MICHAEL MOYNIHAN: Keeping racing on stable footing

There was a time when a micro-economy depended on Denis Brosnan.

As a student in UCC, his classmates’ Saturday nights often depended on the success of his horse-racing choices. Memory suggests the Kerryman secured them more profitable Saturdays than otherwise, but his passion for horses goes back even further.

“In boarding school in St Brendan’s, you didn’t get out from one end of the term to the next, so you’d send out your bets — a shilling — with the day pupils. So I’d go back that far.

“I didn’t have much success in St Brendan’s but in college I did better. I’ve been going to race meetings in the Munster area for a long time... Killarney, Listowel, the old Mallow, Tipperary, Tralee, all of them.

“After college I went to work for Golden Vale and then went to London, but I came back to Ireland in 1972 and was still following the horses. We moved from having horses to keeping mares and we were looking for somewhere we could farm with them, and we found Croom House in 1986. And we’re here ever since.”

The lush fields and rolling landscape around the 200-year-old house are usually home to over 20 mares. Brosnan and Co enjoy the raids launched to the west in particular.

“My first winning racehorse was a filly called Tomona, a 1978 produce so we had her running around 1980. A versatile horse, she could win over the flat or the hurdles and her winning on the Kerry tracks was a great thrill.

“One week in Listowel we really pushed the boat out, we ran her three times in six days, and she finished third, first and fourth respectively on the three days. That was great. We’ve always tried to bring horses back to run in Listowel. This year we had a filly called Loreto winning there, for instance. Winning in Galway is a big thrill, but going back to Kerry with the horses is great.”

Brosnan has another call on his time, of course. The former Kerry Group chief has been chairman of Horse Racing Ireland for 21 years, though he steps down in February with racing as a whole a concern.

“What’s been significant over the past number of years is that while we remember the glory years from the late 90s to around 2006, that brought two particular developments.

“At the farming level, we saw the massive growth in output of the thoroughbred horse, where foals born went from around €8,000 up to around €13,000 per annum because people in Ireland wanted to own racehorses. You also had the success of thoroughbred marketing in Europe.

“Then we had the misery from 2008 through to around this year, where we saw that farming side of the thoroughbred horse not just decline but fall off the cliff, with foal production going back down to around €8,500, and a lot of people went out of business.”

How significant have job losses been?

“It’s probably unnoticed but our view is that it’s probably around 3,000 to 4,000 jobs lost. It’s different in stud farming because you may have only three or four people working on a stud farm and when someone loses their job, nobody counts it. Obviously if a big industry closes down, everyone notices.

“We had that era but I think we’ve had a recovery in 2012 which is very important. Even more important was the work done during that era to open markets that would have been unheard of five to 10 years ago.

“People know of China, that’s been well described, but South Africans have been at the Goffs’ sales this year, while buyers from Argentina have also been in Ireland recently too.

“The traditional countries — America, Hong Kong — remain involved, but those new markets mean there are probably better prospects ahead for the industry.

“The second thing is the redevelopment of the Irish racecourses. Virtually all of them are complete, and a lot of money has been spent there both by the racecourses and in grants from the Horse Racing Authority of Ireland.

“My only regret there is that the Curragh has not been redeveloped. As I bow out in February, that’s the one thing I’d love to see done.”

He’s reasonably happy with attendances, pointing out that all sports are enduring lower crowds during the recession.

“We got to a high of about 1.3 million and that’s fallen by approximately 10%. A lot depends on how you look at it — you could say it’s stabilised at about 1.15 million through the most awful recession, where people’s spending power has been hugely reduced.

“Perhaps those who criticise — people who see it as a glass half-empty — might say that a lot of money goes into the industry, so why can’t you get it to grow? But there’s nothing growing in this recession. The country needs to grow and people need to spend again. We see the racing industry as two parts — one is the strictly agricultural part, involving farmers in the production of horses which are sold before or after they go into training.

“The other part of the industry is the shop window, when people go racing. Those who criticise racing criticise the shop window — ‘I went racing and I didn’t have a good experience’ or ‘your numbers aren’t as good as a few years ago’.

“People deeply involved in the industry would probably come at that from a different perspective and say this is the one export industry which has done well in a major world downturn. We still get new markets.

