Jockey Club needs to be shown more flexibility

PUBLISHED : Monday, 06 July, 2009, 12:00am
UPDATED : Monday, 06 July, 2009, 12:00am

The gaming industry is ever-changing and evolving. Years of government inaction has meant Hong Kong has fast been falling behind regional competitors. A backing of the Jockey Club's long-sought request for additional race days and simulcasts of overseas meetings finally gives the betting franchise greater competitiveness. Devotees of the sport and punters are the obvious winners, but we should keep firmly in mind that we all benefit through the club's position as our city's most successful social enterprise.

Exactly what the financial implications of the increase of race meetings from 78 to 83 and the changing of the rules for simulcast days will mean is for now uncertain. What is clear is that if more punters are drawn to wager on races, the community will be the biggest winner through extra tax revenue for government coffers. Our claim to be Asia's horse racing capital will be strengthened. More tourists will presumably be drawn to our city and, consequently, the tracks at Happy Valley and Sha Tin.

There is no denying that gambling can be addictive and cause social problems. This has been the crux of arguments by conservative groups in lobbying the government to curtail the club's betting activities. A decade of requests to increase the number of racing days and expand live coverage of races elsewhere have in consequence been rejected. This is despite experience elsewhere that there is little to fear if the activity is properly regulated, put in the hands of responsible operators and supported by counsellors knowledgeable in treating addictions.

The club is without doubt responsible. It has world-class management that has firmly put Hong Kong on the international racing map. This has been achieved in tandem with an innovative framework in which taxes from its betting income go directly to the government - a figure set at an annual minimum of HK$8 billion. Welfare groups and charities received a further HK$1 billion last year.

Whether there are enough counsellors is debatable. Studies show only a small percentage of gamblers are prone to addiction, but Hong Kong's needs are unclear due to the nature of the affliction. More research is certainly necessary. The impact of the new arrangements must be closely observed.

Regulation is quite another matter. The government has the final say in every change that the club wants to make in its gaming operations - no matter how small. This micro-management has led to a loss of competitiveness. Gamblers have increasingly turned to Macau and other gaming centres, the internet and illegal bookmaking syndicates.

An increase in the number of operational days would be a straightforward management decision for a company. The club's desire to hold more meetings has been frustrated by lawmakers. It first put forward the idea in 2006 and it was only last Friday that the Executive Council finally gave the go-ahead. No good argument was ever given for the rejection; its determination appeared to be based on a desire not to antagonise anti-gambling lobbyists.

The club is unusual in the gaming world; it is a charitable organisation in its own right that provides legal gambling services. It is also one of Hong Kong's biggest employers. Approval of an enlargement of the racing calendar is a small, but important, achievement. If the club is to meet challenges like competition from overseas and illegal operators, the step must serve as a harbinger of greater flexibility by authorities towards its activities.