VHRMA's Hall of Fame dinner was held at Tabcorp Park Melton. The night was also well attended with more than 300 present to principally celebrate the induction of six new people and horses into the Hall of Fame and the induction of a new legend in Popular Alm.
The HRV Board is determined to support the celebration of the Hall of Fame in the future and I would like to pay credit to management and the team at Melton for making it happen this year.
It is gratifying indeed that the two functions attracted nearly 1000 people, which certainly indicates the support from the industry for the absolute need to celebrate our heroes.
Swabbing Audit
The Racing Integrity Commissioner recently released his findings regarding an audit conducted upon the swabbing processes and systems of the three racing codes in 2015/16.
The Audit found HRV to have the highest compliance rate (99.64%) of the 3 codes with RVL and GRV recording compliance rates of 97.51% and 89.96% respectively. The audit analysed the documentation and records for the entire swabbing process, from the issuance of a testing kit until the final clearance of such sample by the laboratory.
Importantly from the Board's perspective, these findings certainly put to bed the rumours and innuendo which have previously circulated with respect to HRV's swabbing procedures and the testing thereof. The Board is also determined to significantly lift the number of swabs taken to the levels of the other two codes.
Merry Christmas
Finally I'd like to take this opportunity to wish all the trots community a very merry Christmas and a safe and happy New Year.
Dale G. Monteith (Chairman, HRV)