“I’ve always been conscious of the two parts of the industry, maybe because I came up through the dairy industry and I know what it’s like to be farming.”

He’s also conscious that the horse racing experience can always be improved.

“That’s something the HRI and the racecourses work on non-stop. All the time.

“The difficulty we have is that obviously we’re weather-dependent. When the weather’s fine, it’s possible to get everyone to come racing. Then, this year, it couldn’t get any worse.

“Punchestown, the second-biggest festival, got washed out; Galway, the biggest festival, got washed out. Leopardstown has had a very successful summer season by bringing a popular band in to play on a Thursday night — that’s brought in a whole new audience who then trickle in to see the racing then.

“But every Thursday night in Leopardstown this summer was a washout. For the casual racegoer, the sport’s very weather-dependent. The committed racegoer will go anyway, but for the casual fan a lot of things have to fall into place.”

Has this downturn been worse than the 80s, then?

“No, because we hadn’t seen the good times in the 80s. Every year was miserable. Now we’re measuring everything that’s happened since 2008.

“What we’ve found is that sponsorship has stabilised, and that if a sponsor drops out, we can get another one to take their place. We’ve come through the bad years. What happens is that everyone becomes conscious of cost reduction and cutting their cloth according to their measure, and this industry has been no different — whether that’s HRI, racecourses or the farmer’s yard.”

Then surely one long-running saga, the taxation of offshore betting, would help all round?

“It has to happen. The first draft of a bill was done at the start of the year and we’re told the final draft will either be ready for this budget or the Finance Bill early next year. Everybody, including bookmakers, has accepted it’s coming.

“We can think of people who bet offshore, but that doesn’t happen — it’s internet and telephone betting, you place a bet that’s registered in the Isle of Man or Gibraltar or somewhere, and there’s no levy paid. The bookmakers say they have no problem paying a levy but so far, there’s no legislation asking them to do so.

“Ten years ago there was virtually nothing going on offshore but modern telephones and the internet changed that. We’re now satisfied that somewhere in the order of €1.5 billion is going offshore — that’s greater than the total amount being bet 10 years back. The total amount now being bet is approximately €4.5bn, with €3 bn of that recorded onshore.

“What’s frightening is not what the betting industry is doing, it’s what technology is doing in terms of what it’s putting in people’s hands.”

Because of racing’s commercial impetus, it’s no surprise that Brosnan broadens the discussion when asked to nominate a Budget measure which might stimulate the industry, or sport in general.

“I’d start a step behind that by stimulating the economy. If you’re working in an industry in the export business, you’re doing quite well and your job is safe, and so on, but we shouldn’t remove from our thoughts the high levels of unemployment and of emigration.

“I’d start by saying sport is important but we need to stimulate the economy. It’s accepted we need money into the system. You have the banks saying they’ll lend but nobody will borrow, while those looking to borrow say the banks won’t lend.

“Until we get money working in the economy, we can’t start creating those small start-up business which will start off with two jobs, three jobs, and so on.

“What do you do to stimulate sport? The organisations themselves have never stopped working on the ground and you stimulate by getting more people interested. And I think that’s happening.

“I don’t know if a major splash in sport is needed so much as a major splash in the creation of jobs, and smaller enterprises in particular. I won’t say they’re what kept rural Ireland going, but I go back to 1972, when Kerry [Group] started with 13 employees. I was one of them. Today there are 30,000 employees worldwide, but I don’t know of any business that didn’t start small.”

Brosnan sees encouraging the entrepreneurial spirit as vital but to encourage that, you need to embrace failure, he says.

“We see how Ireland treats failure differently — with bankruptcy you’re out of business for 10 years and while that’s supposed to be addressed, you can see why people are going to England, where you’re out of business for only 12 months, and in America after you file for Chapter 11 you’re back in business after 12 months as well.

“What that does is encourage a culture where failure is accepted and risk-taking encouraged. In Ireland, risk-taking is far less encouraged and obviously failure is a huge stigma. We need to change that but it’s not just about changing attitudes, we must change the bankruptcy laws in Ireland.

“We’re saying we’ll go part of the road in comparison with England but maybe if we went further, we’d encourage people. There’s no point in encouraging people to take risks and then saying ‘you’re in trouble’ if things go wrong.”


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