The country’s biggest mystery bet of all

WE ARE venturing into the great unknown. Right now, I doubt anyone knows how much Australians are , or on what code or bet type, not for the latest financial year 2013-14. Some will know bits and pieces but it has become impossible to put it all together.

There are two reasons for this situation. The first is that we are undergoing major changes in what particular product punters are choosing, mainly due to the popularity of the Fixed Odds category. The second factor is that there is no single official repository where operators or racing codes are required to display their turnover figures, much as occurs, for example, for the number of cars sold or the number of people flying on planes, and so on.

The best we can do is to rely on a voluntary scheme run by the thoroughbred's Australian Racing Board and published as the Fact Book. Previously, it has been pretty good but those days are over.

Any other figures you can find are published on a state-by-state and code-by-code basis but they all differently. In any case, in the modern world punters can jump willy nilly from one state to another, not just in terms of the race they want to bet on, but also in terms of their preferred betting operator. This is yet another reason the Feds have to get involved.

Betfair has always refused to provide the Fact Book with its turnover figures, claiming turnover is of no importance and only profit margins count. Online bookmakers may well tell their licensing authority what is happening but that is not published either. In any event, their activity extends to all states and codes, to whom they pay race-field fees, but the recipients of those fees then publish that data in different ways, or not at all, or vaguely.

By vaguely, I mean the amount of fees received have then to be translated into betting volumes with each entity having slightly different ways of charging fees in the first place.

In total, 28 sets of books would need examination by a forensic accountant to have any hope of coming up with accurate and useful figures. That's made up of six states, three territories and three racing codes in each. In Tasmania's case an extra check would be needed because Betfair is based there.

What a shambles!

The TAB figures are fine as far as they go but betting figures for Fixed Odds (in some cases) and online bookies (in most cases) are terrible. Blanks and N/A occupy the boxes in the Fact Book.

Since a heavy minority of Win bets are on Fixed Odds it makes it impossible to gauge what the trends are.

There are no good alternatives. The best of them – figures compiled by the Queensland Treasury – has similar gaps and runs only to 2012-13. The Australian Gaming Council (mainly about casinos and pokies etc) shows nothing for greyhounds except for stakemoney figures copied from the out-of-date pages which run only to 2011. The Australian Wagering Council (online operators) has only rough summaries.

Consequently, the nation does not know where it is going. Individual states will do better but there is no easy way to add them all up as they all report differently. All we can guess at is that online bookies and Fixed Odds turnover is a quarter or so of all betting. Of course, much of that originates in the Northern Territory and also Norfolk Island (where is registered) and it applies to races run in all states, so there is no easy way to break it up by state or code. Obviously, that's why the Fact Book left many boxes blank.

Without knowing national trends, how the devil can racing authorities or governments make good decisions? Indeed, the is pondering what to do with the heavy tax burden it places on local codes – heavy by comparison with neighbouring states.

For the TABs alone, the list below shows what proportion of total TAB turnover is due to Fixed Odds. The asterisks denote Tattsbet states. The large differences in these proportions are themselves suspicious.

  • NSW 23.3%
  • Victoria 18.7%
  • Tasmania* 13.3%
  • Queensland* 9.2%
  • SA* 8.0%
  • WA 6.9%
  • ACT 6.8%
  • NT* Nil

    Of all states, only Victoria and ACT reported anything like meaningful turnover figures for “bookmakers” but the individual sectors do not add up to the totals shown so they are best ignored. Separately, NSW indicates 25.1% of turnover comes from “corporate” bookmakers. Victoria includes that turnover in the general heading of “off-course” while other states offer little detail at all.

    Aside from TABs, there is no breakdown anywhere for overall Fixed Odds figures. Betfair provides 2.6% of turnover in NSW and 5.7% in Queensland, another curious difference. Other states are unknown.

    If it is any consolation, Harness and figures are no better. However, total sports betting, shown as $4.58b, has leapt past Greyhounds at $3.11b but they could be illusory figures due to the absence of online bookie turnover. The Harness total is well behind at $2.36b.

    The main breakdown of traditional tote betting is Win (42.7%), Trifecta (17.3%) and Place (14.9%) but since most of the Fixed Odds betting would be for a Win these proportions may not be meaningful.

    So what we are looking at here is comparable to David Jones and Myer not knowing how many shirts, sox and ties they have sold. Suits and dresses are fine but not the others. All they would know is what is in the till at the end of the financial year. Ridiculous, isn't it?

    The solution? Obviously, big brother has to jump in somehow. On this count, as well as many others, the states and territories need to come to an agreement on how to better supervise what is one of the country's largest industries. To do that they would need to create an independent body to administer the process, just as has been done for aviation, for example. Planes fly around the country under by a single authority. The states long ago agreed that was the only sensible way to go and ceded power to to bring it about. The Productivity Commission recommended a similar approach in respect to assessing racefield fees.

    The Northern Territory may be reluctant to fiddle with its cash cow (i.e., online bookies) but Canberra will still have ways of dealing with that because, as a territory, NT is subject to some overriding controls (as occurred with euthanasia or some Aboriginal matters, for example).

    But, as I said at the outset, what a mess! It should never have been allowed to get to this stage. And the longer it takes to fix, the worse it will get and the more the consumers will suffer. Who will act? Former Victorian premier Jeff Kennett seems to have some interesting ideas so I would put him in charge.

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